COLUMBIA -- State lawmakers used cash flow troubles at the Department of Transportation to blast the agency's leadership Thursday for ignoring road priorities and pursuing a $344 million loan to pay for projects that aren't critical.

The testimony came as Senate Transportation Committee Chairman Larry Grooms launched a fact-finding mission into the troubled agency. This summer, the department ran out of money to pay back major construction loans and road construction crews.

The department turned to the federal government for a $52 million cash advance to get caught up on its bills, but state Transportation Secretary Robert St. Onge told the senators the situation might repeat itself during peak construction season next year.

While St. Onge outlined the corrective steps the agency is taking to avoid that, Grooms said he will call on a subcommittee to continue the inquiry. From there, Grooms said he will evaluate the information and draft legislation to build on a 2007 legislative overhaul of the agency that split control between the governor and a commission made up of political appointees.

The reform centered on a new system of approving road projects based on objective criteria such as safety and traffic congestion, but the commission disregarded that when it approved the $344 million loan package.

"If we're hearing that rankings don't matter and priorities don't matter, then we are in a world of trouble," said Grooms, R-Bonneau. "We've gone through a great exercise of fixing a hole in the boat and it's sprung wide open and the boat's sinking again."

Included in the $344 million bond proposal is $105 million toward initial construction on Interstate 73 to connect Interstate 95 motorists to the Grand Strand and $63 million on an expressway at the Columbia airport. Neither of those projects are ranked as a priority, but determined to be important for commerce.

Borrowing the money, which must still be approved by two oversight boards, will further deplete the agency's cash resources. Some opponents of the projects are using the department's cash-flow troubles to try to kill the deal.

Sen. Greg Ryberg, R-Aiken, grilled St. Onge on the matter during the hearing.

"If you hadn't run into cash- flow problems, this probably would have been a slam dunk," Ryberg said.

Senate Majority Leader Harvey Peeler, R-Gaffney, used the occasion to push for further restructuring to make the agency part of Gov. Nikki Haley's Cabinet.

St. Onge, nominated by Haley, said the agency ran into trouble for a mix of reasons, including inattentiveness of some staff, a booming construction season that led to a flood of requests by contractors for reimbursements and decreased buying power of the state's 16-cent gasoline tax, locked in place nearly 25 years ago.

Going forward, St. Onge said the department is looking to build up an average balance of $60 million in the bank, increase communication between the accounting and engineering staff, post a weekly cash-flow update online and defer $24 million in state-funded projects for August and September.

Reach Yvonne Wenger at 803-926-7855, follow her at @yvonnewenger and read her Political Briefings blog.