Federal Reports

What We Looked AtAllegiant Air—the Nation’s 11th largest passenger airline—grew faster than the airline industry as a whole in 2018 by carrying approximately 14 million passengers. However, incidents at this air carrier—including a series of in-flight engine shutdowns, aborted takeoffs, and unscheduled landings—have raised concerns about its maintenance practices. FAA uses its Compliance Program to achieve rapid compliance with regulatory standards, eliminate safety risks, and ensure positive and permanent changes that benefit the aviation industry. This program is based on the concept that the greatest safety risk comes from an operator who is “unwilling or unable” to comply with rules, rather than a specific event or its outcome. Our objective was to assess FAA’s processes for investigating improper maintenance practices at Allegiant Air. Specifically, we assessed FAA’s (1) oversight of longstanding maintenance issues impacting safety at Allegiant Air and (2) process for ensuring Allegiant Air implemented effective corrective actions to address the root causes of maintenance problems. What We FoundSince 2011, FAA inspectors have not consistently documented risks associated with 36 Allegiant Air in-flight engine shutdowns for its MD-80 fleet or correctly assessed the root cause of maintenance issues. This was because inspectors did not follow FAA’s inspector guidance that requires them to document changes in their oversight once they have identified areas of increased risk. Also, FAA’s Compliance Program and inspector guidance do not include key factors related to carriers’ violations of Federal regulations. Specifically, they do not contain provisions for inspectors to consider the severity of outcomes when deciding what action to take following a non-compliance. As a result, FAA is missing opportunities to address maintenance issues and mitigate safety risks in a timely manner. Our RecommendationsWe made nine recommendations to improve the effectiveness of FAA’s oversight of air carrier maintenance programs. FAA concurred with eight of our nine recommendations and partially concurred with one. We consider the eight recommendations resolved but open, pending completion of planned actions. We are asking FAA to reconsider its actions for the partially-concurred recommendation.

We verified that Refugio County, Texas awarded contracts that complied with Federal procurement regulations and FEMA guidelines. We determined that the County initially did not have written procurement policies to comply with all Federal procurement regulations. Instead, for purchases and contracting, County officials said they followed Texas Local Government Code, Chapter 262. In response to our audit, the County adopted written procurement procedures to comply with Federal requirements. The report contains no recommendations. FEMA did not submit a formal response to our draft report, but informally replied that it did not identify any issues requiring further action by FEMA

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The VA Office of Inspector General (OIG) conducted this audit to determine if VA’s management of undelivered orders (UDO) ensured the most effective use of appropriated funds. UDOs are items or services ordered that have not been received, and their value represents legal financial commitments. Sometimes the final cost for ordered items or services may be less than the amount of the original obligation estimate—for example, if the price of goods or services ordered is reduced before delivery, or if a project order is canceled. When this happens, VA policy requires VA to deobligate the excess funds. These funds can then be reobligated for other goods and services to benefit veterans. If funds are not reobligated on time, however, they must be returned to the Department of the Treasury. The OIG found that VA did not effectively ensure that appropriated funds that were no longer needed were identified and deobligated. The audit team estimated that VA had not deobligated at least $132.6 million out of $3.5 billion in excess funds in a timely manner, and approximately 3,900 of 10,624 orders in the audit sample. The audit team determined that VA staff did not adequately monitor or reconcile open UDOs as required due to conflicting guidance and did not identify and deobligate excess funds or provide supporting documentation. The OIG recommended that VA leaders develop a process for monitoring the department’s performance on reconciling open orders, as well as a plan to share results with appropriate officials for action. VA leaders should also ensure that obligation policy includes timeframes for communications among departments to identify funds that could be deobligated. Other recommendations focused on compliance with existing policies for reviewing, adjusting, and maintaining documentary evidence for obligations.