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DOT Needs To Strengthen Its Oversight of IAAs With Volpe

Self-Initiated
Project ID: 
ZA2019087
What We Looked At
The John A. Volpe National Transportation Systems Center—a component within the Department of Transportation’s (DOT) Office of the Assistant Secretary for Research and Technology—serves as an internal resource for research, development, testing, evaluation, analysis, and related activities. Between fiscal years 2015 and 2017, the Department’s Office of the Secretary of Transportation and its Operating Administrations (OAs) obtained services from Volpe through 901 intra-agency agreements totaling $865.8 million. In 2010, DOT noted inconsistencies among all of the Department’s IAAs and reiterated its existing policy for the proper form and content of the agreements. Accordingly, we initiated this audit to assess DOT’s and its OAs’ policies and procedures for (1) entering into IAAs with Volpe and (2) overseeing the deliverables and expenditure of funds for those IAAs.
 
What We Found
DOT’s Office of the Secretary of Transportation (OST) and its Operating Administrations have limited documentation to show how they plan their use of IAAs with Volpe; and some Operating Administrations have adopted practices for executing Volpe IAAs that do not meet departmental requirements. We also found that neither OST nor the OAs have established specific guidance for evaluating Volpe’s performance on IAA projects or sharing that information among the OAs. In addition, we found that OST and the OAs do not consistently comply with departmental requirements for overseeing IAA funds, such as reconciling financial records and promptly deobligating unused funds.
 
Our Recommendations
We made eight recommendations to the Assistant Secretary for Budget and Programs and one recommendation to the Assistant Secretary for Research and Technology on ways to improve planning, financial management, and sharing of performance information on Volpe IAAs, including a recommendation to determine whether nearly $6 million could be deobligated. When projected across our audit universe, implementing this recommendation could potentially put up to $33.3 million in funds to better use. In response to our nine recommendations, OST concurred with recommendations 1, 2, 3, 4, 6, 7, 8, and 9 and partially concurred with recommendation 5. For the partial concurrence, OST agrees to take the recommended action but does not agree with the amount of funds we identified that could potentially be put to better use.

Recommendations

Open

Closed

No. 1 to OST

Implement requirements for documenting the rationale forentering into intra-agency agreements (IAA) with the John A. Volpe NationalTransportation Systems Center (Volpe), including why the proposed agreement isin the OA's best interest.

No. 2 to OST

Implement a process to ensure OAs' spend plans, or an alternative mechanism, include descriptions of current and planned Volpe IAA projects, as well as the projects' current and future funding needs.

No. 3 to OST

Implement oversight procedures in compliance with section 1.4.3 of DOT Order 1200.9 to verify use of required forms and the inclusion of required elements when executing Volpe IAAs, including but not limited to buyer obligation numbers, lines of accounting to be charged, and Treasury Appropriation Fund Symbols.

No. 4 to OST

Implement procedures to verify compliance with departmental requirements for conducting IAA financial completion processes and returning unused funds after the period of performance ends.

$33,300,000
No. 5 to OST

Comply with DOT Order 1200.9's financial completion and IAA closeout process requirements for the IAAs identified in table 3 of this report, and determine whether to close them and deobligate the appropriate portions of the $5,966,933 we identified. Implementing this recommendation across the 854 IAAs in our audit universe could potentially put up to $33.3 million in funds to better use.

No. 6 to OST

Develop and implement procedures to communicate with and train relevant OA staff (e.g., Program Office, Acquisitions/Procurement Office, and Budget/Finance Office staff) about DOT's current IAA-related requirements and guidance.

No. 7 to OST

Develop and implement procedures for reviewing current and future OA-issued IAA guidance to confirm alignment with DOT policy.

No. 8 to OST

Develop and implement procedures to verify OA compliance with departmental requirements for financially managing IAAs with Volpe, including conducting and documenting monthly and quarterly reconciliations, and year-end reviews.

No. 9 to OST

Develop and implement a mechanism for the OAs to document and share their performance evaluation data regarding Volpe IAAs.