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California transportation sector removed from state auditor’s high-risk list

California has made significant enough progress on its transportation infrastructure that the state’s auditor has removed the sector from its high-risk list.

The state auditor puts out an annual report to the governor with a list of state agencies that it believes need improvement because their deficiencies “pose a high risk to the state.”

The state’s transportation system had been on the auditor’s high-risk list since 2007.

“The auditor’s findings are a testament to the substantial progress Caltrans, the California Transportation Commission and our partners have made,” said state Transportation Secretary Toks Omishakin.

California State Transportation Agency

“The auditor’s findings are a testament to the substantial progress Caltrans, the California Transportation Commission and our partners have made as we work together to improve and rebuild our state’s critical transportation infrastructure,” said California Transportation Secretary Toks Omishakin.

The approval of Senate Bill 1, the Road Repair and Accountability Act of 2017, provided the funding needed to tackle a long list of upgrades needed to improve aging roads and bridges and reduce gridlock. The auditor also dinged the state for intercity rail and for a shortage of walking and bike lanes in metropolitan areas, which has seen improvement.

The transportation funding “ushered in a new era of infrastructure investment” that helped the state reduce the backlog of projects, Omishakin said.

SB 1, which raised gas taxes, provides more than $5 billion in transportation funding annually, which is shared between state and local transportation agencies. Since its passage, the state has spent more than $18 billion from that source to fund more than 10,000 projects across the state.

Those projects include improvements to 15,000 lane miles on the state highway system, repairs to 1,512 bridges and repairs to 578,285 linear feet of culverts and the addition or improvements to 6,200 traffic management system elements.

Caltrans says it has already achieved the 10-year targets in three of the four primary infrastructure categories and substantial progress is being made in the fourth.

The state’s transportation infrastructure assets include more than 50,000 lane miles of pavement, 13,200 bridges, 213,000 culverts and drainage facilities, and nearly 21,000 transportation management system elements, which includes message signs, meters and other traffic control devices.

“Coupled with Gov. Gavin Newsom’s infrastructure streamlining package and a $15 billion investment in clean transportation infrastructure, along with recent increased federal infrastructure funding, our state is in an incredible and unique position to keep making progress and accelerate our transition to a cleaner, safer, more equitable and more connected transportation system that benefits all Californians,” Omishakin said.

State Auditor Grant Parks also removed the state’s two state university systems, the California State Teachers’ Retirement System and the  California Department of Public Health from the high-risk category, along with the state prison system’s handling of inmate health care and the state government’s handling of non-pension “other post-employment liabilities.”

The auditor said CalSTRS is successfully implementing a funding plan the legislature passed in 2014.

“According to CalSTRS’ actuarial valuation reports, its implementation of the funding plan decreased its unfunded liability from $107 billion in 2018 to $89 billion in 2022. Despite investment losses in fiscal year 2021–22, CalSTRS reported that it remains slightly ahead of schedule in its goal of fully funding the benefit plan by 2046,” the auditor’s report said.

The auditor cited the state’s creation of an OPEB prefunding plan and its subsequent implementation.

The Employment Development Department, plagued by fraudulent unemployment claims and poor services for legitimate claimants, was added to the high-risk list.

Among the areas that remain high-risk, according to the auditor, are information security and the state’s financial reporting system.

The state’s most recent published annual comprehensive financial report is for the year ending June 30, 2021.

“The State’s financial reporting for fiscal year 2021–22 is already past due,” the report said. “This continued trend of late reporting reduces the efficiency and effectiveness of the State’s financial oversight.”

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