I asked the City Auditor today to conduct an audit of the Seattle Department of Transportation’s capital investment program and its management of cash balances. I did so after learning that SDOT incurred millions of dollars of unused debt in recent years. In 2011, $112 million remained in its cash balance from bond sale proceeds. Last year, the total was $64 million.
We are $1.8 billion behind on basic street and bridge maintenance projects. It’s very troubling that we have been sitting on so much cash. We sold the bonds. We have the money. We should spend these funds to improve mobility and repair our bridges, streets and sidewalks today. Instead, SDOT is wasting taxpayer dollars on unnecessary interest payments. Until we can determine why this is happening and adopt corrective measures, I will not vote to incur any additional debt for SDOT-managed projects.
The Council’s Government Performance and Finance Committee will review legislation proposed by the Mayor tomorrow morning that includes incurring additional debt for SDOT. I will move to amend the legislation in committee to stop the sale of any additional bonds for this department.
The City regularly issues bonds to finance large capital programs. Regardless of when the proceeds from the bonds are actually spent, the public has to pay the debt service. If capital projects are not started in a timely manner, or funds are not needed in accordance with project plans, these payments are spent unnecessarily. Millions of taxpayer dollars have been spent in this way in recent years.
The audit will explore processes and controls within SDOT that will reduce the likelihood of large, ongoing bond proceed balances and recommend what changes should be introduced to avoid such occurrences in the future.