Purpose

To determine whether travel expenses incurred by the Metropolitan Transportation Authority’s New York City Transit, MTA Bus Company, and MTA Bridges and Tunnels were necessary and properly documented for business purposes. The audit covers the period January 1, 2011 through December 20, 2013.

Background

The Metropolitan Transportation Authority (MTA) is a public benefit corporation providing transportation services in and around the New York City metropolitan area. The MTA comprises six constituent agencies – including New York City Transit (Transit), MTA Bus Company (MTA Bus), MTA Bridges and Tunnels (B&T), Long Island Rail Road, Metro-North Railroad, and MTA Capital Construction – and a Headquarters (MTAHQ), which provides administrative support.

The MTA issues policies, procedures, and rules for its staff to follow. MTA’s Board approved an All Agency Policy Directive entitled “Travel and Business Expense” (travel policy directive) which states that “MTA Headquarters and each of its Constituent Agencies shall issue Agency-specific procedures consistent with this policy instruction for the recording and claiming of reimbursement for eligible employees travel and business expenses.” In 2003, New York City Transit (Transit) issued its Policy Instruction covering travel and business expenses. In December 2013, MTA Bus issued its Travel and Business Expense Procedures that incorporates the travel policy directive by reference.

Since July 2009, MTA has contracted with a firm to act as the official travel agent for the MTA and its constituent agencies. The contract stipulates that the travel agent will book lodging at the lowest applicable and available rates. MTA agencies are required to use MTA’s travel agent for all travel arrangements, except in certain situations (e.g., when more economical group lodging rates are otherwise available).

MTA has a Business Services Center (BSC) to administer certain financial functions for its various constituent agencies. Employees of MTAHQ and the constituent agencies (other than Transit) must file travel request forms and travel expense reports with the BSC. During our review period, Transit, MTA Bus, and B&T spent a total of about $2.1 million for travel and entertainment.

Key Findings

• Transit, MTA Bus, and B&T officials should strengthen certain controls over travel to help reduce costs. For example, they could use travel guidelines established by the U.S. General Services Administration (GSA) and the U.S. Department of State (DOS) regarding lodging rates.
• For trips booked by MTA’s travel agent, we projected that 753 hotel stays exceeded the government lodging rates established by the GSA or DOS by at least $127,963.
• Transit paid more than the GSA maximum lodging rate for 12 of 15 rooms booked by a total of $3,962.

Key Recommendations

• Revise the All Agency Travel Policy Directive to require the travel agent and MTA employees (who make their own lodging arrangements) to request GSA or DOS lodging rates, and when unsuccessful in obtaining such rates, to document the efforts to obtain them.
• Formally direct officials who approve claims for travel reimbursements that they should verify that lodging rates are consistent with GSA and DOS rate limits. When GSA or DOS rates are not obtained, these officials should ensure that unsuccessful efforts are adequately documented.
• Actively monitor compliance of MTA’s travel agent with contract terms regarding the use of government rates for lodging.

Other Related Audits/Reports of Interest

Metropolitan Transportation Authority - Headquarters and Capital Construction: Travel and Entertainment Expenses (2013-S-47)
Metropolitan Transportation Authority - Long Island Rail Road: Selected Travel Expenses (2013-S-77)