The Bureau of Transportation Statistics issue a Reporting Directive clarifying that air carriers are to include booking fees, along with any/all fees required to board the aircraft, in the fare line item reported to the Office of Airline Information's Origin and Destination Survey.

The Office of Aviation Analysis develop a process to regularly collect, maintain, and use information from airlines' website disclosures of all fees charged for optional or ancillary services as a screening mechanism for significant changes in these fees. For each mainline carrier and posted fee, this information should include—but not necessarily be limited to—identification of the type of each service and its price (or price range).

The Secretary request a Revenue Ruling or policy statement from the Department of Treasury regarding the taxation of airline booking fees and, if appropriate, that the Department of Treasury take action to assess the relevant tax. If the Department of Treasury finds that these fees are taxable — and assuming no change in the conditions underlying our calculation of their impact on the Airport and Airway Trust Fund in 2019 — this could conservatively result in $60.6 million in funds put to better use in every year following the determination.

Update and implement FHWA's guidance for risk-based project involvement to clarify the requirements for its project risk-assessment process, including expectations for conducting and documenting the risk assessment and criteria to guide the reevaluation of project risks.

Identify and notify Divisions about sources of information that can inform the project risk-assessment process, such as the quarterly reports required by the grant agreement for the Florida International University project.

Update and issue a procedure within the Florida Division for conducting and documenting complete project risk assessments in accordance with FHWA's national guidance.

Update and implement FHWA's guidance for risk-based project involvement to clarify how the link between elevated risks and associated oversight activities, changes to oversight actions, and the results of its risk-based involvement should be documented in project oversight plans.

Develop and implement guidance for documenting, in risk-based project oversight plans and associated materials, the scope of FHWA's risk-based involvement, such as through the use of checklists or standardized forms.

Develop and implement guidance that establishes criteria for the content of risk-based project oversight plans to maintain consistency and avoid creating multiple redundant plans. Include examples of complete project oversight plans that can be used as a reference, and clarify the role and purpose of the oversight plan for major projects.

Update and issue a procedure within the Florida Division for documenting complete risk-based project oversight plans in accordance with FHWA's national guidance.

Develop and implement a process to routinely monitor the implementation and evaluate the effectiveness of FHWA's risk-based project involvement.

Coordinate with impacted Operating Administrations (OA) to develop a corrective action plan to resolve and close the findings highlighted in this report.

Determine the allowability of the questioned transactions and recover $2,227,535, if applicable.

Develop and implement written procedures for reviewing and approving railroads' Part 219 compliance plans, to include an oversight control, such as a supervisory or second-level review, to validate results.

Develop and implement a formal written process for tracking all Part 219 audits.

Develop and implement a written process for tracking and following up on all action items issued from Part 219 compliance audits to verify that railroads have taken corrective actions.

Update Drug and Alcohol program guidance for both railroads and inspectors to reflect the 2017 Maintenance-of-Way requirements.

Update and implement the Agency's procedures for reviewing the siting of proposed LNG facilities by adding steps to verify the accuracy and completeness of reviews conducted by Agency or subcontractor engineers and to document the verification.

Update and implement the Agency's procedures for conducting evaluations of State natural gas programs, including how to (a) incorporate random sampling into the selection of operators and facilities for testing and (b) identify the records or other evidence that are needed to support the evaluation.

Update guidelines to States to require at least one inspection team member to have completed all required training for lead inspectors.

Implement procedures to require Federal Highway Administration to review about $28,000 identified as improper payments and recover as appropriate.

Implement procedures to require that Federal Highway Administration develop a process to: a. detect grantees that have not reduced improper payments for 3 consecutive fiscal years or over the 3-year risk assessment cycle, and b. review those grantees' root causes to implement robust/individual corrective actions. Implementation of this recommendation could put approximately $169 million in funds to better use.

Perform a comprehensive assessment of DroneZone and LAANC's security controls that at a minimum provides the correct implementation status for system specific, common, and hybrid controls, and issue a new Authorization to Operate decision for DroneZone and its interconnected system LAANC.

Update the security assessment documents for DroneZone and LAANC to reflect the results of all security controls (e.g., common, hybrid, and system-specific) for selection, implementation, and assessing, per DOT requirements.

Establish and implement controls for monitoring, updating, and remediating open security weaknesses as well as the accepted risk in DOT repository for managing security weaknesses, per the DOT Security Weakness Management Guide.

Implement procedures to validate that Security Officials responsible for DroneZone and LAANC are trained on NIST and DOT policy for assessing security controls, and require them to follow the guidance.

Develop Standard Operating Procedures for the use of common and hybrid controls to include at a minimum: a.) System owners must review the cloud provider Control Implementation Summary report to verify and document what controls are the customer's versus the cloud provider's. b.) System owners must review monthly cloud provider POA&Ms and develop a risk mitigation strategy or compensating controls to address any identified vulnerabilities that may impact its system cybersecurity posture. c.) System owners must coordinate with FAA common/hybrid control providers to verify the controls' actual implementation status and document them accurately in the appropriate security document.

Verify and validate that all external information systems providing cloud services to DroneZone and LAANC are FedRAMP-authorized; if not, obtain a departmental waiver approving their use.

Develop and implement a process clearly defining how privacy controls are identified, assessed, and documented, and work with the departmental Chief Privacy Officer in developing and implementing the process.

Complete modification to LAANC Memorandums of Agreement with UAS Service Suppliers to enhance data security and transparency and direct the Authorizing Official to verify and validate that all UAS Service Suppliers are adhering to security requirements outlined in the Memorandum of Agreement.

Develop and implement a process for testing DroneZone information systems for contingency planning, to include business impact analysis continuity of operations plans, business continuity plans, disaster recovery plans, and Information System Contingency Planning (ISCP).

Develop a process to annually document FAA security officials communicating all contingency planning development, planning, and recovery activities to all stakeholders and executive management prior to authorizing officials making risk-based decisions.

Complete an appropriate ISCP test for DroneZone with its contractor and cloud service provider to ensure the ISCP strategies can be implemented successfully.

Provide and verify that the required DroneZone personnel listed in the ISCP receive annual contingency planning training.

Develop, test and implement an alternative back-up solution verifying that DroneZone data can be backed-up and available to transport to alternate sites in the event the cloud service provider availability zone is unavailable

KPMG recommends that FTA management design and implement a process to ensure that a complete population of received FFRs are considered in the retrospective review.

KPMG recommends that FTA management document the revised FFR submission policy in their grant methodology to consider the potential impact on the retrospective review process.

KPMG recommends that FRA management implement policies and procedures to establish a formal process to assess applicable third-party service organization reports that includes reviewing the SOC-1 report, reviewing and comparing reporting updates year-over-year, and reviewing findings and their impact on the grants management system.

KPMG recommends that FRA management implement policies and procedures to establish a formal process to assess applicable third-party service organization reports that includes implementing the service provider's recommended Complementary User Entity Controls (CUECs) and monitoring these controls for proper implementation and operating effectiveness.

KPMG recommends that FHWA develop and implement a process to notify appropriate authoritative personnel in the event that the division sponsor has not completed its user reviews timely ensuring that monthly reviews of user access within the application are completed by all divisions in accordance with the Fiscal Management Information System Standard Operating Procedures (SOP).

KPMG recommends that FHWA Management revise its currentbi-weekly review process in coordination with Human Resources to ensure thatthe grants management application system owners remove terminated users withina defined time period of their termination date and that the User AccessRemoval SOP be updated to reflect the Human Resource coordination and thedefined time period.

KPMG recommends that the FHWA determine the appropriate role for the grant management application user based on job function, and revoke user access to the incompatible role.

KPMG recommends that the FHWA ensure that access policies and procedures regarding segregation of duties are enforced when granting users access to the grants management application via Role Based Access Control procedures as defined in the Manage Accounts SOP.

KPMG recommends that the FHWA develop and implement a periodic review of access for the Database Administrators and Developers for the grants management application.

KPMG recommends FHWA management update the SOP, to clearlydefine the UPACS audit log environment, log mechanisms, and frequency anddocumentation of the log reviews.

KPMG recommends FHWA management enforce the Manage Log Review Files SOP or similar procedure that requires the Windows System Administrator to review Grant Management Application/UPACS operating system logs on a daily basis and digitally certify the reviews on a weekly basis.

KPMG recommends F HWA management ensure that System Administrators (SA) or Database Administrators (DBA) review past Grant Management Application/UPACS operating system log records for completion. If SAs or DBAs determine that the Windows Weekly log records, are not completed as required, SAs and DBAs should follow-up with the Windows System Administrator to ensure that incomplete reviews are remediated and future weekly log reviews are completed timely.

KPMGrecommends FHWA management enforce the Manage Log Review Files SOP or similarprocedure that requires the System Administrators to review Grant ManagementApplication/ UPACS logs on a daily basis and digitally certify the reviews on aweekly basis.

KPMG recommends FHWA management ensure that System Administrators (SA) or Database Administrators (DBA) review past Grant Management Application/UPACS log records for completion. If SAs or DBAs determine that the UNIX/Oracle log records, are not completed as required, SAs and DBAs should follow-up with the UNIX/Oracle System Administrators to ensure that incomplete reviews are remediated and future weekly log reviews are completed timely.

Enhance existing policies and procedures to ensure that the account balances, line items, and all corresponding balances reported in the agency's trial balance are complete, accurate, and classified according to their economic substance.

Enhance existing policies and procedures to ensure that the account balances and line items reported in the financial statement footnotes agree with the agency's adjusted trial balance for the corresponding reporting period.

Enforce existing policies and procedures regarding the review and approval of manual journal vouchers to ensure that all required levels of review are completed and the process is properly documented.

KPMG recommends that FAA management consider adjusting the EC&D liability for any significant changes in factors impacting the EC&D liability that can be reasonably estimated (i.e., inflation) as of and for the year ended September 30, 2019.

KPMG recommends that FAA management develop an information processing guide to assist in the effective operation of the HQ Journal Entry Control Log Reconciliation to ensure the reconciliation is consistently utilizing complete and accurate information, including all entries posted by usernames with HQ journal entry posting responsibility.

KPMG recommends that FAA management revise policies and procedures to ensure that the review of grant invoices includes the review and validation of compliance with terms and conditions per the applicable grant agreement.

KPMG recommends that FAA management enforce the policy that monthly audits are conducted by ESC-EDC personnel, as required by TOPS policy, to ensure that the bi-weekly log reviews are completed as required. In addition, FAA should ensure that the required monthly audits are tracked via checklist and certified by ESC-EDC personnel who conducted the audit. If ESC-EDC personnel determine that the bi-weekly reviews have not been properly completed, the ESC-EDC personnel should follow-up with the DBA to ensure that incomplete reviews are remediated and future bi-weekly log reviews are completed timely, as required by TOPS policy.

KPMG recommends that FAA management update the purchase request application system's SSP to reflect the design and implementation of the formalized procedures for performance of the periodic user recertification.

KPMG recommends that FAA management design and implement a process in coordination with Human Resources, to ensure that the contractor and the environmental cleanup tracking application system owner remove terminated users within a defined period of time subsequent to the individuals' termination date.

KPMG recommends that FAA management implement a change control procedure which includes: change control documents, change control board approval, configuration change testing, and development team approval prior to preceding with implementing changes into production.

KPGM recommends that FAA management continue to perform its existing monitoring procedures over excise tax revenue allocations by the IRS. In addition, KPMG recommends that FAA management communicate instances where allocations and certifications of excise tax revenue are materially inconsistent with expectations to Department of Transportation leadership and to the Department of Transportation's Office of the Inspector General to facilitate the timely allocation and certification of excise tax revenues by the IRS.

Develop procedures to ensure purchase card files are complete. At a minimum, ensure cardholders verify that: a. supervisory and/or program office approval has been obtained prior to making purchases; b. funds availability has been confirmed prior to making purchases; c. required supporting documentation is on file; d. items purchased have been received and services have been accepted; and e. sales tax has not been charged.

Implement procedures to ensure cardholders retain records in accordance with the National Archives and Records Administration's general records schedule.

Update purchase card guidance to include appropriate language that states that purchase cards cannot be used to pay for unauthorized commitments without appropriate documentation showing that the unauthorized commitment has been ratified in accordance with FAR 1.602-3.

Develop procedures to ensure purchase card files are complete. At a minimum, ensure cardholders verify that: a. supervisory and/or program office approval has been obtained prior to making purchases; b. funds availability has been confirmed prior to making purchases; c. required supporting documentation is on file; d. payment amounts match to invoices; e. items purchased have been received and services have been accepted; and f. sales tax has not been charged.

Implement procedures to ensure cardholders retain records in accordance with the National Archives and Records Administration's general records schedule.

Update purchase card guidance to include appropriate language that states that purchase cards cannot be used to pay for unauthorized commitments without appropriate documentation showing that the unauthorized commitment has been ratified.

Develop and implement controls to ensure that all trainings are administered timely in FAA's electronic learning management system, and ensure cardholders complete refresher training in a timely manner.

Establish procedures to enforce the suspension of purchasing authority for cardholders that do not satisfy the refresher training requirement.

Reiterate the importance of following the employee close out and clearance process to Purchase Cardholders, Approving Officials and Agency Program Coordinators, when a cardholder separates from the agency or the purchase card program.

Develop and implement a process to monitor purchase transactions that involve credits to ensure the follow-up is performed and credits are received timely.

Update TAM Chapter 1213, Appendix A to include appropriate language that indicates that purchase cards cannot be used to pay for unauthorized commitments without appropriate documentation showing that the unauthorized commitment has been ratified in accordance with FAR 1.602-3.

Update Departmental policy and procedures to require all OAs (excluding FAA) to include a requirement to obtain supervisory and/or program office approval before purchases are made.

Update the TAM to require OAs (excluding FAA) to certify individual purchase card program manuals to comply with TAM requirements.

Revise the Acquisition Management System (AMS) and/or FAA's Contract Pricing Handbook to address challenges around conducting appropriate price and cost analyses in order to reliably assert and support a fair and reasonable price determination for a major program contract award. This should include techniques and scenarios to address specific issues that could arise during the award process, such as establishment of a contract ceiling amount at award that includes pricing for all contract work (including option years) using a sound source or basis

Revise AMS to require acquisition planning for both competitive and noncompetitive major program contracts to allow adequate time and the possibility for achieving competition of option years and follow-on contracts.

Strengthen internal controls to verify that all independent government cost estimates (IGCE) are completed in compliance with Agency requirements prior to the award of a major program contract. Implementing this recommendation could put up to $4.9 billion in Federal funds to better use by improving FAA's ability to establish contract pricing that is fair, reasonable, and realistic.

Revise AMS to clarify requirements around what actions the Program Office must take prior to the award of a major program contract when an IGCE varies by more than 15 percent from the proposed offer, and strengthen internal controls to verify these requirements are followed.

Strengthen internal controls to hold acquisition and program officials accountable for providing timely signatures on packages for any major program contract procurement action—such as increasing the ceiling or definitizing a contract line item number—to be submitted for Chief Financial Officer approval, per Agency requirements.

Strengthen internal controls to ensure a sound rationale is documented to support each noncompetitive major program contract, per Agency requirements, before the award is made. Implementing this recommendation could put up to $17.3 million to better use by allowing FAA to realize the benefits of competition and make more efficient use of these Federal funds.

Strengthen internal controls to verify compliance with Agency requirements for conflict of interest agreements to be completed by all officials involved in a major program contract source selection process before they perform any of their responsibilities.

Strengthen internal controls to verify compliance with Agency requirements regarding completion and approval of source selection evaluation plans for major program contracts.

Strengthen internal controls to verify compliance with Agency requirements to use code names in lieu of contractor names in all source selection and evaluation communication and documentation for major program contracts.

Strengthen internal controls to verify compliance with Agency requirements for maintaining centralized files for major program contracts—including a complete record of the acquisition history and decisions—and for archiving and destroying documentation.

Ensure Southwest Airlines complies with regulatory requirements to provide accurate weight and balance information to pilots, or grant an exemption that justifies the non-compliance being in the public interest.

Retrain inspectors at the local oversight office for Southwest Airlines on the purpose and proper use of the Voluntary Disclosure Reporting Program.

Train managers and inspectors of the local oversight office on their roles and responsibilities to work with Southwest Airlines for root cause analysis.

Enhance management controls to ensure designated airworthiness representatives comply with established procedures to verify that aircraft conform to U.S. airworthiness standards.

Develop a management control to ensure that designated airworthiness representatives verify the completeness and accuracy of maintenance records, and do not rely on air carrier provided summary data to make airworthiness determinations.

Complete a compliance review of other certificates issued by the designated airworthiness representatives used by Southwest Airlines.

Ensure Southwest Airlines complies with regulatory requirements that the 88 previously owned aircraft conform to U.S. aviation standards.

Train inspectors on FAA's process to provide feedback on designated airworthiness representatives when corrective actions are needed, and provide inspectors access to the system used to provide feedback.

Develop and implement a management control to ensure air carriers and inspectors do not use Safety Management Systems as a substitute for regulatory compliance.

Develop and implement guidance on how to evaluate air carrier safety risk assessments to ensure the carrier has performed a comprehensive analysis, identified root causes, and established appropriate corrective actions.

Develop and implement inspector guidance on how to evaluate air carrier safety culture and how it should be factored into oversight decisions.

Coordinate with impacted Operating Administrations (OA) to develop a corrective action plan to resolve and close the findings highlighted in this report.

Determine the allowability of the questioned transactions and recover $1,135,453, if applicable.

Revise and implement policies and procedures for when to escalate grant noncompliance issues within FRA. At a minimum, these procedures should include criteria for when to escalate noncompliance issues beyond FRA's grants management division, and documentation of FRA's decisions and rationale.

Revise and implement policies and procedures for defining FRA's tolerance for the risk of grantee noncompliance with specific deliverable requirements, periodically assessing those risks, and documenting the resulting risk-based agency decisions on the depth of review to conduct of deliverables.

Define a framework for determining the minimum acceptable standards of what an interim use plan for new infrastructure funded by FRA grants should provide, and procedures for evaluating these plans.

Revise and implement guidance for FRA staff to conduct detailed assessments of grantees' procedures for complying with Federal expenditure requirements. This guidance should include steps for when and how FRA staff are to test grantees' implementation of their procedures through sampling and in-depth reviews of selected expenditures.

Complete publication of the FAA advisory circular that formalizes interim guidance regarding the Service Availability Prediction Tool.

Analyze the feasibility of developing automated systems toprovide operators with more timely information regarding GPS issues, such asoutages and degradations, and if feasible, implement them.

Identify remaining steps and target action dates forcompleting the ADS-B Deviation Authorization Pre-Flight Tool system, as well ascontingencies if the system is not operational by the 2020 deadline.

Develop and implement a management control to require managers to review and validate that known risks documented in the Safety Assurance System Certificate Holder Assessment Tool are tracked until mitigated.

Develop and implement policies and procedures to monitor inspector compliance with Safety Assurance System training requirements.

Revise its inspector guidance to require Certificate Holder Evaluation Process teams to report inspection results to the local inspection office, including a determination on whether the carrier is operating at the highest possible degree of safety in the public interest and how the team reached that conclusion.

Revise its Compliance and Enforcement guidance and its Inspector guidance to include the severity of outcomes as a factor in considering whether inspectors should initiate compliance or enforcement actions.

Develop and implement a resolution process to ensure disagreements in handling non-compliances are dealt with consistently, using the most appropriate processes and all relevant information.

Revise its inspector guidance to clarify how inspectors address recurring non-compliances as a factor in considering whether they should initiate compliance or enforcement actions.

Revise its inspector guidance to require inspectors to determine that corrective actions taken by air carriers are implemented and have addressed known discrepancies prior to closing compliance actions.

Perform a comprehensive review of FAA's root cause analysis training to ensure it meets Agency expectations. Modify training, as appropriate, based on the review and require inspectors to complete the course(s) or offer inspectors access to industry-based training programs.

Develop and implement a process to incorporate historical compliance actions in SAS for inspectors to track current and historical compliance actions.

Engage an auditor to perform an independent audit of the Franchise Fund's financial statements in accordance with generally accepted Government auditing standards and the Government Accountability Office's Financial Audit Manual and that includes an opinion on the Fund's internal controls.

Develop and implement a process directing the Logistics Center to maintain detailed records of the age and costs of inventory items as a way to identify obsolete items and prevent unnecessary storage and maintenance costs or purchase of assets already on hand.

Revise the accounting treatment for imputed costs to avoid the appearance of overstating losses.

Assign the unassigned balance of $6.9 million in unfilled customer orders identified in this report to the appropriate Franchise Fund service organization(s).

Review the $2.6 million in unused unfilled customer orders identified in this report, and return the unexpended balances as appropriate.

Develop and implement a plan to improve oversight of the Franchise Fund's unfilled customer orders balance, such as tracking performance to ensure unexpended funds are returned timely as required. Implementing this recommendation could potentially put $26 million in funds to better use.

Revise the Franchise Fund's policies on agreements to include dealing with delinquent agreements, and require service organizations to adhere to applicable DOT and FAA policies. Implementing this recommendation could potentially put $39 million in funds to better use.

Implement the requirement that service organizations collect advance payments before they provide products or services, in accordance with Public Law 104-205.

Develop and implement a process that requires Franchise Fund service organizations to respond promptly to customer questions about agreements and price changes before the period of performance begins.

Develop and implement formal, documented procedures that require service organizations to include a business case when they submit a capital reserve project to the Franchise Fund Management Council for approval to ensure the project represents the best value.

Implement the Major Business Investment and Expenditures Policy requirement to document formal approval of capital reserve projects.

Develop a plan that clearly describes the Franchise Fund Management Council's vision, goals and expected outcomes for the services provided to its customers. The plan should include what initiatives or specificactions the Council will take to provide the additional oversight and transparency needed.

Develop Franchise Fund process and procedures that require (a) customers to document bona fide needs for new projects before agreements are written and funds obligated and advanced and (b) service organizations to accept year-end funding only for projects that clearly represent a bona fide need.

KPMG recommends that FAA management design and implement procedures to consistently perform and document application log reviews as required by existing internal policies.

KPMG recommends that FAA management design and implement procedures to consistently perform and document database layer audit log reviews as required by existing internal policies.

KPMG recommends that FAA management design and implement procedures to consistently perform and document operation system layer log reviews as required by existing internal policies.

KPMG recommends that FAA management design and implement procedures to consistently perform and document application level user account access reviews as required by existing internal policies.

KPMG recommends that FAA management design and implement procedures to consistently perform and document operating system administrative account access reviews as required by existing internal policies.

KPMG recommends that Office of the Secretary management design controls which are sufficiently precise to ensure that each of the data inputs which are key to the cash flow projections are defined (including for loans expected to reach the substantial disbursement threshold); control procedures are sufficiently designed and documented to ensure that the inputs are validated against source documents; and the inputs are accurate prior to the annual subsidy re-estimation in September.

KPMG recommends that FRA management develop an accrual methodology for incurred but not submitted grantee expenses at year-end.

KPMG recommends that FRA management develop a process to improve communications between the Grant Office and Office of Financial Services to ensure all available expense information is recorded in the proper reporting period.

LSC recommends STB ensure that year-end schedules are updated to allow sufficient timeframes to accomplish STB established internal control processes in an effective manner.

LSC recommends STB require the accounting service provider to provide to STB evidence of quality control reviews signed and approved by supervisory personnel prior to accepting receipt of these documents.

LSC recommends STB reject financial statements and related supporting documentation when the accounting service provider submits incomplete or inaccurate data.

KPMG recommends that Management design and implement procedures to consistently perform and document the following, as required by existing internal policies: Application log reviews.

KPMG recommends that Management design and implement procedures to consistently perform and document the following, as required by existing internal policies: Database layer audit log reviews.

KPMG recommends that Management design and implement procedures to consistently perform and document the following, as required by existing internal policies: Operating System layer log reviews.

KPMG recommends that Management design and implement procedures to consistently perform and document the following, as required by existing internal policies: Application level user account access reviews.

KPMG recommends that Management design and implement procedures to consistently perform and document the following, as required by existing internal policies: Operating system administrative account access reviews.

KPMG recommends that management design and implement review and approval control activities specific to the setup of a new donated inventory part in LCSS to ensure the established unit cost and related attributes are based on supportable and accurate information.

KPMG recommends that management r edesign policies and procedures unique to LCSS and the receipting scenarios that are acceptable for the MISC and F&E purchase order receipt process which support the accuracy of inputs. Further, management should design and implement review and approval control activities surrounding the creation of MISC and F&E purchase orders in LCSS to ensure the unit cost and other attributes which are critical for the appropriate valuation, are valid and accurate.

Update DOT DASH 2016-01 to specifically state that FAA Strategic Sourcing for the Acquisition of Various Equipment & Supplies (SAVES) is not an approved vehicle under Office of Management and Budget (OMB) requirements.

Document the revised IT Spend Plan process to verify OAs meet OMB requirements when procuring laptop computers.

Implement enhanced physical security controls for the Information Technology Shared Services (ITSS) asset room where Working Capital Fund (WCF)-funded laptops are stored.

Develop and implement supplemental guidance that defines responsibilities for the Office of Facilities, Information, and Asset Management (OFIAM) and ITSS with respect to receipt, inspection, and acceptance, and inventory management processes and procedures for WCF-purchased laptops.

Update DOT Order 4410.4 to include: a. Defining roles and responsibilities of DOT offices and personnel with respect to management of WCF laptop computers. b. Requiring hand receipts or a similar form whenever an accountable property asset (e.g., laptop) is assigned or unassigned to/from a user. c. Requiring record retention of records from hand receipts or a similar control with the appropriate property official. d. Establishing a timeframe for submitting Reports of Survey to OFIAM.

Establish a Board of Survey to review instances of lost or damaged WCF equipment as required by DOT Order 4410.4.

Develop and implement a process for verifying the timely and accurate entry of laptop computer data into OFIAM's official personal property system of record, to include establishing data entry timeframes, key fields (e.g., procurement and delivery dates), and quality control checks.

Develop and implement procedures for conducting the annual property inventory to include obtaining missing hand receipts or similar control and timely resolution of discrepancies for WCF laptops. Implementation of this recommendation could result in $2.9 million in funds put to better use.

Reduce permanently NYC DOT's Hurricane Sandy total damage assessment by $2.125 million to remove the ineligible expenses.

Assess the necessary data to affirm that Hurricane Sandy recovery grantees carried flood insurance that complied with the Flood Disaster Protection Act (FDPA). For any Hurricane Sandy recovery grantee that FTA determines had uninsured buildings, contents, or both that should have been insured in compliance with the FDPA, permanently reduce the grantee's total Hurricane Sandy damage assessment by the aggregate amount of the maximum available National Flood Insurance Program (NFIP) insurance or the amount of the Federal investment in the property prior to the storm (whichever is less).

Develop and implement procedures within FTA's Triennial and State Management Reviews to assess the necessary data to affirm that each grantee undergoing a comprehensive review carries flood insurance that complies with the FDPA. FTA's suggested corrective actions for any grantee deficiency in this area should include, at a minimum, requiring the grantee to submit to FTA documentation showing proof of flood insurance in the aggregate amount of the maximum available NFIP insurance or the amount of the Federal investment (whichever is less) for all structures required to have it.

Revise FTA's Emergency Relief Program (ERP) guidance to include a timeframe within which grantees must apply insurance proceeds to support the policy described in its ERP Final Rule.

Require the Hurricane Sandy Recovery grantees to apply their insurance proceeds in accordance with the timeframe established in the revised ERP guidance and in support of the policy described in its ERP Final Rule. Implementation of this recommendation could put over $982.8 million in funds to better use. This is the amount of transit-related insurance proceeds that grantees have received but have not yet spent on eligible transit recovery projects.

Require MTA to apply the full amount of its transit-related insurance proceeds to eligible transit projects. Implementation of this recommendation could put up to $180.7 million in funds to better use.

Develop procedures to track grantee allocation plan implementation for expenditures solely funded with insurance proceeds.

Revise the ERP Toolkit checklist to include a step for FTA Regional staff to crosscheck against the approved insurance allocation plan when reviewing Hurricane Sandy grant applications and awarding Hurricane Sandy grants.

Implement and document a formal quarterly review process to ensure that any non-fatal warnings at the Operating Administration level are investigated, and actions to address the warnings are clearly documented.

Implement and document a formal quarterly review process to ensure that any variances identified between File A and the DOT's GTAS SF-133, and File B and OMB Circular No. A-11 and President's budget are clearly explained and documented.

Implement and document an internal oversight review process for financial assistance awards to ensure that controls are in place to verify recipients are registered in SAM at the time of financial assistance award.

Develop processes to evaluate future reporting of those data elements identified as being inconsistent with DAIMS guidance.

Perform a review of all Plans of Action and Milestone (POA&M) items closed during the audit period to include supporting documentation and re-approve their closure.

Revise current security weakness management policies and procedures (documenting within a revision history table) to require documented evidence such as calendar appointments, meeting minutes, etc. in support of POA&M closure decisions to be uploaded into CSAM.

Work with the OA CIOs to review current assessment and authorization processes and implement a validation process to ensure updated security plans, ATOs and risk assessments are reviewed and updated to reflect all system (including privacy) controls, vulnerabilities, and that current risks are clearly presented to the authorizing officials.

Work with the OA CIOs to develop mechanisms to ensure updated system security plans and assessments of security controls (that were previously assessed as not satisfied or partially satisfied) reflect current operational environments, including an accurate status of the implementation of system security controls, and all applicable security controls are properly evaluated.

Document OA subnets and OA responsibilities for devices and systems operating on the Common Operating Environment.

Document and implement network segmentation to reduce the attack surface or susceptibility of vulnerable and sensitive OA assets in the Common Operating Environment.

Work with OAs to remediate outstanding identity and access management weaknesses through implementation and closure of POA&Ms and control assessments to determine whether these risks were addressed.

Work with Component Privacy Officers (POs) to develop and implement procedures then verify the completion, review, tracking and approval through review of updated PTAs, PIAs and SORNs.

Document and implement a process to ensure incident response procedures related to the timely notification, reporting, updating, and resolution of security incidents are followed in accordance with policy.

Review and update the OCIO Cyber Security Incident Response Plan, documenting evidence of review and revisions within a history log.

Resolve any inconsistencies with respect to Departmental policies and procedures, which prescribe conflicting directions on whether DOT components are required to provide, develop and update incident response plans, documenting evidence of review and revisions within a history log.

Implement a process to ensure incident response plans are developed for all OAs and updated on at least an annual basis.

Work with the OST's Office of Intelligence, Security and Emergency Response to ensure the DOT COOP is reviewed and updated (noting evidence of the review within a history/revision log).

Work with the OA CIOs to remediate identified weaknesses in contingency plans and BIAs, such as missing information, lack of timely review, and inadequate approvals, demonstrated by updated contingency plans and BIAs.

Coordinate with impacted Operating Administrations (OA) to develop a corrective action plan to resolve and close the findings highlighted in this report.

Determine the allowability of the questioned transactions and recover $1,005,222.00, if applicable.

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.

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.

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.

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

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.

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.

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

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.

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

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Forthe fifth NAS recommendation, provide (a) cost estimates that account forstaffing, enforcement, and data collection; and (b) benchmarks for completion.

For the fourth and sixth NAS recommendations, provide (a)cost estimates that account for staffing, enforcement, and data collection; (b)benchmarks for completion; and (c) potential programmatic reforms, revisions toregulations, or proposals for legislation.

Ensures that the Authority complies with the special tests and provisions requirements

Ensure that the Authority complies with the allowable costs/cost principles and reporting requirements.

Ensures that the Authority complies with the subrecipient monitoring requirements.

Ensures the State complies with the allowable costs/cost principles and subrecipient monitoring requirements.

Recovers $232,750 (2018-067) from the State, if applicable.

Recovers $71,167 (2018-068) from the State, if applicable.

Ensures the State complies with the allowable costs/cost principles and subrecipient monitoring requirements, resulting in questioned costs of $11,745.

Recovers $11,745 from the State, if applicable.

Ensures the City complies with the procurement and suspension and debarment requirements.

Recovers $381,190 from the City, if applicable.

Ensures that the Authority complies with the equipment and real property management requirements.

Ensures that the Commonwealth complies with the subrecipient monitoring requirements.

Collect and review each OA's anti-harassment program procedures, and require revisions, as necessary, to bring them into compliance with DOT's policy and EEOC requirements.

Ensures that the Commonwealth complies with the allowable costs/cost principles requirements.

Recovers $150,203 from the Commonwealth, if applicable.

Ensures that the Council complies with the procurement and suspension and debarment requirements.

Ensures that the Council complies with the reporting requirements.

Ensures that the Council complies with the special tests and provisions requirements.

Ensures that the State complies with the special tests and provisions requirements.

Ensures that the State complies with the level of effort requirements.

Ensures that the Council complies with the activities allowed or unallowed requirements.

Recovers $194,821 from the Council, if applicable.

Ensures that the Authority complies with the subrecipient monitoring requirements.

Ensures that the Authority complies with the matching requirements.

Ensures that the State complies with the allowable costs/cost principles requirements.

Recovers $1,023,224 from the State, if applicable.

Develop and implement procedures for consistently reviewing,approving and periodically updating grantee integrity monitor plans.

Develop and implement guidance for determining threats and impediments to independence. The guidance should address criteria for independence, including the use of internal grantee staff and actions required if independence issues cannot be resolved.

Develop and implement procedures requiring all participants in grantee integrity monitoring activities to promptly notify the grantee and FTA when they have knowledge of current or prospective legal matters relating to FTA-funded Hurricane Sandy projects that may affect the Federal Government, including defaults, breaches, major disputes, or litigation; and promptly notify the grantee, FTA, and DOT-OIG if they have knowledge about potential fraud, waste, or abuse occurring on FTA-funded projects, including knowledge of a criminal or civil investigation; by a Federal, State, or local law enforcement or other investigative agency, a criminal indictment or civil complaint; probable cause that could support a criminal indictment; or any other credible information.

Recover the estimated $1.1 million that represents FTA's share of the settlement funds paid to PANYNJ-OIG.

Provide guidance or training on Master Agreement notification requirements for grantees and integrity monitors, such as defining what is meant by providing prompt notification.

Develop and implement procedures for periodically assessingwhether integrity monitors are meeting plan expectations, and for takingappropriate corrective actions when integrity monitors are not meetingexpectations.

Inform integrity monitors about best practices for targetingnew risk areas, such as procedures for contractor responsibilitydeterminations, and updating plans accordingly.

Develop and implement procedures for grantee oversight of integrity monitors that include a review of quarterly reports that, at a minimum contain information about integrity monitor activities, findings, and recommendations, as well as descriptions of the grantee's response to the recommendations and estimated completion dates for corrective actions, where appropriate.

Establish and implement a procedure for determining when to evaluate and, if necessary, adjust the normalizing constants for the accident prediction formula in U.S. DOT's Accident Prediction and Severity Model to reflect current accident and grade crossing inventory data.

Prepare and implement a comprehensive compliance manual for the grade crossing discipline that includes procedures for using grade crossing data to focus inspections and outreach.

Implement a procedure for assessing online and facility-level Performance Based Navigation (PBN) training provided to controllers for effectiveness. This procedure should include reporting the results of the assessments on a continuous basis to FAA management in the PBN policy office, and take corrective action as needed.

Implement a process in the PBN policy office to track andevaluate whether actions taken to address identified obstacles have beeneffective in mitigating them, including the areas of phraseology, training,designing and amending procedures, and automation tools.

Identify the corrective actions needed to mitigate the 10 obstacles from the NextGen Advisory Committee that FAA did not include in its action plan, and if feasible, establish milestones for implementing them.

Display the same benefits numbers on FAA's NextGen website as those that are reported in post-implementation analysis reports for completed Metroplex sites or declare any differences in the data being reported.

Document the methodology used to estimate PBN benefits for each Metroplex site.

Ensures that the Municipality complies with the special tests and provisions requirements.

Ensures that the Municipality complies with the activities allowed or unallowed requirements.

Recovers $151 from the Municipality, if applicable.

Ensures that the Municipality complies with the equipment and real property management requirements.

Recovers $64,220 from the Municipality, if applicable.

Ensures that the City and County complies with the reporting requirements.

Ensures that the State complies with the cash management requirements.

Ensures that the State complies with the cash management requirements.

Ensures that the State complies with the allowable costs/cost principles requirements.

Recovers $155,937 from the State, if applicable.

Ensures that the State complies with cash management requirements.

Recovers $9,204 from the State, if applicable.

Change the password for the compromised server management device account to a strong password that meets DOT's Cybersecurity Compendium requirements and NIST guidelines.

Configure alerts on server management devices to notify staff of unusual activity and when the system reboots.

Change the password for the compromised MARAD service account.

In coordination with DOT CIO develop and implement a training program for administrators to adequately protect passwords that includes the DOT Policy requirement to not record passwords in electronic form.

Encrypt PII data on personal and network drives in accordance with DOT Chief Information Officer Departmental Privacy Risk Management Policy.

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Develop a plan and address identified high and medium vulnerabilities on any remaining legacy websites and verify that new websites are being assessed for vulnerabilities.

In coordination with DOT CIO develop and implement a training program for MARAD personnel who provided credentials during the phishing test on security awareness, with a focus on phishing attacks.

Update the departmental annual security awareness training to include information on encryption using approved technological methods.

Change the passwords for OST's compromised social media accounts.

Change the passwords for MARAD's compromised social media accounts managed by OST.

Change the temporary passwords for the executives and staff that joined the Department during the change in the Presidential Administration.

Encrypt PII data on personal and network drives in accordance with DOT Chief Information Officer Departmental Privacy Risk Management Policy.

Examine service account permissions and remove unnecessary rights using the principle of least privilege so that service accounts have access to intended resources.

Develop a plan and address identified critical and high vulnerabilities on MARAD workstations managed by OST that are older than June 19, 2017 (1 year prior to the ending of our scanning period).

Update fiscal year 2019 Department of Transportation Security Awareness Training to include spear phishing and phishing examples and scenarios.

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

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.

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

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.

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

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.

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.

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.

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.

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.

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.

Develop and implement a data-driven, risk-based inspection scheduling program in accordance with FAA's Safety Risk Management Policy. The program should include: a. Procedures for re-inspecting companies with identified non-compliances to ensure corrective actions have been implemented and are effective, and b. Procedures for selecting substitute companies in the event of inspection cancellations.

Develop and implement a process to coordinate and verify the accuracy of aviation company data, including coordinating with FAA Flight Standards, prior to finalizing the inspection schedule.

Implement procedures to ensure FHWA provides additional guidance to State and local agencies that receive Highway Planning and Construction funds on the importance of eliminating administrative or process errors and maintaining adequate documentation to support payments requests.

Develop and implement a process for periodically assessing force account risk. Based on the risk assessment, develop and implement procedures for overseeing compliance with Federal force account regulations.

Revise force account guidance for the States to clarify when cost-effectiveness determinations are required.

Develop an action plan to collect and review the cost-effectiveness determinations for the 18 projects related to the $22.3 million in unsupported costs. Recover funds associated with projects where force account was not the most cost-effective approach for executing that project.

Develop and implement a process for determining when force account can be used for work performed outside the Federal highway right-of-way without complying with Federal requirements.

Develop and implement a timeline for making key decisions regarding the Civil Aviation Registry Electronic Services (CARES), such as defining requirements, one system vs. two systems, cloud vs. server architecture, risk-based policies, and what processes FAA could automate.

Define what desired capabilities are technologically feasible within the Registry's desired timeframes and include in its requirements, in consultation with FAA's Office of Information Technology (AIT).

Develop and implement a procedure to obtain feedback on CARES from internal and external stakeholders to better ensure that CARES meets the needs of the users of the system.

Develop and implement a plan for maintaining real-time access to aircraft registration data prior to any potential closure of the Public Documents Room (PDR).

Update financial assistance policies and procedures to address what administrative requirements apply to agreements with for-profitand foreign entities.

Finalize and issue policies for signing and administering CRADAs.

Update policies and procedures to determine when it is appropriate to require approval of recipient subcontracts or subawards and communicate this requirement to recipients; review the $12,400 in unapproved subcontractor costs identified in this report; and recover any costs deemed unreasonable. Implementing this recommendation could result in $1.6 million in funds being put to better use.

Update the checklist for agreement files that describes whatpre- and post-award documentation is required under current DOT and FHWApolicies.

Update financial assistance policies and procedures to address what administrative requirements apply to agreements with for-profit and foreign entities.

Update financial assistance policies and procedures to specify what level of review is required to approve a justification for making a financial assistance award without using full and open competitive procedures.

Update financial assistance policies and procedures to specifically address agreements using a work-order structure, including procedures to reduce the risk of using these agreements to circumvent the general requirement to award financial assistance using full and open competitive procedures.

Update the checklist for agreement files that describes what pre- and post-award documentation is required under current DOT and NHTSA policies.

Provide guidance to OAs to reinforce a common definition of R&D for use when determining whether a financial assistance award needs to be identified as R&D.

Develop and implement a risk-based methodology for reviewing a number of grantee reimbursement requests in detail on a regular basis.

Recover $1,900 in unallowable costs and take appropriate action to determine whether $8,000 in computer equipment costs was reasonable,and if not, seek recovery of these funds as well.

Update the checklist for agreement files that describes what pre- and post-award documentation is required under current DOT and OST-R policies.

Revise DOT financial assistance policies to require that OAsdefine what administrative requirements apply to agreements with for-profit andforeign recipients.

Revise DOT financial assistance policies to specify what officials are authorized to approve justifications for awarding financial assistance without full and open competition.

Develop and issue guidance to OAs for clearly identifying awards as R&D.

Develop and implement an integrated Schedule, Budget, and Organizational Chart that incorporates all the partner agencies for the SENSR program.

Develop and implement a plan to identify and mitigate risks associated with the integration of SENSR into NextGen programs as well as into systems throughout the NAS.

Develop, document, and implement a supplemental guide to DOT's Office Space Design Standard Policy (Policy) to provide the Department and its Operating Administrations (OA) guidance for applying the Agency's utilization standard to existing office space—including those spaces that DOT continues to occupy under new agreements—and clarify those terms related to the application of the standard, as identified in this report—i.e., new acquisitions

Develop, document, and implement an internal control process to apply when an OA is planning to acquire or continue to occupy an office space that exceeds the Agency's utilization standard. At a minimum, the process should require the OA to justify with documented evidence that it has implemented a different standard based on mission requirements or that applying the Department's standard will not be cost-effective or a best value option. Implementing this recommendation could potentially put $2.1 million in funds to better use by preventing DOT from paying for unneeded space that exceeds the Agency's utilization standard.

Develop, document, and implement a supplemental guide to DOT's Policy to provide OAs guidance on how to determine peak occupancy and accurately calculate the utilization rates for DOT office spaces in compliance with the methodology prescribed in the Policy.

Develop and implement a process for tracking DOT office spaces and their utilization rates. At a minimum, this process should include the ability to track staff counts and a requirement for the OAs to regularly maintain and report up-to-date data.

Develop, document, and implement departmentwide guidance on how all OAs are to conduct regular reviews of their office spaces to identify and execute cost-efficiency opportunities.

Supplement FTA's existing guidance by developing and implementing additional procedures to promote lessons learned.

Provide transit agencies with a centralized source for lessons learned and encourage them to regularly refer to it when updating their processes to protect rolling stock.

Ensures that the Foundation complies with the reporting requirements.

Ensures that the Native Village complies with the reporting requirements.

Ensures that the Authority complies with the equipment and real property management requirements.

Ensure that the City complies with the procurement and suspension and debarment requirements.

Provide training to warehouse staff to reinforce the proper procedures for processing and recording inventory transactions.

Continue to work with the service provider to correct system deficiencies that are causing processing errors for returned items.

Ensures that the Authority complies with the special tests and provisions requirements.

Ensures that the Authority complies with the subrecipient monitoring requirements.

Ensures that the Authority complies with the activities allowed or unallowed requirements.

Recovers $74,746 from the Authority, if applicable.

Ensures that the State complies with period of performance requirements.

Recovers $3,644,218 from the State, if applicable.

Ensures that the State complies with the special tests and provisions requirements.

Recovers $2,877,461 from the State, if applicable.

Ensures that the City complies with the subrecipient monitoring requirements.

Ensures that the Department complies with the subrecipient monitoring requirements.

KPMG recommends that FAA perform a review of the accounts payable accrual, including the procurement samples selected and their fiscal year allocation, at a level of precision to identify errors in order to prevent a potential misstatement.

KPMG recommends that FAA develop and implement policies and procedures to ensure that all assets that meet the criteria for the EC&D liability are included in the facility quantities report and that any converted assets are properly removed and re-included in the report under the new facility contraction.

KPMG recommends that FAA develop and implement policies and procedures to ensure that all assets are recorded with the appropriate useful life based on the asset dictionary.

KPMG recommends that FAA develop and implement policies and procedures to ensure accurate accounting for internal use software assets in accordance with SFFAS 10.

Ensures that the County complies with the reporting requirements.

Ensures that the City complies with the allowable costs/cost principles requirements.

Recovers $1,656 from the City, if applicable.

Ensures that the District complies with the activities allowed or unallowed requirements.

Recovers $221,551 from the District, if applicable.

Ensure that the Metro Regional Transit Authority complies with the special tests and provisions requirements.

Ensures that the Authority complies with the cash management requirements.

Ensures that the City complies with procurement and suspension and debarment requirements.

Recovers $81,888 from the City, if applicable.

Ensure that the City complies with the activities allowed or unallowed requirements.

Recover $41,733 from the City, if applicable.

Ensure that the City complies with the allowable costs/cost principles requirements.

Recover $107,181 from the City, if applicable.

Ensure that the City complies with the matching, level of effort, earmarking requirements.

Recover $8,067 from the City, if applicable.

Ensure that the City comply with the Allowable Costs/Cost Principles requirement.

Recover $83,547 from the City, if applicable.

Ensure that the City comply with the Allowable Costs/Cost Principles requirements.

Recover $30,335 from the City, if applicable.

Ensure that the City comply with cash management requirements.

Recover $13,465 from the City, if applicable.

Ensures that the Authority complies with the equipment and real property management requirements.

Ensures that the Authority complies with the reporting requirements.

Ensures that the Authority complies with the reporting requirements.

Ensures that the County complies with the Reporting requirements.

Ensures that the County complies with the Reporting requirements.

Ensures that the Authority complies with the internal control requirements.

KPMG recommends that ESC develop, implement, and document a timeline for journal vouchers to be approved and posted.

KPMG recommends that ESC establish a review control, with the appropriate level of precision, to ensure journal vouchers are posted in a timely manner and in accordance with the above policy.

KPMG recommends that FHWA management develop and implement a process to require documentation of the UPACS audit log review to be maintained to include documentation of the date reviewed, person who reviewed the log, and any follow-up actions required.

KPMG recommends that FHWA management update the UPACS standard operating procedures or other appropriate documentation to reflect the new audit log review process.

KPMG recommends that FHWA management develop a process to ensure the review of FMIS5 application access is completed by all divisions.

KPMG recommends that FHWA management update the FMIS5 standard operating procedures or other appropriate documentation to reflect the new review process.

KPMG recommends that FHWA management strengthen policies and procedures that require terminated user accounts to be removed from UPACS in a timely manner.

KPMG recommends that FHWA management update the UPACS standard operating procedures documents to reflect the new requirements.

Develop policy and procedures to verify and validate theaccuracy and completeness of the Department's key FISMA information repositoryand tool, currently the Cyber Security Assessment and Management tool (CSAM).

Direct OCIO to follow policy and conduct annual cybersecurity performance analysis reviews of OAs' cybersecurity programs, and submit reports to OAs with recommendations to address cybersecurity weaknesses.

Develop a process and policy where applicable to ensure the Department develops and maintain a comprehensive and accurate inventory of cloud systems, contractor systems, and websites that the public can access.

Direct OST to prioritize and resolve COE security weaknesses identified by assessor, and develop POA&Ms that realistically reflect resources and timeframes for completions of these actions.

Direct OST to establish MOUs that delineate the responsibilities for COE common controls with each of the following OAs: FHWA, FMCSA, FRA, FTA, OIG, MARAD, SLSDC, and NHTSA.

Direct OAs (FAA, FHWA, FMCSA, FRA, FTA, OST, PHMSA, MARAD, and NHTSA) with weaknesses in data protection and privacy to update the status and develop POA&Ms to address the weaknesses.

Update specialized training guidance in DOT Cybersecurity Action Memos policy and DOT Cybersecurity Compendium policy to clearly define requirements.

Enhance security awareness training policy to define processes to tailor this training to DOT's unique environment and use feedback to enhance its program.

Develop and define a taxonomy that describes the content of the hardware and software inventory and the process to assemble, verify and maintain adequate support for the inventory data as well as the related information reported to OMB and other external parties.

Develop a process to define its performance measures--that consider DOT's business environment--to assess the effectiveness of DOT's information security program, including its ISCM program.

Using NIST guidance, test and authorize CDM applications (such as BigFix) that have been placed into operation on DOT's networks without proper security control assessments.

Provide enterprise wide specialized training on contingencyplanning and testing on a periodic basis to appropriate security officials andstakeholders. Training should reinforcecrucial role contingency planning and testing plays in an effective informationsecurity program.

Develop a plan with target dates to address the Working Group's four deferred recommendations to enhance aircraft systems cybersecurity.

Develop a plan with target dates to finalize the application of CyRM to the mission support and research and development areas, and determine when full application of CyRM will occur.

Establish priorities for FAA-led research and development activities and incorporate these priorities into the budget process.

Develop and implement an action plan that establishes target action dates and assigns responsibility for following up on the key recommendations from the 2015 National Review of State Cost Estimation Practice.

Update FHWA's Guidelines on Preparing Engineer's Estimate, Bid Reviews, and Evaluation (2004 Guidance) to include: a. Estimating guidance for more recent project delivery methods, such as design-build and construction manager/general contractor and, b. Guidelines to account for contingencies and inflation when developing Engineer's Estimates.

Assess the validity and applicability of the threshold in FHWA's 2004 Guidance that is used to measure the accuracy of Engineer's Estimates.

Develop and implement an oversight process for Engineer's Estimates that assesses whether States are following FHWA's guidance and thresholds.

Require FHWA Headquarters and Division Offices to follow established procedures for reviewing and approving initial financial plans to ensure they include an assessment of the appropriateness of a P3 for project delivery.

Revise and issue guidance to communicate to FHWA staff and stakeholders the processes FHWA will use to take Federal stewardship considerations into account in approving P3 projects. This guidance should address FHWA's role, if any, in the assessment of traffic and revenue assumptions.

Develop and issue Agencywide guidance identifying risks specific to P3 projects that Division Offices should consider in their risk assessments of State and local transportation agencies' Federal-aid construction programs.

Consult with the Build America Bureau to define FHWA's and the Bureau's roles and responsibilities during the Operations and Maintenance phase for P3 projects.

Develop and issue guidance to internal and external stakeholders communicating the processes FHWA will use to oversee P3 projects, including during the Operations and Maintenance phase for P3 projects that remain funded by Federal loans.

Ensures that the Tribe complies with the procurement and suspension and debarment requirements.

We recommend that FHWA recovers $1,531,442 from the Tribe, if applicable.

Establish specific timeframes for issuing audit reports and verify that public agencies' independent audits are performed annually.

Update FAA's policy and procedures to require Airport District Offices (ADO) to obtain and review complete audit reports and ensure all required audit opinions are included.

Develop and implement procedures to ensure PFC expenditures at the Gary, IN, airport are independently audited, including the $18.3 million identified in our report.

Develop and implement policies and procedures for verifying that public agencies report accurate PFC collection and expenditure information to FAA.

Develop and implement policies and procedures that require ADO staff to consistently record certain items in the System of Airport Reporting database to enhance its oversight of the PFC program, such as the receipt of independent audit reports, PFC-related findings reported by independent auditors, follow-up actions and comments discussed with the public agency, status of audit findings, and whether the findings are repeated from prior years.

Develop a methodology to review completed PFC projects that determines whether they are achieving intended program goals, and identifies best practices and opportunities for improvement.

To improve the DOT's information security continuous monitoring program, DOT Chief Information Officer needs to update the department's federal information security modernization act standard operating procedures to include steps for verifying the accuracyand completeness of the Federal Aviation Administration's (FAA) CrossAgency Priority (CAP) goal metrics.

To improve the accuracy and completeness of the data FAA uses to report on its CAP goal metrics, the Federal Aviation Administrator needs to implement procedures that: define the requirements for selecting the operating systems to be monitored; criteria for determining which tools should be used to collect data for the CAP goal metrics; and verify the accuracy and completeness of the CAP goal metrics.

To improve the accuracy and completeness of the data FAA uses to report on its CAP goal metrics, the Federal Aviation Administrator needs to develop and implement controls for verifying, validating, and retainingdata used to report on CAP performance-based goal metrics.

Develop an implementation plan for deploying a scheduling system for controllers that includes schedule milestones, system requirements, risk assessment and mitigation, and funding requirements.

Assess and quantify the expected benefits of a customized controller scheduling tool.

LSC recommends STB discuss with ESC officials the need to substantially strengthen its system of review over financial information processed for the STB.

LSC recommends STB require ESC to determine the cause(s) for the instances of incorrect and/or improper accounting and financial reporting of STB data, and to take appropriate corrective actions to address these continuing problems.

LSC recommends STB ensure that the proper accounting procedures are in place and operating effectively for year-end financial statements when posting the costs incurred by contractors with advances.

LSC recommends STB develop a STB policy that: 1) implementsthe BFS guidance relating to interagency agreements; 2) identifies theresponsibilities for the STB and its service provider; and 3) establishes astandard set of processes that support the recording, reporting,reconciliation, and measurement of intergovernmental activity and anyidentified differences.

LSC recommends STB ensure that actions are taken prior to the end of the fiscal year to address the differences identified in the FY 2018 report.

KPMG recommends that DOT management develop sufficient procedures and controls to address the identified GITC control deficiencies.

KPMG recommends that DOT management monitor progress to ensure that the GITC procedures and controls are implemented and operating effectively.

KPMG recommends that DOT Management perform a thorough and detailed review of the overall TIFIA cashflow model functionality and implementation to ensure that all assumptions areproperly applied in the execution of the cash flow projections.

KPMG recommends that DOT consider automating the calculations that are performed manually to reduce risk of misapplication of assumptions due to human error.

KPMG recommends that FAA management develop sufficient procedures and controls to address the identified GITC control deficiencies.

KPMG recommends that FAA management monitor progress to ensure that the GITC procedures and controls are implemented and operating effectively.

KPMG recommends that FAA management design and document policies, procedures, and controls related to the review of inventory shop orders that include standardized reports, an appropriate precision threshold for required analysis or follow-up, and evidence of review.

KPMG recommends that FAA management design and implement policies and procedures to conduct a held for repair unit cost calculation review, including approvals of adjustments due to unique circumstances.

KPMG recommends that FAA management revise its existing policy of expensing all projects initiated via RE&D funding, to include projects that have progressed beyond the preliminary design stage, and design and implement controls at the appropriate level of precision to determine whether projects should be expensed or capitalized, in accordance with the applicable accounting standards.

Allmond recommends that NTSB management redesign itsprovisioning process to require that when access is modified a new systemaccess request form is completed to reflect this change.

Allmond recommends NTSB require the completion andsubmission of an Oracle Federal Financial (OFF) User Access Form to the serviceprovider immediately upon separation of an OFF user from the agency and monitoragency separations on a weekly basis to align with user access terminationpolicies in place for other agency information systems.

Retrain responsible property custodians on the proper procedures for retiring and disposing of assets in a timely manner.

Strengthen policies and controls to assess construction in progress projects to expense costs that are no longer capitalizable.

Perform a review of the net book values for recorded PP&E assets to ensure no other anomalies for converted assets or conversion errors occurred and make adjustments to correct asset values if needed.

Conduct a workforce assessment of the staff assigned to review airspace waiver and authorization requests to determine if Air Traffic Organization (ATO) staffing is adequate, and take appropriate action based on the results.

Assess performance statistics for ATO's non-automated airspace waiver request process to determine if establishing volume and timeliness goals would enhance the process and if so, develop and implement these goals.

Use performance metrics for Low Altitude Authorization and Notification Capability (LAANC) to evaluate the system's effect on application processing volume and timeliness and take appropriate action based on the results.

Develop and implement internal controls to improve consistency in the use of standard template responses when corresponding with applicants regarding requests for information.

Update National Flight Standards Work Program Guidelines to require field offices perform inspections on a sample of commercial UAS operators in their area for a 2-year period, which will increase available inspection data for creating a risk profile of UAS.

Using available inspection and risk data, develop a baseline risk assessment profile of small commercial UAS operators, including those operators with waivers and airspace authorizations, to inform inspector surveillance planning decisions, as well as procedures to periodically update this risk assessment profile using future inspection data.

Issue guidance to field offices regarding where and how to obtain Agency information on waiver and/or authorization-holding UAS operators, to help inform their inspection planning.

Provide clarifying guidance to UAS operators on FAA's website or by other means regarding the small UAS rule provision relating to operations "over people."

Develop and implement contingency plan testing to validatethe effectiveness of techniques and procedures to react to and recover fromERAM outages, with air traffic controllers' and maintenance technicians'participation.

Evaluate, develop, and implement training, consistent with NIST guidelines, for maintenance technicians and air traffic control staff forresponding to ERAM in degraded system conditions and outages.

Upon completion of the safety review regarding removing ERAM's current backup system, determine what backup capability is required for ERAM and then develop and implement that capability.

Fully develop and implement a risk management strategy and the supporting procedures for maintaining an accurate system inventory.

Develop a configuration management plan with supporting policies and procedures and ensure that the existing Change Management Charter aligns with the plan.

Develop an ICAM strategy to guide its ICAM process and activities, and modify existing identity and access management policies and procedures to adequately address: a.) Processes to request, modify, and revoke privileged and non-privileged access; and b.) Processes to ensure separation of duties within the organization.

Fully implement the use of PIV cards for personnel to access STB's facilities.

Develop a privacy program, including related plans, policies and procedures, for the protection of personally identifiable information that is collected used, maintained, shared and disposed of by STB's information systems. Furthermore, identify roles and responsibilities for data exfiltration exercises.

Develop an Incident Response plan in accordance with NIST 800-61, rev. 2.

Modify incident response policies and procedures to incorporate the most recent incident attack vectors taxonomy in accordance with US-CERT.

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Ensure that Access Control Officers complete the quarterly access reviews over the current active user accounts and associated roles within Delphi Financial Application, including iSupplier, to help ensure access is authorized and commensurate with job responsibilities.

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Develop and implement controls for periodically verifying that RO/ADO program managers are implementing FAA's policy for (a) assigning and monitoring grantee risk ratings, as required; (b) performing manual approvals, when required; and (c) performing quarterly reviews and, when applicable, modifying grantee risk ratings according to FAA guidance.

Formally request that OST Delphi system managers modify the wording of the warning message to AIP grantees to specifically state when documentation has not been attached to payment requests and that such documentation is required by FAA policy and the Improper Payments Elimination and Recovery Improvement Act of 2012 (IPERA).

Formally request that OST Delphi system managers implement a function that denies AIP payments to grantees that do not provide the required supporting documentation at the time of the payment request.

Update FAA policy to include the availability of existing Delphi eInvoicing training and communicate the policy revision to all AIP grantees.

Develop and implement a plan to recover the $102,323 in questioned and unsupported costs identified in this report.

Communicate to AIP grantees FAA's policy requirement for maintaining all original documentation that supports grant payments and confirm that all grantees have acknowledged this requirement.

Update AIP payment policy to include a specific requirement that grantees submit payment requests on invoiced costs incurred up to the allowable Federal share, and communicate the revision to all AIP grantees.

Improve existing training for RO/ADO program managers to follow the AIP Handbook requirements for amending grant agreements when expanding project descriptions.

Ensures that the Territory complies with the equipment and real property requirements.

Ensures that the Territory complies with the special tests and provisions requirements.

Recovers $264,077 from the Territory, if applicable.

We recommend that FHWA ensures that the Navajo Nation complies with the equipment and real property requirements.

Ensures that AMTRAK complies with the equipment and real property management requirements.

Ensures that the Republic complies with the equipment and real property management requirements.

Ensures that the District complies with the procurement and suspension and debarment requirements.

Ensures that the University complies with the allowable costs/cost principles requirements.

Recovers $8,954 from the University, if applicable.

Ensures that the University complies with the allowable costs/cost principles requirements.

Recovers $9,377 from the University, if applicable.

Ensures that the Authority complies with the matching requirements.

Recovers $2,787 from the Authority, if applicable.

Ensures that the Commonwealth complies with the equipment and real property management requirements.

Ensures that the State complies with the reporting requirements.

Ensures that the State complies with the matching, level of effort, earmarking requirements.

Ensures that the Authority complies with the subrecipient monitoring requirements.

Ensures that the Authority complies with the reporting requirements.

Ensures that the State complies with the matching, level of effort, earmarking requirements.

Ensures that the Confederated Tribes complies with the reporting requirements.

Ensures that the SC DOT complies with proper accounting requirements for accounts receivable and accounts payable.

Ensures that the City complies with the subrecipient monitoring requirements.

Recovers $2,780,059 from the City, if applicable.

Ensures that the State complies with the cash management requirements.

Ensures that the State complies with the subrecipient monitoring requirements.

Ensures that the State complies with the activities allowed or unallowed requirements.

Recovers $900,000 from the State, if applicable.

Recovers $143,000 from the State, if applicable.

Ensures that the State complies with the special tests and provisions requirements.

Ensures that the State complies with the reporting requirements.

Ensures that the City complies with reporting requirements.

Ensures that the City complies with subrecipient monitoring requirements.

Ensures that the City and County complies with the activities allowed or unallowed and allowable costs/cost principles requirements.

Recovers $24,080,771 from the City and County, if applicable.

Ensures that the City and County complies with the reporting requirements.

Ensures that the Tribe complies with the cash management requirements.

Recovers $3,077,574 from the Tribe, if applicable.

Ensures that the Tribe complies with the activities allowed/allowable costs and cost principles requirements.

Recovers $22,691 from the Tribe, if applicable.

Ensures that the Tribe complies with the equipment and real property requirements.

Ensures that the Tribe complies with the period of performance requirements.

Ensures that the Tribe complies with the special tests and provisions requirements.

Ensures that the Authority complies with the cash management requirements.

We recommend FTA recovers $30,641 from the Authority, if applicable.

Ensures that the State complies with the subrecipient monitoring requirements.

Recovers $106,181 from the State, if applicable.

Ensures that the Authority complies with the equipment and real property management requirements.

Ensures that the Authority complies with the equipment and real property management requirements.

Ensures that the State complies with the subrecipient monitoring requirements.

We recommend FTA recovers $99,226 from the State, if applicable.

Ensures that Guam complies with the equipment and real property management requirements.

Update DOT Orders 8000.8 and 8000.5A and make them available to DOT employees.

Require that Operating Administrations align any criminal referral procedures with updated DOT Orders.

Implement an annual mandatory training requirement on DOT employees' responsibility to report fraud, waste, and abuse to the OIG and requirements in DOT Orders 8000.8 and 8000.5A.

Ensures that the Council complies with the special tests and provisions requirements.

Ensures that the Authority complies with the equipment and real property management requirements.

Ensures that the State complies with the special tests and provisions requirements.

Ensures that the Agency complies with the procurement and suspension and debarment requirements.

Recovers $214,494 from the Agency, if applicable.

Ensures that the Authority complies with the reporting requirements.

Ensures that the Authority complies with subrecipient monitoring requirements.

Ensures that the Authority complies with special tests and provisions requirements.

Ensures that the Authority complies with the matching requirements.

Ensures that the State complies with the special tests and provisions requirements.

Recovers $214,516 from the State, if applicable.

Ensures that the Wyoming DOT complies with the reporting requirements.

Ensures that the Commonwealth complies with the subrecipient monitoring requirements.

Ensures that the State complies with the special tests and provisions requirements.

Develop and implement a risk-based process to monitor manufacturers' reporting of recall remedy, scope, and risk information. The process should include taking appropriate steps with manufacturers that are not in compliance, including enforcement actions when necessary, as well as verifying information submitted by manufacturers, and identifying and addressing potential inadequacies of recall remedies and scope.

Develop and implement a risk-based process—with specific timelines—that provides guidance for Office of Defects Investigation staff on identifying recalls with missing communications (e.g., dealer notifications, technical service bulletins), taking appropriate action to resolve the deficiency, and documenting the outcomes in an official recordkeeping system.

In accordance with the Government Accountability Office's Standards for Internal Control in the Federal Government and NHTSA's procedures, develop, implement, and document management controls, including a supervisory review process, for monitoring recall remedies, scope, and risk reporting and oversight of recall implementation.

Develop a training curriculum on staff responsibilities for updated recall monitoring and oversight processes, and provide this training to Office of Defects Investigation and Office of Vehicle Safety Compliance staff.

Update the recall reporting portal and issue written guidance to identify all recall scope, risk, and completion rate information that regulations require manufacturers to submit.

Document lessons learned from the Takata recalls, and develop and implement a plan for applying those lessons to help manufacturers improve completion rates of other recalls.

Conduct an independent review of FAA's oversight of American Airlines' flight operations to determine whether controls are in place and effective in preventing single points of failure; develop and implement corrective actions, if necessary.

Modify the existing tool used to evaluate the objectivity of inspectors to incorporate risk factors such as non-routine operations and the length of time inspectors oversee the same air carrier.

Develop and implement controls requiring oversight office staff to resolve complaints and follow key policy requirements such as directly contacting complainants and documenting investigations.

Establish and implement criteria for evaluating correspondence to ensure safety complaints are routed to FAA's Office of Audit and Evaluation.

Develop and implement inspector guidance on FAA's oversight requirements for flight test operations.

Provide the Allied Pilots Association with a revised response to its complaint based on results from the October 2017 independent assessment of the American Airlines flight test program.

Develop and implement a corrective action plan to address the recommendations made by the October 2017 independent assessment of the American Airlines flight test program.

Update and remediate the completion dates in the plans of action and milestones for SI-02.A and CM07.A.2 to ensure that the confidentiality, integrity, and availability of the system are not at risk.

Determine the impact of new hire training and certification time and fatigue mitigation requirements on technician staffing and incorporate into the maintenance technician staffing process.

Determine the impact of equipment age on workload and maintenance technician staffing needs and incorporate this factor into the staffing model, if found to be statistically significant.

Review and update the Facility, Service, and Equipment Profile policy to require user training and recurring data-validation reviews at the Support Center and national levels at defined intervals prior to running the staffing model.

Develop and implement a process to reduce and standardize codes in the Labor Distribution Reporting (LDR) system to improve accounting for direct maintenance workload.

Determine if the newly standardized LDR data are reliable for direct maintenance workloads in the Technical Operations Staffing Model, and if so, develop and implement an action plan with milestones to replace the workload assessments with LDR data.

Revise the current standard operating procedure, Tier 1/2/3 Staffing Allocations and Tier 1 Watch Coverage Requirements to: a. Define the job series and clarify whether system specialists and System Support Center coordinators are included in the Tier 1, 2, and 3 staffing targets;and b. Require annual review, validation, and updating of staffing allocation targets.

Update the target delivery dates for initiatives that are still in progress, including those without target delivery dates, and implement procedures for continually updating delivery dates and descriptions of initiatives as changes are made.

Develop and include in the monitoring plan quantifiable metrics or other indicators that can measure the effectiveness of the initiatives.

Consolidate duplicate initiatives within the monitoring plan.

Develop and issue comprehensive policy and procedures for the Pipeline Safety Research and Development Program that includes guidance for: a. notifying a wider spectrum of stakeholder representatives about future Research and Development forums, in order to increase their participation; b. addressing how the results of Research and Development forums are incorporated into the program plan; c. conducting all steps in the conflict-of-interest process; and d. following up with researchers on benefits and uses.

Complete upgrades to the conflict-of-interest portion of the Research and Development Management Information System.

Use Performance Improvement Council best practices to update future biennial Update Reports to Congress, to include additional context, such as analyses of current performance metrics and an evaluation of program success, trends, and anomalies.

Implement procedures to ensure the Federal Transit Administration distributes guidance to selected grantee recipients on the importance of accurate submission and proper review of timesheets to improve proper allocation of labor efforts and the identification and retention of required documentation to support a payment as proper in the Emergency Relief Program-Disaster Relief Appropriations Act program.

Work with the Office of Inspector General (OIG) to ensure it provides additional, clear, and precise travel guidance to employees and approving officials on the preparation and proper review of travel vouchers to improve the allocation of travel expenses in OIG-DRAA fund activity.

Work with OIG to ensure it updates its travel guidance to add instructions on how to split or allocate DRAA-related travel expenses to the appropriate accounting codes including codes for indirect costs and trains employees how to use this guidance.

Ensures that the Council complies with the cash management requirements.

Recovers $666,482 from the Council, if necessary.

Ensures the State complies with the period of performance requirements.

Determine the allowability of the $5,824 transaction, then review all construction projects to ensure that expenditures were properly paid within the period of performance, and recover any additional questioned costs, if applicable.

Ensures that the City complies with the reporting requirements.

Ensures that the City complies with the allowable cost/cost principles requirements.

Recovers $21,265 from the City, if applicable.

Ensures that the City complies with the allowable cost/cost principles requirements.

Recovers $37,543 from the City, if applicable.

Ensures that the DART complies with the allowable costs/cost principles requirements.

We recommend FTA recovers $122,558 from the DART, if applicale.

Ensures that the DART complies with the cash management requirements.

Ensures that the Authority complies with the allowable costs/cost principles requirements.

We recommend FAA recovers $38,339 from the Authority, if applicable.

Ensures that the County complies with the equipment and real property management requirements.

Ensures that the Authority complies with the reporting requirements.

Ensures that the NM DOT complies with the activities allowed or unallowed requirements.

Ensures that the NM DOT complies with the subrecipient monitoring requirements.

Ensures that the County complies with the equipment and real property requirements.

Ensures that the Authority complies with the procurement and suspension and debarment requirements.

Ensures that the Authority complies with the subrecipient monitoring requirements.

Ensures that the State complies with the special tests and provisions reqirements.

Ensures that the City complies with the Subrecipient monitoring requirements.

Provide written guidance specifically to grandfathered sponsors on what constitutes a grandfathered payment and how to accurately report grandfathered payments.

Develop and implement an internal control process to verify the accuracy of reports on grandfathered payments.

In accordance with Federal law, consider the State of Hawaii exceeding its statutory limit on the use of revenues for non-airport purposes as a factor in reducing AIP discretionary funds awarded to the State. Implementation of this recommendation could put $509,727 in funds to better use.

Revise and document a standardized data entry and validation process for the Service Areas to follow to help ensure consistent and accurate REMS data entry.

Develop, document, and implement a new lease approval process that will allow for more timely decisions and for improved coordination with Service Area staff on the status of the decisions made during this process. Implementing this recommendation could potentially put $14.6 million in funds to better use due to missed rent reduction opportunities, which timely and coordinated lease efficiency opportunity decisions could have potentially prevented.

Improve and document methods used to share and communicate Headquarters lease policies, guidance, and initiatives to all real estate staff members in the Service Areas.

Revise and document lease policy and templates to clarify that the indefinite holdover clause should only be used in office and warehouse leases where mission-critical safety equipment or functions are housed, and document a process to verify this policy is followed.

Revise, document, and implement a procedure to require and verify that for any office or warehouse lease whose firm-term portion is greater than one year, an analysis showing use of a firm-term lease is advantageous to the Agency is documented in the lease file.

Revise and document the real estate strategic planning process so that it: (1) provides for annual updates and (2) increase Service Area involvement and awareness.

Develop and implement a method for increasing the likelihood that LOBs provide the necessary funding to implement agreed upon lease efficiency opportunities.

Develop, document, and implement controls to (1) reconcile and validate the accuracy of lease payments that are made during the term of the lease and (2) verify that any lease payment made has an active and valid lease associated with it. Implementing this recommendation could potentially put $111,138 in funds to better use for uncollected interest on erroneous lease payments.

Take appropriate action to address the $9,964 in improper payments identified in this report.

Provide additional guidance and/or training to FAA staff to reinforce existing policy regarding: (1) the proper coding of payments captured under each of the various lease-related object class codes in the Agency's accounting system, Delphi; and (2) the requirement for approving officials to ensure the accuracy of accounting codes.

Develop, document, and implement a process to ensure that for any new or succeeding office space lease that does not meet the utilization standard, a justification is developed and documented in the lease file as to why the application of the Agency's space utilization standard is not cost effective.

Revise, document, and implement an internal control process to regularly track and assess the utilization rate for all office space leases in the Agency's current portfolio using data that is updated for accuracy on a regular basis. Implementing this recommendation could potentially put $22.9 million in funds to better use by preventing FAA from paying rent on unneeded space in excess of its utilization standard.

Update policy or develop procedures to place a greater emphasis on prevention in the SAPR training program and incorporate the Centers for Disease Control's elements of a comprehensive prevention program, such as providing bystander intervention training at all levels (students, faculty, staff, and leadership).

Complete a Sexual Assault Review Board review of all Academy policies and procedures, including the Midshipmen Regulations, to identify any gaps or inconsistencies with SAPR messaging and revise the policies and procedures accordingly.

Communicate the revised policies and procedures to all Academy stakeholders.

Establish and formalize in policy or procedures methodologies to evaluate the effectiveness of the SAPR program and its practices, including metrics to evaluate training outcomes.

Revise sexual assault policies and procedures and sexual harassment policies to clearly provide for documenting, tracking, and maintaining reports, such as by cross-referencing to the records maintenance standard operating procedure.

Develop and implement procedures for prioritizing responses to recommendations based on risk and aligning resources accordingly.

Develop and implement controls to ensure staff at all levels and faculty are held accountable for taking actions to support the SAPR program, including completing assigned action items.

Align the investigative reporting practice with the standard operating procedure for investigating an unrestricted report of sexual assault.

Develop and implement a procedure for reporting, investigating, and responding to sexual harassment complaints.

Develop and implement a procedure for validating the Academy's data on reported sexual assault and sexual harassment incidents.

Ensure that the Authority complies with the equipment and real property management requirements.

Ensure that the Authority complies with the special tests and provisions requirements.

We recommend FTA recovers $76,572 from the Authority, if applicable.

Ensure that the Commission complies with the reporting requirements.

Ensure that the City complies with the reporting requirements.

Ensure that the Authority complies with the procurement and suspension and debarment requirements.

Ensure that the Authority complies with the reporting requirements.

Ensure that the Authority complies with the special tests and provisions requirements.

Ensure that the Authority complies with the procurement and suspension and debarment requirements.

Define the projects that are considered pre-implementation (developmental) in the Agency budget guidance and Acquisition Management System policy and validate that developmental projects align with the definition and are funded under the appropriate budget activity.

Develop and implement a quality control checklist with criteria for determining when the use of incremental funding prior to PLA approval is permissible.

Develop and implement a control for enforcing the PMA limits on the assessment of program management fees for various administrative and contract support specified in the Agency's standard operating procedures.

Update PMA standard operating procedures to include a control that ensures project requirements are met before transferring expiring funds into the PMA account.

Amend the PLA close-out process to include the statement of outcomes and statement that work was concluded or if follow-on work is required.

Establish and implement a mechanism for providing oversight of developmental funding, to include records of decision regarding selecting, justifying, and measuring the outcomes of PLAs to ensure FAA is funding the highest priority work.