GAO: State DOTs Often Use Engineering Firms on Federal Highway Projects – Engineering News-Record

GAO report found continued use of outside consultants by DOTs. Chart courtesy of GAO
A new U.S. Government Accountability Office (GAO) report has found that many state departments of transportation (DOTs) continue to turn frequently to private engineering consultants for aid with various aspects federal-aid highway construction projects.
The GAO report, released on April 19, includes results of a 2021 survey of DOTs from all 50 states plus the District of Columbia and Puerto Rico. It also included a deeper look at eight states, with interviews with state transportation officials, auditors, labor organizations and engineering firms.
The congressionally requested report showed that half of the state DOTs spent at least 60% of their total engineering and design-related costs for such highway projects on outside engineering consultants.
It also found that 50 of the 52 agencies surveyed said that factors related to the size and skills of their in-house work force was a very important or moderately important reason in their decisions to employ engineering consultants.
Joung Lee, American Association of State Highway and Transportation Officials’ (AASHTO) deputy director and chief policy officer, says, “It’s good to get a state of play [or] update in the form of the survey data that they got from our members.” 
Lee adds, “In terms of what that represents, I don’t think there’s any surprise there. The state DOTs continue to really value the partnership with everybody, including … specifically the consultants community.”
Steve Hall, American Council of Engineering Companies’ (ACEC) senior vice president for advocacy, adds, ” I think the report highlighted that the relationship between the industry and our DOT partners is strong and has gotten stronger in recent years.”
Hall says, “We’re all having to operate in an environment where the competition for talent is pretty fierce. But at the end of the day it’s a good team in terms of delivering projects to the public.”
GAO administered the survey portion of its report from June to October of 2021, and thus that data pre-date the huge infusion of highway funding states have started to receive from the Infrastructure Investment and Jobs Act (IIJA).
That measure was signed into law Nov. 15. 
Lee says AASHTO didn’t have current data on whether state DOTs were increasing their use of engineering consultants or adding to their in-house staffs to handle the big wave of highway funding coming from the IIJA.
Regarding the infrastructure act dollars, he says, “We’re certainly mindful of not just putting them to use, but putting them to best use.”
Lee adds, “I think pretty much everybody is in the same boat, whether you’re in the public sector or private sector—facing the same kind of general challenges regarding workforce availability [and] inflationary pressures.”
Hall says ACEC expects that state DOTs’ use of consulting engineers probably will increase as the infrastructure act funding rolls out.
He adds, “We’re hearing anecdotally from our state organizations that the states may need help from industry in a program management capacity.”
Hall says that with the IIJA funding infusion, “it’s reasonable to assume” state DOTs’ reliance on the engineering industry will increase. “That talent shortage is a challenge,” he says, “but as always, we’ll figure out a way to get it done.”
Besides the survey, GAO’s work on the report included more detailed looks at eight state DOTs: California, Connecticut, Iowa, Louisiana, New Hampshire, North Carolina, Texas and Utah.
GAO also interviewed four engineering firms as well as state audit agencies and labor organizations. The firms were HNTB Corp., Mark Thomas Co., Nobis Group and Stanley Consultants.
The report found that 26 of the 52 DOTs “reported they used engineering consultants extensively”—that is, the cost of consultant engineers accounted for at least 60% of the agencies’ dollars spent on total engineering and design-related expenses for federal-aid highway projects.
In nine of those 26 states, the consultant expenses represented at least 80% of the projects’ total engineering and design costs.
In addition, 48 of the 52 DOTs said that their use of engineering consultants on federal-aid highway projects increased or stayed flat over the past five years.
Of the eight DOTs GAO selected for more detailed information, four said their use of consultants had risen “because [the DOTs’] workloads had increased, while the number of state DOT staff had not.”
GAO also looked at the question of relative costs of engineering consultants and state DOTs’ staffs, reviewing reports and asking  about the topic in the interviews it conducted for the report. 
According to the report, some officials said consultants may be more costly than DOT staff in the short term. But others whom GAO spoke with said consultants may be more cost-effective in the long term for federal-aid highway construction projects, when costs of state workers’ salaries and benefits are weighed.
As part of the study, GAO also contacted Federal Highway Administration (FHWA) division officials and said those officials—as required by federal regulation—reviewed and approved state agencies’ policies and procedures for using engineering consultants. GAO determined that they generally addressed the required points that dealt with consultant contracts.
The report also said FHWA assessments found that the DOTs’ use of engineering consultants “generally poses a low risk” to the federal-aid highway contracts.

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Tom Ichniowski has been writing about the federal government as ENR’s Washington Bureau Chief since the George H.W. Bush administration, and he has covered at least five major highway bills. A recognized expert on government policy on infrastructure and regulation, Tom is also a Baltimore native and Orioles fan who grew up rooting for Brooks and Frank Robinson. He is a graduate of Columbia College and Columbia’s graduate school of journalism, where he once used “unrelentless” in a headline.

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