Audit cuts U.S. funds for MTA

May 30, 1994|By Peter Jensen | Peter Jensen,Sun Staff Writer

A federal audit criticizing management of the Mass Transit Administration's bus fleet has caused the state agency to lose $6 million in federal funds.

The report issued by the U.S. Department of Transportation's Office of Inspector General says the MTA keeps dozens more buses in stock than it needs, disposes of buses without properly compensating the federal government and has not conducted a proper inventory in 15 years.

As a result of the April 22 report, the MTA has agreed to purchase 30 fewer buses this year than the 125 originally planned, amounting to a savings to the federal government of about $6 million.

In addition, the Federal Transit Administration has been instructed by the inspector general to collect $443,217 from the state as a reimbursement for 63 buses taken out of service sooner than the federal government recommended.

MTA Administrator John A. Agro Jr. declined to comment on the audit. He said the 30-page report involves sensitive issues that still are being negotiated with the FTA.

"Recognizing that we are still in active discussion with the Federal Transit Administration regarding the incorrect application of guidelines by the Office of Inspector General on the disposition of buses and further recognizing that the buses in question were experiencing significant safety problems in that some actually caught fire and some had high maintenance costs, I don't feel it's appropriate to comment on the report," Mr. Agro said.

Peter G. Halpin, an FTA spokesman in Washington, also declined to comment on the audit until the FTA makes final a written response to the inspector general "in the next several weeks."

One of the disputes involves keeping track of how long a bus is in service. The federal government pays for up to 90 percent of the cost of a new bus -- about $200,000 -- and expects it to last at least 12 years, or 500,000 miles.

If an agency takes a bus out of service prematurely, the FTA is entitled to be compensated for its investment in the vehicle under a formula that takes into account depreciation. For instance, an MTA bus that cost the federal government $95,485 when it went into service on Jan. 29, 1979, was considered to be worth $4,577 when taken out of service June 30, 1990.

Another contested issue is the size of the Baltimore-based agency's bus fleet. Federal guidelines call for transit agencies to maintain fleets no larger than 20 percent over the number needed during peak travel times. The MTA, the auditors contend, had 865 buses in September, 41 percent more than the 615 buses that would be required during the busiest rush hours.

"If an agency has plenty of buses in good condition, it shouldn't need more," said Raymond J. DeCarli, assistant inspector general for the federal transportation department. "If the buses were in poor condition, they needed to get rid of them."

Mr. DeCarli said disputes over the size of bus fleets are not uncommon.

Local transit agencies are under constant pressure to update their vehicles -- to make buses accessible to the handicapped, reduce tailpipe emissions with modernized equipment, or simply to lower repair costs.

"Their thinking is, 'If Uncle Sam is paying 90 percent of your costs and you can use the bus, why not go for it?' " Mr. DeCarli said.

The audit says that the MTA can't account for $24 million in bus-related equipment financed by the federal government over the years and that the agency hasn't conducted a complete inventory since 1979. However, FTA's regional administrator disputes the figure and asserts that a satisfactory inventory was conducted in 1985.

An appraisal company hired by the MTA is conducting an inventory of its assets, which is expected to be completed by Aug. 1, according to the audit.

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