What We Looked At
The Department of Transportation (DOT) and its Operating Administrations (OA) are charged with overseeing billions of dollars in grant funds for projects aimed at building, maintaining, and enhancing our Nation’s transportation system. Between fiscal years 2014 and 2019, the City of Seattle’s Department of Transportation (SDOT) received $259.8 million in grants and cooperative agreements from the Federal Highway Administration (FHWA), the Federal Railroad Administration (FRA), and the Federal Transit Administration (FTA). Over the past few years, our office received hotline complaints concerning federally funded SDOT projects that are subject to DOT’s oversight. Given the significant amount of Departmental funds allocated to SDOT projects and concerns raised by the hotline complaints we received, we initiated this review. Our objective was to assess the Department’s oversight of Federal funds received by SDOT.
What We Found
Our review identified weaknesses in the OAs’ oversight regarding (1) execution of change orders that lacked required approval signatures, (2) approval of a $140 million project estimate and contingency amounts with limited support, (3) the inability to track where and how Federal funds were spent, and (4) procedures to ensure that Federal funds transferred from FHWA to FTA are used in a timely manner or put to better use. In addition, weaknesses related to OST’s and FRA’s oversight of a project’s cost estimates and contingency rates resulted in $21 million in lapsed funds that could be put to better use. Also, as part of our efforts to determine how the grant funds were used, we identified $10.7 million in questioned costs due to a lack of adequate supporting documentation. Further, we identified $3.6 million in transferred FHWA funds that remain unobligated more than 6 years after being transferred, resulting in these funds lapsing. Lastly, we found that FTA had not deobligated $3.8 million in other transferred funds that have been inactive since 2017. By increasing focus on these issues, DOT will be better positioned to ensure the City of Seattle and SDOT effectively manage and use the Federal taxpayer dollars they receive.
We made 14 recommendations to improve DOT’s management and oversight of Federal funds provided for SDOT projects. DOT concurred with recommendations 1, 2, and 4–14, and provided an alternative action from FHWA for recommendation 3 that meets the intent of our recommendation. We consider all recommendations as resolved but open pending completion of the planned actions.