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Local Agencies' Use of Highway Funds ~ - <br /> Performance Audit <br /> SUMMARY AND RECOMMENDATIONS (Continued) <br /> B. Specifically Identify State Highway. Fund Expenditures. (Continued) <br /> for road and street .costs. This will also permit a review by independent parties that city <br /> or county expenditures for street and .road programs were in compliance ~ with <br /> constitutional and statutory requirements. ~ - <br /> i <br /> ~ In addition, consideration should ' be given to requiring an annual certification - be <br /> ~ - <br /> prepared by city or county personnel. The certfication would attest that the city or <br /> I <br /> 1 county had complied with constitutional and statutory requirements for the expenditure <br /> ofi State Highway Fund monies. This certification- would be~ filed ~ with the Oregon <br /> Department of Transportation. ~ ~ ~ - ~ ~ ~ ~ ` <br /> i <br /> C. Revise Requirements for Accumulation of State Highway Fund Monies. <br /> Cities are required by ORS 366.815(2) to spend State Highway Fund monies within two <br /> years unless plans for a definite construction project are approved by the State <br /> Highway Engineer. There are no similar requirements fior counties. <br /> This statute encourages cities to spend State Highway Fund monies or risk having them <br /> remitted back to the Department of Transportation. This could have the undesirable <br /> result of encouraging imprudent projects. We recommend ORS 366.815(2) be revised <br /> to permit a city to accumulate State Highway Fund monies beyond the current two year <br /> limitation without the approval of the State Highway Engineer. This will bring the <br /> statutory requirement in line with that required for counties. <br /> D. Establish Administrative and Indirect (Overhead) Criterion. <br /> At the present time there is no established criteria to evaluate whether administrative <br /> and indirect (overhead) costs allocated to street and road operations are reasonable. <br /> We realize that specific allocation percentages cannot be established, due to different <br /> circumstances of each city or county. These circumstances may include, but not be <br /> Talbot, Korvola & Warwick, ctP 27 <br /> <br /> i <br /> _ _ ~ - _ ~ <br /> <br />