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Testimony: 

Before the Committee on Government Reform, House of Representatives: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery Expected at 10:00 a.m. EDT: 

Thursday, July 28, 2005: 

Mass Transit: 

Preliminary Views on Options for Additional Fiscal Oversight of the 
Washington Metropolitan Area Transit Authority: 

Statement of Katherine Siggerud, 
Director: 
Physical Infrastructure Issues: 

GAO-05-922T: 

GAO Highlights: 

Highlights of GAO-05-922T, a testimony before the Committee on 
Government Reform, House of Representatives: 

Why GAO Did This Study: 

In recent years, the Washington Metropolitan Area Transit Authority 
(WMATA) has faced serious financial and budgetary problems as well as 
continuing challenges related to the safety and reliability of its 
transit services. At the same time, ridership is at an all-time high, 
and WMATA continues to provide critical services and considerable 
benefits to the Washington region and to the federal government. 

This statement discusses (1) WMATA’s responsibilities for serving the 
interests of the federal government, including the agency’s role in 
transporting federal employees and visitors to the nation’s capital and 
in supporting homeland security for the Washington metropolitan region; 
(2) the current funding challenges facing WMATA and the options 
proposed to address these challenges; (3) preliminary information on 
some of the entities that currently provide oversight of WMATA and the 
focus of their recent reviews; and (4) some considerations and options 
in instituting spending safeguards and oversight of any additional 
federal assistance provided to WMATA, should Congress decide to provide 
such assistance.

GAO discussed this testimony with WMATA and FTA officials, who provided 
comments and additional information that GAO incorporated as 
appropriate.

What GAO Found: 

WMATA transports a substantial share of the federal workforce and 
provides an important means of transportation to special events that 
occur in Washington, D.C., as the nation’s capital. WMATA’s Metro 
Transit Police assists federal law enforcement agencies by providing 
expertise in civil disturbance management and explosives detection and 
by training first responders in emergency management techniques 
specific to transit environments. WMATA’s Metrorail and Metrobus are 
the preferred means of transportation in an emergency scenario 
requiring evacuation, and both the regional and the District of 
Columbia emergency transportation plans rely heavily on them.

A regional funding panel estimated WMATA’s budgetary shortfall at $2.4 
billion for fiscal years 2006 through 2015 if WMATA were to fund many 
of the projects in its 10-year capital improvement plan. This shortfall 
may be even greater because the panel’s shortfall calculation did not 
include the costs of providing specialized transportation for persons 
with disabilities, as required under the Americans with Disabilities 
Act. To deal with WMATA’s funding shortfall, the regional panel 
concluded that the region needs to develop a dedicated source of 
revenue for WMATA (e.g., local sales tax) and that the federal 
government needs to provide significant contributions because of the 
benefits it receives from WMATA. However, given the large federal 
budget deficit and competing claims on federal resources, GAO believes 
WMATA may also need to reexamine its own spending priorities.

As part of its ongoing work on WMATA’s oversight entities, GAO found 
that WMATA is subject to oversight from multiple entities that, since 
2003, have issued hundreds of reports—which vary in scope—on a broad 
range of topics. These entities include WMATA’s Auditor General, an 
independent external auditor, the Federal Transit Administration (FTA), 
and industry peer review panels. The entities have made recommendations 
to WMATA, which WMATA has generally implemented or plans to implement. 
As part of its ongoing work, GAO plans to analyze these reviews in more 
detail to determine if they comprehensively identify and address 
WMATA’s overall management and operational challenges. GAO’s ongoing 
work will also cover other FTA reviews and safety reviews of WMATA’s 
operations.

Congress, the administration, and GAO have long recognized the benefits 
of having spending safeguards and management oversight for entities 
that receive federal funding. If Congress decides to provide WMATA with 
additional federal funding, there needs to be reasonable assurance that 
the funds will be spent effectively. We identified several options for 
additional oversight that could be incorporated into legislation that 
provides additional federal funding to WMATA, including having WMATA 
officials periodically report to Congress on how the funding is being 
spent; specifying the types of projects for which federal funds could 
be used; and requiring that any additional federal funding be subject 
to FTA’s oversight programs. 

www.gao.gov/cgi-bin/getrpt?GAO-05-922T.

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Kate Siggerud at (202) 
512-2834 or siggerudk@gao.gov.

[End of section] 

Mr. Chairman and Members of the Committee: 

We are pleased to testify before you today on issues related to the 
Washington Metropolitan Area Transit Authority (WMATA) and the federal 
government. In recent years, WMATA has faced financial and budgetary 
problems, as well as continuing challenges related to the safety and 
reliability of its transit services. At the same time, ridership is at 
an all-time high, and WMATA continues to provide critical services and 
considerable benefits that support the Washington region's economy and 
the federal government. For example, WMATA operates a transit system 
that provides an indispensable commuting option for hundreds of 
thousands of Washington-area workers, including federal government 
employees, tourists, and others who visit the region each day. 

Our statement today is based on the interim results of our work on 
WMATA. We will discuss: 

* WMATA's responsibilities for serving the interests of the federal 
government, including the agency's role in transporting federal 
employees and visitors to the nation's capital and in supporting 
homeland security for the Washington metropolitan region;

* the current funding challenges facing WMATA and the options proposed 
to address these challenges;

* preliminary information on some of the entities that currently 
provide oversight of WMATA and the focus of their recent reviews; and: 

* some considerations and options in providing spending safeguards and 
oversight of any additional federal assistance provided to WMATA, 
should Congress decide to provide such assistance. 

Our work is based on our review of WMATA's documentation of the transit 
services it provides to federal employees and others; its budgetary and 
other financial documentation; our analysis of reports on WMATA's 
financial problems that we and others have issued; and interviews with 
officials at WMATA, the U.S. Department of Transportation (DOT), other 
federal agencies that rely on WMATA's services, and officials with 
expertise in the transit industry, transportation planning, and 
transportation finance. We reviewed selected reports issued by entities 
that oversee WMATA--including WMATA's Auditor General, an independent 
external auditor, and the Federal Transit Administration (FTA). We also 
reviewed prior GAO reports on various oversight issues related to mass 
transit and other areas of surface transportation. We conducted our 
work from March 2005 through July 2005 in accordance with generally 
accepted government auditing standards. We obtained oral comments on 
this statement from WMATA and DOT officials, who generally agreed with 
the information and provided technical comments, which we incorporated 
as appropriate. We also provided selected portions of the statement to 
the District of Columbia Department of Transportation, the General 
Services Administration, the Office of Personnel Management, the 
National Capital Planning Commission, the U.S. Capitol Police, and the 
U.S. Secret Service. Some of these agencies provided technical 
comments, which we incorporated as appropriate. Details of our scope 
and methodology are provided in appendix I. 

In summary: 

* WMATA transports a substantial share of the federal workforce and 
provides an important means of transportation to the special events 
that occur in Washington, D.C., as the nation's capital and its "seat 
of government." WMATA's Metro Transit Police also plays an important 
role in assisting federal law enforcement agencies by providing 
expertise in civil disturbance management and explosives detection and 
by making Metrobuses available for perimeter security and for 
redirecting traffic at high-security federal events. Additionally, 
WMATA trains first responders in emergency management techniques 
specific to transit environments at its tunnel facility in Landover, 
Maryland, and through its training course on managing Metrorail 
emergencies. The Metrorail system is equipped with chemical and 
radiological early warning systems to alert first responders to 
potential hazardous materials incidents. In addition, both the regional 
and the District of Columbia emergency transportation plans rely 
heavily on Metrorail and Metrobus for transportation in an emergency 
scenario requiring evacuation. 

* Over the years, WMATA has faced funding challenges, and the options 
proposed to address those challenges generally include both a dedicated 
revenue source and a federal contribution. A regional panel, convened 
in September 2004, estimated that under its current revenue structure, 
WMATA would have a total budgetary shortfall of $2.4 billion during 
fiscal years 2006 through 2015 if it went forward with the projects 
remaining in its 10-year capital improvement plan, except for those 
that involved expanding the current system. We believe that WMATA's 
anticipated shortfall may be even greater because, in calculating the 
shortfall, the panel did not include the costs of providing paratransit 
services as required under the Americans with Disabilities Act 
(ADA).[Footnote 1] These costs are significant; in fact, the panel 
estimated that these services could result in a shortfall for WMATA of 
about $1.1 billion over the 10-year period from fiscal year 2006 
through fiscal year 2015, thus raising the total anticipated shortfall 
to $3.5 billion for that period. In dealing with its funding 
challenges, WMATA--unlike most other major transit systems--does not 
have a dedicated source of revenue, such as a local sales tax whose 
receipts are automatically directed to the transit authority. As a 
result, the regional panel and others have concluded that the 
Washington region needs to develop a dedicated source of revenue for 
WMATA. In addition, the panel has concluded that the federal government 
needs to participate "significantly" in addressing WMATA's budgetary 
shortfall, particularly for capital maintenance and system enhancement, 
because WMATA has provided numerous benefits to the Washington region 
and the federal government over the years. To the extent that the 
federal government cannot provide significant additional support to 
WMATA because of competing claims on federal resources, and WMATA's 
current revenue structure continues to be insufficient to support its 
planned capital projects, WMATA may need to reexamine its spending 
priorities, including how it will meet its ADA obligations. 

* As part of our preliminary review of WMATA's oversight entities, we 
found that WMATA is subject to oversight from multiple entities that, 
since 2003, have issued hundreds of reports and made dozens of 
recommendations. These entities include WMATA's Office of Auditor 
General, which has issued nearly 500 reports, including internal and 
investigative audits and reviews of contracts and pricing proposals, 
and an independent external auditor, which annually reviews WMATA's 
financial statements and related internal controls. Additionally, FTA 
oversees WMATA's major capital projects through the project management 
oversight program; FTA has issued 125 monthly monitoring reports on 
seven of WMATA's major projects through this program since 2003. FTA 
also reviews WMATA's compliance with a wide range of administrative and 
statutory requirements through its Triennial Review. In 2005, at 
WMATA's request, panels assembled by a transit industry association 
conducted peer reviews of WMATA's bus and rail operations. The peer 
review panels developed recommendations to improve the effectiveness 
and efficiency of bus and rail operations in multiple areas, including 
staffing, organization, maintenance, and technology. WMATA has 
generally implemented or plans to implement the recommendations 
resulting from the various oversight reviews. As part of our ongoing 
work, we plan to analyze these reviews in greater detail to determine 
whether, taken as a whole, they identify systemic problems and are 
adequate to address WMATA's overall management and operational 
challenges. Our ongoing work will also include FTA's in-depth reviews 
of program or system compliance, as well as safety reviews conducted by 
external and internal entities. 

* To control costs and ensure results--especially for high-cost 
transportation infrastructure projects--Congress, the administration, 
and GAO have long recognized the benefits of spending safeguards and 
management oversight for the state and local governments and 
transportation agencies that receive federal funding. For example, 
certain federal laws have historically controlled the uses of federal 
transportation funds, including instituting "matching" requirements to 
ensure the use of some local funds for capital infrastructure projects 
and prohibiting the use of these funds for operating expenses. Several 
ongoing, planned, and past efforts illustrate the benefits of 
management oversight and the ways it can be carried out. At the local 
level, in the 1980s, New York City's ailing Metropolitan Transit 
Authority was subject to increased oversight legislated by the state. 
This oversight, along with increased revenue, was followed by 
improvements in the performance of the authority's subway system. We 
have also reported that safeguards should accompany any increased 
federal funds provided to the District of Columbia to address the 
structural imbalance between its costs and revenue-raising capacity. At 
the federal level, FTA's project management oversight program is 
designed to help ensure that grantees building major capital projects 
have the qualified staff and procedures needed to successfully plan and 
carry out those projects. Finally, the House and Senate versions of the 
surface transportation reauthorization bill currently before Congress 
include provisions that enhance management oversight for major capital 
projects receiving federal funds. We have not fully analyzed the 
applicability of these oversight options to WMATA or evaluated their 
relative merits. However, we believe that should Congress decide to 
provide WMATA with additional federal funding in recognition of its 
support of the federal government, Congress should have reasonable 
assurances that the funds would be spent efficiently and effectively. 
Accordingly, we identified several options for writing safeguards into 
legislation that provides any additional federal funding to WMATA. 
These options include having WMATA officials periodically report to 
Congress on how the funding is being spent; specifying the types of 
projects for which federal funds could be used; and instituting 
additional oversight bodies for WMATA. 

Background: 

WMATA was created in 1967 by an interstate compact that resulted from 
the enactment of identical legislation by Virginia, Maryland, and the 
District of Columbia, with the concurrence of the U.S. 
Congress.[Footnote 2] WMATA began building its Metrorail system in 
1969, acquired four regional bus systems in 1973, and began the first 
phase of Metrorail operations in 1976. In January 2001, WMATA completed 
the originally planned 103-mile Metrorail system, which included 83 
rail stations on five rail lines. The transit system encompasses (1) 
the Metrorail subway system, which now has 86 Metrorail stations on 
five rail lines and a fleet of about 946 rail cars; (2) the Metrobus 
system, which has a fleet of about 1,447 buses serving 350 routes; and 
(3) the MetroAccess ADA complementary paratransit system, which 
provides specialized transportation services, as required by law, to 
persons with disabilities who are certified as being unable to access 
WMATA's fixed-route transit system. 

Congress and the executive branch have supported considerable federal 
funding for WMATA since its inception in the 1960s, citing several 
reasons including (1) the federal government's large presence in the 
area, (2) the attraction of the nation's capital for tourists, (3) the 
overlapping needs of adjacent jurisdictions, and (4) the limitations 
faced in raising other revenue for transit needs. This federal funding 
has taken several forms over the years.[Footnote 3] First, WMATA relied 
on federal funding to pay for nearly 70 percent of the costs to build 
its Metrorail subway system. From 1969 through 1999, the federal 
government provided about $6.9 billion[Footnote 4] of the approximately 
$10 billion that WMATA spent to construct the original 103-mile system, 
according to WMATA officials.[Footnote 5] Second, WMATA has also relied 
on federal funding to cover more than 40 percent of its capital 
improvement costs during the last 10 fiscal years. Of about $3.5 
billion that WMATA received from all sources for capital improvements 
during fiscal years 1995 through 2005 (as of February 2005), about $1.5 
billion, or about 43 percent, came from the federal government, with 
the remaining $2 billion, or about 57 percent, coming from the state 
and local jurisdictions that WMATA serves and from other sources. Most 
of this federal funding has come through grants administered by FTA. 
Finally, WMATA received about $49.9 million for congressionally 
designated projects, including a new Metrorail station at New York 
Avenue in the District of Columbia, during fiscal years 1995 through 
2005. 

WMATA operates in a complex environment, with many organizations 
influencing its decision-making and funding and providing oversight. 
WMATA is governed by a board of directors--composed of individuals 
appointed by each of the local jurisdictions WMATA serves--which sets 
policies and oversees all of WMATA's activities, including budgeting, 
operations, development, expansion, safety, procurement, and other 
activities. In addition, a number of local, regional, and federal 
organizations affect WMATA's decision-making, including (1) state and 
local governments, which subject WMATA to a range of laws and 
requirements; (2) the National Capital Region Transportation Planning 
Board of the Metropolitan Washington Council of Governments, which 
develops the short-and long-range plans and programs that guide WMATA's 
capital investments; (3) FTA, which provides oversight of WMATA's 
compliance with federal requirements; (4) the National Transportation 
Safety Board, which investigates accidents on transit systems as well 
as other transportation modes; and (5) the Tri-State Oversight 
Committee, which oversees WMATA's safety activities and conducts safety 
reviews. 

WMATA's combined rail and bus ridership totaled about 343.8 million 
passenger trips in fiscal year 2005. WMATA operates the second largest 
heavy rail transit system and the fifth largest bus system in the 
United States, based on passenger trips, according to WMATA. WMATA's 
fiscal year 2005 budget is $1.29 billion. Of the total amount, about 76 
percent, or $977.9 million, is for operations, including maintenance 
activities, and the remaining 24 percent, or $314.1 million, is for 
capital improvements. WMATA obtains its funding from a variety of 
sources, including the federal, state (Virginia and Maryland), District 
of Columbia, and local governments; passenger fares; and other sources. 
In general, WMATA relies on passenger fares and subsidies from its 
member jurisdictions to cover the majority of its operating 
costs.[Footnote 6] Its capital funds are obtained from other sources, 
including the federal government and the state and local jurisdictions 
that it serves. Of all WMATA's funding, less than 2 percent is from a 
dedicated source. 

WMATA Supports Federal Government Operations by Providing 
Transportation and Security and by Supporting Emergency Preparedness: 

As the major transit agency in the national capital area, WMATA 
provides transportation to and from work for a substantial portion of 
the federal workforce and is also integral to the smooth transportation 
of visitors to the nation's capital. WMATA also assists federal law 
enforcement agencies by providing security for high-profile events and 
other security-related expertise and services. Furthermore, the 
emergency transportation plans of the District of Columbia and the 
Washington region both rely heavily on Metrorail and Metrobus for 
transportation in an emergency scenario requiring evacuation. 

WMATA's Transit Services Affect Daily Federal Government Operations: 

According to estimates prepared by WMATA, a substantial share of 
Metrorail's riders, particularly at peak commuting periods, are federal 
employees.[Footnote 7] Using data from its 2002 passenger survey (the 
most recent data available), WMATA estimates that approximately 35 
percent of all Metrorail riders were federal employees in 
2002.[Footnote 8] WMATA's estimates are higher for peak[Footnote 9] 
period times, when the system faces capacity constraints: according to 
the survey, approximately 41 percent of the morning peak period riders 
and approximately 37 percent of the afternoon peak period riders are 
federal employees. The federal employees who ride Metrorail to and from 
work each day represent a substantial share of federal employees in the 
Washington, D.C., region. Using an estimate based on its 2002 passenger 
survey data on the number of federal employees who are Metrorail 
passengers, together with data from OPM on the number of civilian 
federal employees in the Washington, D.C., region, WMATA estimated that 
in 2002, approximately 40 percent of federal employees used Metrorail. 

WMATA's operating status is an important factor in OPM's decisions 
about the day-to-day operations of the federal government. OPM 
officials told us that WMATA is a key stakeholder in OPM's decision to 
have an early dismissal, late arrival, or closure of the federal 
government, since a substantial portion of the federal workforce rides 
WMATA's transit system to and from work. Those officials said that they 
are aware of WMATA's operating constraints and take them into account 
when deciding to close the federal government. However, the officials 
told us that OPM makes the final decision and uses the safety of 
employees as the sole factor in its decision. OPM officials further 
noted that the functioning of the federal government is not dependent 
on WMATA's operating status and that employees have other options, such 
as flexible work schedules and teleworking, available should they not 
be able to get to their usual workplace. 

Federal Guidance Provides Incentives for Federal Employees to Use Mass 
Transit: 

Executive Order 12072, issued on August 16, 1978,[Footnote 10] 
instructs federal agencies to consider such factors as the availability 
of public transportation and parking as well as accessibility to the 
public when evaluating and selecting federal facilities. The General 
Services Administration (GSA)--which has overall responsibility for 
reviewing and approving the acquisition of federal facilities--created 
a Site Selection Guide[Footnote 11] for federal agencies that 
implements the provisions of this executive order, as well as other 
public laws and executive orders. Within the National Capital Region, 
the National Capital Planning Commission also has review and approval 
authority over federal building construction, renovations, and 
transportation plans in the District of Columbia, and it has review 
authority only over federal sites in the Virginia and Maryland areas of 
the region. Both GSA and the commission instruct federal agencies to 
locate their facilities near mass transit stops whenever possible. 

The Federal Employees Clean Air Incentives Act of 1993[Footnote 12] 
also encourages the federal use of mass transit, with specific 
provisions for the National Capital Region.[Footnote 13] The purpose of 
this act was to authorize agencies to create programs for federal 
employees to encourage their use of alternatives to single-occupancy 
vehicles for commuting. Under the act, the heads of agencies were 
authorized to establish programs for agency employees that would 
provide, for example, transit passes, space for bicycles, and 
nonmonetary incentives. 

WMATA Provides Transportation to Special Events in the Nation's 
Capital: 

WMATA's services are integral to the smooth operation of the myriad of 
special activities that occur in Washington, D.C., as the nation's 
capital and its "seat of government." According to a visitor 
transportation survey administered for the National Park Service, 61 
percent of visitors used Metrorail during their visit to Washington, 
D.C.[Footnote 14] In several instances, ridership has been highest on 
days when events (1) were sponsored by the federal government, such as 
the first and second inaugurations of President George W. Bush and the 
grand opening of the National Museum of the American Indian or (2) 
occurred in Washington because it is the seat of government, such as 
political rallies. On June 6, 2004, the date of former President Ronald 
Reagan's state funeral ceremony, WMATA marked its highest ridership day 
ever, with more than 850,000 riders. 

The federal government also relies on WMATA to provide transportation 
services outside its normal hours and routes. Some examples follow: 

* In May 2004, WMATA, along with other regional transit agencies, 
provided buses to shuttle attendees from Metrorail stations to the 
World War II dedication ceremony on the National Mall.[Footnote 15]

* Metrobuses ran overnight between RFK Stadium and the U.S. Capitol for 
2 nights in June 2004 to enable people to pay respects to former 
President Ronald Reagan.[Footnote 16]

* On Inauguration Day, in January 2005, WMATA opened Metro 2 hours 
early and closed it 3 hours later than normal, at the request of the 
Presidential Inaugural Committee. 

WMATA Assists Federal Law Enforcement Agencies in Providing Security 
for High-Profile Government Events: 

WMATA's Metro Transit Police supports the U.S. Secret Service by making 
available its officers who have expertise in areas such as explosives 
detection and civil disturbance management to help ensure a safe and 
secure environment before and during events involving the President, 
the Vice President, or high-level foreign dignitaries. For example, 
when events are held in venues located above Metrorail stations, Metro 
Transit Police's explosive ordnance detection team inspects the 
stations to ensure they are free from explosives. The Metro Transit 
Police deployed its civil disturbance team at the 2005 presidential 
inaugural parade at the request of the Secret Service, which had 
received specific intelligence that protestors might attempt to breach 
the parade route. The Metro Transit Police received $299,371 in 
Department of Homeland Security (DHS) Urban Area Security Initiative 
(UASI) grants for overtime associated with providing security for the 
2005 presidential inauguration. In commenting on the importance of the 
Metro Transit Police's security expertise, Secret Service officials 
told us that they consider the Metro Transit Police to be a full law 
enforcement partner, along with the District of Columbia's Metropolitan 
Police Department, the U.S. Capitol Police, and the U.S. Park Police. 

The Metro Transit Police also provides enhanced security throughout the 
Metrorail and Metrobus system when DHS raises the threat level, which 
is communicated through the Homeland Security Advisory System.[Footnote 
17] Since DHS implemented the color-coded system in March 2002, the 
Metro Transit Police has spent about $2.7 million on overtime related 
to increased threat levels, for such activities as increasing patrols 
of Metrorail stations, trains, and buses. WMATA received $632,356 
through a DHS UASI grant for overtime costs in 2004; this grant was 
WMATA's first reimbursement for costs associated with increased threat 
levels, according to a Metro Transit Police official. 

WMATA also supports federal law enforcement efforts by providing 
Metrobuses to the U.S. Capitol Police to establish security perimeters, 
block intersections, and reroute traffic for events that take place on 
the grounds of the U.S. Capitol, such as presidential inaugurations and 
State of the Union addresses, and at other locations where presidential 
and vice presidential events occur. The Secret Service also uses 
Metrobuses periodically to establish temporary security perimeters; for 
example, it did so along the 2005 presidential inauguration parade 
route. The law enforcement agencies that use Metrobuses are charged the 
same standard charter rate that WMATA charges all parties to rent its 
Metrobuses for special events. 

WMATA Supports Emergency Preparedness by Providing First Responder 
Training, Early Warning Sensors, and Emergency Evacuation 
Infrastructure: 

WMATA supports homeland security efforts for the Washington region and 
the federal government through a variety of efforts. It provides 
training for local and federal first responders at its tunnel training 
facility and has deployed early-warning systems to detect chemical and 
radioactive contamination in some of its underground Metrorail 
stations. WMATA's infrastructure is key to emergency evacuation of the 
region, including the evacuation of workers in federal buildings 
concentrated in downtown Washington, D.C. 

First Responder Training: 

WMATA's emergency response training facility in Landover, Maryland, 
provides a realistic setting for fire, police, emergency, and transit 
personnel to learn how to respond to events such as collisions, fires, 
and weapons of mass destruction incidents that occur in a transit or 
tunnel environment. The facility includes a 260-foot tunnel that houses 
two subway cars positioned to resemble a wreck, as well as simulated 
electrified third rail, cabling, and lighting that appear identical to 
those in a real tunnel. Emergency personnel from across the region 
train at the center. The training center's federal clients include the 
Federal Bureau of Investigation's Hostage Rescue Team, the Federal 
Protective Services, and the U.S. Marines' Chemical-Biological Incident 
Response Force. Additionally, according to WMATA officials, FTA's 
Transportation Safety Institute plans to use the Emergency Response 
Training Facility as a host site for the counterterrorism training it 
plans to provide to transit agencies' law enforcement and safety 
personnel. WMATA funds this training facility entirely out of its 
regular operations budget. 

WMATA is also introducing a training course on managing Metrorail 
emergencies, which will address emergency management concepts, 
techniques to respond to weapons of mass destruction attacks, and 
emergency traffic control. The course, which WMATA is funding with a 
$335,261 DHS UASI grant, will be available to first responders from the 
region, transit agencies nationwide, and FTA. 

Early Warning Sensor Systems: 

Metrorail is equipped with a permanent chemical detection system to 
help detect hazardous substances in selected stations in the Metrorail 
system. This system, known as the Program for Response Options and 
Technology (PROTECT), acts as an early warning to safeguard first 
responders, employees, and Metrorail customers and is installed in 
selected locations in underground Metrorail stations. WMATA had 
assistance from the U.S. Departments of Transportation, Energy, and 
Justice in developing the sensor system. It received $15 million in 
federally appropriated funds in fiscal year 2002 and $1.4 million in 
additional funds in fiscal year 2004 through a direct grant from DHS's 
Office of Domestic Preparedness to pay for the installation of the 
sensors.[Footnote 18]

Additionally, Metro Transit Police has distributed pager-sized devices 
to about 100 officers to wear in the Metrorail system to detect 
radiation. According to the Metro Transit Police, these pagers are worn 
mostly by officers in the downtown core because this area is considered 
to be at higher risk for attack. WMATA paid for about half of the 
radiological pagers, and the Department of Energy furnished the 
remainder. 

These early warning devices are important to the area's first 
responders because if a high reading of a chemical or radioactive 
substance is detected, it is considered a potential hazardous materials 
or "hazmat" incident. In such an event, the portion of the Metrorail 
system involved could be temporarily closed, affecting traffic in the 
area, and local emergency management agencies would be notified and 
become responsible for coordinating any additional response. 

Emergency Evacuation: 

The local emergency response officials we interviewed generally prefer 
using Metrorail and Metrobus in an emergency scenario that requires 
evacuation because mass transit can move large numbers of people 
efficiently and help keep roadways clear for first responders and other 
emergency vehicles. To assist in coordinating evacuation planning 
across jurisdictions, the region's metropolitan planning organization, 
the Metropolitan Washington Council of Governments, has developed 
guidance on emergency evacuation that includes the use of Metrorail and 
regular Metrobus routes as well as Metrobuses on special evacuation 
routes. The District of Columbia's emergency evacuation plans also rely 
heavily on WMATA. Additionally, because the federal presence in the 
District is so large, the District Department of Transportation 
consulted with federal agencies in developing its emergency 
transportation plans. 

Options for Addressing Anticipated Future Funding Shortfall Would 
Likely Include both Local and Federal Contributions: 

Over the years, WMATA has faced funding challenges, and options have 
been proposed to address them. Although WMATA has taken steps to 
improve its management, such as prioritizing its planned capital 
improvements, it lacks a dedicated funding source and must rely on 
variable, sometimes insufficient contributions from local, regional, 
and federal organizations to pay for its planned capital improvements. 
A report published by a regional funding panel estimated that, over the 
next 10 years, under its current revenue structure, WMATA will face a 
$2.4 billion budget shortfall, due largely to expenditures planned for 
capital improvement projects--an estimate that may not fully reflect 
the magnitude of the anticipated budget shortfall. Proposed options 
would provide a dedicated funding source, such as a local sales tax, 
and would increase federal funding for capital improvements. 

Estimated Costs of WMATA's Planned Capital Projects Exceed Anticipated 
Funding: 

WMATA and others have projected continuing shortfalls in its capital 
and, to some extent, its operating budgets. For example, in 2001, we 
reported that WMATA faced uncertainties in obtaining funding for 
planned capital spending for two of its capital programs, discussed 
below, the Infrastructure Renewal Program (IRP) and the System Access 
and Capacity Program (SAP).[Footnote 19] At that time, WMATA 
anticipated a shortfall of $3.7 billion in the funding for these 
programs over the 25-year period from fiscal year 2001 through fiscal 
year 2025. 

Since that time, in response to recommendations that we and others 
made, WMATA created a strategic plan, which it issued in October 2002. 
In November 2002, it documented and prioritized its planned capital 
projects in a 10-year capital improvement plan that called for spending 
$12.2 billion over the period from fiscal year 2004 through fiscal year 
2013. Then, in September 2003, WMATA launched a campaign called "Metro 
Matters" to obtain $1.5 billion in capital funding over a 6-year period 
to avert what WMATA believed was a crisis in its ability to sustain 
service levels and system reliability and to meet future demands for 
service. In response, WMATA and its member jurisdictions approved a 
$3.3 billion funding plan for fiscal years 2005 through 2010 to help 
pay for WMATA's most pressing short-term capital investment 
priorities.[Footnote 20]

As concerns about WMATA's anticipated funding shortfall grew, a 
regional funding panel known as the Metro Funding Panel--cosponsored by 
the Metropolitan Washington Council of Governments, the Greater 
Washington Board of Trade, and the Federal City Council[Footnote 21]-- 
was convened in September 2004 to study the magnitude of the shortfall, 
identify sources of funding, and evaluate options for generating 
additional revenues to address that shortfall. The panel estimated that 
under its current revenue structure, WMATA would have a total funding 
shortfall of about $2.4 billion for fiscal years 2006 through 2015 for 
maintaining and upgrading its existing system, assuming that Metro 
Matters was fully funded. As shown in table 1, the panel attributed 
nearly 80 percent of the total estimated shortfall of $2.4 billion to 
WMATA's capital activities (IRP and SAP) and the remainder to 
operations activities associated with future capital projects as they 
are completed. 

Table 1: Components of the Metro Funding Panel's Estimate of WMATA's 
Budgetary Shortfall, Fiscal Years 2006 through 2015: 

WMATA projects or activities: Infrastructure Renewal Program (IRP) 
projects; 
Shortfall in fiscal years: 2011 through 2013; 
Total amount of shortfall: $430.1; 
Percentage of total: 18%. 

WMATA projects or activities: System Access and Capacity Program (SAP) 
projects; 
Shortfall in fiscal years: 2008 through 2015; 
Total amount of shortfall: $1,450.5; 
Percentage of total: 61%. 

WMATA projects or activities: Operations activities associated with 
future operation of capital projects--not including system expansion 
projects; 
Shortfall in fiscal years: 2006 through 2015; 
Total amount of shortfall: $500.8; 
Percentage of total: 21%. 

Total; 
Total amount of shortfall: $2,381.4; 
Percentage of total: 100%. 

Source: GAO analysis of information in Report of the Metro Funding 
Panel, January 2005. 

[End of table]

Funding for the following projects and activities is included in the 
shortfall estimate: 

* IRP projects: The IRP projects occur in fiscal year 2011 through 
2013, after the Metro Matters funding agreement expires. These 
projects, which provide ongoing maintenance and renewal of the 
Metrorail and Metrobus systems, include replacing and rehabilitating 
buses and rail cars, rehabilitating escalators and elevators, 
rehabilitating Metrorail stations and parking lots, renovating rail car 
and bus maintenance facilities, and rehabilitating electrical systems, 
among other things. 

* SAP projects: These projects, which are intended to increase the 
capacity of the current Metrorail and Metrobus systems to handle 
increased passenger levels, include the purchase of 130 new rail cars 
and 275 new buses; a variety of improvements to four maintenance 
facilities, two storage facilities, two new bus garages, and one 
replacement bus garage; enhancements at Metro Center, Union Station, 
and Gallery Place Metrorail stations; the construction of pedestrian 
connections between two pairs of Metrorail stations (between Farragut 
North and Farragut West and between Metro Center and Gallery Place); 
and 140 miles of bus corridor improvements, such as signal priority for 
buses, route delineation techniques using pavement materials and 
painted markings, and passenger waiting area enhancements. 

* Operating activities: Finally, the panel included a relatively small 
portion of WMATA's operating budget in the shortfall estimate. This 
portion consists of some additional operating costs associated with 
some of the capital projects. According to WMATA, these are mostly 
preventative maintenance projects, such as bus engine overhauls, bus 
tire replacements, bus parts, rail parts, and labor costs. 

Appropriately, the panel's budgetary shortfall estimate did not include 
the portion of WMATA's capital improvement plan that involves expanding 
the system--by adding new rail lines, for example. The projects in this 
portion of the plan, known as the System Expansion Program, are 
estimated to cost roughly $6 billion. WMATA officials told us that 
these projects would be paid for by the local jurisdictions and 
businesses where they would be built, as well as by federal grants for 
new transit expansion. 

In preparing its estimate of WMATA's budgetary shortfall, the panel did 
not evaluate the need for, or priority of, individual projects in SAP 
and IRP. Likewise, we did not independently assess the suitability of 
including these projects, as a whole or individually, in the shortfall 
estimate. However, when WMATA developed its 10-year capital improvement 
plan in 2002, the projects were approved by its board of directors, 
which includes representatives from all of WMATA's member 
jurisdictions. In addition, the IRP projects and some of the projects 
in SAP have been incorporated into the region's Constrained Long-Range 
Plan for transportation improvements over the next 20 years by the 
Transportation Planning Board of the Metropolitan Washington Council of 
Governments. 

Estimates of the Magnitude of WMATA's Funding Shortfall May Not Be 
Comprehensive: 

In estimating WMATA's budgetary shortfall, the panel did not include a 
major cost category and, thus, may have significantly underestimated 
the shortfall. The panel did not include the costs of providing 
paratransit services as required under ADA. Compliance with the act's 
requirements may result in significant costs over the next 10 years. 
The panel recognized that including these costs, which are included in 
WMATA's operating budget, would result in a greater budgetary 
shortfall. In fact, the panel estimated the shortfall from MetroAccess, 
WMATA's paratransit system, at about $1.1 billion over the 10-year 
period from 2006 through 2015, thus raising the total anticipated 
shortfall to $3.5 billion for that period. However, the panel stated 
that funding for these services should be provided through a creative 
packaging of social service, medical, and other nontransportation 
resources in the region, rather than by WMATA. We believe that any 
estimate of WMATA's funding shortfall should include the costs 
associated with MetroAccess because WMATA is required by ADA to provide 
paratransit services.[Footnote 22]

Options for Addressing WMATA's Funding Challenges Would Generally 
Establish a Local Dedicated Revenue Source and Include a Federal 
Contribution: 

In our 2001 report and testimony,[Footnote 23] we noted that WMATA's 
funding comes from a variety of federal, state, and local sources, but 
that unlike most other major transit systems, WMATA does not have a 
dedicated source of nonfarebox revenue, such as a local sales tax, 
whose receipts are automatically directed to the transit authority. As 
far back as April 1979, we reported on concerns about the lack of a 
revenue source dedicated to pay the costs of mass transportation for 
the Washington region.[Footnote 24] Concerns about WMATA's lack of 
dedicated revenues surfaced again in reports issued by the Brookings 
Institution in June 2004[Footnote 25] and by the Metro Funding Panel in 
January 2005.[Footnote 26] According to the Brookings report, WMATA's 
lack of dedicated revenues makes WMATA's core funding uniquely 
vulnerable and at risk as WMATA's member jurisdictions struggle with 
their own fiscal difficulties. The Brookings report and the Metro 
Funding panel report both state that the Washington region needs to 
develop a dedicated source of revenue, and they evaluate the advantages 
and disadvantages of a menu of revenue options that could support the 
dedicated revenue source--specifically, gasoline taxes, sales taxes, 
congestion charges, parking taxes, land-value capture,[Footnote 27] and 
payroll taxes. 

Observing that WMATA has provided numerous benefits both to the 
Washington region and the federal government over the years, the Metro 
Funding Panel also concluded that WMATA will require a commitment of 
new revenue sources to sustain those benefits. Accordingly, the panel 
recommended, among other things, that (1) WMATA's compact jurisdictions 
of Virginia, Maryland, and the District of Columbia mutually create and 
implement a single regional dedicated revenue source to address WMATA's 
budgetary shortfalls and (2) the federal government participate 
"significantly" in addressing WMATA's budgetary shortfalls, 
particularly for capital maintenance and system enhancement. 

In the current situation of large budget deficits, any additional 
federal funding for WMATA would need to be considered along with the 
many other competing claims for federal resources. To the extent that 
the federal government cannot provide significant additional support to 
WMATA, and WMATA's current revenue structure continues to be 
insufficient to support its planned capital projects, WMATA may need to 
reassess its capital improvement plan to determine which projects could 
be undertaken within a more constrained funding level. WMATA also may 
need to consider how it will meet its obligations under ADA. 

WMATA Is Subject to Oversight from Multiple Entities Whose Reviews 
Address a Wide Range of Issues: 

WMATA is subject to oversight from multiple entities that have issued 
numerous reports on the agency since 2003. The scope of the reports 
varies and includes compliance reviews of specific statutory 
requirements, monthly assessments of major construction projects, and 
reviews of WMATA's overall bus and rail operations. Specifically, 
WMATA's Office of Auditor General has issued nearly 500 reports, 
including internal and investigative audits and reviews of contracts 
and pricing proposals. In addition, an independent external auditor, 
which reports to WMATA's board of directors, annually reviews WMATA's 
financial statements and related internal controls. FTA oversees 
WMATA's major capital projects through its project management oversight 
program and assesses its compliance with a wide range of requirements 
through its Triennial Review process. In 2005, at WMATA's request, 
transit industry panels conducted peer reviews of WMATA's bus and rail 
operations. Details on these entities and the types of oversight they 
provide are presented in table 2. All of these entities included 
recommendations in their reports, and, in general, WMATA implemented 
them or has plans to implement them. As part of our ongoing work, we 
plan to analyze these reviews in greater detail, together with other 
specialized FTA reviews and safety reviews conducted by external and 
internal entities. 

Table 2: Selected Entities Providing Oversight of WMATA: 

Oversight entity: WMATA's Auditor General: 

Type of oversight: Internal audits; 
Subject of review: Cash processes and revenue sources, reliability and 
effectiveness of WMATA's paratransit contractor, workers' compensation 
and benefits programs, escalator and elevator maintenance contracts, 
inventory management, and internal controls related to the budget and 
fixed assets; 
Number of reports[A]: 39. 

Type of oversight: Investigative audits; 
Subject of review: Preventing or detecting mismanagement, waste, fraud, 
or abuse within WMATA; 
Number of reports[A]: 18. 

Type of oversight: Information technology audits; 
Subject of review: Information technology systems that are under 
development; electronic collection of revenue (e.g. Smart Card, 
MetroCheck sales, and Internet sales); 
Number of reports[A]: 7. 

Type of oversight: Contract audits; 
Subject of review: Cost reasonableness of sole-source contracts, 
contract modifications and cost-reimbursable tasks and contracts, 
oversight and review of engineering firms; 
Number of reports[A]: 404. 

Type of oversight: Control self-assessments; 
Subject of review: Quality of customer service within WMATA (designed 
to improve working relationships among departments within the agency); 
Number of reports[A]: 20. 

Oversight entity: Independent external auditor: 

Type of oversight: Single Audit Act; 
Subject of review: WMATA's financial statements and internal controls 
related to these statements and to major federal programs; 
Number of reports[A]: 2. 

Oversight entity: FTA: 

Type of oversight: Project management oversight program; 
Subject of review: Monthly reports on various aspects of major capital 
projects, including scheduling, budget, and performance; 
Number of reports[A]: 125. 

Type of oversight: Triennial Review; 
Subject of review: Compliance with statutory and administrative 
requirements in 23 areas; 
Number of reports[A]: 1. 

Oversight entity: American Public Transportation Association (APTA): 

Type of oversight: Peer reviews; 
Subject of review: WMATA's overall bus and rail operations; 
Number of reports[A]: 2. 

Total; 
Number of reports[A]: 618. 

Sources: GAO analysis of data from WMATA, FTA, and APTA. 

[A] Numbers are for reports issued since January 2003, except for the 
Triennial Review, which was most recently completed for WMATA in 
September 2002. 

[End of table]

WMATA's Auditor General: 

WMATA's Auditor General is responsible for planning and implementing 
operational, financial, and information system audits, as well as for 
carrying out investigations to prevent or detect mismanagement, waste, 
fraud, or abuse. The Office of Auditor General also conducts audits of 
contracts to ensure they are being done in accordance with WMATA policy 
and cost-effectively. The Auditor General reports directly to the 
General Manager/Chief Executive Officer and briefs the audit committee 
of the board of directors quarterly. The Auditor General prepares an 
annual audit plan that covers most aspects of the agency. 

When deficiencies in a program are found, the Office of Auditor General 
makes recommendations for corrective actions to be taken and follows up 
on the implementation status of recommendations with the executive 
manager responsible for the program or office to which the 
recommendations were directed. If the recommendations are not 
implemented in a timely fashion, the Chief Executive's office may 
intervene to ensure that appropriate corrective action is taken. For 
the most part, WMATA management implements these recommendations. 

The following are examples of audit reports issued by the Office of 
Auditor General in recent years: 

* Contract/Procurement Oversight. Since January 2004, the Office of 
Auditor General has issued five internal audit reports on contracting 
processes and the documentation of contracting activities. 
Recommendations were made to improve the documentation process, improve 
the administration of the cost-estimating process, and develop 
procedures to document the cost-estimating process. 

* Information Technology (IT) Renewal Program. The IT Renewal Program 
is a multiyear, multimillion-dollar initiative to renew WMATA's IT 
systems for the next generation of service. The Office of Auditor 
General has issued six reports during the past 3 years on the 
implementation of this program, with suggestions for improving 
communication and ensuring that appropriate security measures are in 
place. 

* Audit of Cell Phone Usage. This review of employee cell phone plans 
and usage made recommendations for more efficient and effective cell 
phone use, which resulted in potential savings of approximately 
$300,000 per year. Additional recommendations were made to improve the 
administration of the cell phone program. 

Single Audit Act: 

WMATA is subject to federal financial reporting requirements under the 
Single Audit Act as amended.[Footnote 28] Under this act, nonfederal 
entities that expend more than specified amounts of federal awards 
(currently $500,000) are subject to either a single audit or a program- 
specific audit, which must be performed by an independent external 
auditor in accordance with generally accepted government auditing 
standards.[Footnote 29] The purpose of the Single Audit Act[Footnote 
30] was to streamline and improve the effectiveness of audits of 
federal awards and to reduce the audit burden on states, local 
governments, and nonprofit entities receiving federal awards by 
replacing multiple grant audits with one audit of a recipient as a 
whole (or, for entities receiving federal awards under one program, an 
optional audit of that program only). 

In conducting WMATA's annual audits under the act's requirements, an 
independent auditor is required to (1) provide an opinion on WMATA's 
financial statements and the Schedule of Expenditures of Federal 
Awards, (2) report on WMATA's internal controls related to the 
financial statements and major programs, and (3) report on WMATA's 
compliance with laws and regulations that could have a material effect 
on WMATA's financial statements and major federal programs. 

For fiscal years 2003 and 2004, WMATA's independent external 
auditor[Footnote 31] found no reportable conditions or material 
weaknesses in WMATA's internal controls over financial reporting and 
the major programs receiving federal assistance.[Footnote 32] The 
independent auditor's reviews of WMATA's financial statements and 
internal controls did, however, note several areas of noncompliance 
related to requirements for grants for both years. When such areas of 
noncompliance are found, the auditor recommends steps for WMATA to take 
to correct the noncompliance. WMATA generally concurred with the 
auditor's recommendations and agreed to implement them. The following 
are examples of noncompliance and recommendations for corrective action 
found at WMATA during fiscal years 2003 and 2004: 

* Property records for equipment purchased with a federal grant did not 
include serial numbers or prices for the equipment--as required by 
federal law.[Footnote 33] The auditor recommended that WMATA revise the 
records to include the required information, and WMATA agreed to do so. 

* WMATA did not correctly submit federal grant expenditure status 
reports. The auditor recommended that WMATA revise and resubmit its 
financial status reports to include total expenditures, which WMATA 
agreed to do. 

FTA's Project Management Oversight Program: 

FTA oversees the progress of WMATA's major capital projects through the 
project management oversight (PMO) program, which we discuss in greater 
detail later in this statement. To receive financial assistance, FTA's 
grantees must develop and implement a project management plan that 
address each project's scheduling, budget, performance, and other 
issues. FTA retains engineering firms to review and recommend approval 
of the plans, monitor the progress of each project against its plan, 
and issue monthly monitoring reports. The purpose of the monthly PMO 
monitoring reports is to determine whether the projects are proceeding 
in accordance with the terms of the federal grant agreements, including 
whether they are meeting standard project management requirements, such 
as having a project management plan and a quality assurance plan, 
meeting schedule milestones, and being on budget. 

WMATA's major capital projects that are subject to PMO review 
collectively represent a substantial portion of WMATA's capital budget. 
We reviewed PMO reports that were issued from January 2003 through May 
2005. During that time, WMATA had seven capital infrastructure projects 
that were subject to the requirements of the PMO program, including 
IRP, which, as discussed earlier, provides ongoing maintenance and 
renewal of the Metrorail and Metrobus systems; the rail car procurement 
program; and the construction of the New York Avenue Metrorail 
station.[Footnote 34] The total cost of the projects under review was 
about $5 billion, according to data provided by WMATA. 

The monthly PMO monitoring reports that we reviewed identified concerns 
and recommended corrective actions for each of WMATA's major projects 
under review. The concerns most commonly cited in the reports were 
related to schedules, project management plans, and quality assurance 
activities. Details on these concerns--which WMATA has taken steps to 
address--follow: 

* Schedules. The reports cited concerns pertaining to schedules for 
some of the contracts within three of WMATA's projects. For the New 
York Avenue Metrorail station and the Largo Metrorail extension, the 
reports stated that individual components of the projects were behind 
schedule; however, the two projects--as a whole--were both completed 
ahead of schedule. The PMO reports also found that components of the 
rail car procurement program, including the rehabilitation of the 
2000/3000 Series rail cars and the delivery of new 5000 Series rail 
cars, were behind schedule. 

* Project management plans. The reports stated that WMATA needed to 
submit or update project management plans for three of its projects-- 
the rail car procurement program, Metro Matters, and the Infrastructure 
Renewal Program. 

* Quality assurance activities. The reports stated that procedures 
related to quality assurance required updating for three projects: 
Dulles Corridor rapid transit, the Largo Metrorail extension, and the 
Branch Avenue storage and maintenance yard. Some examples of quality 
assurance activities include having (1) written procedures that 
describe how to conduct reviews of contractor's quality programs and 
(2) quality control coordination meetings with contractors. 

FTA's Triennial Review: 

At least every 3 years, FTA is required to review and evaluate transit 
agencies receiving funds under its Urbanized Area Formula Grant 
program. The reviews focus on compliance with statutory and 
administrative requirements in 23 areas, and if grantees are found not 
to be in compliance, their funding can be reduced or 
eliminated.[Footnote 35] In 2002, FTA found that WMATA was deficient in 
the following three areas: 

* Technical. Grantees must implement the Urbanized Area Formula Grant 
Program of Projects[Footnote 36] in accordance with the grant 
application master agreement. WMATA had not been updating the 
milestones in its Milestone Progress Reports, nor had WMATA been 
reporting all required information for its Job Access and Reverse 
Commute grants. 

* Buy America. Certain products used in FTA-funded projects must be 
produced in the United States. WMATA's procurement files for buses and 
rail cars did not include required certifications indicating that these 
procurements complied with Buy America requirements. 

* Half-fare. Grantees must offer reduced fares to elderly or disabled 
riders or to those who present a Medicare card. WMATA's system maps 
specified the base fare but did not indicate that a half-fare was 
available. 

FTA made recommendations for addressing the specific areas of 
noncompliance; WMATA implemented the recommendations, and the findings 
were closed in 2004. 

Transit Industry Association Peer Reviews: 

The American Public Transportation Association (APTA) offers peer 
reviews as a service to transit agencies to help enhance the efficiency 
and effectiveness of their operations. At the request of transit 
agencies, the association convenes panels of experts from within the 
transit industry, who travel to the transit agency under review to 
physically tour the operations, meet with staff and senior management, 
and review documentation in order to develop findings and 
recommendations on the transit agency's operations. Following the site 
visit, the peer review panel issues a written report to the transit 
agency under review. 

At WMATA's own request, APTA conducted peer reviews on WMATA's bus and 
rail operations earlier this year, and WMATA is currently considering 
its response to the recommendations made in the peer review 
reports.[Footnote 37] The peer review panels developed recommendations 
to improve the effectiveness and efficiency of bus and rail operations 
in multiple areas, including staffing, organization, maintenance and 
technology. For example: 

* Findings and recommendations in the rail peer review report focused 
on: 

* the selection, training, and certification of employees, with 
recommendations on improving training for track and train employees and 
implementing a new reporting structure for the training department;

* operations, with recommendations on increasing reliance on line 
supervisors in dealing with in-service problems and restructuring the 
current organization to create distinct line ownership functions and 
responsibilities; and: 

* track maintenance, with recommendations on recertifying track walkers 
annually and increasing the number of track walkers to reduce the daily 
inspection distance to industry standards. 

* Findings and recommendations of the bus peer review report focused 
on: 

* operations and service, with recommendations for increased street 
supervision and re-evaluation of bus route service;

* facility maintenance, with recommendations on consolidating bus shop 
maintenance and improving follow-up procedures for bus defects;

* staffing and training, with recommendations on eliminating high 
vacancy rates and improving training; and: 

* safety, with recommendations on adhering to basic safety programs and 
enforcing personal protective equipment policies. 

Additional GAO Work Remaining on WMATA's Oversight: 

As part of our ongoing work, we plan to analyze these reviews in 
greater detail to determine whether, taken as a whole, they point to 
any systemic problems and are sufficiently comprehensive to identify 
and address overall management and operational challenges. We will also 
broaden the scope of our analysis to include additional oversight 
reviews; specifically, we plan to analyze FTA's in-depth reviews of 
program or system compliance. These include, for example, financial 
management oversight reviews, which assess grantees' financial 
management systems and internal controls; procurement system reviews, 
which evaluate grantees' compliance with federal procurement 
requirements; and drug and alcohol oversight reviews, which assess 
grantees' compliance with FTA's regulations on substance abuse 
management programs and drug and alcohol testing for transit employees. 
We also plan to review safety audits of WMATA that were conducted by 
internal and external entities, including the following: 

* WMATA's Office of System Safety and Risk Protection. This office, 
which reports to the Department of Audit and Safety Oversight, performs 
internal safety reviews of WMATA's operations. 

* Tri-State Oversight Committee. This committee, which is the 
designated state safety oversight agency for WMATA, requires WMATA to 
develop and implement system safety and security program plans, report 
accidents and unacceptable hazard conditions, and conduct safety 
reviews. The committee meets with WMATA quarterly to discuss safety 
issues and has the authority to mandate corrective action. 

* APTA. APTA's bus and rail safety audits review the adequacy of 
transit agencies' system safety program plans and the extent to which 
the plans have been implemented. 

* FTA. FTA performs audits of the Tri-State Oversight Committee to 
determine whether the state oversight agency is carrying out its safety 
oversight program and to examine ways in which the overall program can 
be improved. 

* National Transportation Safety Board (NTSB). NTSB has the authority 
to conduct investigations of accidents and make recommendations. The 
NTSB is currently investigating a November 2004 crash involving two 
Metrorail trains; it expects to issue a report on the results of this 
investigation in the fall of 2005. 

In addition, we plan to review the role of WMATA's board of directors 
in providing oversight of WMATA's management and operations. As noted 
earlier in this statement, WMATA is governed by a board of directors-- 
composed of individuals appointed by each of the local jurisdictions 
WMATA serves--which sets policies and oversees all of WMATA's 
activities, including budgeting, operations, development, expansion, 
safety, procurement, and other activities. 

Spending Safeguards and Management Oversight Have Helped Recipients of 
Federal Transportation Assistance Control Costs and Ensure Results: 

To control costs and ensure results--especially for high-cost 
transportation infrastructure projects--Congress, the administration, 
and GAO have long recognized the importance of instituting spending 
safeguards and management oversight for the state and local governments 
and transportation agencies that receive federal funding. For example, 
certain federal policies have historically controlled the uses of 
federal transportation funds, prohibiting the use of these funds for 
operating expenses and requiring that the federal funds be matched to 
ensure the use of some local funds for capital infrastructure projects. 
In addition, a number of past, ongoing, and planned federal and local 
efforts provide insight into the benefits of management oversight and 
how it can be carried out. For example, in the 1980s, state legislation 
enhanced opportunities for New York City's ailing Metropolitan Transit 
Authority to generate additional revenue while providing increased 
oversight to ensure accountability. Furthermore, FTA's PMO program is 
designed to help ensure that grantees building major capital projects 
have the qualified staff and procedures needed to successfully plan and 
carry out those projects. We have also reported that safeguards should 
accompany any increased federal funds provided to the District of 
Columbia to address the structural imbalance between its costs and 
revenue-raising capacity. Finally, the surface transportation 
reauthorization bills currently before Congress include provisions to 
enhance management oversight controls for projects receiving federal 
funds, including establishing a new program to monitor the use of 
federal highway funds. Although we have not evaluated the application 
of these oversight mechanisms to WMATA, we believe they provide a 
number of options for Congress to consider as it weighs the question of 
providing additional federal funding to WMATA. 

Federal Programs Restrict Use of Funds for Operations and Encourage 
State and Local Spending through Matching Requirements: 

The federal government has generally discouraged federal transit grants 
from being used to fund transit operating expenses, although policy in 
this area has shifted over time.[Footnote 38] Landmark legislation in 
1964 established a program of federal capital expenditure grants to 
state and local governments. [Footnote 39] At that time, no grant money 
could be used for operating expenses because of concerns that such 
grants would discourage efficient operations of transit agencies and 
might even have the perverse effect of rewarding inefficient operations 
with funding assistance. However, that act was amended in 1974 to 
authorize federal subsidies to pay transit operating expenses, 
reflecting the alternative concern that limiting federal assistance to 
capital grants created incentives for local governments to 
inefficiently waste capital, such as by prematurely replacing buses. 
[Footnote 40]

During the 1990s, views on how federal transit grants could be used 
shifted again, and limits were placed on the total amount of transit 
formula grants that could be used for operating expenses. In 1998, with 
the passage of the Transportation Equity Act for the 21st Century (TEA- 
21), transit agencies serving urban populations of 200,000 or more 
could no longer use funding from FTA's Urbanized Area Formula Grants 
for operating expenses. According to FTA officials, this prohibition 
was instituted in part because federal policymakers believed that the 
federal government should pay only for the construction and maintenance 
of mass transit systems, not for their operation. However, TEA-21 did 
allow capital funds to be used for preventive maintenance, which 
included routine maintenance on rail cars and buses--activities that 
were previously classified as operations activities. After the events 
of September 11, 2001, we recommended a legislative exception to the 
prohibition on operations funding that would allow transit agencies to 
use Urbanized Area Formula Grants for security-related operating 
expenses.[Footnote 41] Transit agencies can spend 1 percent of formula 
funds on security-related operating expenses. 

The federal government has also historically used matching requirements 
in its transit and other transportation programs to stimulate local 
investment in transportation infrastructure and equipment. Currently, 
major capital transit investment programs--including the New Starts and 
Rail and Fixed Guideway Modernization programs--provide grants that 
fund up to 80 percent of a project's total costs while requiring a 
local match of at least 20 percent.[Footnote 42]

Assistance to the New York City Transit Agency in the 1980s Was Tied to 
Oversight Requirements: 

During the late 1970s and early 1980s, the New York State Metropolitan 
Transit Authority (MTA), which includes New York City Transit's subway 
and bus systems and the Long Island Rail Road, was in a state of fiscal 
crisis and operational decay. To help salvage the system, the state 
legislature passed legislation[Footnote 43] that provided MTA with the 
flexibility to generate additional revenue--through issuing bonds and 
notes and through the creation of a special tax district--needed to 
rebuild its aging infrastructure. The legislation also established 
several oversight bodies--which are still in place at MTA today--to 
help ensure that MTA's funds would be well spent. They are as follows: 

* The Metropolitan Transportation Capital Review Board. Appointed by 
the governor and composed of two members recommended by the New York 
State legislature and one each recommended by the governor and the 
mayor of New York City, this board reviews and approves, once every 5 
years, MTA's capital program plans for transit and railroad facilities. 
The plans include goals and objectives for capital spending, establish 
standards for service and operations, and include estimated costs and 
expected sources of revenue. 

* The MTA Committee on Capital Program Oversight. This standing 
committee of MTA's board of directors has various oversight 
responsibilities, including monitoring the (1) current and future 
availability of funds to be used in the capital program plans and (2) 
contract awards made by MTA. The committee issues quarterly reports on 
its activities and findings. 

* The MTA Office of the Inspector General. This office was created as 
an independent oversight agency to investigate allegations of abuse, 
fraud, and deficiencies in the maintenance and operation of facilities. 
The Inspector General may also initiate other reviews of MTA's 
operations and can recommend remedial actions to be taken by MTA and 
monitor their implementation. The Inspector General is appointed by the 
governor and submits annual reports of findings and recommendations to 
the governor. MTA is required to report quarterly to the Inspector 
General on the implementation status of all recommendations made in 
final reports. 

Since these oversight bodies were established, and with increased 
funding, MTA has improved its on-time performance and reliability. For 
example, the mean distance between failures has increased from less 
than 7,000 miles in 1981 to nearly 140,000 miles in 2003, according to 
MTA. 

FTA's PMO Program Helps Protect Federal Funds Spent on Major Capital 
Projects, Including WMATA's Projects: 

FTA's PMO program was established in the 1980s to safeguard the federal 
investment in major capital transit projects, which require large 
commitments of public resources, can be technically challenging, and 
often take years to construct. This program provides a continuous 
review and evaluation of the management of all major transit projects 
funded by FTA. Through provisions such as the following, the PMO 
program is designed to help ensure that grantees building major capital 
projects have the qualified staff and procedures needed to successfully 
build the projects: 

* To receive federal financial assistance, grantees must develop and 
implement project management plans that address quality, scheduling, 
the budget, and other issues. 

* Contractors monitor grantees' projects to determine whether grantees 
are progressing on time, within budget, and according to approved plans 
and specifications. 

* The contractors periodically report their findings and 
recommendations for any corrective actions that may be needed. 

In 2000, we reported and testified[Footnote 44] that FTA had improved 
the quality of the PMO program since the early 1990s, when we 
designated it as high risk because it was vulnerable to fraud, waste, 
abuse, and mismanagement.[Footnote 45] We concluded that the program 
had resulted in benefits for both grantees and FTA. Grantees have 
improved their controls over the cost, schedule, quality, and safety of 
their projects. FTA has gained a better understanding of the issues 
surrounding complex construction projects and an increased awareness of 
potential problems that could lead to schedule delays or cost 
increases. As contractors have brought cost and schedule issues to 
FTA's attention, FTA has taken actions to help protect the federal 
investment and control projects' costs and schedules. 

FTA officials told us that any additional federal funding provided to 
WMATA would be subject to the PMO program's requirements only if those 
funds were distributed to WMATA through the U.S. Department of 
Transportation and FTA. Otherwise, WMATA's spending from the additional 
funding would not likely be subject to any federal program oversight. 

We Have Suggested Spending Safeguards for Any Increase in Federal Funds 
Provided to Address the District of Columbia's Structural Imbalance: 

In June 2004, we testified on the structural imbalance between the 
District of Columbia's costs and revenue-raising capability, stating 
that if the federal government chooses to provide additional funding to 
the District to compensate for this imbalance, the government should 
implement safeguards to ensure that the funds are spent efficiently and 
effectively. [Footnote 46] In that testimony, we stated that such 
safeguards should be written into any legislation providing additional 
federal assistance to the District and could include the following: 

* District officials should be required to report to Congress on how 
they plan to spend the federal assistance and regularly report on how 
it is being spent. 

* Congress may consider further specifying the types of projects for 
which federal funds could be used or including a matching requirement 
to ensure that some local funds continue to be used for infrastructure 
and capital requirements. 

Surface Transportation Reauthorization Bill Would Enhance Management 
Oversight Controls for Projects Receiving Federal Funds: 

The House and Senate versions of the surface transportation 
reauthorization bill that are currently in conference committee contain 
provisions aimed at improving the financial integrity and project 
delivery times for surface transportation projects that receive federal 
financial assistance. For example: 

* On the transit side, both the House and Senate versions of the bill 
would increase the amount of funds available to the Secretary of 
Transportation for management oversight of mass transportation 
construction projects receiving federal funds.[Footnote 47] The funds 
would be used to review and ensure compliance with federal requirements 
for project management. To support the need for such enhanced 
oversight, the committee report accompanying the House bill notes that 
comprehensive agency oversight, compliance review, and technical 
assistance are necessary for all major grant programs.[Footnote 48]

* On the highway side, both versions of the bill[Footnote 49] would 
require the Secretary of Transportation to establish an oversight 
program for the Federal-Aid Highway Program to promote the effective 
and efficient use of federal highway funds. As part of this new 
oversight program, the Federal Highway Administration (FHWA) would (1) 
review states' financial management systems, (2) develop minimum 
standards for estimating project costs, and (3) evaluate state 
practices for awarding contracts and reducing project costs. In 
addition, highway projects receiving a certain amount of federal 
assistance--$500 million or more in the House bill and $1 billion or 
more in the Senate bill--would be subject to an increased level of FHWA 
oversight, including submitting a project management plan and an annual 
financial plan to FHWA documenting the project's procedures for 
managing costs and schedules. 

Concluding Observations: 

WMATA's service to the nation's capital and its associated additional 
responsibilities need to be considered when determining whether a 
greater federal role in providing financial assistance to, and 
oversight of, WMATA is warranted. In the end, it is up to Congress to 
decide whether or in what form to provide WMATA with additional federal 
funding in recognition of its support of the federal government. In 
addition, if Congress decides to provide WMATA with the additional 
funding, it is important for there to be reasonable assurances that the 
funds will be spent efficiently and effectively. WMATA is already 
subject to oversight from multiple entities, but it is unclear whether 
this oversight is sufficient to provide such assurances. WMATA's 
existing oversight could be supplemented by including safeguards in any 
legislation that provides additional federal funding. Our research has 
shown that a number of options are available for such safeguards, 
although we have not fully analyzed their applicability to WMATA or 
their relative merits. The options include the following: 

* Require WMATA officials to report to Congress on how they plan to 
spend the federal assistance and regularly report on how it is being 
spent. For example, Congress could require officials to submit a plan 
to Congress on how they intend to spend the federal assistance--before 
any funds are obligated--and update this plan as circumstances or 
priorities change. 

* Further specify the types of projects for which federal funds could 
be used or include a matching requirement to ensure that some local 
funds continue to be used for infrastructure and capital requirements. 

* Require that any additional funding provided to WMATA be administered 
through DOT and FTA and therefore be subject to the PMO program. 

* Institute additional oversight bodies for WMATA, either through or 
independent of its board of directors. 

Mr. Chairman, this concludes my prepared statement. I would be pleased 
to respond to any questions that you or the other Members of the 
Committee may have. 

GAO Contacts and Staff Acknowledgments: 

For further information about this testimony, please contact me at 
(202) 512-2834 or siggerudk@gao.gov. Individuals making key 
contributions to this testimony include Seto Bagdoyan, Mark Bondo, 
Christine Bonham, Jay Cherlow, Elizabeth Eisenstadt, Edda Emmanuelli- 
Perez, Rita Grieco, Heather Halliwell, Maureen Luna-Long, Susan Michal- 
Smith, SaraAnn Moessbauer, Katie Schmidt, and Earl Christopher Woodard. 

[End of section]

Appendix I: Objectives, Scope, and Methodology: 

To determine the Washington Metropolitan Area Transit Authority's 
(WMATA) responsibilities for supporting the federal government, we 
interviewed a wide array of federal and local officials including those 
from WMATA, the Federal Transit Administration (FTA), the Office of 
Personnel Management, the General Services Administration, the National 
Capital Planning Commission, the Metropolitan Washington Council of 
Governments, the U.S. Secret Service, the U.S. Capitol Police, and the 
District of Columbia Department of Transportation. We reviewed federal 
guidance on employees' use of, and the placement of federal buildings 
near, mass transit and local and federal emergency planning guidance. 
We also used WMATA's estimates of federal Metrorail ridership based on 
its 2002 passenger survey. Through our review of the survey 
methodology, and use of other corroborating evidence, we determined 
that the ridership estimates were sufficiently reliable for our 
purposes. 

To determine the current funding challenges facing WMATA and the 
options proposed to address these challenges, we reviewed and analyzed 
the budgetary shortfall estimate prepared by the Metro Funding Panel, 
budget documents from WMATA, and prior GAO reports. We interviewed 
officials from WMATA and local transportation experts who served on the 
funding panel. 

To determine the entities that currently provide oversight of WMATA and 
the focus of their recent reviews, we interviewed WMATA officials and 
reviewed selected reports and audits that have been issued by WMATA's 
oversight bodies since the beginning of calendar year 2003. Our review 
included the following: 

* WMATA Auditor General reports: 

* FTA's Project Management Oversight (PMO) program contractor reports: 

* FTA's most recent Triennial Review[Footnote 50]

* The independent external auditor's review of WMATA's financial 
statements and internal controls as required under the Single Audit 
Act: 

* The American Public Transportation Association's peer review reports: 

Although FTA carries out a number of reviews of transit agencies in 
addition to the Triennial Review and the PMO reports, we selected the 
Triennial Review because it covers grantees' compliance with a wide 
range of statutory and administrative requirements, and we selected the 
PMO reports because this program provides oversight of WMATA's major 
capital projects, which represent a significant part of WMATA's budget. 
For this statement, we did not analyze any oversight entities or 
reports related to safety, such as those of the Tri-State Oversight 
Committee, the National Transportation Safety Board, or the American 
Public Transportation Association. We plan to address these, as well as 
FTA's additional compliance reviews, as part of our ongoing work. 

To identify applicable examples of spending safeguards and management 
oversight of any additional federal assistance provided to WMATA, 
should Congress decide to provide such assistance, we reviewed prior 
GAO work on surface transportation funding and management oversight, as 
well as other documents on transportation planning and finance, and 
interviewed officials with expertise in the transit industry, 
transportation finance, and transportation planning. 

FOOTNOTES

[1] Paratransit most often refers to wheelchair-accessible, demand- 
response van service for individuals who are unable to use the regular 
transit system independently because of a physical or mental 
impairment. 

[2] Washington Metropolitan Area Transit Authority Compact, Pub. L. No. 
89-774 (1966). 

[3] See GAO, Mass Transit: Information on the Federal Role in Funding 
the Washington Metropolitan Area Transit Authority, GAO-05-358T 
(Washington, D.C.: Feb. 18, 2005). 

[4] In our February 2005 testimony (see GAO-05-358T), we reported 
information, provided by WMATA officials, showing that the federal 
government's contribution from 1969 through 1999 was $6.2 billion. In 
commenting on a draft of today's testimony statement, WMATA officials 
told us that they had provided us with incomplete information in 
February 2005 and that, in fact, the total federal contribution during 
those years was $6.9 billion. 

[5] All dollar figures presented in this statement are in nominal 
dollars (not adjusted for inflation). 

[6] Metrorail has the second highest cost recovery ratio (revenues from 
fares per total operating expenses) of any heavy rail system in the 
nation, according to 2002 data, whereas Metrobus's cost recovery ratio 
is ranked 17th out of the largest 20 bus systems. 

[7] WMATA's estimates do not include federal contractors and do not 
consider the extent to which federal employees use Metrobus or 
MetroAccess services. 

[8] Like other estimates, WMATA's estimates are subject to various 
forms of possible error that might cause the actual percentage of 
Metrorail riders that are federal employees to differ from the 
estimated percentage. One form is sampling error. Because WMATA 
surveyed a large sample of riders, the sampling errors associated with 
its estimates are small. All the estimates that we cite from WMATA's 
2002 passenger survey have sampling margins of error of less than plus 
or minus 0.5 percentage points at the 95 percent confidence level. As a 
result, based on sampling error alone, the chances are 95 out of 100 
that the actual percentage of Metrorail riders that were federal 
employees in 2002 lies between 34 and 35 percent. However, the 
practical difficulties of conducting any survey can introduce errors 
from other sources, commonly referred to as nonsampling errors, which 
may reduce one's level of confidence in the estimates. In particular, 
the WMATA survey had an overall response rate of less than 28 percent. 
As response rates decrease, so does the likelihood that the 
characteristics of the survey respondents represent those of the entire 
universe of Metrorail riders. 

[9] WMATA defines the morning peak period as 5:30 a.m. through 9:29 
a.m. and the afternoon peak period as 3:00 p.m. through 6:59 p.m. 

[10] 43 F.R. 36869. 

[11] U.S. General Services Administration, Site Selection Guide 
(Washington, D.C.: March 2003). 

[12] Codified at 5 USC § 7905. 

[13] Executive Order 13150, issued on April 21, 2000, implemented the 
act by mandating that federal agencies establish a "transit pass" 
program for federal employees in the National Capital Region and offer 
a program that allows federal employees to exclude a portion of their 
income from taxes for commuting costs, where such commuting includes 
mass transportation and vanpools. Federal employees in the National 
Capital Area may personally claim up to $1,260 per year in transit 
benefits for commuting purposes. 

[14] National Park Service, Visitor Transportation Survey (Washington, 
D.C.: Nov. 2003). 

[15] The American Battle Monuments Commission and Transportation 
Management Services paid WMATA $223,320 for the use of 240 buses. WMATA 
charged these organizations the standard charter bus rate of $310.50 
for the first 3 hours plus $34.50 for each additional 30 minutes. 

[16] The Ronald Reagan Presidential Foundation paid WMATA $16,110 for 
the use of 20 buses. WMATA charged the foundation the standard charter 
bus rate. 

[17] The Homeland Security Advisory System is a threat-based system 
that DHS uses to communicate to public safety officials and the public 
the likelihood of a terrorist attack. 

[18] Department of Defense and Emergency Supplemental Appropriations 
for Recovery from and Response to Terrorist Attacks on the United 
States for Fiscal Year 2002, Public Law No. 107-117, Div. B, Ch. 4, 115 
Stat. 2230, 2304. 

[19] See GAO, Mass Transit: Many Management Successes at WMATA, but 
Capital Planning Could Be Enhanced, GAO-01-744 (Washington, D.C.: July 
3, 2001) and Mass Transit: WMATA Is Addressing Many Challenges, but 
Capital Planning Could Be Improved, GAO-01-1161T (Washington, D.C.: 
Sept. 21, 2001). 

[20] The $3.3 billion included $1.8 billion in previously pledged 
funding and $1.5 billion in new commitments called for in Metro 
Matters. The $1.5 billion is largely funded by the local jurisdictions; 
however, it also includes a request for about $260 million in federal 
appropriations over the 6-year period, to be used for rail cars. WMATA 
officials told us that the federal government has not acted on the 
additional funding request. 

[21] The formal name of the panel is "Panel on the Analysis of and 
Potential for Alternate Dedicated Revenue Sources for WMATA." See PB 
Consult, Inc., Report of the Metro Funding Panel (Washington, D.C.: 
Jan. 6, 2005). 

[22] The Metropolitan Washington Council of Governments is currently 
evaluating how well the National Capital Region delivers paratransit 
services to local constituents and the extent to which local agencies 
have coordinated the provision of these services. In particular, the 
study will seek more cost-effective ways to provide the service. 

[23] GAO-01-744 and GAO-01-1161T. 

[24] GAO, Issues Being Faced by the Washington Metropolitan Area 
Transit Authority, CED-79-52 (Washington, D.C.: Apr. 10, 1979). 

[25] Robert Puentes, Washington Metro: Deficits by Design (Washington, 
D.C.: Brookings Institution Series on Transportation Reform, June 
2004). 

[26] Report of the Metro Funding Panel (2005). 

[27] Land-value capture is a tax arrangement under which incremental 
growth in property tax receipts generated in the Metrorail service 
areas would be shared with WMATA. 

[28] 31 U.S.C. §§ 7501-7507. 

[29] GAO, Government Auditing Standards, GAO-03-673G (Washington, D.C.: 
June 2003). 

[30] The Office of Management and Budget's Circular No. A-133, Audits 
of States, Local Governments, and Non-profit Organizations provides 
implementing guidance for the act's requirements and sets forth 
standards for obtaining consistency and uniformity for the audits of 
nonfederal entities expending federal awards. 

[31] See KPMG LLP, Washington Metropolitan Area Transit Authority, 
Single Audit Report, Year Ended June 30, 2003 (Washington, D.C.: Sept. 
26, 2003) and KPMG LLP/F.S. Taylor & Associates, P.C., Certified Public 
Accountants, Washington Metropolitan Area Transit Authority, Single 
Audit Report, Year Ended June 30, 2004 (Washington, D.C.: Sept. 28, 
2004). 

[32] A reportable condition is a significant deficiency in the design 
or operation of an internal control that could adversely affect the 
entity's ability to record, process, summarize, and report financial 
data consistent with the assertions of management in the financial 
statements. A material weakness is a reportable condition in which the 
design or operation of one or more of the internal control components 
does not reduce to a relatively low level the risk that misstatements 
caused by error or fraud in amounts that would be material in relation 
to the financial statements being audited may occur and not be detected 
within a timely period by employees in the normal course of performing 
their assigned functions. 

[33] See 49 C.F.R. 18.32(d)1. 

[34] The other projects that were under review were Metro Matters, 
Dulles Corridor rapid transit (which has received funding only for the 
preliminary engineering phase and is being done in cooperation with the 
Virginia Department of Rail and Public Transportation), the Addison 
Road to Largo Town Center Metrorail extension, and the Branch Avenue 
storage and maintenance yard. 

[35] The 23 areas include legal, financial, technical, equal employment 
opportunity, safety, security, and others. 

[36] The Urbanized Area Formula Grants Program provides transit capital 
and operating assistance to urbanized areas with populations over 
50,000. A "program of projects" is a set of related projects with a 
common strategic goal or aim. 

[37] See American Public Transportation Association, Rail Operations 
Review for the Washington Metropolitan Area Transit Authority 
(Washington, D.C.: March 2005) and Bus Operations Review for the 
Washington Metropolitan Area Transit Authority (Washington, D.C.: June 
2005). 

[38] For transit agencies that serve urbanized areas with populations 
of 200,000 or more. 

[39] Urban Mass Transportation Act of 1964, Public Law No. 88-365, 78 
Stat. 302. 

[40] The National Mass Transportation Assistance Act of 1974, Public 
Law No. 95-503, 88 Stat. 1565. 

[41] GAO, Mass Transit: Federal Action Could Help Transit Agencies 
Address Security Challenges, GAO-03-263 (Washington, D.C.: Dec., 2002). 

[42] However, FTA continues to encourage project sponsors to request a 
federal New Starts funding share that is as low as possible. 

[43] Metropolitan Transportation Authority and New York City Transit 
Authority--Highways--Appropriations, ch. 314 (1981); N.Y.S. Public 
Authorities Law, § 1279 (1983); Metropolitan Transportation Authority 
and N.Y.C. Transit Authority--Operating and Capital Needs, ch. 929 
(1986); Mass Transportation and Highways--Financing--Credit Against 
Mortgage Recording Tax, ch. 13 (1987). 

[44] See GAO, Mass Transit: Challenges in Evaluating, Overseeing, and 
Funding Major Transit Projects, GAO/T-RCED-00-104 (Washington, D.C.: 
Mar. 8, 2000) and Mass Transit: Project Management Oversight Benefits 
and Future Funding Requirements, GAO/RCED-00-221 (Washington, D.C.: 
Sept. 15, 2000). 

[45] The PMO program is no longer designated by GAO as high risk. 

[46] GAO, District of Columbia: Structural Imbalance and Management 
Issues, GAO-04-908T (Washington, D.C.: June 22, 2004). 

[47] H.R. 3 109th Cong., Engrossed House, § 3026 (2005); H.R. 3, 109th 
Cong., Engrossed Senate Amendment, § 6025 (2005). 

[48] House Report No. 109-12, at 421 and 422 (2005). 

[49] H.R. 3, 109th Cong., Engrossed House, § 1105 (2005); H.R. 3, 109th 
Cong., Engrossed Amendment Senate, § 1802 (2005). 

[50] The most recent Triennial Review of WMATA was in September 2002.