AUDIT OF FEDERAL TRANSIT 

ADMINISTRATION’S OVERSIGHT OF 

PIONEER VALLEY TRANSIT AUTHORITY 

ELECTRIC BUS COOPERATIVE AGREEMENT 

Federal Transit Administration 

Report Number: MH-2008-058 

Date Issued: July 9, 2008 
U.S. Department of 

Memorandum

Transportation 

Office of the Secretary 

of Transportation 

Office of Inspector General 

Subject: ACTION: Audit of FTA’s Oversight of 

Pioneer Valley Transit Authority 

Electric Bus Cooperative Agreement 

Federal Transit Administration 

Report Number MH-2008-058 

Date: July 9, 2008 

From: Joseph W. Comé 

Assistant Inspector General 

 for Highway and Transit Audits 

Reply to 

Attn. of: JA-40 

To: Federal Transit Administrator 

This report presents the results of our audit of the cooperative agreement between 

the Federal Transit Administration (FTA) and the Pioneer Valley Transit 

Authority (PVTA) in Springfield, Massachusetts, to design and build a preproduction prototype for a battery-powered transit bus. ElectraStor, a private 

company in Pittsfield, Massachusetts, conducted the activities of this cooperative 

agreement. 

FTA requested that the Office of Inspector General (OIG) review PVTA’s 

management of cooperative agreements. In responding to that request, we became 

aware of concerns related to PVTA’s management of its agreement with 

ElectraStor and initiated this audit. Our audit objectives were to determine 

whether: 

• ElectraStor met Federal requirements to demonstrate that funds were 

spent on activities eligible for FTA reimbursement, expenses were 

prudent and reasonable, and costs incurred were necessary to 

accomplish the project’s objectives; 

• ElectraStor contributed and spent its local share of the project funding, 

as required; 

• ElectraStor achieved the project objectives as outlined in the 

cooperative agreement and subsequent amendments; and 
2

• FTA and PVTA exercised appropriate oversight over the project. 

We conducted this performance audit in accordance with Generally Accepted 

Government Auditing Standards as prescribed by the Comptroller General of the 

United States and performed such tests as we considered necessary to detect fraud, 

waste, and abuse. Details of our objectives, scope, and methodology are in 

Exhibit A. 

BACKGROUND ON COOPERATIVE AGREEMENT WITH PVTA 

After Congress approved initial funding for the electric bus project in October 

1999, FTA signed a cooperative agreement with PVTA in August 2000 to design 

and manufacture one 22-foot battery-powered electric propulsion transit bus. 

Before August 2000, PVTA had entered into an agreement with several parties, 

including ElectraStor, to prepare an electric bus proposal for FTA, whereby 

ElectraStor would actually develop and manufacture the electric bus. The project 

requirements were amended in July 2001, reducing the project’s scope to focus on 

the nickel-hydrogen battery to be used in a transit bus. 

Federal funding allocated for the electric bus project totaled about $4.25 million 

between 1999 and 2005. The total included $3.45 million in earmarked funds and 

$800,000 in FTA discretionary funds. As shown in the table below, over 

$4 million of the Federal funds were paid to ElectraStor and the remaining 

$200,000 was paid to PVTA. 

Table. Federal Funding for Electric Bus Project 

Description Amount 

Earmarked Funds $3.45 million 

Discretionary Funds $800,000

Total Federal Funds Obligated $4.25 million

Costs Claimed by ElectraStor $9 million

50 percent Requested for Reimbursement $4.43 million

Funds Paid to ElectraStor $4.04 million

Funds Retained by PVTA $200,000

Total Paid for Project by FTA $4.25 million

Source: OIG Analysis of FTA data 
3

FTA’s cooperative agreement with PVTA set forth requirements for implementing 

the project. As the table above also shows, the cooperative agreement stipulated 

that FTA would pay 50 percent of the project costs and the recipients would pay 

50 percent of the project costs from non-Federal sources (local share). 

Additionally, the agreement required grant recipients, including third-party 

recipients such as ElectraStor, to comply with applicable Federal regulations 

regarding supporting documentation, eligible project costs, and the 50-percent 

local share requirements. 

The cooperative agreement also specified oversight responsibilities for FTA and 

PVTA. For example, the FTA project manager was to verify that milestones were 

achieved before approving claims for reimbursements. PVTA was to award and 

manage third-party contracts; conduct project status reviews; prepare progress, 

technical, and financial reports; and notify FTA of any unexpected problems. It 

was also to review the operational requirements for the battery to ensure that it 

would meet PVTA needs. For these oversight activities, PVTA received 5 percent 

of the Federal project funds. In addition to responsibilities in the cooperative 

agreement, FTA’s regional office in Cambridge, Massachusetts, was to conduct 

annual risk assessments of all project recipients. 

During the course of the project, ElectraStor submitted 31 claims for 

reimbursement through PVTA to FTA. The claims totaled approximately 

$9 million in project costs, for which ElectraStor requested a 50-percent 

reimbursement, or approximately $4.43 million. Of the $4.43 million, FTA paid 

$4.25 million in Federal funds to PVTA, which then reimbursed ElectraStor 

$4.04 million between August 2000 and May 2005. PVTA retained the remaining 

$200,0001

 as compensation for its oversight activities. FTA halted further 

payments when concerns about the project were raised. 

RESULTS IN BRIEF 

ElectraStor received $4.04 million in Federal reimbursements for ineligible 

claims. The claims were determined to be ineligible for reimbursement based on 

the incomplete and unreliable records ElectraStor made available to the audit 

team. Specifically, the $9 million in project costs listed on the 31 reimbursement 

claims to FTA were not traceable to the documentation ElectraStor provided to the 

audit team. Overall, the records provided were not sufficient to determine whether 

the costs cited were accurate and eligible for Federal reimbursement, or whether 

ElectraStor had provided its required 50 percent share of the project costs. We 

found that: 

 

1

 The total reimbursed ($4.04 million to ElectraStor and $200,000 to PVTA) add up to $4.25 million due to rounding. 
4

• records ElectraStor provided did not include bank statements for 26 of the 

67 months reviewed (August 2000 through February 2006). Statements 

that were provided were missing pages or were otherwise incomplete. 

General ledger records were made available only for year 2000, the first 

year of the cooperative agreement. 

• $284,000 in payments to consultants was not supported by documentation 

that was required to show what was done to earn the payment, or whether 

the work was related to battery research. 

• $115,000 for lobbying expenses was cited in ElectraStor’s records as a 

reimbursement expense even though lobbying is not eligible for Federal 

reimbursement. 

Moreover, although FTA reimbursed $4.04 million in Federal funds to ElectraStor 

through PVTA, ElectraStor did not provide evidence of any real progress in its 

research to develop a nickel-hydrogen battery for use in a transit bus. For 

example, during a visit to ElectraStor facilities, we observed a prototype battery 

that ElectraStor officials said was much too large to fit in a bus and could hold an 

electrical charge for only a few seconds. 

Further, our review showed that neither FTA nor PVTA adequately carried out 

oversight activities, such as the review of milestones achieved and claims for 

reimbursement that are specified in the cooperative agreement. Although PVTA 

still retained over $200,000 for its oversight role, the unsubstantiated claims were 

not adequately reviewed before FTA reimbursed PVTA $4.25 million in Federal 

funds. To its credit, however, since the time that we began this audit, FTA has 

taken positive steps to address weaknesses in its oversight of grants and 

cooperative agreements. 

Based on our findings of insufficient documentation and oversight to support 

claims for reimbursement, FTA has grounds to recover the entire $4.25 million in 

Federal funds it paid for this project, which includes the $4.04 million paid to 

ElectraStor and $200,000 retained by PVTA. 

To attain a full explanation of the insufficient documentation to substantiate the 

claims, further information may be required. Consequently, nothing in this report 

should be deemed to relieve any individual or entity of criminal liability. A 

complete list of our recommendations is on page 10 of this report. 

In its June 3, 2008, comments on our draft report, FTA concurred with our four 

recommendations. FTA’s comments and our response are discussed fully on 

page 11 of this report. FTA’s complete comments are in the appendix to this 

report. 
5

FINDINGS 

ElectraStor Received Federal Reimbursement of $4.04 Million, but Did 

Not Provide Complete or Reliable Records Supporting Its Claims 

Although ElectraStor was reimbursed with $4.04 million in Federal funds, 

ElectraStor did not provide adequate records to the audit team to show how the 

money had been spent nor demonstrate that only eligible costs had been incurred 

to develop a bus battery. The Office of Management and Budget (OMB) and FTA 

regulations referenced in the cooperative agreement require recipients of Federal 

funds to maintain documentation to support eligible project costs, including costs 

for consultants and meals. The regulations also require that all costs charged to a 

federally reimbursable project be supported by properly executed payrolls, time 

records, invoices, contracts, or vouchers that are “intact and readily accessible.” 

The 31 claims ElectraStor submitted for reimbursement listed $9 million in project 

costs. However, ElectraStor neither provided documentation to the audit team 

showing that the cited costs were eligible for Federal reimbursement, nor 

adequately demonstrated that ElectraStor contributed and spent its 50-percent 

matching share of the project costs. 

When we requested that ElectraStor provide supporting documentation for the 

$9 million in claimed expenditures, ElectraStor’s chief scientist provided us access 

to two file cabinets filled with files that did not support the claims ElectraStor 

submitted to FTA for reimbursement. The files were a mixture of bills and 

invoices from vendors that loosely correlated to the dates that the claims were 

submitted to FTA. They were not comprehensive records. Specifically: 

• There were no bank statements covering 26 months of the 67-month 

period under review and bank statements for another 10 months were 

missing pages or were otherwise incomplete. 

• The check register ElectraStor provided contained no information dated 

after June 2004 and copies of checks provided were dated before 

May 2002. 

• General ledger records were made available only for the year 2000, the 

first year of the cooperative agreement. 

ElectraStor’s chief scientist acknowledged that the files did not support the claims 

submitted to FTA for reimbursement. Additionally, no one on ElectraStor’s staff 

showed us how the claims ElectraStor submitted for reimbursements were 

prepared. 
6

Our analysis of available documentation did not find sufficient evidence that costs 

incurred for items such as consultants were eligible for reimbursement under 

Federal regulations. Also, we identified costs that, by definition, cannot be 

reimbursed. The records the audit team was able to review showed that 

ElectraStor made payments of more than $284,000 to five consultants but none of 

the documentation ElectraStor provided showed what was done to earn the 

payment, when the work was done, or any other evidence that the consultants were 

supporting the development of the nickel-hydrogen battery. Further, the records 

we reviewed showed expenses of at least $17,000 for meals in the first year of the 

grant. ElectraStor provided no explanation or supporting documentation to link 

the meals to battery research. Finally, the records showed more than $115,000 for 

lobbying costs, a category specifically prohibited by OMB Circular A-87, and the 

documentation did not support claims from ElectraStor officials that these 

expenses were paid out of their own funds. 

ElectraStor’s financial records were also insufficient to document that ElectraStor 

contributed and spent its 50-percent matching share of the project costs, a 

requirement for receiving Federal reimbursement. According to Federal 

regulations, a recipient must obtain its local matching share from sources other 

than the Federal Government. Accordingly, ElectraStor’s local matching share for 

the $9 million in claims would total approximately $4.5 million. However, 

records made available for the audit team’s review did not support ElectraStor’s 

claim that it provided local matching funds to the project. For example: 

• ElectraStor claimed five high interest short-term loans totaling 

approximately $2.8 million as part of its local matching share, but the 

records it provided were so scattered that we could not determine 

whether any of the loan proceeds were actually used for the project. 

• ElectraStor claimed another $2.5 million for an in-kind contribution for 

a debt owed to an engineering company for work performed during the 

project. However, the records provided showed that ElectraStor 

identified these costs as part of its local matching share but also claimed 

them as an expense for costs associated with project work. Because 

FTA reimbursed ElectraStor, the costs were not “contributed.” 

In summary, based on the insufficient documentation and support provided to the 

audit team for the claimed project costs and expenditures, we question the entire 

$4.04 million that ElectraStor received in Federal reimbursements. 
7

ElectraStor Did Not Provide Support That Progress Was Achieved 

With the $4.04 Million in Federal Funds 

ElectraStor did not develop the proto-type electric bus envisioned in the 

cooperative agreement or meet the reduced goal to focus only on the bus battery, 

despite claiming and receiving $4.04 million in Federal reimbursement. When the 

audit team visited ElectraStor’s facilities, we did not observe a functioning battery 

and we found no support for claims that research benefits from ElectraStor’s work 

were demonstrated through existing patents. 

The original scope of the electric bus program was reduced to focus on the 

research, development, and demonstration of a nickel-hydrogen battery to be used 

in a transit bus. The August 2000 cooperative agreement between FTA and PVTA 

was for ElectraStor, as PVTA’s subcontractor, to design and produce a 

demonstration model of a 22-foot battery-powered electric propulsion transit bus. 

In July 2001, all participants agreed to reduce the project’s scope. 

Our field work and other research did not provide evidence of any real progress in 

ElectraStor’s research to accomplish this reduced scope. For example: 

• In spring 2006, during a visit to ElectraStor facilities, we observed a 

prototype battery that ElectraStor officials said was much too large to fit 

in a bus and could hold an electrical charge for only a few seconds. 

• In response to our subsequent request for research results, ElectraStor 

officials provided information about licensed patents and pending patent 

applications purportedly developed as part of the battery project. 

However, when we queried the U.S. Patent Office database, we found 

that the listed patents were held in the name of other companies—no 

patents were registered to ElectraStor. 

In responding to the draft report, FTA noted that ElectraStor may not have had to 

produce a functioning battery, but under the agreement, ElectraStor did have to 

exercise its best efforts to produce a battery. Additionally, FTA noted that the 

FTA project manager in the Office of Research, Demonstration, and Innovation 

who was responsible for the project had indicated some accomplishments under 

the agreement. In our opinion, the accomplishments indicated by the FTA project 

manager, such as the unsupported claim that ElectraStor developed patents, are not 

reliable. Since our field work, the project manager had been removed from his 

responsibilities and has retired. 

To obtain more reliable information for assessing ElectraStor’s research, FTA 

should ensure that PVTA issues a final report on the accomplishments, if any, 
8

resulting from the agreement, as required in the August 2000 cooperative 

agreement. 

Neither FTA nor PVTA Adequately Carried Out the Oversight 

Activities Specified in the Cooperative Agreement 

Although a full explanation regarding the insufficient support for project costs and 

benefits may require further information, neither FTA nor PVTA performed the 

oversight activities specified in the cooperative agreement. The FTA project 

manager in the Office of Research, Demonstration, and Innovation neither 

maintained the necessary contact with PVTA and ElectraStor nor adequately 

reviewed the milestones achieved and claims for reimbursement. In addition, 

PVTA performed no oversight of the project but merely forwarded claims for 

reimbursement from ElectraStor to FTA and reimbursement payments from FTA 

to ElectraStor. Because of their lack of oversight, neither FTA nor PVTA were 

assured that Federal funds were spent on eligible activities; that ElectraStor 

contributed and spent its 50-percent matching share of the project costs, as 

required; and that adequate progress was made on the battery research. 

Under the August 2000 cooperative agreement, FTA was required to oversee and 

actively participate in the project and to verify the achievement of each specific 

payable milestone prior to approval of reimbursement for the milestone. PVTA 

was required to oversee ElectraStor activities and to provide reports to FTA on all 

major activities and potential problem areas, as well as a final report on the 

accomplishments resulting from the cooperative agreement. 

We found that neither FTA nor PVTA performed the required oversight. 

Specifically: 

• FTA’s project manager in the Office of Research, Demonstration, and 

Innovation signed and approved claims for reimbursements, but did not 

enforce the requirement that ElectraStor submit in-depth quarterly 

progress reports that would verify the achievements of each specific 

payable milestone. ElectraStor provided only 6 of 22 quarterly progress 

reports required by FTA circular 6100 chapter 3 section 5(b) to PVTA 

from 2000 through the end of 2005. 

• FTA’s regional office did not increase its oversight over PVTA to 

reflect the changing level of risk for PVTA shown in its annual risk 

assessments. Additionally, neither single audits of PVTA’s finances 

(conducted by an independent certified public accounting firm) nor 
9

triennial reviews2 of a sample of PVTA’s projects (conducted by the 

regional office) discovered the weaknesses in PVTA’s oversight of the 

activities at ElectraStor. 

• PVTA officials told us, contrary to the written text of the cooperative 

agreement, that PVTA had no oversight responsibilities; no expertise in 

batteries; and no role in carrying out the cooperative agreement, other 

than forwarding ElectraStor’s claims for reimbursement to FTA and 

forwarding FTA’s reimbursement payments back to ElectraStor. Yet, 

FTA reimbursed PVTA over $200,000 for forwarding the claims for 

reimbursement from ElectraStor to FTA. 

Because of the inadequate oversight, neither FTA nor PVTA took appropriate 

action to ensure the Federal requirements were being met and adequate progress 

was being made on the electric bus project before $4.04 million in Federal funds 

was paid to ElectraStor. In addition to seeking recovery of funds paid to 

ElectraStor, FTA has grounds to recover the $200,000 paid to PVTA for its lack of 

oversight activities. One option for a Federal agency to seek recovery of a debt is 

to issue a demand for payment under the Federal Claims Collection Standards (31 

CFR 901.2). An entity receiving a formal demand for reimbursement can provide 

additional evidence to support costs claimed. Regulations on collection activities 

are issued by the Secretary of the Treasury and the Attorney General of the United 

States. 

FTA Recently Took Steps To Improve Its Oversight 

Since the time that we began this audit, FTA has taken positive steps to address 

weaknesses in agency oversight of grants and cooperative agreements. For 

example, in August 2006, FTA issued FTA Order 6200.1, establishing policies 

and standards for the management of all FTA National Research and Technology 

Program projects and funds.3

In addition, FTA suspended all reimbursements to PVTA for projects associated 

with ElectraStor, and in fiscal year (FY) 2007 FTA developed and carried out an 

Action Plan for Improving Oversight Within the National Research Programs 

(Action Plan). According to FTA, the agency has: 

• reviewed the agreements assigned to the former FTA project manager 

who was responsible for PVTA, and based on this review retained a 

 

2

 The triennial review, mandated by Congress in 1982, is used by FTA as a management tool to exam grantee 

performance and adherence to current FTA requirements and policies. The review occurs once every 3 years. 3

 FTA Order 6200.1, “Federal Transit Administration’s Project Management Guidelines for Research Projects,” 

August 14, 2006. 
10

private consulting firm to undertake five financial management 

oversight reviews to review the recipients’ internal controls; 

• developed a risk assessment approach to review research recipients to 

determine the level of appropriate oversight; 

• provided training for FTA staff on cooperative agreement management; 

• held a 1-day workshop for research recipients on their grant 

management responsibilities; and 

• contracted with a private consulting firm to assess FTA’s oversight 

processes, an assessment that included agreements such as the 

cooperative agreement with PVTA. Based on the contractor’s 

recommendations, in FY 2008 FTA plans to establish an internal 

working group to implement the recommendations. 

RECOMMENDATIONS 

We recommend that the Federal Transit Administrator: 

1. Disallow all future costs claimed by ElectraStor. Develop an action plan, in 

coordination with the OIG, to seek recovery of the $4.25 million in Federal 

funds paid for the project. 

2. Establish specific milestones and reporting requirements for the internal 

working group that is being set up to implement recommended improvements 

in FTA’s oversight processes to ensure that all procedures included in the 

August 2006 FTA Order 6200.1 and the Action Plan to improve oversight over 

FTA research grants and cooperative agreements have been implemented and 

are functioning as intended. 

3. Review other research grants or cooperative agreements for which the FTA 

project manager assigned to ElectraStor was responsible, to determine whether 

similar problems exist in other research agreements awarded by FTA. 

4. Obtain from PVTA a final report disclosing the results of the research, as 

required in the cooperative agreement. 
11

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

We provided FTA a draft copy of this report on April 4, 2008. On April 16, 2008, 

FTA provided us with suggested changes and comments on the project’s technical 

progress. We incorporated FTA’s suggested changes and comments, as 

appropriate. On June 3, 2008, FTA provided its written comments on the report. 

In its comments, included as an appendix to the report, FTA concurred with our 

recommendations and agreed to take the following actions. 

• Recommendation 1. FTA stated that it will develop an action plan, in 

coordination with the OIG, to seek recovery of the $4.25 million in 

Federal funds by August 31, 2008. 

• Recommendation 2. FTA stated that it has established a working 

group to implement recommended improvements in FTA’s oversight 

processes and will develop milestones for program implementation by 

September 1, 2008. 

• Recommendation 3. FTA stated that it has completed five Financial 

Management Reviews, representing five grantees and nine projects 

assigned to the FTA project manager responsible for ElectraStor 

projects. The reviews will be provided to the OIG by June 30, 2008. 

Additionally, FTA stated that the lessons learned from these reviews 

will be used as part of recommendation 2. 

• Recommendation 4. FTA will request PVTA to provide a final report 

disclosing the results of the research by June 30, 2008. 

ACTIONS REQUIRED 

We consider FTA’s planned actions reasonable. We will continue to monitor the 

status of FTA’s implementation of our recommendations, in accordance with 

Department of Transportation Order 8000.1C, until the planned actions are 

completed. 

We appreciate the courtesies and cooperation of FTA representatives during this 

audit. If you have any questions concerning the report, please call me at 

(202) 366–5630. 

#
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EXHIBIT A. OBJECTIVES, SCOPE, AND METHODOLOGY 

The objectives of this audit were to determine whether: 

• ElectraStor met Federal requirements to demonstrate that funds were 

spent on activities eligible for FTA reimbursement, expenses were 

prudent and reasonable, and costs incurred were necessary to 

accomplish the project’s objectives; 

• ElectraStor contributed and spent its local share of the project funding 

as required; 

• ElectraStor achieved the project objectives as outlined in the 

cooperative agreement and subsequent amendments; and 

• FTA and PVTA exercised appropriate oversight over the project. 

To accomplish these objectives, we: 

• interviewed FTA Research and Development staff to determine what 

oversight activities were performed. 

• interviewed PVTA officials, the Chief Finance Officer, and the Director 

of Procurement and Transit, to assess PVTA’s role in grant and 

cooperative agreement administration and oversight. 

• conducted several site visits at ElectraStor’s facilities in Pittsfield 

Massachusetts, and met with the ElectraStor CEO and chief scientist—

to discuss the project’s scope of work, activities conducted, and the 

internal controls over the use and accounting of project funds. We also 

discussed the means by which ElectraStor obtained and maintained its 

required local share of funding for the project. 

• reviewed and analyzed available documentation maintained at 

ElectraStor to support invoices submitted to PVTA for FTA 

reimbursement. 

• relied on the limited records and other documents available to develop 

our overall observations and information on individual expenses. 

We conducted this performance audit from April 2006 through January 2008, in 

accordance with Generally Accepted Government Auditing Standards as 

prescribed by the Comptroller General of the United States. 

Exhibit A. Objectives, Scope, and Methodology 
13

EXHIBIT B. MAJOR CONTRIBUTORS TO THIS REPORT 

Name Title 

Tom Yatsco Program Director 

James Corcoran Program Director 

David Pouliott Project Manager 

Mary Thomas Project Manager 

Laurence Burke Senior Analyst 

Kathleen Conway Analyst 

David Deutsch Analyst 

Harriet E. Lambert Writer-Editor 

Exhibit B. Major Contributors to This Report 
14

APPENDIX. MANAGEMENT COMMENTS 

 Memorandum 

Subject: Response to Audit of Federal Transit Administration’s 

Oversight of Pioneer Valley Transit Authority electric 

Bus Cooperative Agreement (06M3005M001) 

Date: 

 

From: Robert J. Tuccillo 

Associate Administrator for 

 Budget and Policy/CFO 

Reply to

Attn. of: R.G. Owens 

X61689 

To: Joseph W. Come 

Assistant Inspector General for 

 Highway and Transit Audits 

The Federal Transit Administration is providing our proposed corrective actions to address the four 

recommendations in the Office of Inspector General (OIG) Audit of FTA’s Oversight of Pioneer Valley 

Transit Authority (PVTA) Electric Bus Cooperative Agreement, forwarded to our agency on April 4, 

2008. 

Proposed corrective actions on recommendations 1-4: 

1. Concur. FTA will develop an action plan by August 31, 2008, in coordination with the OIG, to 

seek recovery of the $4.25 million in Federal funds paid for the project. 

2. Concur. The FTA working group has been established and will develop milestones for program 

implementation by September 1, 2008. 

3. Concur. FTA has undertaken this recommendation. The five Financial Management Reviews 

representing five grantees and nine of the Project Managers’ projects have been completed. The 

reviews will be provided to the OIG by June 30, 2008. Findings within the reviews did not rise 

to the level of those for PVTA. Lessons learned from the reviews will be used as part of 

recommendation number two. 

4. Concur. FTA will request PVTA to provide a final report disclosing the results of the research 

by June 30, 2008. 

We appreciate your assistance and guidance regarding our proposed response to the audit. If you have 

any questions regarding our response, please contact Bob Owens, our Audit Liaison at x61689.

Appendix. Management Comments