Mass Transit Grants

If Properly Implemented, FTA Initiatives Should Improve Oversight Gao ID: RCED-93-8 November 19, 1992

The $35 billion grants program at the Federal Transit Administration (FTA), which helps state and local authorities build or upgrade mass transit systems, is one of 16 areas in the federal government that GAO has flagged as highly vulnerable to fraud, waste, and abuse. In a series of reports, GAO has examined grant oversight in four FTA regions that receive about 60 percent of FTA's grant funds. This report (1) builds on GAO's earlier work to demonstrate the systemic effect of FTA's weak oversight, (2) assesses recent FTA and legislative initiatives designed to correct oversight problems, and (3) examines the mix of staff between FTA regional offices and headquarters and the agency's use of contractors to conduct oversight activities.

GAO found that: (1) FTA failed to give high priority to grant oversight and relied on grantees' assurances for proper federal funds management; (2) FTA oversight inadequacies included noncompliance with federal reporting requirements, improper expenditures of grant funds, and grantee financial, technical, procurement, inventory, and management control deficiencies; (3) FTA failed to properly use management oversight tools including triennial reviews, single audits, quarterly progress and financial reports, procurement system reviews, third-party contracting activities, site visits, quarterly project review meetings, and contractor oversight; (4) FTA failed to withhold or suspend funds to compel grantees to comply with requirements and take corrective actions; (5) FTA initiatives and legislative requirements should strengthen grant management and oversight and help reduce grant fraud, waste, abuse, and mismanagement; (6) continued inconsistent, unfocused, and disproportionate staffing oversight problems jeopardized the implementation of new oversight strategies; and (7) FTA spent less than $17 million for contractor oversight responsibilities and failed to provide contractors with oversight guidelines.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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