GAO report rips spending by division of FAA in Alaska

Posted: Friday, May 31, 2002

FAIRBANKS (AP) -- An Alaska division of the Federal Aviation Administration bought expensive computer monitors and a security system that didn't work while repeatedly asking branch offices to find more ways to spend money, according to a government report.

The FAA's Airway Facilities Division also built 30 housing units in King Salmon at a cost of $12.9 million, but is using only a third of them, according to the report issued Thursday by Congress' investigative agency, the General Accounting Office.

The GAO said the division also ''did not have good internal controls over purchases.'' The report focused mostly on problems with government-issued credit cards.

The GAO investigated the division at the request of Rep. Don Young, R-Alaska. It was the agency's second report on the division. In November, the GAO issued a critique of the division's ''corporate maintenance philosophy.''

The investigations were prompted by complaints from the union representing about 410 Airway Facilities Division employees in Alaska, according to the union's western regional vice president.

Ron Rahrig, of the Professional Airways Systems Specialists, said the latest GAO report is accurate.

''I have witnessed a lot of things they did mention in there and more that they didn't,'' Rahrig told the Fairbanks Daily News-Miner.

An assistant administrator of the federal Department of Transportation, which oversees the FAA, did not dispute the GAO's allegations. Melissa Allen said in a May 14 letter to the GAO that the FAA had been ordered to take corrective actions.

Bill Mosley, a DOT spokesman in Washington, D.C., said Thursday that the agency would not have a more detailed response.

''That speaks for itself,'' he said.

Hank Price, an FAA spokesman in Washington, said the agency had no additional comment. The secretary for the Anchorage division manager, Dennis Powell, referred press questions to Washington, D.C. on Friday morning.

The GAO said the Airway Facilities Division maintains ''navigation and communication equipment, such as radar and communications towers, throughout the state.'' It has two main offices, one in Fairbanks and one in Anchorage. Other personnel are in Juneau, Sitka, Ketchikan, Nome, Bethel, King Salmon and Kodiak, Rahrig said.

In 1997, the division, under Powell's direction, adopted the ''corporate maintenance philosophy.'' The system, used only in Alaska, was supposed to save money by making maintenance work more efficient and reducing employee numbers. The money saved was then made available for equipment purchases and employee incentive awards.

Rahrig said the union believed the approach was flawed.

''They reduced our staffing. We couldn't get the work done,'' he said. ''There were a lot of maintenance certifications that weren't getting done. We felt the safety of the flying public up there was in jeopardy.''

The FAA dropped the system after the union filed a complaint. However, the division still ''remains vulnerable'' to inappropriate spending, the GAO said.

The report pointed to several purchases that, ''while not in violation of specific policies or regulations, were excessive or for questionable needs.''

For example, the division bought the following:

-- 18 flat panel computer monitors for $44,965, at an average price of about $2,500. A standard monitor costs $300, the report said.

Division managers defended the decision, saying the monitors reduced headaches among frequent computer users, the report said.

''However, we did not observe any greater use of computers in (the division) than would occur in other government offices ...'' GAO investigators said.

Rahrig, with the union, said the flat screens mostly went to managers, not union workers.

-- Three wall-mounted video display screens for $11,500 each. The GAO said adequate alternatives cost $4,500 each.

-- Personal digital assistants for any employee who requested one, at $300 to $500 each. The GAO suggested that paper calendars were adequate.

In addition, the GAO criticized several ''high-dollar, fixed-asset purchases that were short-lived or underutilized.''

Those included:

-- The King Salmon housing project, which began in October 1995. Before construction of the 30 units began, the FAA closed its flight service station in King Salmon and contracted out the air traffic control tower, so it should have foreseen vacancies and scaled back the project, the GAO said.

Now, eight units are empty, 11 are leased to other agencies, seven are occupied by full-time division employees and four are used to house transient employees, the GAO said.

-- The security system, which the division knew had problems before it closed the deal. The division found, prior to purchase, ''brittle key buttons that occasionally broke and locks that did not open in extremely cold conditions.'' The system has been dismantled and ''the majority of the $370,000 spent represents a complete loss,'' the report said.

-- A 30-foot boat that cost $122,000 and was supposed to replace helicopters used to move employees between Sitka and Biorka Island, where navigation equipment is located. The boat was damaged in two incidents, fixed for $42,000 and then transferred to the U.S. Forest Service, the report said.

The GAO also criticized the division's control over purchases.

Government credit card holders often were able to both make and approve their own purchases without any other oversight, the report said.

In a review of 150 transactions that raised initial questions, the GAO found that purchasing procedures were violated in 118 cases.

Investigators said that in one case, employees bought two $1,600 digital cameras and a pair of $600 binoculars from a small retail store, violating rules requiring that purchasers find the best price.

In another case, a cardholder charged three all-terrain vehicles and two snowmobiles for the agency in one day, then had the vendor split the receipt because the total exceeded the $25,000 cap on individual purchases.

Some of the questionable purchases were made in management-solicited sprees designed to spend money left at the end of the fiscal year, the GAO said.

''For example, in fiscal year 2000, (the division) solicited system management offices and branches nine times for additional spending requests, primarily in the last three months of the year, spending a total of about $4.5 million,'' the report said.

The Alaska division is supervised not by the Alaska regional FAA headquarters but by the Washington, D.C., headquarters. That is part of the problem, the GAO concluded.

The Washington office is left ''without critical information,'' the report said.

For example, the investigators noted, in 1999 the FAA told its divisions nationwide to eliminate ''non-essential travel for conferences, meetings, workshops and site visits.''

''However, (Alaska) officials took at least three one-week trips during this period for management meetings at premier resorts in Alaska costing from $6,000 to $8,800 each,'' the report said.

Rahrig said several managers also chartered a private jet and flew from Anchorage to Dutch Harbor, where they reviewed the division facilities and stayed overnight in the Grand Aleutian Hotel.

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