Federal Reports

An Amtrak employee based in Jackson, Michigan, was terminated from employment on December 2, 2020, for violating the collective bargaining agreement between the Brotherhood of Maintenance of Way Employees and Amtrak. Our investigation found that the former employee violated company policy by engaging in outside employment while on a medical leave of absence from the company.

What We Looked AtWe queried and downloaded 35 single audit reports prepared by non-Federal auditors and submitted to the Federal Audit Clearinghouse between July 1, 2020 and September 30, 2020, to identify significant findings related to programs directly funded by the Department of Transportation (DOT). What We FoundWe found that reports contained a range of findings that impacted DOT programs. The auditors reported significant noncompliance with Federal guidelines related to 8 grantees that require prompt action from DOT’s Operating Administrations (OA). The auditors also identified questioned costs totaling $25,838 for one grantee. RecommendationsWe recommend that DOT coordinate with the impacted OAs to develop a corrective action plan to resolve and close the findings identified in this report. We also recommend that DOT determine the allowability of the questioned transactions and recover $25,838, if applicable.

We audited the U.S. Department of Housing and Urban Development’s (HUD) response to COVID-19 to determine if it appropriately, effectively, and efficiently tracked, monitored, and issued Federal Housing Administration (FHA) refunds owed to homeowners with terminated loans. During our field work, the Coronavirus 2019 (COVID-19) pandemic began and as a result, we developed a second, more urgent audit objective to determine how COVID-19 has affected policies, procedures, and distribution of FHA refunds and whether HUD’s response was appropriate. We determined that COVID-19 generally did not affect the Single Family Insurance Operations Division’s (SFIOD) FHA refund policies and procedures; however, SFIOD did not fully notify homeowners of operational changes to its physical mail procedures, which potentially impacted its distribution of refunds. We issued this interim report to ensure HUD was made aware of the issues identified during our review and could act in a timely manner to address them. The audit prompted HUD to take immediate corrective action for all three recommendations, one of which will be closed concurrently with the issuance of this memorandum and two that will be completed during audit resolution.

We determined that PA Education generally had sufficient internal controls to ensure that LEAs developed IEPs in accordance with Federal and State requirements for children with disabilities who attend virtual charter schools and that these students were provided with the services described in their IEPs. These internal controls included developing model policies and procedures; monitoring LEAs; and providing technical assistance, guidance, and training. However, we found that PA Education could strengthen its monitoring process to ensure that LEAs also have written procedures on how they implemented the model policies for IEP development and how they provided and documented service delivery for students with disabilities.

The Federal Emergency Management Agency approved New York State’s Division of Homeland Security and Emergency Services (DHSES-NY) application for approximately $40.8 million to provide Disaster Case Management Program (DCMP) services to disaster survivors for household recovery efforts. FEMA did not provide the oversight needed to ensure DHSES-NY, as the grantee, carried out its responsibilities. DHSES-NY and its managing contractor did not always properly account for FEMA grant funds in accordance with Federal regulations and FEMA guidelines when approving contractor costs claimed, resulting in questioned costs of $12.2 million. DHSES-NY’s paper-based system used to track DCMP grant funding and expenditures was not sufficient to ensure contractors claimed eligible costs for payment. As a result, there is no assurance the contractors’ claimed costs are valid putting Federal funds and taxpayers’ money at risk of fraud, waste, and abuse. We made six recommendations to FEMA that, when implemented, should help strengthen oversight of FEMA’s individual assistance grant funds. FEMA concurred with all six recommendations. We consider recommendations 1, 2, 3, 4, and 5 resolved and open with an estimated completion date of July 30, 2021. Recommendation 6 is considered unresolved and open.

The OIG received allegations that the Veterans Health Administration (VHA) reported inaccurate data on the VA public website about the electronic wait list for patient appointments. The allegations, made by a VHA employee, stated that the data did not include wait list entries older than two years or administrative entries, such as patients requesting care at a different facility. The resulting OIG audit examined these allegations and two additional issues: whether VHA managed the wait list in accordance with scheduling requirements for veteran care and whether VA medical facilities complied with policies for managing the wait list. Although it substantiated the employee’s allegations, the audit team found that VA’s Office of the Medical Inspector had also identified the issues and made recommendations for corrective action. VHA began including wait list entries older than two years in 2018 and developed procedures to manage administrative wait list entries in a new tracking system in 2019. The OIG audit team further found that wait list entries were not reviewed and validated as required. Patients were not removed from the wait list when appropriate, indicating that employees at medical facilities did not review entries daily and supervisors did not validate the list weekly. Insufficient oversight increases the risk that patients will not receive care in a timely manner or at their preferred facility. It could also lead to excess entries on the wait list, which makes it seem as though veterans are experiencing longer delays for appointments than they are. Although VHA made advances in managing its wait list, the OIG made three recommendations for improvement. These focused on monitoring and routinely reviewing scheduling for patients who are waiting for care and overseeing wait list entries transferred to the new tracking system.