oversight

FTA Made Progress in Providing Hurricane Sandy Funds but Weaknesses in Tracking and Reporting Reduce Transparency Into Their Use

Published by the Department of Transportation, Office of Inspector General on 2021-07-21.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                   FTA Made Progress in Providing
                Hurricane Sandy Funds but Weaknesses
                  in Tracking and Reporting Reduce
                      Transparency Into Their Use




Report No. ST2021032
July 21, 2021
FTA Made Progress in Providing Hurricane Sandy Funds but
Weaknesses in Tracking and Reporting Reduce Transparency
Into Their Use
Self-initiated

Federal Transit Administration | ST2021032 | July 21, 2021




What We Looked At
After Hurricane Sandy caused widespread damage to transportation infrastructure in October 2012,
the Disaster Relief Appropriations Act (DRAA) designated $10.9 billion for the Federal Transit
Administration’s (FTA) new Public Transportation Emergency Relief Program. We assessed (1) FTA’s
progress in allocating, obligating, and disbursing its Hurricane Sandy funding and (2) any weaknesses
in these processes that we identified.

What We Found
Through December 31, 2020, FTA allocated and obligated approximately $10 billion—most of its
Hurricane Sandy appropriation—but only disbursed about $4.3 billion. The pace was influenced by a
number of factors, including but not limited to project construction planning and execution and the
complexity of competitive resilience projects. As a result, over 8 years after the storm, more than half
of the funds remain to be spent. We also found that FTA inconsistently tracks and reports Hurricane
Sandy funding data or does not fully comply with Federal guidance. The Agency has allocation data in
a variety of sources, but—as FTA does not have procedures to accurately communicate allocated
amounts over time—the data from these sources do not align. Thus, FTA cannot use these data to
determine whether obligation amounts for specific recipients and purposes stayed within the
allocated amounts in FTA’s official documentation. Finally, FTA has not complied with a directive from
the Office of Management and Budget to make DRAA obligation data readily identifiable on the
USAspending.gov website. Overall, the weaknesses we identified reduced transparency for internal
users, decision makers, and the public into FTA’s use of Hurricane Sandy funds.

Our Recommendations
We made two recommendations to improve FTA’s tracking and reporting on its use of Hurricane
Sandy funds. FTA concurred with both recommendations and proposed appropriate actions and
completion dates. Accordingly, we consider both recommendations as resolved but open pending
completion of the planned actions.




All OIG audit reports are available on our website at www.oig.dot.gov.
For inquiries about this report, please contact our Office of Government and Public Affairs at (202) 366-8751.
Contents
     Memorandum                                                               1

     Results in Brief                                                         3

     Background                                                               4

     FTA Allocated and Obligated Most of Its Hurricane Sandy Appropriation
        but Only Disbursed Less Than Half of the Funds                        6

     FTA’s Tracking and Reporting of Hurricane Sandy Funding Data Are
        Inconsistent or Do Not Fully Comply With Federal Guidance            10

     Conclusion                                                              16

     Recommendations                                                         16

     Agency Comments and OIG Response                                        16

     Actions Required                                                        17

     Exhibit A. Scope and Methodology                                        18

     Exhibit B. Organizations Visited or Contacted                           20

     Exhibit C. List of Acronyms                                             21

     Exhibit D. Major Contributors to This Report                            22

     Appendix. Agency Comments                                               23




ST2021032
           U.S. DEPARTMENT OF TRANSPORTATION
           OFFICE OF INSPECTOR GENERAL




Memorandum
Date:             July 21, 2021

Subject:          ACTION: FTA Made Progress in Providing Hurricane Sandy Funds but Weaknesses
                  in Tracking and Reporting Reduce Transparency Into Their Use |
                  Report No. ST2021032

From:             David Pouliott
                  Assistant Inspector General for Surface Transportation Audits

To:               Federal Transit Administrator


                  After Hurricane Sandy caused widespread damage to transportation
                  infrastructure in the mid-Atlantic and the northeastern United States in
                  October 2012, the Disaster Relief Appropriations Act (DRAA) 1 designated
                  $10.9 billion for the Federal Transit Administration’s (FTA) new Public
                  Transportation Emergency Relief Program. 2 Although DRAA did not mandate a
                  deadline to obligate these funds, it did require FTA to provide up to $2 billion
                  within 60 days and for all recipients to expend their funds within 24 months. The
                  Office of Management and Budget (OMB) subsequently waived the 24-month
                  expenditure requirement for several Department of Transportation (DOT)
                  Operating Administrations, including FTA. However, FTA informed grantees that
                  OMB expected DOT agencies and their grantees to work together to expend
                  DRAA funds in a timely manner.

                  Our past work has identified concerns regarding the timeliness of Hurricane
                  Sandy awards and expenditures. In June 2015, we reported that FTA had
                  allocated most of its DRAA funds, but the pace of obligations and disbursements
                  was slower than expected due to several factors. 3 We did not make any related
                  recommendations in that report.




1 Pub. L. No. 113-2 (2013).
2 The Emergency Relief Program was established by the 2012 Moving Ahead for Progress in the 21st Century Act
(Pub. L. No. 112-141) to provide funds for States and public transportation systems to protect, repair, or replace assets
damaged in an emergency, such as a natural disaster.
3 FTA Has Not Fully Implemented Key Internal Controls for Hurricane Sandy Oversight and Future Emergency Relief

Efforts (OIG Report No. ST2015046), June 12, 2015. OIG reports are accessible from our website:
https://www.oig.dot.gov.




ST2021032                                                                                                              1
                  Given these concerns, as well as the expectation for timely fund expenditure, we
                  initiated this audit. Our announced objectives were to assess FTA’s progress in
                  obligating Hurricane Sandy funds and actions to ensure timely expenditure of
                  those funds. However, since we announced the audit, the Coronavirus Disease
                  2019 (COVID-19) pandemic has disrupted Hurricane Sandy-related project
                  schedules. 4 Therefore, we are not reporting on FTA’s actions to ensure timely
                  expenditure of the Hurricane Sandy funds. This report discusses our assessment
                  of (1) FTA’s progress in allocating, obligating, and disbursing its Hurricane Sandy
                  funding and (2) any weaknesses in these processes that we identified. 5

                  We conducted this audit in accordance with generally accepted Government
                  auditing standards. Exhibit A details our scope and methodology. Exhibit B lists
                  the entities we visited or contacted.

                  We appreciate the courtesies and cooperation of Department of Transportation
                  representatives during this audit. If you have any questions concerning this
                  report, please call me at (202) 366-1844 or Tiffany Mostert, Program Director, at
                  (202) 366-0625.

                  cc:      The Secretary
                           DOT Audit Liaison, M-1
                           FTA Audit Liaison, TBP-30




4 In March 2020, FTA received $25 billion through the Coronavirus Aid, Relief, and Economic Security (CARES) Act to
prevent, prepare for, and respond to COVID-19 (Pub. L. No. 116-136). In December 2020, FTA received an additional
$14 billion for these purposes through the Coronavirus Response and Relief Supplemental Appropriations (CRRSA)
Act of 2021 (Pub. L. No. 116-260). In March 2021, FTA received another $30.5 billion for these purposes through the
American Rescue Plan (ARP) Act of 2021 (Pub. L. No. 117-2).
5 In this report, “allocating” refers to FTA assigning funds for each of the purposes allowed under DRAA. “Obligating”

describes FTA’s formal commitment to a recipient to use the allocated funds, such as through grants and contracts.
“Disbursing,” also called expending or outlaying, refers to FTA’s payments to reimburse recipients for the obligations.


ST2021032                                                                                                             2
Results in Brief
            FTA allocated and obligated most of its Hurricane Sandy
            appropriation but only disbursed less than half of the
            funds.

            Through December 31, 2020, after a reduction and transfers to other DOT
            agencies, FTA retained approximately $10.1 billion in DRAA funds for allocation,
            obligation, and disbursement. Of the amount retained, FTA allocated all but
            $2.125 million (nearly 100 percent), with the vast majority of the funding—about
            $9.7 billion—going to the four recipients it determined were most affected by the
            storm: (1) Metropolitan Transportation Authority (MTA), (2) New Jersey Transit
            Corporation (NJT), (3) Port Authority of New York and New Jersey (PANYNJ), and
            (4) New York City Department of Transportation (NYCDOT). Through December
            31, 2020, FTA obligated approximately $10 billion (about 98 percent) of the
            amount retained. However, by that same date, FTA had disbursed about
            43 percent—approximately $4.3 billion—of the funds. Because funds are
            disbursed on a reimbursable basis for incurred expenses, the pace is influenced
            by a number of factors, including project construction planning and execution, as
            well as the complexity of competitive resilience projects, and, more recently, the
            COVID-19 pandemic. As a result, over 8 years after the storm, more than half of
            the funds remain to be spent.

            FTA’s tracking and reporting of Hurricane Sandy funding
            data are inconsistent or do not fully comply with Federal
            guidance.

            FTA has Hurricane Sandy allocation information in a variety of sources, including
            its official documents, grants management system—the Transit Award
            Management System (TrAMS)—and public website. It is important that amounts
            in these sources agree because allocations are intended to serve as controls for
            ensuring that funds are correctly awarded to recipients and that obligated
            amounts do not exceed limitations. However, recipient allocation data from these
            sources do not align, and the amounts contained in TrAMS and on FTA’s website
            are inaccurate relative to the approved amounts in its official documentation. For
            example, compared to FTA’s official documentation, TrAMS reports about $54
            million more in total allocations for recovery and resilience. In addition, FTA’s
            public website report totals include $30.5 million more for PANYNJ recovery than
            allocated and still include about $13.5 million in resilience funding for MTA that
            FTA transferred to the Federal Railroad Administration (FRA). The inconsistencies
            occurred because FTA does not have procedures to accurately communicate
            allocated amounts through its notices, memoranda, letters, systems, and external
            reports over time. As a result, the Agency cannot use these data to determine
            whether obligation amounts for specific recipients and purposes stayed within


ST2021032                                                                                    3
                  the allocated amounts in FTA’s official documentation. FTA also reported
                  inconsistent information to OMB about the impact two transfers to FRA had on
                  its program management and oversight funding amounts. Finally, FTA’s data on
                  the USAspending.gov website—which provides the public access to information
                  on Federal award recipients and obligated amounts—does not comply with a
                  March 2013 OMB directive to make DRAA obligation information readily
                  identifiable on that site. Overall, the weaknesses we identified reduced
                  transparency for internal users, decision makers, and the public into FTA’s use of
                  Hurricane Sandy funds.

                  We are making recommendations to improve FTA’s tracking and reporting on its
                  use of Hurricane Sandy funds.




Background
                  DRAA specified purposes for, and limitations on, the funds appropriated to FTA’s
                  Public Transportation Emergency Relief Program. In addition to funding recovery
                  and relief efforts in the areas most affected by Hurricane Sandy, the law
                  permitted the Secretary of Transportation to transfer up to $5.383 billion to
                  appropriate agencies for projects to reduce the risk of damage from future
                  disasters in areas impacted by the hurricane. 6 The law required congressional
                  notification 15 days in advance of any transfer. It also allowed FTA to use up to
                  0.75 percent of the funds retained for public transportation emergency relief for
                  administrative expenses and ongoing program management oversight—in
                  addition to other appropriations for such purposes. In this report, we describe the
                  purposes outlined in DRAA as recovery, resilience, program administration, and
                  oversight. To track the Hurricane Sandy obligations and disbursements for each
                  of these purposes, FTA established specific account classification codes.

                  Before FTA could use its DRAA appropriated funds for these purposes, it made
                  the funds available through the following steps: 7

                       1. Apportionment: The action by which OMB distributes amounts available
                          for obligation based on specific time periods (usually quarters), activities,
                          projects, objects, or a combination of those things. An apportionment



6 FTA referred to this as “resilience” funding and defined a resiliency project as one designed and built to address
future vulnerabilities to a public transportation facility or system from emergencies or major disasters likely to occur
again in that geographic area or projected changes in development patterns, demographics, or climate and weather
patterns.
7 See Government Accountability Office (GAO), A Glossary of Terms Used in the Federal Budget Process (GAO-05-

734SP), September 2005, for more information on these terms.




ST2021032                                                                                                                  4
                                limits the amount of obligations that may be incurred. Some apportioned
                                funds may be reserved to provide for contingencies or to effect savings
                                made possible by the Antideficiency Act. 8 According to FTA’s budget
                                process documentation, FTA requests this funding authority from OMB
                                through the Standard Form (SF) 132, the Apportionment and
                                Reapportionment Schedule, which FTA’s Office of Budget and Policy
                                Budget Analysts prepare and the Budget Director reviews.
                                Apportionments are prepared annually and as needed during a fiscal year.

                           2. Allotment: An authorization by the agency head (or a designee) to incur
                              obligations within a specific amount. This allotment cannot exceed the
                              amount apportioned by OMB. For discretionary programs—such as FTA’s
                              Emergency Relief Program, which received DRAA-appropriated funds—
                              the Agency’s process explains that once OMB approves the SF-132, FTA’s
                              Office of Budget generates allotments in TrAMS. Allotments are prepared
                              annually and as needed during a fiscal year..

                           3. Recipient Allocation: A further subdivision of an apportionment, which
                              assigns funds to specific recipients for particular purposes or projects.
                              Recipient allocations remain in effect through the funding’s period of
                              availability or until they are otherwise modified. FTA’s Emergency Relief
                              Manual describes an allocation process in which the Agency determines
                              the amounts for which specific recipients are eligible and notifies them—
                              either through an official notice or a letter of allocation—that the funds
                              are available. For DRAA funds, FTA used internal memoranda to document
                              allocation and reallocation amounts and, in its official allocation
                              documentation, listed the amounts allocated to recipients for recovery,
                              locally prioritized resilience, and competitive resilience. This
                              documentation also included an allocation amount for program
                              administration and oversight. As TrAMS is a grant management system, it
                              tracks FTA’s discretionary allocations by program, purpose, and recipient.
                              However, TrAMS does not include allocations for FTA’s program
                              administration and oversight, which are reflected in the Department’s
                              Delphi system.

                      Apportionments, allotments, and recipient allocations each represent a
                      progressively more detailed breakdown of the maximum amount FTA should
                      obligate for a given purpose, such as through a grant, contract, payroll, or travel
                      order. FTA disburses funds on a reimbursable basis for eligible expenses incurred.
                      This report describes FTA’s allocations, obligations, and disbursements to its




8   Title 31, U.S. Code (U.S.C.), § 1512.


ST2021032                                                                                               5
                    recipients for the recovery and resilience purposes, as well as the funds the
                    Agency retained for program administration and oversight.




FTA Allocated and Obligated Most of Its Hurricane
Sandy Appropriation but Only Disbursed Less Than
Half of the Funds
                    Through December 31, 2020, FTA retained about $10.1 billion from the full
                    $10.9 billion DRAA appropriation for allocation, obligation, and disbursement
                    after transfers to other DOT agencies and a reduction.

                         1. Oversight Transfer: DRAA specified a $6 million transfer to the DOT
                            Office of Inspector General (OIG) to support oversight of FTA’s Hurricane
                            Sandy relief funding under its Emergency Relief Program.

                         2. Sequestration Reduction: As a result of the Budget Control Act of 2011 9
                            and OMB’s 2013 Sequestration Report, 10 the total DRAA appropriation for
                            FTA's Emergency Relief Program (excluding the transfer to OIG) was
                            reduced by 5 percent. This reduction was known as “sequestration.”

                         3. Resilience Transfers: FTA transferred funds to FRA for resilience projects
                            in three separate instances, a total of about $238.7 million. The Secretary
                            approved the first transfer for $185 million in 2013. FTA leadership
                            approved the remaining two transfers for $40.2 million in 2016 and about
                            $13.5 million in 2017.

                    Table 1 shows the effects of these actions on the DRAA funds available for FTA to
                    allocate under its Emergency Relief Program, which we refer to as Hurricane
                    Sandy funding.




9   Pub. L. No. 112-25 (2011).
10   OMB, Report to the Congress on the Joint Committee Sequestration for Fiscal Year 2013, March 1, 2013.


ST2021032                                                                                                    6
Table 1. Effect of Transfers and Sequestration on FTA’s Hurricane Sandy Funding
Retained for Allocation, Obligation, and Disbursement, Through
December 31, 2020

 Purpose                                                                                        Amount

 DRAA appropriation for the Emergency Relief Program                                     $10,900,000,000

 Transfer to OIG                                                                            ($6,000,000)

 5-percent sequestration                                                                  ($544,700,000)

 Initial transfer to FRA for resilience                                                   ($185,000,000)

 Other resilience project transfers to FRA                                                 ($53,679,978)

 Amount FTA retained to allocate, obligate, and disburse                                 $10,110,620,022

Source: OIG analysis of DRAA and FTA’s allocation notices, memoranda, and letters.

                   By December 31, 2020, FTA had allocated and obligated nearly all of the over
                   $10.1 billion it retained from the DRAA appropriation. It allocated all but
                   $2.125 million—to specific recipients for recovery and resilience projects or to its
                   own program administration and oversight—and obligated all but about
                   $157 million (see table 2). However, by that same date, FTA had disbursed less
                   than half of the funds. Because disbursements are provided on a reimbursable
                   basis the pace was influenced by a number of factors that could impact recipient
                   expenditures. These factors included project construction planning and
                   execution, the complexity of competitive resilience projects, the time required to
                   settle Hurricane Sandy–related insurance claims, the lead time for procuring
                   assets, the extended project timelines for some recovery and local resilience
                   activities, internal grantee processes and, more recently, the impact of the
                   COVID-19 pandemic. As a result, over 8 years after the storm, more than half of
                   the funds remain to be spent.




ST2021032                                                                                              7
Table 2. FTA’s Progress in Using the Over $10.1 Billion in the Hurricane Sandy
Funds It Retained, Through December 31, 2020

    Purpose                                  Allocated Amount         Obligated Amount a         Disbursed Amount a

    Recovery                                   $5,559,805,723 b             $5,480,784,884              $2,997,008,417

    Resilience                                     $4,472,457,048           $4,421,547,095              $1,268,438,187

    Program Administration                            $76,232,250              $33,769,509                $33,760,472

    Oversight                                                                  $16,525,704                $15,406,593

    Total                                          $10,108,495,021          $9,952,627,192              $4,314,613,670

    Percent of the Over $10.1 Billion
                                                           99.98%                   98.44%                     42.67%
    FTA Retained

    Amount Remaining From the Over
                                                       $2,125,001             $157,992,830              $5,796,006,352
    $10.1 Billion FTA Retained

a   Amounts rounded to the nearest whole dollar.

bExcludes $441 described in FTA's allocation documents as “reserved for future allocation,” which
FTA attributed to an error, and we determined was immaterial.

Source: OIG analysis of FTA allocation and transfer data from its Hurricane Sandy allocation notices,
memoranda, and letters and obligation and disbursement data from DOT’s Delphi financial
management system.

                     By December 31, 2020, FTA had allocated the vast majority of funding to the four
                     recipients it determined were most affected by the storm—(1) MTA, (2) NJT,
                     (3) PANYNJ, and (4) NYCDOT. To these four agencies, FTA allocated about
                     $5.5 billion in recovery funds and approximately $4.2 billion for resilience efforts.
                     FTA allocated the rest of the recovery and resilience funds—about $326 million—
                     to other agencies (see table 3).




ST2021032                                                                                                            8
Table 3. FTA’s Hurricane Sandy Recovery and Resilience Allocations to
Recipients, Through December 31, 2020

 Allocation Recipient                        Recovery Allocation     Resilience Allocation     Total Allocation

 New York Metropolitan Transportation              $3,664,038,109          $2,148,088,721       $5,812,126,830
 Authority

 Port Authority of New York and New                $1,403,285,499            $429,228,662       $1,832,514,161
 Jersey

 New Jersey Transit Corporation                     $444,822,739           $1,382,221,856       $1,827,044,595

 New York City Department of                          $34,627,941            $200,111,124        $234,739,065
 Transportation

 Rhode Island Public Transit Authority                 $5,949,180                      $0           $5,949,180

 City of Long Beach                                    $5,100,205                      $0           $5,100,205

 Southeastern Pennsylvania                             $1,192,568             $86,758,000          $87,950,568
 Transportation Authority

 Massachusetts Bay Transportation                       $344,311              $35,065,132          $35,409,443
 Authority

 Westchester County Department of                       $317,200                       $0             $317,200
 Transportation

 Connecticut Department of                                $55,622            $169,957,772        $170,013,394
 Transportation

 Nassau County                                            $45,214                      $0              $45,214

 Greater Bridgeport Transit District                      $21,783                      $0              $21,783

 Milford Transit District                                  $5,352                      $0               $5,352

 City of Nashua, NH                                            $0                 $25,781              $25,781

 Washington Metropolitan Area Transit                          $0             $21,000,000          $21,000,000
 Authority

 Total                                            $5,559,805,723          $4,472,457,048       $10,032,262,771

 Remaining for future allocation                       $2,125,001                      $0           $2,125,001

Source: OIG analysis of FTA data from its Hurricane Sandy allocation notices, memoranda, and
letters.

                  FTA had allocated all of its Hurricane Sandy funding by December 31, 2019.
                  However, in 2020, the Agency reduced NYC DOT’s total recovery allocation by




ST2021032                                                                                                     9
                 $2.125 million, making these Hurricane Sandy recovery funds available for
                 allocation to another FTA grantee. 11




FTA’s Tracking and Reporting of Hurricane Sandy
Funding Data Are Inconsistent or Do Not Fully
Comply With Federal Guidance
                 FTA’s Hurricane Sandy funding allocations are inconsistent across the data
                 sources the Agency used for tracking or reporting and inaccurate relative to the
                 approved amounts in its documents. In addition, FTA reported inconsistent
                 information to OMB about the impact two transfers to FRA had on its program
                 management and oversight funding amounts. Finally, FTA has not fully complied
                 with an OMB reporting requirement for DRAA obligations.



             Hurricane Sandy Recipient Allocation
             Amounts in FTA’s Data Sources Are Not
             Consistent
                 FTA‘s allocation amounts for DRAA-allowed purposes differ among the data
                 sources that FTA staff and officials indicated they use to track and report on
                 Hurricane Sandy funding. When we asked FTA for the allocation system of
                 record—that is, the authoritative data source for allocation information—staff
                 and officials pointed to multiple data sources, including but not limited to:

                     1. Documents: Official documents of allocation approvals, which include
                        FTA’s Federal Register notices, memoranda, and letters.

                     2. TrAMS: FTA’s system to award and manage Federal grants, which also
                        provides data to the Department’s Delphi financial management system.
                        This system contains a module to track recipient allocations.

                     3. FTA’s Public Website: The website has a report for its recipient allocations
                        for the recovery and resilience purposes that officials said was derived
                        from the TrAMS module.




11For more information about why FTA reduced NYC DOT’s allocation, see FTA’s Limited Oversight of Grantees’
Compliance With Insurance Requirements Puts Federal Funds and Hurricane Sandy Insurance Proceeds at Risk (OIG
Report No. ST2020005), October 30, 2015.


ST2021032                                                                                                       10
                     It is important that amounts in these sources agree because allocations are
                     intended to serve as controls for ensuring that funds are correctly awarded to
                     recipients and that obligated amounts do not exceed limitations. Moreover, FTA
                     relies on its notices and website to provide transparency by communicating its
                     funding information to the public. DOT’s Information Dissemination Quality
                     Guidelines direct the Department’s Operating Administrations to ensure
                     disseminated information is accurate, complete, and clear. 12 However, the data
                     from these sources through December 31, 2020, that we reviewed do not align,
                     resulting in a lack of clarity on the funds FTA had allocated for each DRAA-
                     allowed purpose and in total. Notably, both the data from TrAMS and the
                     Agency’s website are inaccurate compared to FTA’s documents, which represent
                     the official, approved recipient allocations (see table 4).


Table 4. Hurricane Sandy Recipient Allocation Amounts in FTA Data Sources
and Magnitude of Differences From Approved Amounts, Through
December 31, 2020
                                                                                         TrAMS %         Website %
 Allocation                                                                       Difference from   Difference from
 Purpose                      Documents                 TrAMS          Website         Documents         Documents

 Recovery                 $5,559,805,723a      $6,818,968,148   $5,592,430,724b           22.65%             0.59%

 Resilience               $4,472,457,048       $3,266,974,601    $4,485,937,026          -26.95%             0.30%

 Total Recovery          $10,032,262,771      $10,085,942,749   $10,078,367,750            0.54%             0.46%
 and Resilience

 Difference from                     N/A          $53,679,978      $46,104,979             0.54%             0.46%
 Documents Total

a Excludes$441 described in FTA’s allocation documents as “reserved for future allocation,” which
FTA attributed to an error, and we determined was immaterial.

b Includes   $2,550 “reserved for future allocation.”

Source: OIG analysis of allocation data from FTA’s Hurricane Sandy allocation notices, memoranda,
letters, TrAMS, and website.

                     FTA uses TrAMS to report recipient allocations through its public website as well
                     as to obligate funding and report on those obligations through the Department’s
                     financial management system, Delphi. Based on our review, however, through
                     December 31, 2020, TrAMS reported about $54 million more in total allocations
                     for recovery and resilience than FTA’s official allocation documentation showed.



12DOT, Secretary’s Policy Statement on Information Quality and DOT Information Dissemination Quality Guidelines,
October 2019.


ST2021032                                                                                                          11
            Specifically, TrAMS included $40.2 million and about $13.5 million in resilience
            allocations to PANYNJ and MTA, respectively, that FTA had transferred to FRA
            several years earlier. In addition, TrAMS showed more funding available for
            recovery and less available for resilience than FTA’s documentation showed was
            available for these purposes. This occurred because FTA used a different identifier
            (ID) for the TrAMS allocations than the account classification codes it had
            established to track DRAA funds. Specifically, FTA assigned the ID for recovery
            funds (D2013-SAND) to locally prioritized resilience allocations instead of the ID
            for resilience funds (D2013-RESL). In contrast, the Agency used the resilience
            account classification code when obligating and disbursing locally prioritized
            resilience funds. This created a mismatch between the allocation and obligation
            amounts. In written comments on a draft of this report, FTA stated the Agency’s
            initial intent was to use the SAND ID for all funding and then it subsequently
            decided to create the separate RESL ID for competitive resilience projects. FTA
            further noted that the resilience projects are clearly identified in descriptions that
            accompany the SAND ID.

            After we brought these issues to FTA’s attention, the Agency revised its public
            website to address some of the allocation data concerns we identified. In the
            recipient allocation report on its website, FTA noted that it had removed the
            $40.2 million that it had transferred from PANYNJ to FRA from the resilience total.
            FTA also revised the website to report locally prioritized resilience as a separate
            category. However, through December 31, 2020, the website still included
            $30.5 million more for PANYNJ recovery than was reflected in the allocation
            documentation, and about $13.5 million in resilience funding that FTA transferred
            from MTA to FRA.

            These inconsistencies occurred because FTA does not have procedures to
            accurately communicate allocated amounts through its notices, memoranda,
            letters, systems, and external reports over time. As a result, the Agency cannot
            use these data to determine whether obligation amounts for specific recipients
            and purposes stayed within the allocated amounts in FTA’s official
            documentation. FTA officials acknowledged that, although the TrAMS allocation
            data inform its public website allocation reporting and are useful to FTA staff at
            the time of grant award, they are not designed as a control on obligations.
            Instead, FTA officials identified the apportionment data that FTA budget staff
            load into TrAMS as the control total against which FTA reserves funding for
            obligations. However, during the course of this audit, DOT and FTA budget staff
            instructed us not to use apportionment data to describe allocations, as these
            serve different purposes. In addition, FTA has not documented a process that
            uses either the allocation or the apportionment data as a control when making
            obligation decisions.

            Furthermore, the Agency did not consistently follow the process described in its
            Emergency Relief Manual, which explains that FTA notifies applicants that funding


ST2021032                                                                                      12
                  is available through an official notice or a letter of allocation. FTA issued four
                  allocation notices from March 2013 through July 2016. 13 The initial allocation
                  notice stated that the Agency had reserved about $28 million for future
                  allocations, and the final notice said that about $17.5 million remained. However,
                  the intervening notices did not describe how FTA had allocated the
                  approximately $10.6 million difference between the two amounts. FTA provided
                  internal memoranda approving these allocations but confirmed that it did not
                  have letters to the recipients regarding allocations or changes to allocations.

                  Overall, the inconsistencies we identified raise questions about FTA’s ability to
                  rely on these data in making obligation decisions and decrease transparency for
                  internal users, decision makers, and members of the public seeking information
                  about the Agency’s use of Hurricane Sandy funds. Moreover, the unclear and
                  inaccurate information FTA provided also did not comply with DOT’s Information
                  Dissemination Quality Guidelines.



             FTA Reported Inconsistent Information
             About Its Program Management and
             Oversight Funding Amounts
                  DRAA stipulated that FTA could use up to 0.75 percent of the funds retained for
                  public transportation emergency relief for administrative expenses and ongoing
                  program management oversight. However, in the backup information that
                  accompanied the SF-132 requesting OMB approval for funding apportionments,
                  FTA inconsistently described how the three transfers to FRA impacted the funds
                  available for its program administration and oversight. FTA officials confirmed
                  that the Agency had allocated about $76.2 million for those activities, which was
                  presented in one part of the SF-132 backup spreadsheet and in FTA’s official
                  allocation documentation. FTA based this calculation on the amount of DRAA
                  funding it retained after the sequestration reduction, transfer to OIG, and initial
                  $185 million transfer to FRA. However, in its calculation FTA did not account for
                  two subsequent transfers to FRA for $40.2 million and about $13.5 million (see
                  table 5).




13FTA, Allocation of Public Transportation Emergency Relief Funds in Response to Hurricane Sandy, Federal Register 78,
no. 61 (March 29, 2013); Second Allocation of Public Transportation Emergency Relief Funds in Response to Hurricane
Sandy: Response, Recovery, and Resiliency, Federal Register 78, no. 103 (May 29, 2013), and its related correction,
Federal Register 78, no. 107 (June 4, 2013); Selection of Public Transportation Resilience Projects in Response to
Hurricane Sandy, Federal Register 79, no. 214 (November 5, 2014); and Fourth Allocation of Public Transportation
Emergency Relief Funds in Response to Hurricane Sandy, Federal Register 81, no. 128 (July 5, 2016).


ST2021032                                                                                                          13
            Table 5. Effect of Transfers and Sequestration on Amount FTA
            Could Use for Hurricane Sandy Program Administration and
            Oversight

             Purpose                                                        Amount      0.75 Percent


             DRAA appropriation for the Emergency Relief             $10,900,000,000    $81,750,000
             Program


             Transfer to OIG                                             ($6,000,000)      ($45,000)


             5% sequestration                                         ($544,700,000)    ($4,085,250)


             Initial transfer to FRA for resilience                   ($185,000,000)    ($1,387,500)


             Subtotal of amounts FTA used to calculate              $10,164,300,000     $76,232,250
             program administration and oversight allocation


             Other resilience project transfer to FRA                   ($40,200,000)     ($301,500)


             Other resilience project transfer to FRA                   ($13,479,978)     ($101,100)


             Subtotal of amounts FTA did not include in                 ($53,679,978)     ($402,600)
             calculating program administration and oversight
             allocation

            Source: OIG analysis of DRAA and FTA’s allocation notices, memoranda, and
            letters.

            FTA officials maintained that it was appropriate for the Agency not to reduce the
            program administration and oversight allocation to account for the latter two
            transfers to FRA, based on administrative costs the Agency had incurred prior to
            their transfer to FRA. Yet, on another part of the same SF-132 backup
            spreadsheet, FTA also indicated that it had reduced that allocation by $301,500 to
            account for the $40.2 million transfer to FRA. FTA officials could not explain the
            inconsistencies on the spreadsheet, and an Agency official agreed that FTA could
            enhance the transparency and accuracy of the information on the SF-132 backup
            spreadsheet it provides to OMB. To address the issues we identified, FTA later
            revised the SF-132 spreadsheet. Specifically, the Agency removed the erroneous
            reference to an additional program administration and oversight allocation
            reduction, thereby clarifying the information provided to OMB.




ST2021032                                                                                        14
             FTA Has Not Fully Complied With an
             OMB Requirement for Reporting DRAA
             Obligations
                 On March 12, 2013, OMB issued a memorandum with the internal control
                 planning and reporting requirements for all DRAA-funded programs. 14 The
                 memorandum included a reminder that—under the Federal Funding
                 Accountability and Transparency Act 15—agencies must provide their spending
                 information to USAspending.gov, which gives the public access to information on
                 award recipients and obligated amounts. OMB directed agencies to obtain and
                 assign a separate Catalogue of Domestic Federal Assistance (CFDA) number for
                 DRAA funds to make obligation information readily identifiable on that site.
                 Specifically, when obtaining the CFDA number, an agency was to include the term
                 “Disaster Relief Appropriations Act” in the program title and DRAA’s statutory
                 purposes for the funds in the program information. This requirement applied to
                 all financial assistance awards made on or after the date of this guidance.

                 Contrary to OMB’s directive, FTA's CFDA program title for Hurricane Sandy
                 funding was “Public Transportation Emergency Relief Program,” and the program
                 description did not include the DRAA funding purposes. This occurred because
                 on February 6, 2013—prior to OMB’s March 2013 memorandum—FTA received
                 approval from OMB for a CFDA title and description for its “Public Transportation
                 Emergency Relief Program,” but it had not yet issued any grants under the CFDA
                 number. FTA did not subsequently update the program information or seek a
                 waiver from OMB and continued to use the same CFDA number for DRAA and
                 subsequent disaster relief funding. 16

                 An FTA official indicated that FTA has since revised its CFDA—now known as
                 Assistance Listings—process. According to that official, FTA intends to update its
                 established internal guidance to include a new standard operating procedure that
                 directs the Assistance Listings Officer to review current or proposed OMB
                 guidance or action memoranda that may impact a new request. According to the
                 official, these actions will be completed by September 2021.

                 Because FTA did not have such a procedure in place when it obtained the CFDA
                 number for its Hurricane Sandy funding, FTA’s use of DRAA funds is not
                 transparent to members of the public who consult USAspending.gov. Specifically,



14 OMB, Memorandum for the Heads of Executive Departments and Agencies: Accountability for Funds Provided by the
Disaster Relief Appropriations Act (M-13-07), March 12, 2013.
15 Pub. L. No. 109-282 (2006).
16 FTA’s Emergency Relief Program received a $330 million appropriation through the Bipartisan Budget Act of 2018

for response and recovery efforts related to Hurricanes Harvey, Irma, and Maria.


ST2021032                                                                                                       15
            without a unique identifier, it is difficult for users who are unfamiliar with the
            program to accurately extract and analyze Hurricane Sandy awards.




Conclusion
            Congress intended the Disaster Relief Appropriations Act (DRAA) to provide
            expeditious and efficient assistance to areas damaged by Hurricane Sandy. FTA
            has made progress toward this goal by allocating and obligating most of its over
            $10 billion in DRAA funding for recovery and resilience projects, program
            administration, and oversight. Central to these efforts is for FTA to provide
            internal users, decision makers, and the public with consistent and accurate
            funding information. Therefore, increased management attention on tracking and
            reporting procedures will enhance FTA’s ability to manage disaster relief funds
            and emergencies in the future.




Recommendations
            To improve tracking and reporting on the use of Hurricane Sandy funds, we
            recommend that the Federal Transit Administrator:

               1. Establish and implement written policies and procedures to accurately
                  communicate allocated amounts over time through FTA’s documents,
                  such as notices, memoranda, and letters; the grant management system;
                  and external reports.

               2. Complete the planned update to FTA’s Assistance Listings internal
                  guidance to include procedures to ensure the Agency complies with the
                  Office of Management and Budget assistance listing requirements that
                  are intended to make obligation information readily identifiable on
                  USASpending.gov.




Agency Comments and OIG Response
            We provided FTA with our draft report on May 26, 2021, and received its
            response, dated June 25, 2021, which is included as an appendix to this report.
            FTA concurred with both of our recommendations and provided appropriate
            actions and completion dates. Accordingly, we consider all recommendations
            resolved but open pending completion of the planned actions.




ST2021032                                                                                        16
Actions Required
            We consider all recommendations resolved but open pending completion of
            FTA’s planned actions.




ST2021032                                                                             17
Exhibit A. Scope and Methodology
                 We conducted this performance audit between February 2020 and May 2021 in
                 accordance with generally accepted Government auditing standards as
                 prescribed by the Comptroller General of the United States. Those standards
                 require that we plan and perform the audit to obtain sufficient, appropriate
                 evidence to provide a reasonable basis for our findings and conclusions based on
                 our audit objectives. We believe that the evidence obtained provides a
                 reasonable basis for our findings and conclusions based on our audit objectives.

                 Our announced objectives were to assess FTA’s progress in obligating Hurricane
                 Sandy funds and actions to ensure timely expenditure of those funds. However,
                 since we announced the audit, the COVID-19 pandemic has impacted public
                 transportation agency operations, disrupting Hurricane Sandy-related project
                 schedules. 17 Therefore, we did not report on FTA’s actions to ensure timely
                 expenditure of the Hurricane Sandy funds at this time. This report discusses our
                 assessment of (1) FTA’s progress in allocating, obligating, and disbursing its
                 Hurricane Sandy funding and (2) any weaknesses in these processes that we
                 identified.

                 We initially planned to report on FTA’s progress in allocating, obligating, and
                 disbursing its Hurricane Sandy funding and any related weaknesses through
                 December 31, 2019. However, in January 2021, we updated our audit scope to
                 extend through December 31, 2020.

                 To guide our work, we identified criteria in relevant legislation, especially DRAA 18
                 and related FTA guidance, such as the Agency’s Emergency Relief Manual. In
                 addition, we reviewed Federal guidance with requirements related to allocations,
                 such as OMB Circular A-11, Preparation, Submission, and Execution of the Budget.
                 Finally, we reviewed Federal guidance on transparency and reporting, including
                 DOT’s Information Dissemination Quality Guidelines and OMB’s Accountability for
                 Funds Provided by the Disaster Relief Appropriations Act.

                 To assess FTA’s progress in and processes for allocating its Hurricane Sandy
                 funding, we analyzed and compared data from the following five sources that we
                 identified through our prior work and interviews with FTA:

                      1. Documentation, including the four Federal Register notices FTA published
                         with allocations for its Emergency Relief Program funding—dated



17 In March 2020, FTA received $25 billion through the CARES Act to prevent, prepare for, and respond to COVID-19
and, in December 2020, FTA received an additional $14 billion for these purposes through the CRRSA Act. In March
2021, FTA received another $30.5 billion for these purposes through the ARP Act.
18 Pub. L. No. 113-2 (2013).




Exhibit A. Scope and Methodology                                                                                18
                   March 29, 2013; May 29, 2013 (corrected June 5, 2013);
                   November 5, 2014; and July 5, 2016—as well as internal Agency
                   memoranda and letters to FTA recipients and Congress.

               2. Backup information the Agency included with its SF-132, which the
                  Agency submits to request OMB approval for funding apportionments;

               3. Status of Funds report from DOT’s financial management system, Delphi,
                  which categorizes the allotted amounts for DRAA funding by purpose;

               4. TrAMS, FTA’s system to award and manage Federal grants, which is also
                  tied to the Department’s Delphi financial information system; and

               5. FTA’s public website, which features a recovery and resilience funds
                  allocation report that officials said was derived from TrAMS.

            In November 2020, after reviewing the results of our analysis of its allocations
            through December 31, 2019, FTA affirmed that the five sources listed above
            contained allocation data. Yet in March 2021, DOT and FTA officials informed us
            that the backup information the Agency included with its SF-132, the Status of
            Funds report from Delphi, and the recipient allocation data in TrAMS were not
            useful for determining the status of FTA’s Hurricane Sandy allocations through
            December 31, 2020. Instead, FTA officials identified a new source of data—the
            apportionment data that FTA budget staff load into TrAMS. However, FTA
            officials later confirmed what DOT and FTA Budget staff had previously
            emphasized—that we could not use apportionment data to describe allocations.
            As such, we concluded these data were not useful for our purposes and, in
            consultation with FTA, we relied on our analysis of FTA’s official documentation to
            determine FTA’s allocation amounts.

            To assess FTA’s progress in obligating and disbursing its DRAA funds for
            Hurricane Sandy, we determined, in consultation with FTA, that Delphi would
            provide the data on obligations and disbursements by purpose and recipient.
            DOT’s Enterprise Services Center (ESC), through FTA, responded to our request
            for data in March 2020. We tested and analyzed the data and asked FTA and ESC
            staff about the discrepancies we noticed. FTA informed us in June 2020 that the
            data contained erroneous entries and in August 2020 that the data were
            incomplete. Therefore, we determined those data were not sufficiently reliable for
            our purpose. Instead, we relied on the Status of Funds report from Delphi, which
            we determined was reliable for identifying obligation and disbursement data by
            DRAA-allowed purpose. However, we could not report on obligations and
            disbursement data by recipient, as we had initially planned, because the Status of
            Funds report does not provide such data. We also assessed the obligation
            information for FTA’s Public Transportation Emergency Relief Program on
            USAspending.gov.



Exhibit A. Scope and Methodology                                                            19
Exhibit B. Organizations Visited or Contacted

          Department of Transportation
             DOT Headquarters

             Office of Audit Relations and Program Improvement

             Office of the Budget

             Office of the General Counsel

             DOT Regions

             Enterprise Services Center, Oklahoma City, OK



          Federal Transit Administration
             FTA Headquarters

             Office of Budget and Policy

             Office of Chief Counsel

             Office of Program Management

             FTA Regions

             Region 1, Cambridge, MA

             Region 2, New York, NY

             Region 3, Philadelphia, PA




Exhibit B. Organizations Visited or Contacted                    20
Exhibit C. List of Acronyms
             ARP              American Rescue Plan
             CARES            Coronavirus Aid, Relief, and Economic Security
             CFDA             Catalogue of Domestic Federal Assistance
             COVID-19         Coronavirus Disease 2019
             CRRSA            Coronavirus Response and Relief Supplemental
                              Appropriations
             DOT              Department of Transportation
             DRAA             Disaster Relief Appropriations Act
             ESC              Enterprise Services Center
             FRA              Federal Railroad Administration
             FTA              Federal Transit Administration
             GAO              Government Accountability Office
             ID               identifier
             MTA              Metropolitan Transportation Authority
             NJT              New Jersey Transit Corporation
             NYCDOT           New York City Department of Transportation
             OIG              Office of Inspector General
             OMB              Office of Management and Budget
             PANYNJ           Port Authority of New York and New Jersey
             SF               Standard Form
             TrAMS            Transit Award Management System




Exhibit C. List of Acronyms                                                    21
Exhibit D. Major Contributors to This Report
             TIFFANY MOSTERT                   PROGRAM DIRECTOR
             LUKE BRENNAN                      PROJECT MANAGER
             JOHN HANNON                       SENIOR ANALYST
             P. DAVID MCBRIDE                  SENIOR ANALYST
             MORGAN MZHEN                      ANALYST
             AMY BERKS                         DEPUTY CHIEF COUNSEL
             GEORGE ZIPF                       SUPERVISORY MATHEMATICAL
                                               STATISTICIAN
             MAKESI ORMOND                     STATISTICIAN
             JANE LUSAKA                       SENIOR WRITER-EDITOR




Exhibit D. Major Contributors to This Report                              22
Appendix. Agency Comments

                                                                           Memorandum
                   U.S. Department
                   of Transportation
                   Federal Transit
                   Administration
   Subject:
                  INFORMATION: Management Response – Office of                    Date:   June 25, 2021
                  Inspector General (OIG) Draft Report – Hurricane Sandy
                  Funding Progress

    From:         Nuria Fernandez                                             Reply to
                                                                              Attn. of:   Greg Danis
                  Administrator
                                                                                          (202) 366-7557
                  Federal Transit Administration
       To:        David Pouliott
                  Assistant Inspector General for Surface Transportation Audits

      The Federal Transit Administration (FTA) is committed to safeguarding funds from the Disaster
      Relief Appropriations Act of 2013 (DRAA), which includes overseeing the timely expenditure
      offunds awarded to FTA’s recipients. FTA also is committed to ensuring transparency by
      accurately presenting information to the public regarding the allocation of funding by amount
      and purpose, as well as the obligation and disbursement of funds made available under the
      DRAA.

      FTA has reviewed the OIG’s draft report and provides the following comments:
              •     FTA has awarded 99 percent of the DRAA grant funding and FTA is working with the
                    recipients to disburse the remaining funding. While OIG notes that FTA has
                    inconsistent information about funding amounts, all grant funding awarded has been
                    consistent with the official allocation amounts.
              •     FTA also has consistently and accurately explained the amount and purpose of the
                    funding allocated or awarded to recipients under the DRAA.
      Upon review of the OIG’s draft report, FTA concurs with the two recommendations, as
      written, to (1) establish and implement written policies and procedures to accurately
      communicate allocated amounts over time through FTA’s documents, such as notices,
      memoranda, and letters; the grant management system; and external reports; and (2) complete
      the planned update to FTA’s Assistance Listings internal guidance to include procedures to
      ensure the Agency complies with the Office of Management and Budget assistance listing
      requirements that are intended to make obligation information readily identifiable on
      USASpending.gov.

      FTA plans to complete actions to implement Recommendation 1 by December 31, 2021 and
      Recommendation 2 by September 30, 2021. FTA will continue to work with project sponsors to
      obligate and disburse the remaining funding.


Appendix. Agency Comments                                                                                  23
 We appreciate this opportunity to comment on the draft report. Please contact Greg Danis,
 FTA’s Audit Liaison Program Manager, at (202) 366-7557 with any questions.

 Sincerely,




 Nuria I. Fernandez




Appendix. Agency Comments                                                                    24
             Our Mission
 OIG conducts audits and investigations on
behalf of the American public to improve the
performance and integrity of DOT’s programs
   to ensure a safe, efficient, and effective
       national transportation system.