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ERM #3: Technical Capacity

Governance, Leadership, and Management

1. How are members of the governing body selected? How are they paid (direct or indirect costs)? Documentation?

Procedures Evaluation/Comments


1. Review the articles of incorporation of the agency to determine if:

2. governing body members, are selected, elected or appointed

3. members are allowed to serve consecutive terms

4. the responsibilities of the governing body are adequately defined

5. Interview member(s) of the governing body to learn how the board sets and facilitates the implementation of policies; whether the board comprehends its responsibilities, the organization and the policies and procedures that drive operations

6. Review the governing body minutes

7. Is there discussion of the grantee’s responsibility towards fulfilling its mission?

8. Is there discussion of issues related to the daily operation of the grantee (i.e. financial management, technical capacity, procuring goods and services, stakeholder involvement, state of good repair, etc.)?

9. Utilizing the National Transit Database (NTD) (or any other industry accepted source) information, identify agencies with similar characteristics of the grantee: operating and capital budget, fleet size, service area, ridership, reporting requirements, etc.

Grantee: Technical Capacity ERM FY2017 Grantee Information Request 1



Compare the following characteristics of the agency with industry norms to assess the ability of the agency to adequately implement the FTA program

10. Organization and staffing of the grantee/department responsible for administering the FTA program

11. If part of a larger organization, the level of support provided by the organization’s leadership and/or governing body, and other departments

12. Technical capacity of the staff administering the program

13. Transit related experience

14. Management experience

15. Number of years spent in position

16. Knowledge of FTA requirements

17. Level of training available and provided to staff

18. Operating cost (including source and level) allocated to the department

19. Level of sophistication of the tools used to assist with the implementation of the program

Grantee Response:

Reviewer Comments:

2. What is the length of each term?

Grantee Response:


Reviewer Comments:

3. Describe any organizational changes to the governing body structure since the last Comprehensive Review (i.e., number of board members, voting rules, term limits).

Grantee Response:

Reviewer Comments:

4. Provide details on any departures of governing body members prior to the end of their term since the last Comprehensive Review.

Grantee Response:

Reviewer Comments:

5. If there are any vacancies in the membership of the governing body, provide information on how and when they will be filled.

Grantee Response:

Reviewer Comments:

DETERMINATION:Input into determining the overall technical capacity of the grantee.

6. What are the primary roles and responsibilities of the governing body?

Grantee Response:

Reviewer Comments:

7. Describe any formal committees to the governing body and how they are determined.


Grantee Response:

Reviewer Comments:

8. How often do the governing body and committees meet?

Grantee Response:

Reviewer Comments:

9. Are records of these meeting kept and available to the public?

Grantee Response:

Reviewer Comments:


10. Does the governing body formally review results of oversight reviews, audits, etc., performed on the grantee?

Grantee Response:

Reviewer Comments:

11. How is the governing body involved in meeting the award’s reporting and program requirements? Are reports and budget changes reviewed prior to submission? Is management required to report to the governing body on the status of the Federal Transit Administration (FTA) programs? Describe the type of information conveyed and how often information is provided. How are comments or concerns of the governing body documented and addressed?

Grantee Response:


Reviewer Comments:

12. How does the governing body ensure that it fulfills its fiduciary responsibilities (i.e., review financial statements, evaluate financial management and financial and technical capacity)?

Grantee Response:

Reviewer Comments:

13. What is the conflict of interest policy for the governing body? How are board members vetted?

Grantee Response:

Reviewer Comments:

14. Does the governing body formally evaluate the performance of the chief executive officer? How often?

Grantee Response:

Reviewer Comments:

15. What is the level of involvement of the governing body in the day-to-day management of the agency and/or the FTA program? Does it appear that the governing body exercises too much influence or too little oversight in the management of the grantee?

Grantee Response:

Reviewer Comments:


16. Has the governing body established an internal audit function that reports to it? If yes, how large is the internal audit staff? How does the governing body determine subjects to be investigated by the internal auditor?

Grantee Response:

Reviewer Comments:

17. Does the governing body play a role in addressing improprieties of the grantee staff?

Grantee Response:

Reviewer Comments:


18. Has grantee experienced turnover in executive leadership/key management positions since the last Comprehensive Review? If yes, please explain.

Grantee Response:

Reviewer Comments:

19. What executive leadership/key management positions are currently vacant? What is the projected timeframe to fill these positions?

Grantee Response:

Reviewer Comments:

20. Since the last Comprehensive Review, has the grantee made changes to its organizational structure? If yes, please explain.

Grantee Response:


Reviewer Comments:

21. If the grantee reduced staff and/or eliminated positions associated with its FTA program, explain how the grantee determined what positions would be eliminated and how responsibilities are to be redistributed.

Grantee Response:

Reviewer Comments:

22. Following reductions in staff, describe any changes the grantee made to policies and procedures utilized in implementing its FTA program.

Grantee Response:

Reviewer Comments:

23. If there are multiple FTA awards, how are positions and the associated level of effort documented for key personnel? How is this documentation related to the development of salaries and employee pay?

Grantee Response:

Reviewer Comments:

DETERMINATION: Input into assessing the overall technical capacity of the grantee.

Grant Administration

24. What are the grantee’s procedures for managing its FTA grants? How does the grantee document the procedures? Is there a designated position to manage the award? How does the grantee assess its practices to determine that they are adequate?



Grant Management Practices

1. Access the grantees projects in TrAMS. Assess whether the grantee utilizes the following practices in administering its program.

2. Spend oldest funds first for on-going expenses such as project management, operating assistance, ADA complementary paratransit, and preventive maintenance

3. Tie third party contracts to projects, not directly to grants

4. Set project time limits (less than 2 years)

5. Use available funding in open grants before including projects in a new grant

6. Move delayed projects to newer grants and active projects to older grants

7. Transfer small remaining balances to new line items

8. Deobligate project balances and reapply for funds (if within period of availability and allowed by the regional office)

9. Regularly reconcile grant balances with those in TrAMS to the financial purpose code (FPC) level

10. When funding a project out of multiple grants, develop a grant drawdown plan

11. When funding a project out of multiple grants, charge retainage to the newest grant (and report it as an unliquidated obligation) to enable the closing of older grants


Grantee Response:

Reviewer Comments:

25. Has the grantee designated a specific department with responsibility for managing the FTA program? If yes, what staff position leads the department? What are the responsibilities of this position? To whom does this position report? Has the recipient identified key personnel?

Grantee Response:

Reviewer Comments:

26. If no single department is responsible for the FTA program, describe how the grantee manages and complies with grant agreement requirements.

Grantee Response:

Reviewer Comments:

a. How are decisions made relative to the FTA program?

Grantee Response:

Reviewer Comments:

b. What entity within the grantee makes final decisions relative to the FTA program? How are such decisions made?

Grantee Response:

Reviewer Comments:


27. What other departments support the FTA programs? Do these departments support other non-FTA programs?

Grantee Response:

Reviewer Comments:

28. When resources are needed for key management positions or for managing FTA projects, how are those resources identified and who has hiring or acquisition responsibilities? How are positions related to key personnel staffed? How are assignments made? What is the process for ensuring that staff is not overextended?

Grantee Response:

Reviewer Comments:

29. Describe how the grantee determines the amount of administrative support (resources and budget) needed for its FTA program.

Grantee Response:

Reviewer Comments:

30. What resources in addition to internal staff (e.g., consultants) and tools (e.g., technology) are utilized to assist in managing the FTA program? What portion of these are contracted services? How is this relayed in the budget?

Grantee Response:

Reviewer Comments:

31. What is the source of revenue to support the administrative costs of the FTA program?

Grantee Response:


Reviewer Comments:

32. Describe any changes to the current budget that have occurred since the last Comprehensive Review.

Grantee Response:

Reviewer Comments:

33. Describe any projected changes to the current budget for the next two years.

Grantee Response:

Reviewer Comments:

DETERMINATION:Input into assessing the overall technical capacity of the grantee.

34. Describe how the grantee issues management policies and procedures related to its FTA program.

Grantee Response:

Reviewer Comments:

35. How does the grantee determine the need to make revisions to the policies or procedures related to its FTA program? Have revisions been made since the last Comprehensive Review?

Grantee Response:

Reviewer Comments:


36. How is the grantee staff trained to carry out policies or procedures related to the FTA program? How are they informed of policy or procedural changes?

Grantee Response:

Reviewer Comments:

37. How does management monitor and assess staff compliance with policies or procedures related to the FTA program?

Grantee Response:

Reviewer Comments:

DETERMINATION:Input into assessing the overall technical capacity of the grantee.

38. Describe the process for developing the grantee’s annual program of projects?

Grantee Response:

Reviewer Comments:

39. Is the process documented?

Grantee Response:

Reviewer Comments:

40. What staff positions and departments lead and are involved in the process?

Grantee Response:

Reviewer Comments:


41. Are existing grants reviewed during the process to determine if there are any available funds before applying for new grants?

Grantee Response:

Reviewer Comments:

42. Does the grantee initiate grant closeout within 90 days of completion of all activity in the program of projects? What is the status of all FTA grants? (Complete Exhibit 1)

Grantee Response:

Reviewer Comments:

DETERMINATION: See Part B: Grant Administration of the Technical Capacity area in the baseline review guide, questions 71-76.

Progress Reports

43. What are the grantee’s procedures for ensuring that Milestone Progress Reports (MPRs) are completed as required and that they contain sufficient current information to describe changes in cost, schedule, and scope of work?

Procedure Evaluation/Comments

Milestone Progress Report

1. Review a sample of milestone reports to determine if they contain the following information:

a. Current status of each open ALI within the active/executed grant



b. Narrative description of projects, status, problems encountered in implementation, specification preparation, bid solicitation, resolution of protests, and contract awards

c. Detailed discussion of all budget or schedule changes

d. Dates of expected or actual requests for bid, delivery, etc

e. Actual completion dates for completed milestones

f. Revised estimated completion dates when original estimated completion dates are not met accompanied by:

g. (i) Explanation of why scheduled milestones or completion dates were not met

h. (ii) Identification of problem areas

i. (iii) Narrative on how the problems will be solved

j. Discussion of the expected impacts and the efforts to recover from the delays

k. Analysis of significant project cost variances using quantitative measures, such as hours worked, sections completed, or units delivered. Discussion of completion and acceptance of equipment and construction or other work, together with a breakout of the costs incurred and those costs required to complete the project.



l. List of all outstanding claims exceeding $100,000, and all claims settled during the reporting period accompanied by a brief description, estimated costs, and the reasons for the claims

m. List of claims or litigation involving third party contracts and potential third party contracts that:

(i) Have a value exceeding $100,000

(ii) Involve a controversial matter, irrespective of amount

(iii) Involve a highly publicized matter, irrespective of amount

n. List and briefly describe all potential and executed change orders and amounts exceeding $100,000, pending or settled, during the reporting period

o. List of all real property acquisition actions, including just compensation, property(ies) under litigation, administrative settlements, and condemnation for each parcel during the reporting period

p. For Section 5307 funds obligated before October 1, 2015, annual associated transit improvements report (4th quarter only) for designated recipients in urbanized areas of 200,000 or more who receive funds under Section 5307

NOTE: See number 3 below for content

2. For Section 5316 and 5317 programs, review the MPRs to determine that they contain:



a. Updated program of projects for each active grant that contains active projects reflecting revised project descriptions, changes in projects from one category to another, and adjustments within budget categories

b. Revised milestones for activity line items (ALIs) that require milestones with grant submission (vehicle procurements, construction projects, and program reserve) and, for revised estimated completion dates, an explanation for the revision

c. Budget revisions for changes in line item budgets

d. Significant civil rights compliance issues

e. Additional information requested by the regional office

3. For the grantees in large urbanized areas (200,000 or more in population), if an associated transit improvement report was submitted with its 4th quarter MPR, did it contain the following items:

a. Name of grantee(s) expending the enhancement funds

b. UZA name and number

c. FTA Award Identification Numbers: TEAM grants Project Numbers or Federal Award Identification Numbers (FAIN) for TrAMS grants

d. Project category or categories



e. Brief description of improvements and progress towards project implementation

f. Activity line item codes from the approved budget(s)

g. Amount awarded by FTA for the project

Federal Financial Reports

4. Review a sample of federal financial reports to determine if the following are completed correctly:

a. Federal cash receipts and cash disbursements reported; if positive cash on hand at the end of the period, is explanation included in the “Remarks” tab

b. Unliquidated obligations reported reflect the status of projects in the milestones progress reports

c. If indirect costs are charged to a grant:

d. indirect expense section of the FFR is completed

e. rates shown are consistent with the cost allocation plan or indirect cost rate proposal

f. The grantee certifies that the information is true, complete and accurate to the best of its knowledge under the remarks and certification tab

g. The grantee responded to any comments made by FTA regarding a report



Reporting

5. Select a sample of MPRs and FFRs to determine the following:

a. For grantees in small urban areas (populations less than 200,000), were reports submitted no later than 30 days after the end of the Federal fiscal year?

b. For grantees in large urban areas, were reports submitted no later than 30 days after the end of each quarter?

c. If a grantee is managing a vehicle procurement and/or construction project or has program reserve, were reports submitted no later than 30 days after the end of each quarter, regardless of the population size?

Grantee Response:

Reviewer Comments:

44. What are the grantee’s procedures for obtaining and validating project information (for the agency and its contractors/subrecipients) for inclusion in MPRs? Is there a designated individual or office responsible for inputting and providing assurances for required reports?

Grantee Response:

Reviewer Comments:

45. Are all applicable MPRs submitted for each open grant at the required intervals and on time?

Grantee Response:


Reviewer Comments:

46. What are the procedures for reconciling the data reported in the MPRs to the Federal Financial Reports (FFRs) and the grantee’s records? Did the review of FFRs in the baseline portion of the Comprehensive Review disclose any potential deficiencies that should be addressed in coordination with the MPRs?

Grantee Response:

Reviewer Comments:

DETERMINATION: See Part B: Grant Administration of the Technical Capacity area in the baseline review guide, questions 57-68.

Project Management

47. What are the grantee’s procedures for providing technical oversight on directly managed projects? What staff position(s) is responsible for the outcome of projects directly managed by the grantee?


Project Management Practices

1. Obtain a copy of the grantees project management procedures and/or plan to determine if it addresses the below information.

NOTE: If the grantee is in the process of or planning capital construction, assess if the plan is being implemented.

a. Developing a budget and schedule for construction projects that are reasonable for the scope of work

b. Requiring that updates are provided as changes occur



c. If projects overrun the budget, a cost recovery plan is required to be developed

d. Procedures for managing contractors, including project managers and construction managers

e. Assigning appropriate personnel to appropriate functions such as project manager, construction manager, and project controls

f. Implementing tools and/or processes to update the schedule and budget progress, changes to scope, change orders, request for information, claims, document control, and as-builts

g. Assign personnel and procedures for managing materials testing and inspection

h. If Quality Control/Quality Assurance (QA/QC) is being managed by the grantee, developing a policy to ensure QA/QC is being implemented

i. Procedures for adequate invoice approval procedures

j. Procedures for approving invoices in a timely manner and for eligible activities

k. A process to ensure compliance with the Davis Bacon Act

l. Addressing environmental mitigation measures prior to project closeout

Grantee Response:


Reviewer Comments:

48. How does staff responsible for the outcome of projects interact with other staff associated with the FTA program? (e.g., grants management, civil rights, procurement)

Grantee Response:

Reviewer Comments:

49. What are the grantee’s procedures for overseeing projects managed by entities such as contractors, subrecipients or other related departments?

Grantee Response:

Reviewer Comments:

DETERMINATION: See Part C: Project Management of the Technical Capacity area in the baseline review guide, questions 77-78.

50. Provide a brief description of capital projects initiated or completed since the last Comprehensive Review.

Grantee Response:

Reviewer Comments:

51. How does the agency work with the FTA to ensure a written Project Management Plan (PMP) is submitted for all major capital projects? Was the PMP submitted during the application review process?

Grantee Response:

Reviewer Comments:


52. Describe any issues that impacted the timeliness or budget of completed projects. Are ongoing projects on schedule and within budget? If not, for each project, summarize the causes and provide any developed recovery plans for the schedules and budgets.

Grantee Response:

Reviewer Comments:

53. Describe any capital projects planned for the next three to five years. For planned projects, has the grantee implemented a similar project in the past three years? If no, how does the grantee plan to maintain or increase its technical capacity to ensure project implementation?

Grantee Response:

Reviewer Comments:

DETERMINATION See Part C: Project Management of the Technical Capacity area in the baseline review guide, questions 77-78.

The grantee is deficient if it has not developed and/or submitted for approval by FTA a PMP for major capital projects. (DEFICIENCY CODE 795: No approved PMP)

Deficient Not Deficient

Oversight

54. What department(s) is/are responsible for ensuring procedures are developed, approved, followed, and updated as needed?


Oversight

1. Obtain the grantees procedures/ processes and technical assistance materials. Determine that the program is implemented as depicted. Assess if the program adequately addresses oversight to ensure



that third parties are in compliance with FTA requirements. Does it include mechanisms such as:

a. Reporting requirements

b. Meetings

c. Site visits

d. Vehicle/facility inspections

e. Mandatory attendance to training sessions

f. Following up on findings

Grantee Response:

Reviewer Comments:

55. Has the grantee established a way to assess, measure, and remedy identified risks during the award lifecycle? Does this plan incorporate the monitoring of subrecipients for compliance, performance, and financial review? ow is monitoring scheduled and performed?

Grantee Response:

Reviewer Comments:

56. If compliance issues are found during monitoring, explain next steps taken by the grantee (e.g., corrective action development, reports/memos, briefings of key management staff, follow-up on corrective actions, etc.)

Grantee Response:

Reviewer Comments:


57. How often are assessments performed?

Grantee Response:

Reviewer Comments:

58. What tools are used to assess compliance?

Grantee Response:

Reviewer Comments:

59. If an assessment finds compliance issues with a third party contractor’s performance, how is this information conveyed to grantee staff responsible for administration of the contract?

Grantee Response:

Reviewer Comments:

60. How are items requiring corrective action identified and addressed? If corrective action is required, how does the grantee ensure action was taken by the contractor, subrecipient, and or lessee?

Grantee Response:

Reviewer Comments:

61. If noncompliance continues, explain next steps taken by the grantee?

Grantee Response:


Reviewer Comments:

62. How does the grantee evaluate the effectiveness of its oversight program?

Grantee Response:

Reviewer Comments:

63. Do the grantee’s oversight procedures address all of these discussion points?

Grantee Response:

Reviewer Comments:

DETERMINATION: See question 29 in Part A: Program Management and questions 79-80 in Part C: Project Management in the Technical Capacity area in the baseline review guide.


TRIGGERS

Record the triggers identified as a result of the analysis conducted.

Triggers Y/N Triggers Y/N

The grantee is a new grantee undergoing a Comprehensive Review for the first time, or a grantee that is in an area whose categorization has changed from small urbanized area (UZA) to large urbanized area due to the 2010 Census

Milestone Progress Reports and/or Federal Financial Reports are not submitted, submitted late, incomplete, or do not correspond to each other

The grantee is an experienced grantee, undertaking a new type of project

MPRs do not contain reasonable explanations and/or recovery plans for budget and/or schedule variances

An oversight control board has been implemented by the State or another Federal agency

The grantee has multiple subrecipients or transit contractors

There is an OIG Action Memo or Hotline Complaint referred back to the OIG for investigation or requiring FTA disciplinary action (i.e., return of funds, draw down restrictions, loss of grant)

The manner in which the grantee’s organization is structured and/or the levels of staffing appear inadequate

The grantee has repeat or past due deficiencies or is not noted in a Single Audit report as a “low risk” auditee

There are a number of vacancies or shortages in key positions or major changes in key grant or project management staff

There is a pattern of poor quality corrective actions from past oversight reviews

There are indications of inadequate governance or impropriety by the Board of Directors, governing body, or senior management

Technical capacity issues have been identified in FTA’s Oversight Assessment Tool (OAT)

Management has transferred some of its authority, directly or indirectly, to a third party

The number of open grants, inactive grants, or grants with scheduling problems appears excessive for the size and complexity of the grantee’s program

The grantee does not have procedures or a program for providing financial oversight of subrecipients


Exhibit 1

STATUS OF OPEN GRANTS AS OF: (date)

GrantDate

Executed FPC

Year Funds

Appropriat

ed

TEAM Balance

Date of Last Draw

FFR Unliquidated ObligationsAs of (date)

Projected Close Date Comment


Grantee: Technical Capacity ERM FY2017 Grantee Information Request28

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Grantee: Technical Capacity ERM FY2017 Grantee Information Request29

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