FTA Did Not Adequately Verify PATH’s Compliance With Federal Procurement Requirements for the Salt Mitigation of Tunnels Project
In response to the widespread damage caused by Hurricane Sandy, Congress enacted the Disaster Relief Appropriations Act of 2013 (DRAA) on January 29, 2013, appropriating over $10 billion for FTA’s Public Transportation Emergency Relief Program for relief, recovery, and resiliency efforts in the affected areas. Under this authority, FTA awarded a grant in June 2014 to the Port Authority Trans-Hudson Corporation (PATH)—a rapid transit railroad serving northern New Jersey and Manhattan, NY—for a variety of Hurricane Sandy-related repair, recovery, and resiliency projects. To date, the total value of the grant, including amendments, is $678 million—including about $310 million for a Salt Mitigation of Tunnels Project, which aims to repair salt water damage caused by Hurricane Sandy. As part of our DRAA mandate to support oversight of FTA’s Hurricane Sandy relief funds, we reviewed FTA’s oversight of PATH’s procurement practices for the Salt Mitigation of Tunnels Project.
FTA did not adequately verify that PATH’s procurement practices for the Salt Mitigation Project complied with FTA and other Federal requirements. Our assessment determined that FTA did not enforce its requirement that PATH have a project management plan (PMP) for the Salt Mitigation Project before the grantee began drawing down Federal funds. PATH also completed critical work for the project without a PMP. Additionally, FTA did not conduct any oversight reviews of PATH until August 2015, despite rating PATH’s procurement area as “high” risk over 2 years earlier. Consequently, FTA missed opportunities to identify and possibly prevent areas of noncompliance with FTA requirements. Finally, while FTA utilizes a Project Management Oversight Contractor to assist in its oversight of PATH’s Salt Mitigation Project, the Agency lacks effective processes for tracking and following up on the grantee and project-specific issues identified by the contractor. FTA concurred with all three of our recommendations to improve FTA’s oversight of PATH’s procurement practices for the Salt Mitigation of Tunnels Project.