In a report issued today, GAO concludes that states are using highway contractors to such a large extent that states are losing control over highway projects and also losing the expertise to exercise oversight to ensure that contractors are accountable and perform as required.

The GAO report is well worth a read, lots of important details. Here are two brief excerpts to capture GAO's concerns.

State DOTs have increased the amount and type of highway activities that they have contracted out to consultants and contractors over the past 5 years. In particular, state DOTs have increasingly contracted out preliminary engineering, design, right-of-way, and construction engineering and inspection activities. We also found that state DOTs have increasingly given consultants and contractors more responsibility for project quality through a growing trend to contract out construction inspection and engineering activities. Some state DOTs have used broader contracting types and techniques that give additional responsibility to consultants and contractors. For example, some state DOTs have used consultants to serve on their behalf as project managers or program managers to oversee and manage day-to-day activities on highway projects.

Despite the extensive use of contractors, state administrators have become blind to their inability to ensure oversight:

State DOT officials that GAO interviewed believe that they have sufficient tools and procedures in place to select, monitor, and oversee contractors to ensure that the public interest is protected. However, implementation of these mechanisms is not consistent across states, and state auditors reported weaknesses in several states. State DOTs also face additional challenges in conducting adequate oversight and monitoring, given current trends in the use of consultants and contractors. For example, while state employees are always ultimately responsible for highway project acceptance, they are increasingly further removed from the day-to-day project oversight. Officials from all 10 state DOTs that GAO interviewed said that current trends may lead to an erosion of in-house expertise that could affect the state DOTs’ ability to adequately oversee the work of contractors and consultants in the long term.

I guess it's the fox in the fast lane. Much better pickings than those old henhouses.

The GAO Report is: Federal-Aid Highways: Increased Reliance on Contractors Can Pose Oversight Challenges for Federal and State Officials GAO-08-198, January 8, 2008

• highways,
• roads,
• privatization,
• contractors,
• FHWA