27 in 7 Program Drew Ire of State Auditors

By John O’Connor, The State, Columbia, S.C.

Aug. 13–While most state transportation leaders have called 27 in 7 a complete success, the program also led to much of the criticism directed at the agency in the November Legislative Audit Council report.

That report, from the investigative arm of the General Assembly, spurred lawmakers to pass a Transportation Department reform bill in June.

The audit concluded the agency’s contracts with construction firms to manage hundreds of millions of dollars in road and bridge projects were too generous, and that the agency paid for work that was never completed.

In addition, many have questioned some of the projects chosen for the 27 in 7 program.

“I don’t think we managed the funds in 27 in 7 well,” said commissioner Tee Hooper, who noted the state was benefiting from projects such as the Conway bypass and the Carolina Bays Parkway. “We wasted millions of dollars by not managing it well.”

Agency officials defend the management, noting the program was the first of its kind in the country. The agency, they said, learned during the process.

The program was absolutely a success, said Transportation Department finance director Mo Denny. “This is the first time the state had tried to do something like this.”

Applying a normal inflation rate — typically less than the rate of construction inflation — the agency estimates it saved at least $3 billion by building the projects now rather than waiting years until the money was available.

But critics said the program has set a precedent at the agency, one that could lead the Transportation Department to borrow again in the future.

“A lot of that audit comes directly back to the 27 in 7 decision,” said Sen. Larry Grooms, R-Berkeley and chairman of the Senate Transportation Committee. “We started more road projects than we could finish.”

—–

To see more of The State, or to subscribe to the newspaper, go to http://www.thestate.com.

Copyright (c) 2007, The State, Columbia, S.C.

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.