Feds call StarTran deficiencies “serious” and “unacceptable” – and put federal funds at risk
Federal transportation officials have warned the city of Lincoln that its transit system, StarTran, has shown a “longstanding pattern of non-compliance and disregard for federal procurement requirements” and if the city doesn’t fix problems with the way it makes purchases, it risks losing federal funds.
In June, the regional administrator of the Federal Transit Administration informed Mayor Chris Beutler that a triennial review of StarTran – a regular review to ensure federal guidelines are followed – found that the city was deficient in six of the 24 areas reviewed. Five of the six areas related to the procurement process.
According to the FTA’s final report on the matter, many of the findings were repeat deficiencies from the last two triennial reviews conducted in 2004 and 2007. Cities with repeat findings are subject to more federal oversight. Both StarTran and the city Purchasing Department share responsibility for ensuring that purchases adhere to federal requirements.
In a letter to the mayor, the FTA said, “The disregard of the federal procurement rules is unacceptable and will no longer be tolerated” and “due to the serious nature of the findings associated with the area of procurement,” the FTA would send representatives to Lincoln for an “in-depth procurement systems review” – which is being done this week.
While the FTA was satisfied with the city’s response to some issues, it sent the team in to probe more deeply three remaining issues: lacking justification for a non-competitive award; lacking independent cost estimates and failing to verify that barred companies are not participating.
A team of three FTA workers were in the city-county purchasing office scouring records on Tuesday, after doing the same in StarTran offices on Monday.
The FTA said failure to meet deadlines for correcting the deficiencies “may put StarTran at risk for receiving future” mass transit grants or being suspended from drawing funds from existing grants. However, in a letter to City Council members on Tuesday, Public Works Director Greg MacLean said the city is not at risk of losing federal funds.
Beginning in mid-June, the city was required to give the regional FTA office a copy of all solicitation packages for any future purchases that use FTA money prior to soliciting bids.
On Monday, StarTran head Larry Worth characterized the FTA review as “typical” and akin to an IRS audit finding issues. However, he also acknowledged that StarTran had never before been subject to an in-depth review (as is being done now) in his 15-year tenure.
Among the areas the city was found to be deficient in the final report:
• The city did not perform an independent cost estimate for any of the five procurements reviewed during an FTA site visit – including the purchase of a bus wash system and digital video equipment.
• The city could not document that it performed an independent cost estimate for the purchase of a bus wash system purchased with federal stimulus funds.
• The city did not perform a cost/price analysis for bids evaluated – a repeat finding from the last review.
• The city didn’t have sufficient documentation for the award of three single bid contracts.
• The city couldn’t provide evidence it ensures excluded (debarred or suspended) companies aren’t participating in federal purchases.
• Recipients of federal grants and contracts worth more than $100,000 did not have language in their contract certifying compliance with lobbying restrictions.
To read the entire report, click on 2010 StarTrans Triennial Review.
Winterized 
I’m a big proponent of public transportation, and I think there should be more. That being said, I love that Lincoln has a bus system, but I’ve always had problems with the fact that all routes LEAD TO DOWNTOWN!!!! Believe me, I used to ride when I had a job down there (now I don’t). Not that I’m anti-downtown, but it just seems incredibly inefficient to have all routes going there. In larger cities you have to deal with transfers, and yes they may be a pain, but as a taxpayer, I really think it’s unnecessary for all routes to end up at 10th & O. If this report is valid, it doesn’t surprise me. Lincoln’s bus system is still operating on the premise that everyone NEEDS to go downtown, to jobs, shopping, etc., and that is not the case anymore. We’re bigger, we have places to go to work, shop, etc., other than downtown, and most of us don’t really have the time to take a one hour side trip, to or from work. If they can’t figure that out, than I don’t believe they can figure out their finances, either. It kinda, sorta, ticks me off that the city of Lincoln is condescending and thinks that the bus service ONLY provides to people who don’t have cars, whatever the situation, and not the entire population of Lincoln! I would be glad to ride, but their routes just don’t fit into my schedule……I’m not trying to be mean, I’m just really trying to be green!
There have been all sorts of transit studies done over the past ten years looking at updating the system. They did change the network from the old fashioned – all transfers downtown – system, from the days when downtown was the center of commerce, shopping etc. The new network connected downtown to Westfield and there was a neighborhood connection that went north and south from Westfield to finish the loop. My understanding is that the two connector routes (crucial to that network) were cut by the powers-that-be in this year’s budget.
The interesting part about transit vs cars is that the old trolley tracks used to run south down to Sheridan, east on Randoph to 48th and all the way north to Havelock. Rumor has it some of those rowdy methodists in dry University Place would topple the cars off the tracks so people couldn’t get to the taverns in Havelock. Deena – you might need to refudiate that.