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Date Issued
Submitting OIG
Department of Transportation OIG
Agencies Reviewed/Investigated
Department of Transportation
Components
Federal Aviation Administration
Report Number
AV2025044
Report Description

Our Objective(s)
To assess (1) FAA's assignment of risk levels to Infrastructure Investment and Jobs Act (IIJA) grant recipients, and (2) the impact of the assigned risk levels on FAA's IIJA oversight efforts.

Why This Audit
IIJA provides $20 billion over fiscal years 2022-2026 for three grant programs to address aging aviation infrastructure. FAA is using its well-established Airport Improvement Program (AIP) policies and procedures to administer IIJA grant programs. However, these programs broaden the uses of funds beyond the purposes allowable under AIP, which could introduce additional risks to IIJA-funded airport sponsors. Given the importance of accurately assessing risk and FAA's IIJA oversight responsibilities, we initiated this audit.

What We Found
FAA's assignment of risk levels does not consider all potential risks to IIJA-funded grant recipients.
FAA develops an overall risk rating for airport sponsors receiving funds under AIP to administer IIJA grant programs. Most of these sponsors' assessments were completed prior to receiving IIJA funds and may not account for all potential risks to IIJA-funded grant recipients.
FAA's policy does not specify what types of changes in an airport sponsor's conditions or risk factors would require project managers to initiate an interim risk assessment. In a survey of FAA project managers, 79 of 84 (94 percent) indicated they had not conducted interim assessments.
FAA's grant payment policy does not specify where or how to document the grant payment risk level result separately from the overall risk level. Therefore, project managers may not differentiate between the levels, presuming both risks are the same.

FAA's nominal risk ratings for most IIJA-funded airport sponsors and breakdowns in internal control procedures hinder IIJA oversight efforts.
FAA assigned most IIJA-funded airport sponsors a nominal risk rating, subjecting those sponsors to the lowest level of oversight.
FAA did not properly apply its internal control procedures for overseeing IIJA-funded airport sponsors, resulting in $338 million in unsupported costs.

Recommendations
We made 6 recommendations to improve FAA's oversight of IIJA grants to airport sponsors.

Report Type
Audit
Agency Wide
Yes
Number of Recommendations
6
Questioned Costs
$338,315,301
Funds for Better Use
$0
Report updated under NDAA 5274
No
External Link
https://www.oig.dot.gov/library-item/46948

Open Recommendations

This report has 6 open recommendations.
Recommendation Number Significant Recommendation Recommended Questioned Costs Recommended Funds for Better Use Additional Details
1 Yes $0 $0

Clarify for project managers the types of changes to an airport sponsor's condition that would trigger the need for a project manager to conduct an interim risk assessment of the sponsor's overall risk level.

2 Yes $0 $0

Clarify the grant payment policy on how a project manager should use the Project Manager Assessment Checklist to determine an airport sponsor's grant payment risk level and how project managers should document that risk level.

3 Yes $0 $0

Determine whether the $338 million questioned in this report as unsupported costs are supported and allowable.

4 Yes $338,315,301 $0

Recover any of the $338 million questioned in this report as unsupported costs that are determined to be unsupported or unallowable.

5 Yes $0 $0

Provide formal training to project managers on how to conduct risk assessments, determine risk levels, and conduct oversight in accordance with FAA's Airport Improvement Program, grant oversight, and grant payment policies.

6 Yes $0 $0

Establish a process to provide reasonable assurance that project managers comply with FAA's Airport Improvement Program, grant oversight, and grant payment policies for the assessment of airport sponsors' risks and approval of sponsors' grant payment requests.

Department of Transportation OIG

United States