(The Center Square) – Despite its history for overspending, the North Carolina Department of Transportation (NCDOT) did not follow guidelines for developing its spending plan, a new state audit shows.
The NCDOT did not develop its spending plan based on specific projects and operations scheduled for the fiscal year, the Office of the State Auditor said, putting the agency at risk for exceeding its spending plan in future periods, auditors said.
The NCDOT stayed within its budget during the first half of the state fiscal year – July 2020 through December 2020 – despite straying from spending plan guidelines, auditors found. However, auditors said it was only by chance.
Transportation Secretary Eric Boyette said he agreed with the auditor's findings in his response to the audit, and the agency has "implemented corrective action."
Boyette said the agency has hired staff and uses statistical tools to create a structured process to monitor its spending for the fiscal year. The chief engineer's office will formally monitor each highway's division spending every month, Boyette said. The chief engineer's office must approve purchases over $500, and the department monitors the cash balances weekly along with other measures, Boyette said.
Not following guidelines for developing its spending plan is not the first time the embattled agency has received a negative finding in a state audit.
In March, the state auditor found the NCDOT did not follow auditing standards, leading to possible inaccuracies. NCDOT's Office of Inspector General had not completed a performance audit since 2016, according to an evaluation report completed by the General Assembly's Program Evaluation Division in August 2020, causing budget and cash flow problems.
The agency spent $742 million over its spending limit in 2019, a previous audit found. As a result, the General Assembly had to route an additional $220 million to the department to resume projects that stalled because it failed to maintain its cash balance limit between $282 million and $1 billion.
The department is now subject to additional oversight by the General Assembly and must base its spending plan on specific projects and operations.