By Mannix Porterfield
Register-Herald Reporter
May 21, 2008 06:49 am
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CHARLESTON — A legislative audit unwrapped Tuesday gave the West Virginia Parkways Authority generally high marks for its efforts to operate in a more prudent fashion.
At the same time, the audit pointed to diminishing toll revenues, noting some $27 million in improvements to the West Virginia Turnpike are being left on the shelf each year.
“I think overall this is a favorable report for the agency,” John Sylvia of the Performance Evaluation and Research Division told members of the Joint Standing Committee on Government Organization, meeting in the House chamber.
Since 1989, when the authority succeeded the old West Virginia Turnpike Commission, toll revenues have risen by an average rate of 2.7 percent, but between 2000 and last year, it was noted, the average annual growth rate was 0.8 percent.
Money poured into the baskets at the three toll plazas has hovered between $10 million and $15 million, but annual road needs have been pegged at $40 million, the report revealed.
Sylvia’s findings showed the authority has adequate internal controls in force but suggested some improvements are needed in purchases, particularly for those under $1,000.
Generally speaking, the policies and procedures of the authority “facilitate an economical operation,” Sylvia concluded.
The audit showed $95.9 million in outstanding road bonds alone and another $7.9 million left to pay off bonds for Tamarack. That facility is destined to be turned over to the Department of Commerce, pending the authority’s ability to tie up all the loose financial strings.
In fiscal 2007, the toll road took in $58 million from motorists, but after expenses were paid, it had a mere $5.6 million in net funds for capital improvements.
Sylvia’s research showed 61 percent of the 88-mile, four-lane highway is in “fair to poor condition,” while the authority has a goal of cutting that to 25 percent.
As an example of liberal spending, the audit showed the authority has paid 100 percent of its employees’ premiums to the Public Employees Insurance Agency, running up an annual bill of between $300,000 and $400,000.
Salary discrepancies also were evident, Sylvia informed the legislators.
For instance, one chart the legislative auditor provided showed maintenance workers at the Standard facility pocketed an average annual pay hike of 7.43 percent, more than twice that of employees at the Chelyan garage, whose salary went up an average of 2.85 percent.
Moreover, Sylvia said he learned of a “relatively large” salary disparity between Parkways workers and those in the Division of Highways who perform practically identical tasks.
On the plus side, the auditor’s office said the more attractive pay on the turnpike leads to a much lower turnover rate when compared with the DOH.
“The issue is likely that DOH transportation workers are not paid an adequate wage rate,” the report stated.
In future hirings, it was suggested, the authority should take an objective look at its step wage increase process as a means of saving money.
Sylvia’s report praised the maintenance work performed at the turnpike’s three stations in Ghent, Beckley and Standard. Combined, the three have 147 employees. All turnpike equipment is well maintained, the audit showed.
Wages must be considered in the fact that the authority’s routine maintenance runs $734,000 above what it costs the DOH for the same length of road, the report said.
Each mile of the turnpike costs about $67,022 in maintenance, comparatively low with other places, such as the New Jersey Turnpike Authority with an average cost of $201,518.
However, as Sylvia pointed out, the traffic is considerably heavier on the New Jersey Turnpike.
Sylvia detected a strong suggestion of “stringing” in some contracts, a practice that divides purchases from the same vendor into smaller ones so the order isn’t one large one.
As an example, he pointed to work performed by BJW Printing & Office Supply in Beckley — six orders, all dated Jan. 26, 2006, and totaling $4,930.20.
A similar discovery involved six receipts for the like amount of $943.50 to Eastern Data Paper of New Jersey.
“The evidence suggests that the purchases were separated a week apart to avoid obtaining three verbal bids,” the report said.
“There is no evidence that the Parkways Authority has an open-ended or statewide contract with either the Beckley or New Jersey vendors that were competitively awarded. It is possible that similar incidents of this nature are occurring with other vendors.”
In another avenue, the auditor’s office suggested the authority consider investment management services offered by state agencies when issuing a request for proposal for investment management or custodian services.
Overall, Sylvia’s report found room for improvement, and turnpike manager Greg Barr didn’t disagree.
“I think it is a fair report,” he said afterward.
“He pointed out some things we do that are a little different than the state. But overall, the suggestion of the report was that we are doing a fair job and an adequate job of running our maintenance division. There were a lot of positives. There’s always room for improvement. We’re always willing to listen and to review.”
— E-mail: mannix@register-herald.com
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