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Management Advisories

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The Office of Inspector General is working to ensure that the more than $48 billion in stimulus funds allocated to the Department of Transportation is committed to infrastructure projects that meet ARRA requirements. We issued this advisory to alert the Department that FAA’s process for awarding ARRA grants for Airport Improvement Program (AIP) projects did not ensure all ARRA requirements were met. Specifically, FAA’s guidance to regional officials for selecting airport projects did not adequately reconcile national ARRA goals with the Agency’s National Priority Rating (NPR) process for scoring potential AIP projects, and the economic merit of some lower–ranked projects may be questionable. Additionally, some projects may involve recipients with histories of grant management problems. As a result, some of these grants may not fully comply with ARRA requirements calling for transparent, merit–based selections and effective administration of funds. We offer proposed actions for change for the Department’s consideration. Most broadly, to ensure only projects of the highest priority and economic merit receive ARRA funds, FAA needs to reconcile its guidance to regional officials with ARRA requirements and provide a transparent selection process. We suggest that until FAA can demonstrate their economic merit, it should refrain from awarding additional grants for lower–ranked projects. For such projects that have been approved but for which no ARRA funds have been expended, FAA should show their economic merit or consider withdrawing those grants. Finally, FAA should increase its oversight over ARRA grant recipients that historically have not administered AIP funds effectively. We plan to follow up on the information in this advisory with a full audit.