The District Department of Transportation and city contractors didn’t follow standard guidelines for using economic stimulus dollars, nearly putting D.C. taxpayers on the hook for almost $3 million, the city’s inspector general has found.
As a part of federal efforts to boost the economy in 2009, D.C. received about $124 million to pay for 15 road projects.
Those projects came with traditional stimulus catches: among them, they had to be “shovel-ready” and the Federal Highway Administration would have to approve any changes to original plans.
But some of the city’s projects would eventually fail to meet the second mandate, risking millions of public dollars.
Investigators say the origins of the close call begin with DDOT, which manages D.C.’s labyrinth of roadways.
The probe found that DDOT regularly “did not adequately review and approve project designs and specifications,” forcing reactive changes that totaled $2.8 million.
The problems multiplied when DDOT and city contractors began making changes without first securing the approval of the Federal Highway Administration and a District contracting officer.
That, investigators wrote, meant DDOT “did not adhere to federal regulations” and the contractor “clearly disregarded” policies spelled out in its agreement.
Fort Myer Construction, which has performed hundreds of millions of dollars in work for D.C., was the contractor on two projects that nearly cost D.C. a combined $1.9 million. “Each construction contract contains language that specifically identifies the contracting officer as the only person who may authorize additional contract work,” investigators wrote. “The contractors did not notify the contracting officer … and receive written authorization.”
Fort Myer Construction declined to comment on the report.
Federal authorities ultimately approved most of the changes, though the government hasn’t made final decisions on four orders totaling about $1.1 million. DDOT said it “anticipates” approval.
In a statement, the Federal Highway Administration said it had granted oral approval in some — and perhaps all — of the instances documented by the city, but the agency acknowledged it was working with DDOT to “further strengthen the city’s change-order review and approval process.”
In the aftermath of the episode, DDOT demoted a program manager, one of several actions the agency took in response to a report the inspector general issued in October.
“There were two instances where a project manager did not follow the established change order process and that was addressed,” DDOT spokesman John Lisle told The Washington Examiner. “Also, we have instituted additional training for staff and launched a number of initiatives to improve project management and contract administration.”
