Everything seemed to be running so smoothly between the Georgia Department of Transportation and the state’s elected leaders ever since the dust settled on last year’s war between them.
Now, not so much.
And so far, the new tussle could cost taxpayers about $22 million.
On Jan. 21, DOT board members out of the blue took up a singularly explosive issue between them and Gov. Sonny Perdue and ignited it. In defiance of the state auditor, the board voted 10-1 to reverse a change to its accounting practices that it had put in place following blistering audits over the past two years. The move could allow the DOT to sign a multiyear contract before it had set aside all the money necessary to cover the full life of the contract.
On Thursday, the board chairman led a special meeting to see whether the board would back down. No dice.
Perdue's response was swift. He canceled a DOT bond refinancing that, according to his office, might have saved the DOT -- and taxpayers -- $22 million.
"While I am incredibly frustrated that we are forced to pass up a substantial savings opportunity, I am more concerned that this Board continues to act irresponsibly and show such little regard for the state’s conservative fiscal management policies,” Perdue said in a statement.
House Speaker David Ralston wasn't thrilled with the board, either.
"I regret this move because it now has jeopardized some funding as the governor announced yesterday," Ralston told The Atlanta Journal-Constitution. "My preference would be for the legislative process to move forward so we could be deliberate about looking at the proper accounting method to use." However, he said, contrary to published reports, "I have not indicated to anyone that I plan to retaliate. That's not the proper response at this time."
Asked whether he may try to gut the DOT's powers even more than a law passed last year did, Ralston said that that law was like any other major legislation that could always be revisited.
"I am not about targeting anyone or slashing funding because of their vote," Ralston added.
Perdue spokesman Bert Brantley said Friday that there was no guarantee the state would have realized that $22 million savings after creditors learned about the DOT's actions, and that it wasn't worth the risk it posed to the state's credit rating. The state's stellar credit rating allows it to save millions by borrowing cheaply.
Some board members who backed the vote countered that there was no evidence the state's credit rating would have suffered. They had delayed the accounting change to July 1, time enough for Attorney General Thurbert Baker to weigh in. A deputy of Baker's has already backed the auditor, but the board has now requested an official opinion from Baker himself.
Board member Bobby Parham, who introduced the matter at the board's monthly meeting, said he thought the audits were related to a ploy by the governor to take more control of highway money. Brantley said the auditor was independent and called that assertion absurd.
Board Vice Chairman Rudy Bowen voted for the reversal. Bowen said his only motivation was to create more jobs, since the accounting reversal would allow the DOT to spend money it had set aside for future road payments. He stressed he would do nothing illegal.
He also gave no indication the governor's action had changed his mind about his vote.
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