Department of Homeland Security
 

Costs Invoiced by the Omaha Airport Authority 

for Closed Circuit Television Cameras at 

Omaha Eppley Airfield Airport 

American Recovery and Reinvestment Act of 2009 

OIG-12-121 September 2012
 
 

 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

 Washington, DC 20528 / www.oig.dhs.gov 

SEP 14 2012 

MEMORANDUM FOR: John P. Sanders 

Assistant Administrator 

Office of Security Capabilities 

Transportation Security Administration 

 

FROM: Anne L. Richards 

Assistant Inspector General for Audits 

 

SUBJECT: Costs Invoiced by the Omaha Airport Authority for ClosedCircuit Television Cameras at Omaha Eppley Airfield Airport 

Attached for your information is our final letter report, Costs Invoiced by the Omaha 

Airport Authority for Closed­Circuit Television Cameras at Omaha Eppley Airfield Airport. 

Since the report contains no recommendations to Transportation Security 

Administration management, we did not solicit formal comments. 

Consistent with our responsibility under the Inspector General Act, we are providing 

copies of our report to appropriate congressional committees with oversight and 

appropriation responsibility over the Department of Homeland Security. We will post 

the report on our website for public dissemination. 

Major contributors to this report are Roger LaRouche, Audit Director; Karl Gallagher, 

Audit Manager; and Marisa Coccaro, Report Referencer. 

Please call me with any questions, or your staff may contact John E. McCoy II, Deputy 

Assistant Inspector General for Audits, at (202) 254-4100. 

Attachment
 

 

 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Background 

On February 17, 2009, Congress enacted the American Recovery and Reinvestment Act

of 2009, as amended (Recovery Act) to preserve and create jobs, promote economic 

recovery, and invest in transportation, environmental protection, and other 

infrastructure that will provide long-term economic benefits. The Recovery Act 

appropriated $1 billion to the Transportation Security Administration (TSA) for 

“procurement and installation of checked baggage explosive detection systems and 

checkpoint explosives detection equipment....” According to TSA, $61,827,702 of that 

amount was awarded to 14 airport organizations for the advanced surveillance program. 

Under Other Transaction Agreement (OTA) No. HSTS04-09-H-REC309, as modified, TSA 

agreed to reimburse the Omaha Airport Authority (Airport Authority) for allowable, 

allocable, and reasonable costs up to $3,562,994 to support the design, installation, and 

operation of closed-circuit television cameras (CCTVs) at the Omaha Eppley Airfield 

Airport. Under the OTA, the Airport Authority was required to install CCTVs throughout 

the airport to monitor activities at various locations, including checkpoint, ticket 

counter, and gate areas, and TSA search tables.

The OTA was signed on September 16, 2009, and specified a project period of 2 years. 

The OTA required the Airport Authority to submit invoices for reimbursement of project 

costs to TSA. Reimbursement for eligible project costs is based on the scope of the 

agreement and Office of Management and Budget (OMB) Circular A-87, Revised, Cost 

Principles for State, Local and Indian Tribal Governments. TSA accepted the CCTV as 

complete on December 9, 2011, with total invoiced costs of $3,562,994. 

The agreement also required the Airport Authority to comply with OMB Circular A-133, 

Revised, Audits of States, Local Governments, and Non­Profit Organizations, and 

Recovery Act provisions to submit quarterly recipient reports to the Federal 

Government; and pay prevailing wages as determined by the Secretary of Labor under 

40 U.S.C., Chapter 31, Subchapter IV.

The objective of this audit was to determine whether costs invoiced by the Airport 

Authority are allowable, allocable, and reasonable according to the funding agreement 

and applicable Federal requirements. 

 

www.oig.dhs.gov 2 OIG-12-121 
 

 

 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Results of Audit

We determined that invoiced costs of $3,562,994 for the CCTV design and installation

were allowable, allocable, and reasonable. Allowable invoiced costs consisted of 

$3,323,425 for the contract to install the CCTV system, $239,227 for a consultant 

contract for design and construction oversight, and $342 for Airport Authority 

administrative costs for installation and testing. We also concluded that the Airport 

Authority complied with the requirements for submitting quarterly reports and paying 

prevailing wages. 

www.oig.dhs.gov 3 OIG-12-121 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Appendix A 

Objective, Scope, and Methodology 

The Department of Homeland Security (DHS) Office of Inspector General (OIG) was 

established by the Homeland Security Act of 2002 (Public Law 107-296) by amendment 

to the Inspector General Act of 1978. This is one of a series of audit, inspection, and 

special reports prepared as part of our oversight responsibilities to promote economy, 

efficiency, and effectiveness within the Department. 

The objective of this audit was to determine whether costs invoiced by the Airport 

Authority are allowable, allocable, and reasonable according to the funding agreement 

and applicable Federal requirements. Our audit covered invoiced costs of $3,562,994 

for the period September 16, 2009, through the final invoice dated September 26, 

2011. This project is completed and as such this amount represents the total invoiced 

and reimbursable. 

Our tests and procedures included the following: 

•	 Reviewing TSA project files, the OTA and modifications, the Recovery Act,

and TSA and OMB guidelines;

•	 Interviewing TSA officials to gain an understanding of the project and 

project management; 

•	 Examining the Airport Authority accounting records supporting amounts 

invoiced; 

•	 Interviewing Airport Authority officials to obtain an understanding of 

project management, accounting, procurement, and invoicing; 

•	 Inspecting the CCTV project; and 

•	 Reviewing the audit working papers of the certified public accounting firm 

that performed the Single Audits of the Airport Authority for the fiscal 

years ending December 31, 2010, and December 31, 2011. 

The Single Audits of the Airport Authority were performed by KPMG and included 

Recovery Act-funded CCTV project costs totaling $3,464,813 (97 percent of invoiced 

costs). The Single Audit reports classified the CCTV as a major program. The Single 

Audit reports did not identify any questionable costs or compliance issues related to 

the CCTV, or any deficiencies in internal controls that were considered material 

weaknesses that would affect the CCTV. 

We also tested Airport Authority records supporting costs invoiced to determine 

compliance with OMB Circular A-87, Revised, and with other terms and conditions of 

www.oig.dhs.gov 4	 OIG-12-121 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

the agreement. We considered Airport Authority internal controls over the 

administration of TSA funds in determining our audit procedures. 

We conducted this performance audit between March and August 2012, pursuant to 

the Inspector General Act of 1978, as amended, and according to generally accepted 

government auditing standards. Those standards require that we plan and perform the 

audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our

conclusions based on our audit objectives. We believe that the evidence obtained 

provides a reasonable basis for our findings and conclusions based upon our audit 

objectives. 

www.oig.dhs.gov 5 OIG-12-121 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Appendix B 

Report Distribution

Department of Homeland Security

Secretary 

Deputy Secretary 

Chief of Staff 

Deputy Chief of Staff

General Counsel 

Executive Secretary 

Director, GAO/OIG Liaison Office 

Assistant Secretary for Office of Policy 

Assistant Secretary for Office of Public Affairs 

Assistant Secretary for Office of Legislative Affairs 

Acting Chief Privacy Officer 

Departmental Recovery Act Coordinator 

Acting General Manager, Checked Baggage Division/Program 

 Manager, Electronic Baggage Screening Program, TSA 

Audit Liaison Official, TSA 

Office of Management and Budget

Chief, Homeland Security Branch

DHS OIG Budget Examiner

Congress

Congressional Oversight and Appropriations Committees, as appropriate 

www.oig.dhs.gov 6 OIG-12-121 
 

ADDITIONAL INFORMATION AND COPIES 

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at: @dhsoig. 

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