The Federal Highway Administration is reviewing the prices Indiana paid to acquire land for the Interstate 69 extension to Evansville and other highway projects across the state, a report Sunday said.
Such reviews can result in the forfeiture of federal funds, The Indianapolis Star reported Sunday. In a 2009 Nebraska case, the highway administration pulled back $6.9 million from an $11.4 million project.
A portion of the federal investigation conducted at the Indiana Department of Transportation's Indianapolis office concluded last week.
"We are still analyzing the findings and have no report yet," the FHA said in a statement.
INDOT spokesman Will Wingfield issued a statement Sunday saying the agency follows state and federal land acquisition laws. He also said three sections of the I-69 extension that opened to traffic in November came in about $300 million below early cost estimates.
"Our partners at (the FHA) routinely review INDOT's performance, and we are currently working with them to review our land acquisition performance over the past few years," Wingfield said.
The Star recently reported Indiana offered $7 million for 32 properties that its appraisers had valued at $3.34 million. In some instances, the settlement documents did not explain the justifications for the inflated payments.
State Sen. Brent Waltz, R-Greenwood, said the federal review couldn't have come at a worse time.
"At a time when there are furious discussions in some circles in the Indiana General Assembly even to raise taxes to fund transportation, it's very disappointing when state government has jeopardized tens of millions of dollars in funding for not doing what they should have done in the first place," Waltz said.
Indiana has received $626 million in federal funds for the I-69 project. This year, it's scheduled to receive $807 million in federal transportation funds for all projects combined.
Gov. Mike Pence last week directed his top ethics officer, Inspector General David Thomas, to investigate the purchase of land owned by Troy Woodruff, INDOT's chief of staff, and his family as part of the I-69 project between Evansville and Indianapolis.
The Star said Woodruff failed to inform the state that he had sold land as part of the project and that six land deals netted $1.8 million for Woodruff's uncle and cousins.
Woodruff has said he had no involvement with I-69 land purchases other than a nearly 3-acre Daviess County parcel he owned with his brother and father.