SCDOT Performance Audit.pdf

Request for Proposal South Carolina Department of Transportation Performance Audit

1. Introduction

The South Carolina Office of the State Auditor (OSA) is requesting proposals from qualified firms to conduct a performance audit of the South Carolina Department of Transportation (SCDOT).

All correspondence regarding this request for proposal should be directed to:

Sue Moss, CPA Interim State Auditor 1901 Main Street, Suite 950 Columbia, SC 29201 803.832.8249 smoss@osa.sc.gov

2. Nature of Services Required

The purpose of this engagement is to conduct a performance and organizational audit of the

South Carolina Department of Transportation (SCDOT) in accordance with SC Code Section 57- 1-360(B)(4). The purpose of the audit is to assess current operations and to identify opportunities to strengthen policies and practices for improved efficiency and effectiveness.

Recommendations addressing weaknesses or regarding implementation of better practices and other observations should be articulated and prioritized according to significance and urgency and, where feasible, should include an analysis of potential costs or benefits associated with implementation. Areas to be considered within the scope of the performance and organizational audit include:

1) Structure including a benchmark to other state DOT’s that are governed through direct gubernatorial appointment.

2) SCDOT’s planning processes as required under state code and existing regional planning programs.

3) Project planning, development, and delivery process utilizing recent process mapping conducted by the Federal Highway Administration.

mailto:smoss@osa.sc.gov

4) Construction management framework in terms of project delivery, risk allocation, and dispute resolution.

5) Maintenance programs and structure relative to system size and operational requirements including best practices and recommendations to optimize service and asset life.

6) Traffic engineering and transportation systems management capacity and needs necessary to deal with the growth of South Carolina.

7) Financial management structure and processes needed to deliver current and anticipated needs.

8) Requirements of Act 177 and steps being taken by SCDOT to deliver the program.

The provider is expected to utilize experience with similar engagements in exercising judgment and creativity in conducting this engagement.

3. Time Requirements

Proposal Calendar

Request for proposal issued October 23, 2026 Due date for Intent to Respond notification November 16, 2026 Due date for proposals November 30, 2026 Award Date January 15, 2027

Engagement Timetable

Start of work Date mutually agreed-upon Preliminary draft April 30, 2027 Final report issued July 30, 2027

4. Proposal Submission

An electronic proposal (PDF format) should be submitted by email (smoss@osa.sc.gov) no later than 5:00 PM (Eastern Standard Time) on November 30, 2026. Proposals meeting the requirements set forth in this document will be evaluated by OSA.

5. Intent to Respond

A notification of intent to respond to this RFP is requested by email (smoss@osa.sc.gov) no later than November 16, 2026, and should include the firm name as well as the name, title and contact information of the lead consultant.

Submitting this notification is not a prerequisite for submitting a proposal, but rather is intended to allow OSA to provide all firms that intend to respond copies of any questions and answers that may arise during the proposal process and any amendments to this solicitation that may be published. Firms that either choose not to submit a notification of intent to respond or fail to meet the deadline for its submittal may submit a proposal in response to this RFP, but must include with their proposal an acknowledgement that they were notified that additional information regarding this request was available from OSA upon request.

6. Background

The South Carolina Department of Transportation was established in 1917 and is responsible for the construction, maintenance, and operation of the nation’s fourth largest state highway system at approximately 41,000 miles. In addition, SCDOT has responsibility for the administration of mass transit and rail programs. SCDOT is governed through Title 57 of the South Carolina Code of Laws.

Until January 1, 2027, SCDOT is governed by a nine-member Commission appointed by the Governor with General Assembly confirmation. The Commission appoints a Secretary of Transportation to be the agency head, subject to Senate confirmation. Effective with the passage of Act 177 of 2026, the Commission will be abolished, and the Secretary of Transportation will be appointed directly by the Governor starting January 1, 2027.

The Secretary of Transportation serves as agency head with full responsibility for managing all day-to-day activities. The Secretary is supported by four Deputy Secretaries (Engineering, Finance and Administration, Planning, and Intermodal and Freight), Chief of Staff, and a Chief Counsel. In addition, SCDOT is the only state agency with an internal auditor appointed by the State Auditor who also serves on the executive team.

SCDOT has 4,600 approved positions with approximately 4,000 presently filled. Headquarters provides centralized governance, project development including planning and preconstruction, financial management and oversight, human resources, and procurement and construction letting. Policy setting units exist for Maintenance, Traffic Engineering, Bridge Management, and Construction.

The state is divided into seven engineering districts responsible for day-to-day maintenance, traffic engineering, construction, and bridge activities. The state is further divided into individual county maintenance and construction units in the state’s 46 counties.

SCDOT presently has a budget of approximately $2.8 billion, of which approximately $2.0 billion is dedicated to its construction program. Current value of the construction program is approximately $6.2 billion. Funding is approximately 60% state funds and 40% federal funds.

State funds include SCDOT’s share of the 28.75 cent gas tax, portions of the state’s license and registration fees, car sales tax proceeds, and General Funds. At present, SCDOT has no debt outstanding and recently gained the authority to enter into public-private partnerships to advance large-scale projects.

Following the 2017 Roads Bill which increased the gas tax and several other revenue streams, SCDOT has been focused on implementation of its 10-Year Plan. The primary focus of the 10- Year Plan has been on improving pavement and bridge conditions, reducing fatality rates on rural routes, and adding capacity to its interstate system. SCDOT reports the following challenges in achieving its mission:

1) Large backlog of deferred maintenance: pavement and bridge conditions began deteriorating in the mid-2000’s. Current 10-Year Plan efforts have improved conditions, but large portions of the network still require repair and rehabilitation.

2) Cost inflation has eroded the ability to deliver projects and as a result, planned efforts are being scaled back to align to budgets. This includes a reduction in pavement rehabilitation annually and deferring major interstate projects.

3) South Carolina has seen rapid growth over the past five years which is straining the capacity of the system. As a result, increasing delays and congestion are becoming routine in areas not accustomed to it.

The General Assembly adopted Act 177 of 2026 which requires a quadrennial performance audit of SCDOT. In addition to the structural change to the SCDOT previously discussed, it also enabled public-private partnerships, expanded procurement authorities, allowed SCDOT to obtain National Environmental Policy Act Assignment, and expanded toll authorities to include choice lanes.

7. Proposal Requirements

To provide the maximum degree of comparison, proposals must be organized as follows.

Questions should be submitted by email to smoss@osa.sc.gov.

Title Page Show the RFP subject, firm name, contact information and date.

Table of Contents Include a clear identification of material presented by section and page number.

Letter of Transmittal (limit to 3 pages) Provide an understanding of the work to be done and a commitment to the timeline outlined in this RFP. In addition:

1. Provide the name and contact information of the individual who will be authorized to make representations on behalf of the proposer.

2. State the person signing the letter is authorized to bind the proposer.

Profile of the Proposer

1. Briefly describe the proposer, including size and identification of office locations.

2. Identify the office location which will have primary responsibility for the work to be done.

3. Describe material litigation to which the firm is currently a party as well as litigation brought against the firm in the last five years.

Summary of Proposer’s Qualifications

1. State the identity of senior members of the proposed engagement team and include resumes detailing relevant experience for each.

2. Affirm that the proposer has no conflict of interest with SCDOT.

3. Describe recent engagements similar in scope to the services requested, with an emphasis on engagements performed by the office/team that is proposed for the work to be done for SCDOT.

4. Provide a minimum of three references for similar work performed in the last five years.

5. Identify public agency clients that have terminated the proposer’s services in the last five years and include the reasons for termination.

Detailed Work Plan Include a work plan describing in detail the methodology to be employed by the proposer in performing the fiduciary audit. The work plan should include a projected timeline reflecting major milestones and dates to comply with the delivery date for a preliminary draft and a final report.

Compensation Provide an all-inclusive maximum fee, including out-of-pocket costs, for which the requested work will be done.

Mandatory Criteria Affirm the following:

1. Proposer does not discriminate in the employment of persons upon the basis of race, color, creed, national origin, sex, age or physical handicap.

2. Proposer will provide a drug-free workplace during the term of this contract in accordance with Section 44-107-10 through 44-107-90 of the 1976 South Carolina Code of Laws, as amended.

3. Proposer has and will comply with, and has not, and will not induce a person to violate Title 8, Chapter 13 of the 1976 South Carolina Code of Laws, as amended (Ethics Act).

4. Proposer is in compliance with Sections 11-57-300 through 11-57-330 of the 1976 South Carolina Code of Laws, as amended, with respect to investment activities in Iran.

8. Proposal Evaluation

Proposals should demonstrate the technical qualifications, competence and capacity of the firm seeking to undertake the services required in this RFP. Evaluators will determine the winning proposal based on the qualification, approach and cost as well as commitment to delivery of final reports by the due date specified in this RFP.

Proposals which do not include the minimum requested information, including affirmation of mandatory criteria, will be rejected as not being responsive. OSA reserves the right to request additional information or clarifications from the proposing firms during the evaluation process where it serves OSA’s best interest. Technical corrections or omissions may be allowed at the discretion of OSA.

OSA reserves the right to reject any or all proposals submitted.

OSA reserves the right to negotiate with the highest-rated proposer on final contract terms.

The following evaluation factors will be considered:

Technical Factors

1. Responsiveness of the proposal in clearly stating the firm’s understanding of the work to be performed, including:

• Appropriateness and adequacy of the detailed work plan

• Timeliness of milestones in complying with the final report delivery date

2. Technical experience of the firm

3. Qualification of staff

4. Size of the firm

Cost Factor Proposed fees are a consideration but are not the dominant factor. Cost will be given more importance when all other evaluation criteria are equal. Proposals believed to be unreasonably low will be rejected.

Proposers may be asked to make a presentation prior to awarding the contract. Dates for the presentation will be determined by OSA.

9. Other

Billings and Payment OSA will issue an award letter to the successful proposer stating the maximum fee to be paid for the engagement. While OSA is the client, SCDOT is responsible for payment of engagement fees.

All invoices are to be submitted to OSA for approval. OSA will submit approved invoices to SCDOT for payment. Services which may increase the fee above the maximum must have prior written approval of OSA.

Progress billings based on the percent of engagement completion will be accepted. Final payment will not be made until contractual obligations have been met, including delivery of final reports. OSA reserves the right to hold progress billings should issues arise in the delivery of services or if there is a reason to believe billings have been submitted in advance of work being completed. A federal Employer Identification Number (EIN) must be provided with each invoice.

Choice of Law, Jurisdiction and Venue Any contract resulting from this RFP is governed by and in accordance with the laws of South

Carolina. Jurisdiction and venue for resolution of any dispute shall be in the courts of South Carolina.

Entrance Conference Within 30 days of being awarded the engagement, the provider will contact OSA to arrange a date and time for a meeting to discuss in detail documentation requests, specific tasks to be performed and timing. Key SCDOT staff will be included in this meeting.

Electronic File Sharing SCDOT can securely share documents requested.

Progress Reports Provider will provide periodic progress reports during the audit process. Progress reports are expected to be more frequent during the weeks prior to report issuance.

Exit Conference Near the conclusion of the engagement, an on-site exit conference will be held at a time agreeable to the provider, SCDOT and OSA.

Report Distribution Requirements The provider will deliver to OSA twenty-five bound copies and an electronic version (PDF) of the final report. The electronic copy must meet the requirements of Section 508 of the Work Force Investment Act of 1998 regarding accessibility by individuals with disabilities.

Board Presentation Provider will attend a meeting with OSA, SCDOT, and the Office of the Governor to present and discuss findings, conclusions, and recommendations resulting from the engagement at a date to be determined later.