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LINCOLN — Federal highway officials, citing “substantial deficiencies and violations of federal law,” have ordered Nebraska to substantially upgrade its oversight of city and county road-building projects that use federal funds.
In a recent letter, the local administrator for the Federal Highway Administration rejected a compromise suggested by the state and said current oversight efforts were insufficient to protect the public interest and prevent the potential for conflicts of interest.
At the heart of the bureaucratic spat is a long-standing practice by some — mostly smaller — Nebraska municipalities and counties of hiring the same private engineering firm both to design roads projects and then oversee their construction and compliance with federal aid rules.
Joe Werning, the new division administrator of the FHA in Lincoln, recently issued a new interpretation of federal rules that will require hiring separate engineering firms to handle the two tasks.
“The primary intent is to maintain the proper stewardship and oversight of federal-aid highway dollars,” Werning said in a prepared statement.
Officials with a Nebraska engineers association complained that the federal action was unwarranted and would delay projects and increase costs for taxpayers.
But Nebraska Roads Director Monty Fredrickson said his agency is working to comply and has already rewritten its policies on local construction projects, transferred three more state workers to quality assurance tasks and trained city and county workers to better conform with federal rules.
“There were some gaps there that needed to be shored up,” said Fredrickson, who was promoted to roads director in July.
He said he was unaware of any problems that arose by not having two separate engineering firms on local projects, but he said the potential for a problem was there.
Two officials with the American Council of Engineering Companies Nebraska, which represents 46 firms, were less diplomatic.
Karl Fredrickson (no relation to Monty), who works for Omaha's Kirkham Michael engineering firm, called the federal order “heavy-handed” and unnecessary, though he acknowledged that oversight could be improved.
“If there were actual cases of waste and abuse, I'd be much more understanding,” he said.
Federal highway officials did not respond to interview requests to detail their concerns, but other officials said oversight can suffer if the same engineer does both the design and construction tasks.
Jackie McCullough, executive director of the engineering association, said that many engineers have been laid off because of the recession and that stimulus spending has not helped because most has gone to resurfacing projects that don't require significant engineering services.
The federal action, she said, might increase layoffs because firms will no longer have the assurance that they will do both the initial design work and the construction oversight.
Both McCullough and Karl Fredrickson cited advantages to having the same engineer handle both tasks.
Hiring two firms will take more time, McCullough said. That in itself will increase costs because two separate bidding processes will be needed, she said. In addition, travel costs will rise because two engineering firms aren't common in many rural areas.
“These aren't the days to fritter away money on two processes that are exactly the same,” McCullough said.
Larry Dix, executive director of the Nebraska Association of County Officials, said the decision will have the greatest impact on about 20 of the state's smallest counties. They don't have full-time engineers, so they hire private firms to draw up county road plans.
The same practice is used by many small to midsize cities, officials said.
Increased paperwork and red tape has been a major complaint by local officials with the federal stimulus program. It has delayed the start of work on about $70 million worth of local projects in Nebraska and prompted a complaint earlier this year from Gov. Dave Heineman.
But officials said the spat over engineers preceded the stimulus program and resulted in a federal audit, which concluded that the state's oversight on federal aid projects overall was weak.
Contact the writer:
402-473-9584, paul.hammel@owh.com
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