Audit: MDOT not checking warranties, costing taxpayers

(File)


GRAND HAVEN, Mich. (WOOD) — A new audit reveals a Michigan Department of Transportation shortfall that is costing taxpayers hundreds of thousands of dollars.

The report, completed by the Michigan Auditor General’s Office, said MDOT’s efforts to monitor warranties for road and bridge construction projects is not effective.

MDOT contracts out some of its road and bridge projects, and some of that work comes with warranties so if a project needs to be fixed, MDOT is not on the hook for it.

But the new report shows MDOT isn’t checking up on those, and it’s costing taxpayers.

When the state gets a warranty for a road or bridge project it’s entered into a database that notifies MDOT engineers when it’s about to expire.

“Their supposed to know ahead of time that a warranty is due and go out and inspect it very thoroughly,” MDOT spokesperson Jeff Cranson said.

Between Oct. 1, 2011 and March 31, 2014 MDOT oversaw the completion of 1,340 road and bridge construction projects costing $1.4 billion.

The Auditor General’s report looked at 12 of those projects and found there were 14 warranties.

Of those 14 warranties, five of them had corrective action that should have been taken to fix the projects, they went unfixed and now MDOT estimates it will cost them $314,000.

“I want to stress the context of this, we’re talking about maybe three or four hundred thousand dollars in this audit on 60 million dollars of projects just there,” said Cranson.

Out of the five warranties that showed the road or bridge project needed corrective action, two of them MDOT completed an inspection on prior to the expiration of the warranty determined corrective action was necessary, but never actually notified the contractor.

In the other three MDOT notified the contractors of the fixes that needed to be made but the work never got done, and MDOT did not check to make sure it did.

“It’s very difficult, very challenging to keep up when you have that many warranty out there and you have a staff that has to monitor them, make sure put them in a data base, go back and make sure check and see if things are holding up before a warranty runs out,” said Cranson.

According to MDOT, Michigan leads the nation in the number of warranties it gets for road projects.

“We’re not running from it in any way. Our engineers are saying yeah we’re going to work at this even harder. We’re going to upgrade the technology and we’re going to do what we have to do to stay on top of it,” Cranson said.

MDOT said it was working on upgrading its software so that notices about warranties expiring go out sooner and more often.

“It’s about resource and it’s about time. You have to spend money to monitor this too,” Cranson said.

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