http://www.oig.dot.gov/rss.jsp?type=5 The 10 most recent releases on the U.S. DoT OIG web site ... Correspondence en-US webmaster@oig.dot.gov (OIG Webmaster) http://www.oig.dot.gov/images/dot.gif http://www.oig.dot.gov/rss.jsp?type=5 http://www.oig.dot.gov/item.jsp?id=2520 On July 31, as mandated by the FY 2009 Consolidated Appropriations Act, we issued our quarterly report to the House and Senate Appropriations Committees on Amtraks savings from operational reforms and yeartodate financial performance. Amtraks operating loss through June 2009 was $367.2 million, 0.6 percent more than budgeted as declining passenger revenues were largely offset by declining fuel and employee benefit costs. Amtraks financial performance is expected to continue to erode through the remainder of the fiscal year, resulting in a forecasted yearend operating loss of $16.0 million more than budgeted. Thus far, Amtrak has not yet identified the measures it will take to close this funding gap.Amtrak expects to end the year with a cash balance of $192.8 million, well above the minimum yearend level the OIG believes is necessary. These funds could be used to close the funding gap if Amtrak can not implement sufficient operating efficiencies. Fri, 31 Jul 2009 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2520 http://www.oig.dot.gov/item.jsp?id=2496 On June 24, we issued a results of our review related to the solvency of the Highway Trust Fund, conducted at the request of Senator Judd Gregg, Ranking Member of the Senate Budget Committee. As requested, our objectives were to evaluate: (1) the basis for the Departments projection of the magnitude and timing of a Highway Account cash shortfall; (2) how that projection would vary under different assumptions; and (3) the triggers the Department uses to decide that the risk of insolvency for the Highway Account requires action by the Administration and Congress.We found that the Department used a reasonable methodology to project the magnitude and timing of a cash shortfall. However, some of its assumptions were outdated, as the Department did not use actual yeartodate data to adjust total revenue or outlay estimates. This could yield a margin of error in those projections of up to $1 billion in magnitude and 2 weeks in timing. We also found that the Departments cash balance forecasts vary largely due to factors outside the Departments control. While the accuracy of the Departments projections could be incrementally improved, the range of defensible values for the factors influencing those projections makes it difficult to estimate precisely either the magnitude or timing of the cash shortfall. Finally, we found that the Department relies on cash balance forecasts to trigger formal notification to Congress and the States of a potential insolvency in the Highway Account. While the Department greatly increased the amount of data publicly available regarding the balance of the Highway Account, until recently it has lacked a consistent and easily understood message regarding the timing and magnitude of a cash shortfall. Wed, 24 Jun 2009 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2496 http://www.oig.dot.gov/item.jsp?id=2489 On June 3, 2009 as mandated by the fiscal year (FY) 2008 Consolidated Appropriations Act, we issued our quarterly report to the House and Senate Appropriations Committees on Amtraks savings from operational reforms and yeartodate financial performance. Amtraks operating loss through March 2009 was $259.9 million, 6.9 percent less than budget as declining passenger revenues were largely offset by declining fuel and employee benefit costs. Amtraks financial performance is expected to continue to erode through the remainder of the fiscal year, resulting in a forecasted yearend operating loss of $25.8 million. Thus far, Amtrak has not yet identified the measures it will take to close this funding gap.Amtrak has shifted $24 million in costs from general operating to capital and now expects to end the year with a cash balance of $182 million, well above the minimum yearend level the OIG believes is necessary. These funds could be used to close the funding gap if Amtrak can not implement sufficient operating efficiencies. The OIG also found that Amtrak could do more by providing a transparent and detailed analysis of the financial risks and external factors, such as forecasted economic growth and fuel prices, impacting the companys revenues and expenses. Doing so would improve policymakers understanding of the magnitude of these risks going forward. Finally, the OIG believes that while Amtrak has enhanced its internal reporting of financial and operating measures, it will be important to integrate this reporting with the measures required under the Passenger Rail Investment and Improvement Act of 2008 to better link Amtraks actions, external risks, and its bottom line.As directed by Congress, reports requested by the House and Senate Appropriations Committees are subject to a 15 day hold before being publicly released. In compliance with that requirement, the report was withheld from public release until June 18, 2009. Wed, 03 Jun 2009 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2489 http://www.oig.dot.gov/item.jsp?id=2441 On February 23, 2009 as mandated by the fiscal year (FY) 2008 Consolidated Appropriations Act, we issued our quarterly report to the House and Senate Appropriations Committees on Amtraks savings from operational reforms and yeartodate financial performance. Amtrak is not pursuing any new operational reform savings in FY 2009. Amtraks operating loss through December totaled $82.2 million, $26.1 million less than originally forecast, largely due to lower than expected revenues being more than offset by lower employee benefit and fuel costs. For FY 2009, Amtrak projects an operating loss of $476 million, only $1 million more than originally forecast, despite significant projected changes in both revenues and expenses. Amtrak reestimated both revenue and ridership forecasts in light of the steep decline in the economy since the FY 2009 budget forecasts were prepared last summer. The OIG believes that Amtrak requires no more than $40 million above the current CR level for operating subsidies in order to reduce the risk associated with Amtraks revenue forecasts and to implement Amtraks decision regarding its defeased leases.As directed by Congress, reports requested by the House and Senate Appropriations Committees are subject to a 15 day hold before being publicly released. In compliance with that requirement, the report was withheld from public release until March 10, 2009. Mon, 23 Feb 2009 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2441 http://www.oig.dot.gov/item.jsp?id=2416 On January 15, 2009, we issued our review of the Department of Transportations (DOT) and the Federal Aviation Administrations (FAA) actions regarding final rulemaking activities related to the auction of takeoff and landing slots at LaGuardia, John F. Kennedy, and Newark airports. This review was requested by Patty Murray, Chairman of the Senate Subcommittee on Transportation, Housing and Urban Development, and Related Agencies and James Oberstar, Chairman of the House Committee on Transportation and Infrastructure.FAA planned to auction up to 66 slots at the three New York airports in January 2009. However, in September 2008, the Government Accountability Office (GAO) found that FAA does not have the statutory authority to auction the slots and stated that if FAA moves forward and uses the auction proceeds, it would violate the Antideficiency Act and the Purpose Statute. DOT disagreed and, based on a legal opinion from the Department of Justice (DOJ), FAA signed the final rules to auction the slots. In December, the U.S. Court of Appeals issued a stay, which prevented FAA from auctioning the slots pending further judicial review.Consistent with the Chairmens request, we focused our review on two issues related to the rulemaking activities. First, in light of the GAO opinion, did FAA and DOT actions constitute a willful violation of the Act and Purpose Statute? Second, were career FAA and DOT staff coerced, compelled, or otherwise required by their supervisors to knowingly engage in illegal conduct? We found that FAA and DOT officials have a valid defense against the antideficiency charge because they can demonstrate a good faith belief that what they were doing was lawful, based on DOJs external, legal opinion. A final decision on whether the Act was violated will depend on how various, interrelated legal issues are resolved in Federal courts. In addition, while FAA staff felt considerable pressure from the Department, they told us that they were not coerced or otherwise compelled to agree with the decision to sign the final rules for the slot auctions. Thu, 15 Jan 2009 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2416 http://www.oig.dot.gov/item.jsp?id=2385 On November 12, 2008 as mandated by the fiscal year (FY) 2008 Consolidated Appropriations Act, we issued our quarterly report to the House and Senate Appropriations Committees on Amtraks savings from operational reforms and yeartodate financial performance. Amtrak achieved $30.7 million in operating reform savings through July, $5.0 million more than it originally anticipated However, we believe Amtrak will fall short of achieving its $40.3 million FY 2008 operational reform savings target. Amtraks operating loss for FY 2008 was $381.1 million, $93.9 million less than budget due largely to better than expected revenues, partially offset by higher than budgeted wages and fuel, power, and utility costs. We identified three nearterm challenges facing Amtrak. First, an extended economic downturn could pose risks to Amtraks ability to meet its ridership and revenues targets. Second, Amtrak is scheduled to make $145 million retroactive wage payment in FY 2009. While this payment can be accommodated within Amtraks current cash balance, it is concerned that doing so would leave the company with unacceptably low reserves at the beginning of FY 2010. Third, Amtrak has yet to define a strategic direction which incorporates continuous operating improvements. Such a strategic direction would allow the company to reduce its operating costs, freeing up Federal support for Amtraks substantial capital needs. As directed by Congress, reports requested by the House and Senate Appropriations Committees are subject to a 15 day hold before being publicly released. In compliance with that requirement, the report was withheld from public release until November 27. Wed, 12 Nov 2008 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2385 http://www.oig.dot.gov/item.jsp?id=2339 In a letter dated January 31, 2008, Senator Tom CoburnRanking Member of the Senate Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Securityrequested that we review the San Francisco city governments use of Federal transit funds for the citys bus and transit system, the Municipal Railway (Muni). Specifically, Senator Coburn asked that we determine if the city had used those funds for unauthorized purposes, including directly paying for lobbying activities or replacing city transportation funds diverted for lobbying activities. Federal regulations prohibit the use of Federal funds for such activities. In summary, we found no evidence that the city had used Federal transit funds for unauthorized purposes. We also found that Federal Transit Administration and Muni controls were adequate to ensure proper use of these funds. Wed, 20 Aug 2008 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2339 http://www.oig.dot.gov/item.jsp?id=2332 On August 7, 2008 as mandated by the House passed fiscal year (FY) 2008 Appropriations Act for the Department of Transportation, we issued our quarterly report to the House and Senate Appropriations Committees on Amtraks savings from operational reforms and yeartodate financial performance. Amtrak has realized $19.5 million of the $31.7 million in FY 2008 reform savings it originally anticipated. Over 65 percent ($12.7 million) of Amtraks cost savings were achieved from productivity savings in Amtraks core operating departments and reflect lower staffing requirements. These savings resulted from better business practices and management efficiency reforms undertaken in the prior 2 years. Amtraks operating loss through June was $294.1 million, $72.8 million less than budget due largely to better than expected revenues. Amtrak forecasts it will finish FY 2008 with an operating loss of $456 million, $19 million less than budgeted. This increase in Amtraks projected loss this quarter largely is a result of an accrual of $25.8 million in onetime costs related to Amtraks recent labor settlements and higher than budgeted fuel, power, and utility costs.Amtrak is in the process of developing a new 5year strategic plan that it hopes to complete and begin implementing this fall. Along with the strategic plan, Amtrak needs to ensure the appropriate management structure to ensure adequate oversight, management, and reporting on its strategic reform initiatives. As required by Congress, reports requested by the House and Senate Appropriations Committees are subject to a 15 day hold before being publicly released. In compliance with that requirement, the report was withheld from public release until August 15. Thu, 07 Aug 2008 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2332 http://www.oig.dot.gov/item.jsp?id=2325 On June 17, as requested by the Senate Transportation Appropriations Subcommittee staff, we issued our assessment of the costs related to Amtraks recently settled labor negotiations and Amtraks ability to pay those costs. We continue to believe that for FY 2009, Amtrak needs $475 million for operations, $675 million for capital, and $266 million for debt service. We believe Amtraks projected cash balance of $293.2 million will be sufficient to fund Amtraks labor settlement costs in FY 2009 without any supplemental appropriation in FY 2009. This large projected cash balance reflects betterthanexpected financial performance for the yeartodate (through April). The total cost of the settlement is estimated to be $435.6 million, $23.4 million over Amtraks March estimate. Since March, these estimates were revised upward to reflect the actual payout amounts of a portion of the retroactive pay for the employees of 15 of the 19 union negotiating groups, as well as for the recently agreed upon terms of the retroactive payments for the remaining 4 negotiating groups. Tue, 17 Jun 2008 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2325 http://www.oig.dot.gov/item.jsp?id=2295 On April 30th, as mandated by the fiscal year 2008 Appropriations Act for the Department of Transportation, we issued our quarterly report on Amtraks yeartodate financial performance and savings from operational reforms to the House and Senate Appropriations Committee. Amtrak performed better than it expected financially through February. Amtraks cash operating loss through February was $158 million, $73 million better than planned and reflects $3.2 million in operational reform savings. Amtrak underestimated its Acela revenues and overestimated its benefits costs. Based on performance thru February, Amtrak now projects to end the year with cash operating loss of $444.3 million and a cash balance of $286.1 million. Overall, we believe Amtrak may achieve $13.8 million in operational reform savings. Our FY 2008 operating reform savings target is a subset of Amtraks $40 million target because we did not consider $26 million of Amtraks savings to be sustainable reforms. Amtraks focus is now on overall budget performance, not implementing sustainable operating reforms. As a result, shortterm cost avoidance or unsustainable favorable financial performance from factors beyond Amtraks control could take the place of sustainable operating reforms.Amtraks current strategic plan does not include specifics on how it would achieve its broad financial and operating goals, thereby making its reform priorities unclear. Amtraks new strategic plan, currently being developed, will provide an opportunity for Amtrak to indicate more clearly its reform priorities. Wed, 30 Apr 2008 00:00:00 GMT http://www.oig.dot.gov/item.jsp?id=2295