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Summary

On March 31, we issued our report on oversight challenges facing the Department of Transportation with the implementation of the American Recovery and Reinvestment Act (ARRA) of 2009. The objective of this audit was to highlight key DOT oversight challenges–based on prior OIG reports and other agencies’ relevant audit work–and identify actions DOT should take now in support of ARRA requirements. Our report condensed the challenges into 10 focus areas where DOT must exhibit sustained and effective actions related to providing oversight to grantees receiving ARRA funding; implementing new requirements and programs mandated by ARRA; and preventing fraud, waste, and abuse. To ensure sufficient consideration of the potential risks discussed in this report, we recommended that the Secretary of Transportation, through the DOT–wide Transportation Investment Generating Economic Recovery (TIGER) team, develop an oversight implementation plan that outlines the key actions DOT already has underway or will take to address the following 10 focus areas: (1) acquire sufficient personnel with relevant expertise to oversee grantees; (2) adhere to existing Federal requirements for programs funded under ARRA; (3) evaluate the credibility and completeness of cost and schedule estimates; (4) oversee grantees’ contracting management activities and ensure selection of appropriate contract types; (5) address internal control weaknesses and identify unused funds for use on other eligible projects; (6) implement new ARRA tracking and reporting requirements that are designed to promote accountability and transparency; (7) develop comprehensive plans and sound criteria for the new discretionary grant and passenger rail programs created by ARRA; (8) develop appropriate oversight strategies for the new programs created by ARRA by drawing lessons from DOT’s Operating Administrations; (9) enhance understanding among DOT staff, grantees, and their contractors on how to recognize, prevent, and report potential fraud; and (10) take timely and effective action to suspend and/or debar individuals or firms that have defrauded the Department so they do not receive Federal contracts in the future. In addition, we recommended that the plan prioritize the greatest risks for DOT and address open OIG recommendations from prior audit reports that have relevance to the implementation of ARRA. DOT concurred with our recommendation and agreed to provide us with a document outlining actions taken and planned to address our 10 focus areas within 30 days of the date of our report.