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Downsizing WISDOT

Are the cuts worth the cost?

By Jeremy Harrell

A few weeks ago, Dave Buschkopf's manager called him into the conference room.

Buschkopf, an engineer at the state Department of Transportation for 19 years, learned that he was at risk of losing his job, one of thousands of potential casualties of Gov. Jim Doyle's pledge to purge the rolls of state employees.

"It really caught me by surprise," Buschkopf said. "You go through a range of emotions. You go first to disbelief, then anger, then frustration. I know what I do is valuable to the DOT."

Within months, Buschkopf will know if his job is permanently gone or if he'll be asked to move to another slot with WisDOT. Whatever the case, he remains convinced that he's a victim of a numbers game, an expendable item on an actuarial spreadsheet.

"The governor made promises when he got elected," Buschkopf said. "There's no evidence it will save any money; the opposite, in fact. [My managers] said they're trying to fulfill a goal. That means to me they're not doing it for the right reason."

There's a battle raging at WisDOT.

It has nothing to do with roads, bridges or pavement types. It's a fight for jobs, the latest and so far most intense rendition of an old conflict between state-employed engineers and their private counterparts.

The battlefield for this turf war has changed from years past. Gov. Jim Doyle's pledge to slash the state work force has thrown this familiar conflict into a bureaucratic crucible, pitting state employees not just against engineering consultants but also against their government employers.

The heart of the debate is whether reducing state employment truly delivers the savings Doyle has promised.

If a judge were scoring this bout after three rounds, state employees would have a comfortable lead. Over the summer, it came to light that WisDOT signed a $165,000 contract with Milwaukee engineering firm HNTB Corp. to oversee the agency's inventory of road signs. WisDOT had been paying a single state employee $11.68 per hour to do the job, but under the contract, HNTB paid the same employee, working in the same state-owned warehouse, about $80 per hour to do the same task.

Then, in December, came the news that WisDOT paid the engineering joint venture on the Marquette Interchange reconstruction job a $665,000 no-bid contract to design a Web site for the project. Republican Assembly Speaker John Gard said high school students in his native Peshtigo could have created the Web site for half as much.

The final blow arrived late in 2004, when WisDOT and Doyle's office found themselves in the middle of an open-records battle over a report concluding that WisDOT's own engineers cost 18 percent less than private consultants. The agency drafted the report in April but failed to make it public for more than six months, finally releasing it in tandem with a Doyle-backed study finding that private engineers cost 43 percent less than state employees.

WisDOT Secretary Frank Busalacchi demoted the longtime agency lawyer who revealed the WisDOT report. The lawyer is now contemplating a suit against the state, and the attorney general is investigating whether the department took too long to make its report public. Legislators are now also gearing up to audit the state's contracting procedures.

Facing the largest budget deficit in a generation, Doyle followed the lead of many seasoned corporate chiefs: He proposed eliminating a big chunk of government overhead by forcing thousands of layoffs — ten thousand layoffs in a 10-year span, to be exact.

The impending retirement of the baby boomers gave the state a once-in-a-lifetime chance to get smaller. By shedding more than 10 percent of its work force, state government would be leaner, more efficient and, budgetarily speaking, better equipped for the future.

Not surprisingly, state employees had a thing or two to say about the plan. At first, the state employees' union predicted the closing of Department of Natural Resources service stations and the like. In the last eight months, however, the focus has shifted to the Department of Transportation and has pretty much stayed there.

Doyle's move to downsize the state work force turned up the heat on a long-simmering debate between consulting engineers and their state-employed colleagues. The two sides have been trading blows for years, most recently in 2002. In June of that year, the national organization representing state engineers fired off a study contending that consultants drive up project costs and lure top-flight public engineers into their ranks. The American Council of Engineering Companies responded five months later with a study of its own that came to the opposite conclusion.

Though not necessarily new, this debate gained a new urgency this year. Until recently, cutting state jobs meant deleting unfilled positions and seeing retirees out the door. In 2004, the engine driving the dramatic scaling back of the state work force kicked into gear, and WisDOT is leading the way.

In November, all state agencies submitted their plans to begin in earnest the 10-year effort to reduce the number of state employees. The state employs roughly 68,000 full-time workers (positions known as full-time equivalents, or FTEs). About 3,800 of those, or 5.6 percent, work at WisDOT.

WisDOT's reduction plan, part of a departmentwide reorganization, calls for the elimination of 364 jobs. The only other state agency that came close was the Department of Health and Family Services, which proposed shedding 248 FTEs. Some agencies, such as the Department of Justice and the Department of Public Instruction, bristled at the notion of losing any FTEs, warning of doom and gloom if anyone lost a job. All of the agencies together proposed cutting 1,608 workers.

That means that WisDOT employs 5.6 percent of the state work force, yet the agency proposed nearly a quarter of the overall staff cuts. The zeal with which WisDOT is carrying out Doyle's order to slash is a large part of what irks state engineers, especially since the department report found that in-house engineers cost 18 percent less.

"How come the DOT is being more aggressive than other agencies?" said Mark Klipstein, president of the State Engineering Association, a group representing WisDOT engineers. "As a taxpayer and association member, I'm disappointed by that. I just don't understand it."

But just because WisDOT is energetically heeding the call to get small doesn't mean it's a dispassionate exercise. At a recent industry conference, Kevin Chesnik, the director of WisDOT's Division of Transportation Infrastructure Development and the administrator responsible for seeing the staff cuts through, said he understands that employees are looking over their shoulders, especially since the agency recently started sending out alerts notifying those workers at risk of losing their jobs.

"This is a significant change," said Chesnik. "It's a significant effort. It's on the minds of everybody."

Setting aside bureaucratic politics, it becomes clear that plenty of other factors are driving a realignment of WisDOT's engineering procedures. In fact, WisDOT's growing reliance on outsourced engineering services largely comes down to a numbers game.

The size of WisDOT's construction budget has ballooned in the last decade thanks to the last two federal transportation bills. Between 1992 and 2003, the agency's annual budget grew from $426 million to $630 million, according to a Department of Administration cost analysis. During that same period, WisDOT's staffing levels shrank by 9 percent, according to the DOA report.

Simply keeping up with the increased workload has forced WisDOT to seek private engineering companies. Just five years ago, WisDOT staff did 59 percent of the department's engineering work. By 2004, that decreased to 46 percent, meaning that consultants are now handling more than half of design and construction oversight.

OMNNI Associates Inc.'s work on the Waupaca East Gateway combines an overhaul of an airport, a new interchange and road construction. The Appleton engineer led the project on everything from environmental analysis to bridge design.

Photo courtesy of American Council of Engineering Companies of Wisconsin

WisDOT policy aims for a maximum of 50 percent consultant involvement.

Wisconsin's reliance on engineering consultants is average compared with other Midwestern states, which have also seen large increases in their construction budgets because of the infusion of federal cash. In Michigan, for instance, consultants account for between 55 percent and 60 percent of transportation engineering in an average year. In Minnesota, the figure is 30 percent to 35 percent.

In 2004, the Iowa DOT spent $40 million on consultants out of a total construction budget of $317 million, amounting to 12.5 percent of its overall spending. WisDOT, in the same year, spent $102 million of its $1.2 billion construction program on consultants, or 8.5 percent. Indiana, however, outsources all of its design functions to consulting engineers.

Back in Wisconsin, the numbers game suggests that private engineers will continue to snare a larger proportion of WisDOT work, both because of staff cuts and because the agency is already having a hard time delivering projects on schedule. In the last five years, WisDOT's ability to complete designs on time has fallen from 97.6 percent in 2000 to 78.5 percent in 2003, according to agency budget documents. It's gotten bad enough that road builders have expressed fear that WisDOT can't cope with its rising demands.

It's safe to say that this is a time of turmoil for WisDOT. Across the board, the agency is being asked to do more with less, while at the same time phasing out a large segment of its work force.

"It's not an easy life right now," Klipstein said. "In the last couple of years, I haven't seen morale as low as it is now."