The Vermont Agency of Transportation blew past estimates it gave the Legislature for the costs and timelines of several recent major paving projects — and it hasn’t been clear on the reasons why, according to a new report by state Auditor Doug Hoffer.
Paving is the largest program in the state’s proposed transportation budget for the 2024 fiscal year, totalling about $142 million. The Legislature has approved nearly $600 million for paving projects between fiscal years 2019 and 2023, according to Hoffer.
But “despite these significant appropriations,” the March 15 report found, the agency lacks “transparency and accountability” when it comes to tracking the cost and timeliness of its paving projects — especially in the early engineering phase.
The agency should establish measures to determine whether paving projects have “deviated excessively” from their proposed price tag and schedule, Hoffer’s office recommended, and develop a process to “consistently record” what causes projects to run too long or over budget.
Jesse Devlin, the agency’s highway safety and design program manager, said in an interview Thursday that the agency worked closely with the auditor to support the report and agrees that it could share more information. The transportation secretary, Joe Flynn, wrote in a response to the report that he did not dispute any of the facts presented by the auditor’s office. Hoffer noted, though, that he did not think the agency’s leadership had committed to taking up all of the suggestions his office made.
“We are utilizing this as a way in which we can improve,” Devlin said Thursday. He added that the agency plans to “take steps to meet” Hoffer’s recommendations.
The report analyzed 14 paving projects that the agency completed across the state in the 2020 fiscal year. Of those, the agency completed the projects the auditor considered “simpler” on schedule and by spending within 30% of the original estimated cost. But for the more complex projects, the report states, the agency exceeded initial cost estimates by more than 50% — and finished the projects up to six years later than initially planned.
For instance, the cost of one paving project in Essex and Richmond ended up more than 200% higher than, and three years behind schedule from, its initial estimate, the report found.
Five of the 14 projects missed their original planned completion date for preliminary engineering work by three or more years, according to the report.
Additionally, the report found that the agency has not kept records identifying the reasons for the cost and schedule overruns, and “while VTrans officials identified some of the reasons, they could not always explain project delays.”
Most of the schedule delays for complex projects occurred during the “preliminary engineering phase,” which is when officials develop construction plans and determine a project’s required materials and costs, the report states. Once the construction phase of a project began, according to the auditor, the agency fared better at meeting its estimates.
The report states that the agency lacks a systematic way to assess and report whether its paving projects, specifically, are deviating from their initial estimated cost. And while the agency has a measure to assess the number of projects it advertises on time each year, the report says, it has none assessing on-time performance for the duration of a project.
Devlin acknowledged that the agency does not formally report all of the expected changes in a project’s cost and timeline starting with the initial engineering phase, saying that projects are managed “dynamically” within the agency as they progress.
“It hasn’t been a primary gap that we’ve identified previously,” he said, though “we certainly see value in that, you know, coming out of this audit report.”
The auditor’s office also suggests the Legislature amend state law to require the agency to report every time its estimated project costs exceed original projections by more than 50%. Lawmakers should also make it so the agency must report significant paving delays, and the cause of those delays, “in a manner that is transparent, timely, and accessible to Legislators,” the report says.