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Transportation Development Act Triennial Performance Audits

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Transportation Development Act Triennial Performance Audits TTAC STAFF REPORT SUBJECT: Transportation Development Act Triennial Performance Audits MEETING DATE: December 1, 2016 AGENDA ITEM: 5 STAFF CONTACT: Andrew Orfila, Peter Imhof RECOMMENDATION: Review and recommend that the Board approve the draft Triennial Performance Audits for FYs 2012/13-2014/15 for Santa Barbara Metropolitan Transit District (SBMTD), Santa Maria Area Transit (SMAT), City of Lompoc Transit (COLT), Santa Ynez Valley Transit (SYVT), City of Guadalupe Transit, Santa Barbara County Transit (Cuyama and Los Alamos), Easy Lift, the Santa Maria Organization of Transportation Helpers (SMOOTH), and SBCAG. SUMMARY: California Public Utilities Code (PUC) Section 99246 requires regional transportation planning agencies (RTPAs) such as SBCAG to conduct performance audits every three years of its activities as well as the activities of the transit operators to which it allocates Transportation Development Act (TDA) funds. SBCAG allocates TDA funds to the Santa Barbara Metropolitan Transit District (MTD), Santa Maria Area Transit (SMAT), City of Lompoc Transit (COLT), Santa Ynez Valley Transit (SYVT), City of Guadalupe Transit, Santa Barbara County Transit (Cuyama and, until June 2013, Los Alamos Shuttle), Easy Lift, and the Santa Maria Organization of Transportation Helpers (SMOOTH). SBCAG contracted with Michael Baker International to conduct the TDA triennial performance audits for FYs 2012/13 through 2014/15. Michael Baker International reviewed compliance, implementation of prior audit recommendations, and agency functions, and made findings and recommendations for SBCAG and each of the transit operators. The findings and recommendations from the final draft audits of SBCAG and the transit operators are attached. TTAC is asked to review and recommend that the Board approve the triennial performance audits. The draft audits will be brought for review and a recommendation to the Santa Barbara County Transit Advisory Committee (SBCTAC) at its December meeting. Staff will seek SBCAG Board approval of the final draft audits at the January meeting prior to submittal to Caltrans. DISCUSSION: Background California Public Utilities Code (PUC) Section 99246 requires regional transportation planning agencies (RTPAs) such as SBCAG to conduct performance audits every three years of its activities as well as the activities of the transit operators to which it allocates Transportation Development Act (TDA) funds. SBCAG allocates TDA funds to the Santa Barbara Metropolitan Transit District (MTD), Santa Maria Area Transit (SMAT), City of Lompoc Transit (COLT), Santa Ynez Valley Transit (SYVT), City of Guadalupe Transit, Santa Barbara County Transit (Cuyama and, until June 2013, Los Alamos), Easy Lift, and the Santa Maria Organization of Transportation Helpers (SMOOTH). Contracting for performance audits not only fulfills SBCAG’s legal requirements, but also provides for an independent, objective, and comprehensive review of the audited agencies. A performance audit evaluates an organization's effectiveness, efficiency, and economy of operation. The TDA audits evaluate compliance with TDA requirements and status of implementing prior audit recommendations, and provide a review of agency functions. SBCAG’s performance audit describes how well SBCAG is meeting its administrative and planning obligations particularly as it relates to the TDA programs. Transit operator performance audits ensure accountability in the use of public transportation revenue, and include calculations of transit service performance indicators. The audits conclude with findings and recommendations for improvement. In October 2015, SBCAG issued a request for proposals (RFP) to conduct the triennial performance audits for fiscal years (FYs) 2012/13-2014/15. SBCAG formed an evaluation and selection committee composed of SBCAG and local transit operator staff to review the proposals. After reviewing the two proposals submitted, the committee recommended Michael Baker International. In January 2016, the SBCAG Board approved a contract with Michael Baker International to conduct the TDA triennial performance audits for FYs 2012/13-2014/15. Shortly thereafter, Michael Baker International initiated work on the performance audits. The work included on-site interviews and visits with each audited organization in the late spring/early summer. Michael Baker International submitted draft audits throughout November 2016. Draft TDA Triennial Performance Audits The findings and recommendations from each of the draft TDA triennial performance audits, submitted by Derek Wong of Michael Baker International in November 2016, are included as Attachments 1a-1i. The complete draft audits are available for review with the TTAC agenda on the SBCAG website (Attachment 2). Draft audits incorporate both transit operator and SBCAG comments and suggested revisions, where necessary. Recommendations for SBCAG Michael Baker International’s recommendations for SBCAG are summarized below. SBCAG responses follow. 1. Update the SBCAG TDA Claims Manuals for new legislation. SBCAG Response: Concur with recommendation. 2. Update the Coordinated Public Transit-Human Services Transportation Plan. SBCAG Response: Concur with recommendation. Last month, SBCAG submitted an application for a transportation planning grant for funding to update its Coordinated Public Transit-Human Services Transportation Plan. 3. Update the Transit Resource Guide. SBCAG Response: Concur with recommendation. The SBCAG Traffic Solutions Division is currently working on the update to the Transit Resource Guide. 2 4. Review agency strategic planning process as warranted under new leadership. SBCAG Response: Concur with recommendation, subject to new leadership direction. Findings for Transit Operators Michael Baker International’s findings regarding operator compliance with state requirements for continued receipt of TDA funds are shown in Table 1 below. Table 1: Operator Compliance Urbanized) - Performance Measure Definitions Measure Performance Reports Controller State of Submittal Audits Compliance and Fiscal of Submittal Inspections CHP Claims TDA of Submittal Non and (Urbanized FBRR 15%/Year < Increase Budget Operating (Urbanized) FBRR Elderly/Disabled) or (Rural FBRR System Retirement Funded Fully Funds of Use Federal Full COLT N/A N/A County Part N/A Part N/A N/A Easy Lift N/A N/A Guadalupe N/A N/A MTD N/A N/A SMAT Part N/A Part N/A SMOOTH N/A N/A SYVT N/A N/A = Full Compliance Part = Partial Compliance N/A = Not Applicable FBRR = Farebox Recovery Ratio Recommendations for Transit Operators Draft audit recommendations for the eight transit operators are summarized below. 3 COLT 1. Ensure all financial and operations data are properly included in the State Controller’s Transit Operators Financial Transactions Report. 2. Include additional locally generated revenue in the farebox recovery. 3. Ensure monthly contractor reports include all operational performance measures. 4. Update system map and schedule description on COLT website. County 1. Ensure the proper and accurate completion of State Controller Reports. (Carryover recommendation from prior audit) 2. Enclose annual California Highway Patrol (CHP) terminal inspection report for Cuyama Transit in County TDA claim. (Carryover recommendation from prior audit) 3. Consider merger of Cuyama Transit into SMAT. Easy Lift 1. Develop cost allocation plan for Easy Lift program services. 2. Further develop active travel training. 3. Maintain consistent reporting of performance data. Guadalupe 1. Review opportunities for increasing local revenue to boost farebox recovery. 2. Consider other transit administration options for Guadalupe Transit. MTD 1. Hold discussion with SBCAG regarding new rules for farebox recovery. 2. Continue efforts to locate and enhance program training, including for maintenance. 3. Fill key administrative positions. SMAT 1. Continue to improve upon the consistent reporting of performance data to the State Controller. (Carryover recommendation from prior audit) 2. Fill key transit administrative positions. 3. Add interactive trip planning capability on SMAT website. 4. Plan and budget for additional technology systems to improve service. SMOOTH 1. Develop expanded performance standards for CTSA service efficiency and effectiveness. 2. Evaluate alternative cost allocation models. SYVT 1. Update the Short-Range Transit Plan. 2. Review opportunities for increasing local revenue to boost farebox recovery. 3. Consider options for further cooperation and consolidation with COLT. 4 If the local transit operators wish to respond to the findings and recommendations after the TTAC meeting, responses should be forwarded to SBCAG staff so this information is included when the TDA Performance Audits are considered for approval by the SBCAG Board. Conclusion The findings and recommendations from the final draft audits are attached (Attachment 1). Complete copies of the final draft audits are available on the SBCAG website (TTAC meeting agenda on SBCAG website). TTAC is asked to review and recommend that the Board approve the audit reports. Comments from today’s TTAC meeting will be assessed and addressed by the consultant, Derek Wong of Michael Baker International, together with any comments from SBCTAC at its December meeting. Next month, the Board will be asked to approve the final draft audits prior to submittal to Caltrans. ATTACHMENTS: 1. Draft Audit Findings and Recommendations: a. SBCAG b. Santa
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