scdot cost savings report



Prepared February 2008

The enclosed report reflects areas of savings under the current administration, as well as initiatives undertaken that will produce cost savings. 

Here are some highlights of the report:

One-time Savings Realized in 2007

Decrease in agency travel      178,686

Improved consultant contract negotiation   5,442,525

Innovative Project on I-95 in Clarendon County         402,000

Aggressive negotiations in construction claims against SCDOT                      10,265,386

Settlement of claim for defective products sold to SCDOT                                  1,550,000

                                                                                                       TOTAL     $17,838,597

Annual Savings Realized

Elimination of staff in Secretary’s office          32,000

Elimination of Washington lobbyists              265,000

Streamlining of employee training       31,880

Change in toll operations contract     612,000

Cellular phone contract changes          41,400

Increase on signal replacement/upgrade cycle        350,000

Refurbishment of used sign blanks    157,300

Use of temp employees in lieu of permanent employees                 30,894

Use of in-house diagnostic services & repairs      1,441,499

Use of inmate labor  2,777,991

Use of LED bulbs in traffic signals  1,143,991

Use of in-house forces for capital improvement projects    445,139

Elimination of select mowing cycles              377,000

Applying value engineering to projects       2,038,129

                                                                                                       TOTAL       $9,744,223

Initiatives Designed to Produce Savings

  • Reductions in administrative costs pursuant to Governor Sanford’s “Transparent Spending” Initiative
  • Reductions in travel
  • Reductions in fuel consumption
  • Reductions and/or budget cuts in conference/event costs
  • Reduction in outside legal counsel
  • Aggressive pursuit of claims on damages to SCDOT property
  • Aggressive negotiation of claims against SCDOT
  • Use of Subsurface Utility Engineering firms


Agency Travel

Overall agency travel for the calendar year of 2006 was $1,021,572.99.  In 2007, total travel was $842,886.01, a decrease of 17%.

Improved Consultant Contract Negotiation

In 2007, pursuant to recommendations by the Legislative Audit Council, SCDOT launched an internal database for use in capturing negotiations, documentation, and other items related to its consultant negotiation process.  Having this historical data enabled senior management to track negotiations from a consultant’s initial estimate through to the final contract amount.  It is estimated that our contract negotiators were able to save the agency $5,442,525.41 for 2007.

Fuel Consumption

In November 2007, SCDOT issued an administrative directive to its employees to cut fuel consumption for November and December by ten percent.  This was accomplished by teleconferencing, reducing equipment idle time, taking more efficient routes, ensuring that each vehicle taken to a jobsite is needed, and combining trips whenever possible.  As reflected in the charts below, total agency fuel consumption decreased by 15% from October to November and decreased by 16% from November to December.


October     2007

November 2007

December 2007

Gallons used




Amounts taken from monthly fuel data received by SCDOT from fuel supplier.

Defective Equipment Case Settlement

Secretary Limehouse’s intervention to help settle a lawsuit against a provider who sold defective products to the agency resulted in an increase of $1,550,000 for the agency, when we settled for $1,800,000 versus the original offer of $250,000.

Clarendon County Project on I-95

Last fall, Secretary H. B. “Buck” Limehouse Jr. approved a unique solution to a long-standing situation on I-95 in Clarendon County.  The situation centers on a 252-foot long drainage pipe located at milepost 103. The steel pipe is 84 inches in diameter. The repair has been needed for several years to prevent the pipe from collapsing.  Several years ago, two estimates for relining the pipe using two different methods were presented. Both of these estimates came in at approximately $500,000 at that time. No funding had been identified for this project, so it was postponed.  Several months ago, SCDOT engineers met with representatives of Sekisui SPR Americas, headquartered in Atlanta. The firm expressed an interest in performing a demonstration project with minimal cost to SCDOT. Sekisui SPR Americas uses a technique for culvert rehabilitation that SCDOT engineers have not utilized before. The firm uses a pipe-lining method that is trench-less, and the liner is installed from the ends of the pipe, which means there is practically no disruption to traffic on this major highway. In addition to reinforcing the pipe, Sekisui SPR Americas reports that its liner will improve the flow of drainage. This method is environmentally friendly and has a life expectancy of 50 years. The firm agreed to rehabilitate this site for only the cost of materials, which was approximately $98,000, a savings of $402,000 over previous estimates.  The project has been completed.

Settlement of Construction Claims

Aggressive negotiating of contractor related claims against SCDOT resulted in savings of $10,265,387 in 2007.

Value Engineering Savings

Palmetto Parkway Phase II (District 1)              $852,343

Engineering and engineer revisions on construction projects (District 1, 3 & 6)          $994,486

Salvaged parts on equipment/vehicles prior to disposal (Equipment Depot)               $191,300


Savings on Conference-Related Costs

With regards to reduced travel attending training conferences, it is estimated that Engineering Operations has realized a savings of $31,000.  ($17,185 – ‘07 Bike & Pedestrian Conference; $2,720 – District 4; $2,300 – Director of Maintenance Office; $2,000 – Director of Traffic Engineering; $4,336 – Director of Construction Office; $2,700 – Office of Materials and Research).


Elimination of Staff Position in Secretary’s Office

When an administrative vacancy occurred in the Executive Office, Secretary Limehouse chose not to fill the position, saving $32,000 annually.

Elimination of Washington Consultants

At the recommendation of Secretary Limehouse, the SCDOT Commission voted in July of 2007 to release the consulting services of our Washington consulting firms.  This will account for an average savings of $265,000 per fiscal year.

Streamlining of Employee Training

All employee training was reviewed to see which programs could be combined and/or restructured to maximize results.  Leadership training that was previously administered under a program called STTARS has been streamlined so that training is provided in-house and will be more cost-effective.  Elimination of the STTARS program results in savings of $27,000/year plus lost labor time.  Another program, the Women’s Forum, is also being eliminated and will result in savings of approximately $4,865 annually plus lost labor time.

Change in Toll Contract

We currently pay an average of $290,000 a month under our existing contract.  It is an average because it varies from month to month depending on the variables that we pay.  With the new contract, effective March 1, we will no longer be billed for account maintenance or opening new accounts over 21,000 in old system.  The new monthly payment is $239,000.  There are no variables with this amount; it is all inclusive of the work, hence the savings of $51,000 a month. 

After screening firms through procurement, the firm that held the original contract was selected to provide services again.  Not only did the company provide the lowest bid, but they also agreed to forgo the implementation costs, estimated to be at least $1.5 million to $2 million.  We would have been paying the existing contract until March 1st or longer while making simultaneous payments to a second vendor for their work.  The minimum would have been six months of payments greater than what we are paying the current contractor therefore a cost savings of $250,000 plus a month for at least 6 months.

Administrative Costs

Administrative costs have been reviewed to see areas where savings could be recognized. 

Cellular Phones – In July 2007, SCDOT consolidated and renegotiated its cell phone contract with Verizon.  This change in contract is saving an average of $3,450 per month.

July August September October November December
2006 $ 25,345 $ 26,690 $ 25,352 $ 25,444 $ 25,515 $ 26,190
2007 $ 20,392 $ 22,542 $ 22,701 $ 22,428 $ 22,991 $ 22,754

Pagers – At the beginning of 2007, DOT was paying 76 pager bills either on a monthly, quarterly, or yearly basis. 

Ø      During the process of reviewing our pager usage, 20 of the pager contracts were terminated when the pagers were cancelled.

Ø      Of the remaining 56 contracts, 28 have been consolidated into one account, thus reducing the current number of bills being paid to 29.  USA Mobility continues to work towards consolidating their remaining bills into one account.

Pager Cost

July 1 – December 31 2007




$ 14,909

$ 34,256


Information from IT Services based on current LAC review, expenditure amounts taken from accounting cash disbursements records.

March 2007 November 2007
Total Active Pagers


179 *

Total Dual Cell Phone / Pager Users


38 #

Total Pagers Cancelled To-Date



Dual Users Pagers Cancelled To-Date



Dual Usage Justification Submitted To-Date



* In the process of consolidating all pager accounts into one account with IT Services as the custodian. # Of total 19 are unassigned to individuals and used for on-call purposes only in District and County.

Laptops – IT Services has consolidated approximately 112 computers in the last two years. Those computers that were consolidated were based on many employees turning in secondary computers or deciding to retain the laptop as a primary and giving up the desktop unit. In general, it could be said that the average savings per replacement was about $1200.

Engineering District Annual Savings

Signal Replacement/Upgrade (District 7)

By increasing the cycle of signal replacement/upgrade from 12 to 15 years, it has resulted in approximately 7 fewer signals being replaced/re-built last year at an estimated savings of $350,000 annually.

Refurbish Used Sign Blanks (Districts 1, 3 & 6)

By initiating a contract to refurbish used sign blanks in order to re-use the aluminum from old signs and manufacture new signs, the three sign manufacturing shops have realized a combined estimated cost savings of over $157,300 this past year.

Temporary Employees (District 5)

Use of temporary employees in lieu of permanent employees resulted in a savings of approximately $30,894.

In-house Diagnostic Services (Districts 2, 5 & 6)

It is estimated that the department has realized an estimated $1,441,499 this past year on contractual services by performing in-house diagnostic services and equipment repair formerly done by dealers.

Use of Inmate Labor (Districts 1-6)

By using inmate labor in six engineering districts, a savings of approximately $2,777,991 was realized when compared to an in-house entry level maintenance worker labor.  The use of inmate labor allows us to provide particular services, such as weed-eating and litter pickup, without filling full-time positions.

Use of LED bulbs in traffic signals (Districts 1, 3-7)

By replacing incandescent bulbs with low wattage LED’s (light emitting diode), SCDOT has realized a savings of approximately $1,143,991 due to reduced operating and maintenance costs.

Capital Improvement Forces (Districts 4 & 6)

A savings of approximately $445,139 in rehab/construction and maintenance service monies was realized by utilizing our Capital Improvement forces rather than using local contractors. 

Eliminated Mowing Cycle (District 3)

By eliminating a mowing cycle on interstates and secondary routes due to drought conditions, SCDOT realized a savings of approximately $377,000.

Modified Copier Contract (District 4)

District 4 recently renegotiated its 5 year copier contract for 22 photocopiers, creating a savings of approximately $15,324 annually.


The following initiatives have been undertaken by SCDOT and should produce cost savings in the future:

Governor Sanford’s Transparent Spending Initiative

Governor Sanford issued an Executive Order in August 2007 requiring all cabinet agencies to report expenditures on travel, office supplies over $100, and contractual expenses over $100.  As the newest Cabinet agency, SCDOT was proud to take the lead in complying with the Governor’s Order by contacting SC.GOV (the entity responsible for coordinating the details of the public website) to show staff what database capabilities SCDOT has that meet the requirements of the Executive Order.  SC.GOV staff met with the Comptroller General’s Office staff and agreed that SCDOT’s reporting database, combined with information from the Comptroller General’s Office, could be used as a model for the development of the public website required by the Executive Order.  This public website is scheduled to be on line in March of this year and we are hopeful that all employees will be even more cognizant of every item purchased because of the public reporting requirements.


Overall agency travel has been severely streamlined over the past year and travel expenses will continue to be monitored through initiatives undertaken by this administration, as well as the Governor’s Executive Order that requires us to post travel expenses on a public website.  Items that have been addressed through Departmental Directives or other departmental policies include the following:

  • Participation in conferences and/or meetings is limited primarily to those employees that can use the event to fulfill educational certification or training requirements directly related to their position with the agency. 
  • Minimal staff should be utilized at public hearings or meetings.
  • Carpooling and SMARTRIDE use are strongly encouraged.
  • Same day travel is strongly encouraged.
  • Sharing of hotel rooms is encouraged when overnight stay is required.

Just as an example to give a picture of savings that can be realized – Secretary Limehouse has limited his travel, spending $796.07 in travel on a budget of $28,276 for the current fiscal year.  That trend should produce year-end results that are far below the budgeted amount.

Conference Costs

As stated above, SCDOT staff participation in conferences and/or meetings is limited primarily to those employees that can use the event to fulfill educational certification or training requirements directly related to their position with the agency. 

Each conference and event where any SCDOT resources are utilized (i.e. money, equipment, personnel) is reviewed to ensure that resources are used as efficiently and effectively as possible.   An SCDOT Events Planning Committee reviews each request for a conference or event to ensure that policies outlined in the applicable Departmental Directives are met.   In addition, the group reviews the application compared to past events or similar conferences to identify areas where cost savings could be realized.  Some of those items are:

  • Conference/event locations are central to the group attending the conference/event. 
  • When available, facilities that do not charge for meeting space are utilized. 
  • Conferences/event that target similar audiences are considered for combination to minimize cost to SCDOT and attendees.
  • Conference revenues and expenditures are handled resourcefully, with attention given specifically to the regulations of the State Treasurer’s Office. 
  • Commission policies on conference sponsors are followed in order to share the cost burden with private entities while maintaining ethical considerations.
  • Agendas are reviewed to minimize the number of days for an event.
  • Agendas are drafted to maximize work time.
  • Conference/event staff is limited to only those personnel essential for successful and professional planning and operation of the event.  Outside groups are looked at to supplement SCDOT conference staff.  
  • Sharing of hotel rooms is considered when overnight stay is required.  
  • Employees are required to utilize state vehicles and are encouraged to carpool when possible. 

Fuel Savings

In November 2007, SCDOT issued an administrative directive to its employees to cut fuel consumption for November and December.  This was accomplished by teleconferencing, reducing equipment idle time, taking more efficient routes, ensuring that each vehicle taken to a jobsite is needed, and combining trips whenever possible. In 2008, the goal continues to be reduction and long-range energy efficiency plans are being developed to improve agency-wide fuel consumption.

Energy Audit

In May 2007, Secretary Limehouse requested that an energy audit be conducted to determine potential energy costs savings throughout the agency.  A Level One Energy Audit was conducted at SCDOT’s three largest facilities – the Headquarters Building, the Materials and Research Laboratory, and the District Headquarters Building in Greenville.  The audit findings produced several recommendations that could produce savings on electricity, if implemented.  SCDOT is currently developing a Request for Qualifications for potential vendors to assess occupied buildings throughout the state for potential energy cost savings.

Outside Legal Counsel

Secretary Limehouse has requested a thorough review of the agency’s use of outside legal counsel to evaluate which services can be provided in house rather than outsourcing. 

Claims for Damages to SCDOT Property

Late last year, Secretary Limehouse issued a directive to the Office of Legal Counsel to pursue any and all claims on hits to highway appurtenances, including guardrails, cable barriers, signs, etc., no matter how small the claims may be. SCDOT has employed a claims specialist who has 20 years of experience in the private sector insurance industry, specializing in Property and Casualty Claims.  Work is underway to improve the claims collection process. 

Amounts are taken from SCDOT accounting records – Settlement of Claims revenue account.

Settlement of Claims

July 2007 – January 2008

FY 2007

FY 2006

FY 2005

Amount Billed 

$ 1,211,741

$ 1,820,566

$ 1,812,373

$ 911,215

Number of Bills





SCDOT also aggressively pursues outstanding amounts due.  Once amounts due exceed 90 days, they are given to the Legal Department to collect.  The table below details the number of claims sent to the Legal office for collection and the amount actually collected.

Claims to Legal Calendar Year 2007 Calendar Year 2006 Calendar Year 2005
Claims Received 377 422 219
Claims Collected 124 170 83
Amount Collected $308,472 $ 207,203 $115,070

Subsurface Utility Engineering Services:

SCDOT believes that it can recognize cost savings by implementing and utilizing a Subsurface Utility Engineering (SUE) Program.  Subsurface utility engineering is the convergence of new site characterization and data processing technologies that allows for the cost-effective collection, depiction, and management of existing utility information.  In January 2008, the SCDOT Commission gave approval for the agency to advertise, select and negotiate with SUE firms to provide services on an as-needed basis. 

In 1999, the Federal Highway Administration sponsored and funded a research project, performed by Purdue University, on four state Departments of Transportation using SUE and quantified substantial cost savings being realized by those states.  A total of 71 projects from Virginia, North Carolina, Texas and Ohio were studied. These projects had a total combined construction value in excess of $1 billion. The study concluded that for every $1 spent, on these projects, for Subsurface Utility Engineering a savings of $4.62 was realized. The study also concluded that qualitative savings such as project delays were non-measurable but were significant and may be many times more valuable than the quantifiable savings.

Some of the examples of estimated potential savings presented to the SCDOT Commission were:

Example 1 – cost savings estimates developed by CRM East on eight SCDOT projects dated March 10, 2004 – Prior to the end of the CRM Program, CRM East was asked to perform an evaluation and estimate the potential cost savings on eight projects in which they had utilized Subsurface Utility Engineering. Their findings indicated an average SUE cost of $53,952.00 with an average savings of $567,000.00 establishing a cost to savings ratio of $10.52 saved for every $1 spent for SUE.

Example 2cost savings estimates, developed by Davis and Floyd, on US Route 17 Improvements from I-526 to Isle of Palms Connector and savings of $86,800 from BellSouth Communications also for the US Route 17 Project – Davis and Floyd performed an investigation into the potential cost savings they encountered by using Subsurface Utility Engineering on the U.S. 17 Widening project from I-526 to Isle Of Palms Connector. Their findings indicated a cost savings in two areas. Those areas were Prior Rights vs. None Prior Rights. Where Prior Rights existed, Davis and Floyd estimated a savings of $106,400 and an additional $480,000 savings due to avoiding six months of delays had Subsurface Utility Engineering not been utilized. Where None Prior Rights existed, Davis and Floyd estimated a savings $275,000 by avoiding utility conflicts in which SCDOT would have been responsible for the cost of moving the utilities.  In addition to Davis and Floyd’s findings, an additional $86,800 was saved because BellSouth agreed to move all the Utility Poles from the construction limits even though BellSouth had Prior Rights and the moving cost would have been the responsibility of SCDOT. BellSouth’s reasoning for absorbing the cost was due to Davis and Floyd’s ability to avoid Utility conflicts where SCDOT had Prior Rights, saving BellSouth more than the $86,800 they agreed to absorb.

Interactive Interchange Management System

Utilization of Interactive Interchange Ranking system for evaluation of potential projects in accordance with ACT 114 – The savings associated with this action involve avoidance of numerous traffic count, projection, geometric analysis and other data that would have been required of staff to accomplish this task.  The cost savings associated with this being declared are those only involved with the analysis of the existing interchanges for prioritization.  Using this system enabled this to be done in minutes, rather than countless hours that would have been required otherwise. 

Project Closures

The Engineering staff has collaborated closely with the finance office in an effort to speed the closure of projects.  SCDOT continues to put emphasis on the timely closure of completed projects.  Since July 2007, 295 projects have been closed and $17.7M in obligation authority released.

C Fund Match Program

This program is administered by the Preconstruction division – the concept is one of bringing additional funds to the State Highway System from local governments.  Each county, through the CTC, is offered an amount of funds by the department that must be matched.  The projects eligible for this program must meet criteria established by the State Highway Engineer.  Over the past several years the program has resulted in approximately $8 million additional funds per year being expended on the state highway system.  These funds are spent generally on resurfacing and shoulder paving, resulting in resources being placed on two areas of primary importance to the state of South Carolina, highway system preservation and safety.