Federal Audit Questions Airport Board’s Spending, Contract Practices

photoA federal audit of the Metropolitan Washington Airports Authority, which operates Dulles and Reagan National Airports and is building the Metrorail Silver Line, finds fault with the board’s policies for awarding contracts and controlling travel and entertainment expenses.

The report was requested by Rep. Frank Wolf, D-Va., who said he was “deeply troubled” by the findings, which he said “raise  significant concerns about the current board’s policies and procedures, including contracting practices, ethics and transparency.”

“This demands immediate action,” Wolf said in a letter to Transportation Secretary Ray LaHood.  It was LaHood’s Inspector General who conducted the audit, which found — among other things — that the MWAA board too often awards contracts without competition.

The auditors also took issue with the board members’ travel expenses, which included a $9,200 plane ticket to Prague and a $4,800 dinner tab for board members and their guests on a trip to Hawaii.

Wolf said the auditor’s findings about the board’s contracting practices were the most egregious.

“The report notes that in many cases MWAA failed to even abide by its own established contracting procedures, which already fall short of industry standards. Particularly concerning are the number of sole source contracts issued. As you know, MWAA is required by law to fully compete any contract over $200,000, with limited exceptions,” Wolf said. “Yet the IG’s report states that ‘[d]uring the period of our review, MWAA awarded five sole source contracts that were over $200,000, but did not fall under any of MWAA’s categorical exemptions. These contract awards, which amount to $6 million, did not have Board approval.’ Not only did MWAA abuse the exemptions permitted under federal law, they issued numerous contracts that failed to meet even these basic standards.”

The IG’s reported found that at least 40 percent of the MWAA’s $589 million in contracts were awarded without competitive bidding during the period covered by the audit.

Board conduct

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Rep. Frank Wolf

The report also details the lack of proper standards for the recusal of board members. The report states that MWAA’s ethics practices “are vague regarding when and how Board members should recuse themselves when a conflict of interest arises.” The report cites an instance where two board members recused themselves from a particular issue. One member left the meeting while the other stayed. While the report said the board member who stayed did not participate in the decision or vote, “he had been instrumental in drafting the materials that were up for a vote, and had a clear interest in the outcome of the vote because of his relationship with the organizations that would potentially benefit from the proposal passing.”

“This simply cannot stand,” Wolf said.

The interim report also addresses MWAA’s lack of transparency, specifically noting the board’s excessive use of closed executive sessions. MWAA routinely uses these closed sessions to discuss important business that the public has a right to know, Wolf said.

The report cites two examples that Wolf said are particularly egregious. In one instance, the report notes that, “MWAA’s recent revisions to its bylaws were conducted in a closed executive session – even though the revisions included enhancements to transparency.” Later, the report states “…MWAA’s Board holds its audit committee meetings exclusively in close executive sessions.”

Wolf said the report further details how MWAA’s board members abuse the public trust, charging expensive flights and meals to the authority. The report cites one voucher reviewed which “contained meal expenses for some Board members and their guests for a trip to Hawaii for a conference. The cost for three dinners totaled approximately $4,800.”

What is even more troubling, Wolf said, is the fact that, “[W]hile MWAA’s travel policy states that Directors should make every effort to secure the most cost effective means of travel, there are no specified guidelines to limit travel costs for these kinds of trips.”

If the board does not issue adequate guidelines, extravagant expenses like this will continue to occur, he said.

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About the Author

Truman Lewis
A former reporter and bureau chief, Truman Lewis has covered presidential campaigns, state politics and stories ranging from organized crime to environmental and consumer protection.