Inspector General’s ART review reveals funding source, procurement problems

The city latest review of the Albuquerque Rapid Transit project indicates clear mistakes that could threaten the $75-million in federal funds that the city’s expecting for the delayed bus project. 

The city’s Office of the Inspector General published its five-month review on the ART project Thursday. 

VIEW: Inspector General’s ART Project Report »

The report sheds new light on various controversial elements of the project, including how it was paid for, the quality of the buses, how the city procured contracts and whether federal rules have been followed in the project’s roll out. 

As of June, ART stations still sit empty on Central Avenue. Albuquerque Mayor Tim Keller stated in a late-May news conference that limited service on the bus route could begin “sometime soon,” with hopes to put a mixed bus fleet into full-service by year’s end. 

Overall, Inspector General David Harper notes several areas where he believes the city should have handled the ART project differently. 

“Certainly there were problem areas that I think the city can do better in,” said Harper in an interview with KRQE News 13 Thursday. 

One of the problem areas Harper notes in his office’s report is with how the project was paid for. Harper believes the city paid for ART construction upfront by using GO (Genral Obligation) bond money based on statements made by the city’s former Chief Operating Officer Michael Riordan. 

GO bonds are voter approved funding sources for specific projects. Harper says IRS rules indicate that bond money must be used entirely on the projects it was intended for within five years. 

Harper says it’s unclear exactly which city bonds were used to pay for ART construction. 

“We discovered that the city doesn’t really have a good accountability of that,” said Harper. 

The city will eventually have to replenish any bond money used on ART from another funding source. 

“We’re kind of in a negative cash position right now, and that’s not a good position to be in,” said Harper. 

In the report, the IG also notes how the bus maker “BYD” or “Build Your Dreams” was picked by an ADHOC committee full of city leadership, or people in mayoral appointed positions. 

“It was top-heavy,” said Harper. “We really didn’t have, I believe, more technical people.” 

One of the biggest items noted in the IG’s report is the length of time it will likely take to get reimbursed by the federal government, if ever. Harper says based on conversations with the Federal Transit Administration, it will likely be another year at minimum before the Feds even consider giving ART grant money. That’s because at least one 60-foot ART bus needs to pass federal testing first. 

“The buses won’t be through testing for well over a year,” said Harper. 

Once an ART bus passes the federal test, the rest of the city’s fleet will have to match its exact design before the Feds fork over any cash. 

Another area of concern noted in the IG’s report has to do with inspectors who reviewed the buses the city was set to accept. The report states that those inspectors weren’t specially trained on the electric buses they were inspecting. The IG says the inspectors used inspection criteria for the city’s normal diesel fleet. 

“There were unfortunate, probably mistakes made,” said Harper of the process of the ART project. 

Harper hopes the report sheds light and the future city leaders don’t repeat the mistakes they’ve found. 

“I really think that what this does is reflect upon a lot of what I consider kind of vulnerabilities and weakness within our processes, especially in the procurement area,” said Harper. 

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