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COLUMBIA -- The chairman of a Senate panel delving into a critical management audit of the state Department of Transportation said after another hearing Tuesday that he is unconvinced he has the full story.

"It's up to us to separate fact from fiction," said Sen. Harvey Peeler, chairman of the special Senate finance committee. "I think we're at the liar, liar pants on fire phase of the audit."

The Legislative Audit Council report released last month alleged DOT wasted millions of dollars, mismanaged contracts and violated state and federal laws.

DOT officials have accused the LAC of inaccuracies and misleading statements in the report, claiming that no significant problems were found in areas involving 99 percent of the agency's expenditures.

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Tuesday's hearing was aimed at resolving some of the contradictions between what auditors reported and what DOT officials said.

One of the biggest gaps between the audit and DOT officials concerns a finding that the agency deliberately delayed billing for millions of dollars in federal reimbursements during the legislative sessions in 2004 and 2005.

The delays may have cost the agency as much as $1.5 million in interest, the audit reported. Auditors did not specify why the agency might have chosen not to seek payment right away, though others have suggested it might have been to hide money from lawmakers.

DOT officials two weeks ago emphatically denied that they had attempted to hide any of their cash balances from the Legislature and also said the reimbursements were not available at the time from the federal government.

But on Tuesday, auditors provided a DOT memo that summarized a December 2003 meeting at which they said officials decided to classify expenditures in such a way as to defer billing the government for reimbursement.

Jane Thesing, deputy director of the LAC, told senators that auditors heard during interviews that the delay was done purposely during the legislative session. Auditors also provided accounting records which they said showed the agency could have sought up to $252 million in reimbursements in January 2004.

Mo Denny, acting deputy director for finance and administration, told senators on Tuesday that $92 million could have been billed in January 2004 but wasn't. Denny denied officials were trying to hide anything from the Legislature. DOT Executive Director Elizabeth Mabry was ill Tuesday, officials said, and did not attend the hearing.

Peeler and other senators repeatedly questioned Denny and other officials about whether the agency purposely delayed getting the money and why. But their efforts were clouded by detailed explanations of the complicated funding system used by the agency.

Peeler said afterward he is still suspicious about whether DOT officials were shielding funds from lawmakers.

"I don't want to say they deliberately did it," he said. "But it looked like they did and that's what we got to get to the bottom of."

Peeler said he did not think the audit was needed to tell senators that DOT needs restructuring, "but I think this adds fuel to the fire."

The Senate majority leader said he isn't sure whether the agency will wind up under the control of the governor, as proposed by Gov. Mark Sanford.

"It will be under the control of somebody," he said. "I haven't quite figured out where the buck stops," he said.

A House committee will begin hearings into the LAC report on Wednesday, while another Senate committee will continue its look on Thursday.