SALEM — A $1 million management performance audit of the Oregon Department of Transportation may yield no specific recommendations for how to improve accountability or reduce waste at the agency.

Instead, the Department of Administrative Services plans to recommend that the state spend more money and hire more independent contractors to address issues such as conflicts of interest in contracting and projects overdue and over budget.

The work product from those contractor studies could take up to a year, DAS Director Katy Coba told lawmakers on committee subgroup examining accountability measures.

Wednesday.

The state paid New York-based McKinsey & Co. $1 million to evaluate the performance of the agency before lawmakers consider approving hundreds of millions of dollars in new transportation funding later this session. The new revenue would likely come largely from a hike in the state’s gas tax and registration fees.

Gov. Kate Brown ordered the review to help allay lawmakers’ concerns the agency wasn’t prepared to handle the new projects efficiently and effectively.

“You can understand why a couple of us are incredulous,” said Sen. Betsy Johnson, D-Scappoose. “All of this was supposed to be the condition antecedent to a package. I’m just trying to figure out we are now trying valiantly to move a package and we’re finding out that all of this work that the governor called for is now out maybe as much as a year.”

When hiring additional consultants to reform ODOT, “how do we not waste a boatload of money?” Johnson asked.

Coba suggested that lawmakers could still move forward with the package, noting that the management review was generally favorable of ODOT.

“The McKinsey report, as I would interpret it, basically says ODOT is a solid operation,” Coba said. “They are in the top quartile for Western departments of transportation. This is a not a broken organization.”

McKinsey released a report of findings about the agency Feb. 1. For instance, the consultants concluded there is an unclear governance structure for ODOT and the Oregon Transportation Commission, which sets policy for the agency. The agency also lacks a strategic vision for the future and accountability measures, the consultants found.

Some of those findings could be addressed with law changes, said Sen. Kathleen Taylor, D-Portland.

“All of us are wanting to make certain that we can answer questions from the public about when they are paying more money at the pump the gas tax that the money is being used properly,” Taylor said.

Accountability measures could be proposed in-house or by legislators on the legislative Committee on Transportation Preservation and Modernization, which is responsible for crafting a transportation package.

For instance, lawmakers could restore the authority to hire and fire the ODOT director to the OTC, as some former commission chairmen have suggested. That authority now lies with the governor.

Despite McKinsey’s favorable report of the agency, some lawmakers will remain distrustful of the agency, said Rep. John Lively, D-Springfield.

Sen. Fred Girod, R-Stayton, said he was “less than impressed with the quality of what” McKinsey released.

DAS initially had planned to produce recommendations from McKinsey’s findings by March 1. That due date was pushed back to April 15, after the co-chair and vice-chairs of the transportation package committee asked DAS to “slow down,” Coba said.

“We were asked to slow down and I think that is all I am comfortable in saying,” Coba said, after lawmakers pressed her for more details.

Committee Co-Chairman Sen. Lee Beyer, D-Eugene, denied instructing DAS to slow down on the recommendations. But he admitted committee leadership had signaled to the agency that the recommendations were no longer essential to negotiations on the transportation package because the committee was looking at its own accountability measures.

Paris Achen

Portland Tribune Capital Bureau

503-385-4899

email: pachen@portlandtribune.com

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