Four-fifths of council building projects have been delayed and three-fifths have gone over budget, the public spending watchdog has found.
One project ran more than four years behind schedule while another was nearly three times the original cost estimate, the first comprehensive review of council capital investment has found.
The average delay was 17 months and the total cost was 26% higher than the initial combined estimate, an overspend of £89 million, according to the Accounts Commission.
Combined council debt has increased by two-fifths in the last five years and could rise further in the years to come, the Commission warned.
The report does not paint the full picture due to "significant gaps" in information provided. A fifth of councils did not provide initial cost estimates and a third did not provide early timescale projections, either because they were not done or the records were lost.
Most early cost and timescale estimates "proved to be inaccurate", business case development was largely "weak" and information monitoring "insufficient", according to the Commission. It has called for strong leadership in the coming years, with money for capital investment expected to decrease significantly to 2014/15 and beyond.
Scottish Building Federation executive director Michael Levack said: "Local authorities need to do more to improve their planning and control of capital budgets. From the perspective of the construction industry, a crucial element of those improvements must be streamlined and more transparent processes for procuring services from building firms. Price is frequently the overriding priority in awarding contracts, often to the detriment of other important criteria such as quality and skills."
Conservative infrastructure spokesman Alex Johnstone said: "At a time when money is so tight, there is no room for inaccurate forecasts on capital projects which are inevitably going over budget and over time. It's no surprise council debt has increased when the Scottish Government has slashed the housing budget, instead telling the councils to shell out massive amounts of money for much-needed social housing."
A Scottish Government spokeswoman said: "It is up to councils to ensure they spend capital budgets effectively and in line with local needs. The Accounts Commission report sets out some valuable messages for councils in how they manage capital expenditure effectively and get the most from their capital investment, including through working in partnership with other councils and other bodies.
"The report notes that councils completed 121 major capital projects costing £3.5 billion in the three years to March 2012 - this local capital investment protects jobs and output, improves public infrastructure and helps retain vital skills and activity in key sectors of industry. The Scottish Government will continue to work closely with local government to get maximum benefit to the economy from our combined investment."