Audit turns up Georgia DOT deficit
State bean counters are recommending the Georgia Department of Transportation use more than $450 million in gasoline taxes from this year's budget to plug a shortfall that cropped up at the end of the last fiscal year.
The unexpected deficit turned up during an audit of DOT budgeting practices requested by Gov. Sonny Perdue.
Unless the shortfall is erased, the agency will be forced to void contracts for road projects the state already is committed to build, John Thornton, director of the Georgia Department of Audits and Accounts' State Government Division, told members of the DOT board's Finance Committee on Wednesday.
"I'm not aware that we've ever done anything like this," he said. "(But) this is a very necessary adjustment and very appropriate."
Thornton's comments came during a presentation of the audit's preliminary findings. A final report is expected within two weeks.
Thornton said the DOT's bookkeeping is plagued by a "breakdown of controls and processes" that led to the deficit.
He said the problems came to a head in fiscal 2007, when the agency spent more than $5 billion, far in excess of typical DOT budgets.
While that year set a record for new construction spending — $2.7 billion — Thornton said the department's financial plight was aggravated by large numbers of change orders and "supplemental agreements" that drove up the costs of projects.
The audit found that the DOT's budgeting procedures typically involved committing funds to projects before the money actually was in hand direct payday loan cash advance. Both legal opinions and court rulings have held that such practices violate Georgia's Constitution.
"You've got to have the money up front before you enter into a contract," Thornton said. "Advance spending on construction projects, when you really get down to it, caused the shortage."
Board members also received a second audit of DOT operations on Wednesday. The second report criticized the agency's Office of Right of Way for inadequate management of the $230 million the state spends each year buying property to make room for transportation projects.
In one of the more dramatic findings, the audit identified $157 million that the DOT has spent on parcels for projects that are no longer in the agency's plans.
Finance Committee Chairman Sam Wellborn said the board will hold a special meeting on Sept. 26 to discuss and possibly act on the audits.