THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Friday, September 29, 1995 TAG: 9509290493
SECTION: LOCAL PAGE: B1 EDITION: NORTH CAROLINA
SOURCE: BY LANE DEGREGORY, STAFF WRITER
DATELINE: NAGS HEAD LENGTH: Long : 108 lines
By hiring private contractors to perform work traditionally assigned to state employees, the northeast division of North Carolina's Department of Transportation saved $1.6 million in the past year, said R.V. Owens III.
Owens, who represents the division on the state's Board of Transportation, said this week that he hopes even more repair and maintenance road work can be farmed out to private contractors.
But division engineer Don Conner worries that Owens may be pushing privatization too quickly.
``In the past five years, we've gone from where we used to do all the road work with state employees to where we're farming out one-third or more of it now to private firms,'' Conner said.
``There's no question that we have better control over projects if we do them ourselves instead of hiring private workers. We can respond quicker to emergency needs and make sure our people are where they need to be, when we need them most. We can't make a contractor come help us clear a road or patch a pothole in emergencies, like we can our own employees.
``I know R.V. thinks we can get a whole lot smaller than we are and do the same amount of service,'' Conner said. ``But I think our service will be adversely affected if we get too small. I think there has got to be a mix of the two - state and private workers. And I think we need to be more cautious about losing state employees.
``I had a fear at one time that R.V. was out to destroy me,'' said Conner, who talks to Owens at least four times a day. ``Now, I understand his objectives. But I want him to be more cautious than he is.''
Department of Transportation Maintenance Engineer Anthony Roper agreed. ``We don't want anyone to lose their jobs,'' Roper said. ``But we do want to save taxpayers' money. There's a happy medium here, somewhere. But we don't know where it is yet.''
With 550 employees working in 14 northeastern North Carolina counties, the division includes more land than any other. Officials traditionally have hired private contractors to build bridges and most major new roads. But in the past two years, they also have increasingly contracted private firms to perform resurfacing work, shoulder clearing, mowing, paving secondary roads and maintaining potholes and other ``spot safety'' needs.
In the 1994-95 fiscal year, for example, 81 percent of the road resurfacing was done by private firms - for a total of $4 million. More than 36 percent of the secondary road construction was handled by private contractors, for a total of $2.9 million. By farming out secondary road construction alone, Conner said, the transportation department saved taxpayers $38,456 over what it would have cost state employees to do the same work.
Mowing, for example, costs the state $35 per mile if DOT workers do the job. Private contractors perform the same services for $22 per mile. On Oct. 1, outside firms will begin handling the state's street sweeping work in Division 1. Private contractors will clean 1,600 miles of road for $128,000. The state paid its employees $168,000 to do the same job last year.
``The private sector always can do it cheaper than government,'' said Owens, who insists he is not trying to micro-manage the Department of Transportation. ``When the DOT assigns a contract to a private firm, that means taxpayers don't have to pay for those workers' benefits, overtime or retirement. Overall, privatization has been quite a success for our highway department.
``The only problems come in crisis situations,'' said Owens. ``When the road goes out on Hatteras Island, we have to be able to mobilize our forces faster than anyone else. We have seven or eight contractors that work with our division. The question is: Can they be counted on to come help us in emergencies? Some of the contractors have said they don't want to handle that type of work because they think the DOT has more leeway about disposing materials, getting contracts and addressing environmental concerns than the private sector ever is permitted.
``I think the DOT can get some permits and privileges that other private agencies can't,'' Owens said. ``The solution might be to play ball with the same rules as those that govern the private sector.''
Allen Barnhill's private construction company has performed much of the state's highway work in the northeastern region. In the past two years, he said, Barnhill Construction's state contracts have increased by 50 to 60 percent. Some of that increase is because the amount of area construction projects has grown so drastically, he said. But his firm also has reaped the benefits of privatization.
``The larger the job, the more competitive pricing we can offer the state,'' Barnhill said Thursday from his Tarboro office. ``Some of the patching and smaller projects, though, the state can do cheaper because they have to respond right away. We'd have a hard time reacting within a day to those emergencies.
``And the state definitely has more leeway in terms of how they can fulfill the parameters of a job,'' said Barnhill. ``When we sign a contract, we have to be pretty specific in what we do. When the state does its own work, it can just meet whatever immediate needs it has.''
Facing future thrusts at privatization, Conner said he already is earmarking state jobs that could be eliminated - and handled by outside contractors. This year, he cut 43 temporary state field laborer positions and hired private workers instead. Eight full-time state road maintenance positions also have been cited for elimination. But Conner said he will cut those jobs as people leave or retire. The Department of Transportation doesn't plan to fire anyone.
``We're trying to put the money where the rubber meets the road instead of in payroll,'' said Owens. ``Privatization is going to be hard and painful. But when the downsizing in state government comes - and it's coming - we'll be ready.'' ILLUSTRATION: Color photo
DREW C. WILSON/Staff
Barnhill Construction company employees work a section of State
Route 168 near Moyock, work once in the state-worker domain.
by CNB