Audit Reports

-A A +A
skip-to-content

Opportunities Exist To Improve FRA and Volpe’s Acquisition and Use of Oversight Contractors

Self-initiated
Project ID: 
ZA2019056
What We Looked At
In 2009, Congress appropriated $10.5 billion for the Federal Railroad Administration’s (FRA) High-Speed Intercity Passenger Rail (HSIPR) Program. To implement the program and fund the HSIPR projects, FRA took on new oversight responsibilities and entered into cooperative agreements with State departments of transportation and other entities. FRA also established an intra-agency agreement (IAA) with the John A. Volpe National Transportation Systems Center (Volpe). The IAA allowed FRA to implement its Monitoring and Technical Assistance Program with Volpe’s assistance and acquire Monitoring and Technical Assistance Contractors (MTAC) to provide oversight support. In November 2013, Volpe competitively awarded 11 master contracts, with an estimated value of $75 million, for MTAC services. Given the significant funds involved and FRA’s expanded oversight responsibilities, we initiated this audit to assess (1) FRA’s acquisition of MTACs through the Volpe Center and (2) FRA’s management and use of MTAC oversight services for HSIPR projects.
 
What We Found
Volpe’s acquisition and management of the MTACs did not always follow Federal requirements or guidance. For example, Volpe prepared independent government cost estimates without adequate support, and awarded an MTAC master contract and three task orders valued at $7.6 million to a contractor that lacked a current audit of its accounting system. Also, adding steps to its invoice review process could help Volpe ensure that it pays allowable and reasonable costs for MTAC work. In addition, FRA lacked both the necessary oversight tools and a consistent reporting and recommendation tracking process to ensure effective use of MTAC services when it launched the HSIPR program. As result, the MTACs did not consistently document oversight reviews and much of their work was not formally reported. This in turn impeded FRA and Volpe’s ability to realize the full benefit of the MTACs’ oversight.
 
Our Recommendations
We made 11 recommendations to improve FRA and Volpe’s acquisition and use of MTACs, and the Department concurred with all of them. We consider these recommendations resolved but open pending completion of the Department’s actions.

Recommendations

Open

Closed

No. 1 to OST

Update and implement procedures to ensure Volpe's staff follow Volpe and departmental requirements and guidance when preparing and documenting independent government cost estimates.

No. 2 to OST

Update Volpe's procedures to require the use of risk-mitigation controls if the contractor's accounting system cannot be evaluated with current audit information prior to award of a cost-reimbursement contract, and document the contract file.

No. 3 to OST

Develop and provide refresher training for Volpe's contracting personnel on the Federal Acquisition Regulation, Transportation Acquisition Manual, and Volpe's requirements and guidance for establishing contract and task order files that provide complete and accurate records of all actions

No. 4 to OST

Obtain incurred cost audits for its Monitoring and Technical Assistance Contractor (MTAC) cost-reimbursable contracts or document the rationale for not obtaining these audits in the contract file.

No. 5 to OST

Update the Volpe April 2018 invoice review policy to require contracting officials to verify that the appropriate indirect rates have been charged.

No. 6 to FRA

Develop, finalize, and implement procedures for FRA and the MTACs to use for all phases of project design oversight reviews and Rail Traffic Controller modeling simulation results.

No. 7 to FRA

Develop and implement a risk-based oversight process for non-safety field inspections to include criteria to determine which prospective projects could benefit at key project phases.

No. 8 to FRA

Revise the Monitoring Procedures to better align with FRA's financial assistance programs and strengthen the MTACs' role in the oversight of FRA financial assistance programs.

No. 9 to FRA

Develop and implement policies and procedures that require the MTACs to follow a consistent process for conducting oversight reviews and documenting deliverables in a manner appropriately scaled for the size, complexity, and type of project.

No. 10 to FRA

Develop and implement procedures that (a) direct the MTACs to describe each recommendation in terms of impact, such as safety or cost; (b) clearly state whether the recommendation is required or optional; and (c) track MTAC recommendations to resolution.

No. 11 to FRA

Develop and implement a process that ensures that completed MTAC oversight reports are uploaded and maintained at regular intervals in FRA's Program Management Tracker database.