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DOH audit first step to identify cost efficiencies

MARTINSBURG, W.Va. — When members of the Governor’s Blue Ribbon Commission on Highways held a public outreach meeting at the Comfort Suites in Kearneysville in July 2013, one of the issues brought up by several speakers was the need to cut waste in the West Virginia Division of Highways before asking residents to pay more in fees and taxes to fund the state transportation system.

The long-awaited Governor’s Blue Ribbon Commission on Highways report that was released Wednesday in Charleston includes several recommendations for the DOH to cut expenses. The report refers to the cuts as “cost efficiencies.”

“We’ve already made a good start in that area by passing a comprehensive audit of the Division of Highways,” state House of Delegates Majority Leader Daryl Cowles, R-Morgan, said Wednesday in a telephone interview. “I’m reluctant to talk about tax increases until we’re sure we’re getting a good value for our tax dollars.”

 

Some cost efficiencies recommended in the Blue Ribbon Commission’s report include asset management, converting the division’s fleet to natural gas, reducing middle-management personnel and other cost-reduction measures.

Otherwise, Cowles, who said he had not yet had a chance to look at the report in detail, was pleased that it had been released.

“I hope it sparks a real conversation to improve our road system,” he said. “Our roads must be a priority, and the audit is the first step.”

Contacted by phone Wednesday, state Sen. Craig Blair, R-Berkeley, echoed Cowles’ sentiments about the importance of the audit of the DOH.

“We’ve got to get our house in order,” he said, adding that the changes the Legislature made to the state’s prevailing wage laws during the last legislative session will help reduce costs.

“We will see a significant savings on state road construction when we separate state dollars from federal dollars,” Blair said.

If funds come from the U.S. Department of Transportation for road projects, then workers have to be paid a wage set by the federal government by authority of the Davis Bacon Act. The state was using the same wage scale for state-funded projects.

Lawmakers passed legislation that reduces the amount of wages that must be paid to workers on state-funded projects. Blair said state funds could be used for state-maintained roads, using the new wage scale to reduce expenses, and federal funds could be used for U.S. highways and Interstates.

State Delegate Paul Espinosa, R-Jefferson, who sits on the House Transportation Committee, did not see any significant surprises in the report, he said Wednesday in a telephone interview.

“It states the obvious,” he said. “We didn’t get in this situation overnight. It will take a concerted effort to get out it. For me, we have to make transportation a funding priority.”

Espinosa, too, was pleased with the comprehensive audit of the DOH that was passed by the Legislature.

“The audit will show us if our investments in transportation are being spent as wisely as they can be,” he said. “Before we start spending more, we need to know if we’re using our existing resources wisely. Then, the people will have additional confidence that we are spending tax dollars wisely. Efficiencies alone are not going to get us to where we need to be, but it is a prudent step to take before adopting fee and tax increases.”

Espinosa said the DOH audit is scheduled to begin this month and will be done before the end of the year.

The Blue Ribbon Commission’s report says that West Virginia needs about an additional $750 million a year to maintain the existing roads and bridges in the state, and about an additional $380 million a year to build new roads and bridges that are needed to meet the demands on the state’s transportation system. That totals about $1.1 billion a year.

Among its final recommendations, the panel says the state must find new sources of revenue to maintain and expand West Virginia’s road system. The report recommends increasing vehicle-related fees, such as registration fees and initiating a vehicle sales tax.

The commission members have recommended exploring “innovative financing methods,” such as public-private partnerships and shifting some expenses to counties and municipalities.

– Staff writer John McVey can be reached at 304-263-3381, ext. 128.

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