Comptroller puts Transportation Department on the wagon
By SHERRY HALBROOK
Bad habits are hard to break, but state Comptroller H. Carl McCall says he is going to help the state Transportation Department break its addiction to using expensive outside consultant engineers.
Whether DOT likes it or not, the department is going to have to give up its unhealthy dependence on consultants for highway and bridge design and inspection work that could be done better and for millions of dollars less by state engineers.
The comptroller says he will no longer sign off on contracts with consultants until DOT proves that it is justified in paying more for the outside help. And it will have to provide specific justification for each contract every time.
McCall is getting tough with DOT because it has ignored repeated public criticisms from himself, his Republican predecessor and PEF for “wasting millions of taxpayers’ dollars a year hiring consultant engineers, despite a decade of evidence that doing the work in-house is often less expensive.”
“These tax dollars could have been better spent repairing roads and bridges across New York,” McCall says.
PEF blew the whistle
PEF President Roger Benson commends McCall for refusing to let the waste continue.
“Fifty percent of the budget for this work is used to pay for just 20 percent of it — the part that’s done by outside consultants. Taxpayers can no longer afford to subsidize this kind of private-sector pork barrel,” Benson says.
“Our members know they can do the work as well or better than the consultants, and they know they can do it more economically,” Benson says.
“We have been telling the state for more than a decade that it needs to improve pay for its engineers so that it can recruit and retain enough of them to do this work,” he says. “But the state has been making virtually no progress on this issue.
“The state needs to hire 400 more transportation engineers over the next two years,” Benson adds. “But they couldn’t do it, even if they tried, at the current level of pay they offer. The $52,000 to $62,000 annual salaries the state pays these engineers just can’t compete with pay in the private sector.”
Abuse well documented
In 1990, former Comptroller Edward Regan urged DOT to reduce its use of consultants. He released an audit which reported that DOT could save millions of dollars by reducing its reliance on outside engineering services for design, supervision and inspection and by increasing its own engineering staff.
In 1995, McCall issued an audit that showed DOT’s dependence on consultants was still growing and was wasting money.
A state Supreme Court judge recently forced DOT to share with PEF the statistical results of a private audit that DOT paid KPMG to conduct.
“It confirms what our members have been telling us all along,” Benson says.
The KPMG report found that on average, the design expenses made up just 8 percent of total project costs when state engineers did the work, compared to 14 percent for projects contracted out to consultant engineers.
The KPMG study found consultant engineers cost the state 75 percent more than state engineers for design work, and 50 percent more for construction inspection.
No EZ Pass for taxpayers
From fiscal 1991 through 1999, DOT paid $1.3 billion in design and construction inspection fees to outside consultants, according to the KPMG report.
“If only a half or a quarter of this work had been done in house, New York might have saved taxpayers tens or even hundreds of millions of dollars,” McCall says. “KPMG, Comptroller Regan’s audit and my audit have all made it clear: it’s more expensive to hire consultants. This has been going on far too long and has cost the taxpayers far too much.”
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