Report rips FAA spending in Alaska

GAO focuses on misspending using federal agency's credit cards

Posted: Thursday, June 06, 2002

FAIRBANKS - 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 last week 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, an Alaska Republican. 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.

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 adopted the "corporate maintenance philosophy." The system, used only in Alaska, was supposed to save money by making maintenance work more efficient and reducing staff. 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 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.

The GAO also criticized several "high-dollar, fixed-asset purchases that were short-lived or underutilized," such as 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 report also cited the housing's security system, which the division knew had problems before it closed the deal. The system has been dismantled and "the majority of the $370,000 spent represents a complete loss," 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 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.

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.

In fiscal year 2000, he division solicited staff 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.

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