FEDERAL ELECTION COMMISSION 

OFFICE OF INSPECTOR GENERAL 

FINAL REPORT 

AUDIT OF THE COMMISSION’S 

EMPLOYEE TRANSIT BENEFIT PROGRAM 

February 2007 

AUDIT ASSIGNMENT OIG-06-01
OFFICE OF INSPECTOR GENERAL 

TABLE OF CONTENTS 

DESCRIPTION PAGE 

Executive Summary-----------------------------------------------------------------------------1 

Background---------------------------------------------------------------------------------------3 

Objectives, Scope and Methodology----------------------------------------------------------8 

Audit Findings and Recommendations 

Program Policy Needs Improvement------------------------------------------------10 

Employees Did Not Comply With Program Policy-------------------------------12 

Program’s Internal Controls Need to Be Strengthened---------------------------16 

Other Matters to Be Reported--------------------------------------------------------22 

Conclusions--------------------------------------------------------------------------------------24 

Management’s Comments---------------------------------------------------------------------24 

Appendix 1: FEC Transit Subsidy Program Application-------------------------------25 

Appendix 2: FEC Employee Clearance Form--------------------------------------------27 

Appendix 3: Summary of Audit Findings and Recommendations--------------------29 
EXECUTIVE SUMMARY 

The Federal Election Commission (FEC) Office of Inspector General (OIG) initiated an audit 

of the FEC’s Employee Transit Benefit Program in response to a 2005 OIG hotline complaint 

alleging that some participants received transit benefits while on extended business travel, a 

violation of FEC policy. The FEC’s Employee Transit Benefit Program is a subsidy intended 

to encourage employees to commute to and from work by means other than single-occupant 

vehicles. The employee benefit program had not been reviewed since 1994 and considering 

the cash equivalent nature of the program benefits, the OIG believed that an audit of the 

program would be beneficial. 

The OIG conducted the audit with the objectives of assessing program policies and operating 

procedures for compliance with applicable regulations, verifying employee compliance with 

program participation requirements, and ensuring that the appropriate internal controls are in 

place. The audit fieldwork was conducted between February 2006 and November 2006. The 

audit scope included a review of program activity from January 2003 through July 2006. 

FEC Directive 54, Employee Transit Benefit Program, August 2001, requires employees to 

reduce their monthly transit benefit when they do not take public transportation for the 

majority of the month. The OIG’s audit substantiated the OIG hotline complaint allegation 

that some employees were not adhering to the program directive. In fact, 50 employees 

inappropriately claimed $2,494 in transit benefits of which they were not entitled given their 

extended absence from the FEC. According to the program directive, it is the employee’s 

responsibility to reduce the transit benefit received in the event of an extended absence from 

work. Clear program policies and procedures need to be developed to provide participants 

with specific instructions on how adjustments should be made. 

Furthermore, we discovered three employees who were allowed to inappropriately participate 

in both the transit benefit program and the subsidized parking program. The three employees 

had been issued an FEC paid parking permit and also received the transit subsidy for several 

months during the period reviewed. In fact, two of the three employees worked in one of the 

program offices responsible for administering the Employee Transit Benefit Program. 

Although the practice was not consistent with the program directive, the OIG found no 

evidence of misuse of the benefit by the three employees. 

The OIG concluded the FEC’s Employee Transit Benefit Program policy is compliant with 

the intent of Federal regulations, to encourage employees commute on mass transit. 

However, the current directive needs to be improved since the policy does not include 

guidelines for proper management of SmartBenefits. Moreover, we noted that the FEC does 

not have written operating procedures to effectively implement program policy, program 

staff did not always follow the provisions of the program’s policy and program 

documentation was not properly maintained. 
Additionally, the OIG found the program office failed to properly suspend and remove 

program participants upon separation from the agency. As a result, former employees no 

longer eligible for the benefit had access to $30,935 in FEC funds, of which $1,972 (rounded 

to the nearest dollar) was inappropriately claimed by former employees. Further, while 

reviewing employee separations, the OIG also identified three ineligible employees who 

claimed $527 in transit subsidies while on administrative leave. The OIG also identified 

several employees who separated from the agency, but failed to return $2,101 of unused 

transit benefits. 

The program’s internal control system needs strengthening to ensure that unused subsidies 

are returned by separating employees, former employees are promptly removed from the list 

of eligible transit subsidy recipients and that ineligible persons do not have access to FEC 

transit benefits. As a result of these conditions, the program was not effectively monitored 

thereby providing opportunity for fraud, waste and abuse of program funds. Considering this, 

we have made several recommendations for improvement to the management of the program. 

2 
BACKGROUND 

The Federal Election Commission’s (FEC) Employee Transit Benefit Program was 

established in April 1992 to encourage employees to commute to and from work by means 

other than single-occupant vehicles. To achieve this, the Employee Transit Benefit Program 

provides financial incentives to employees who regularly commute via public transportation, 

not to exceed the lesser of the Federal tax-excludable amount or the actual commute cost. In 

1992, the program had 164 enrolled participants and provided a transit subsidy in the form of 

either a Metrofare card or a bag of bus tokens, with a value of $23.10 and $23.00, 

respectively. Since the inception of the FEC’s program, Executive Order 13150, “Federal 

Workforce Transportation,” was issued in April 2000 and mandated all Federal agencies in 

the national capital region (Washington, D.C.) to implement a transit pass benefit program by 

October 2000. As of 2005, the Federal tax-excludable amount for transit subsidy increased 

to $105 per month for transit/vanpool benefits. 

According to FEC Directive 54, Employee Transit Benefit Program, August 2001, any 

person on a full-time or part-time work schedule who is listed on the FEC payroll is eligible 

to participate in the transit benefit program. To apply, employees must complete the FEC 

Transit Subsidy Program Application (Appendix 1) and submit it to the Human Resources 

Office. Once approved, employees remain eligible until they leave the employment of the 

FEC or their commuting pattern changes in such a manner as to make them no longer 

eligible. As of March 27, 2006, 327 employees were enrolled and approved to receive a total 

of $29,786 in monthly transit subsidy. 

In the national capital region, the Washington Metropolitan Area Transit Authority 

(WMATA or Metro) directs the Metrochek and SmartBenefits programs. Employees who 

commute to work on WMATA-specified forms of transportation have the option of receiving 

their approved monthly transit benefit by paper Metrocheks or via SmartBenefits. Unlike 

paper Metrocheks which are manually distributed by the FEC monthly, SmartBenefits allow 

the FEC to electronically distribute transit benefits in a secure online environment. In fact, 

SmartBenefits makes it more effective to manage transit benefits; a web-based program 

allows the FEC to load the dollar value of an employee’s transit benefit directly to a 

SmarTrip card. 

The SmarTrip Card 

The SmarTrip card is a permanent plastic farecard 

registered with Metro at the time of purchase. The 

SmarTrip card can hold a maximum balance of $300 and 

is currently used for metrorail, metrobus and participating 

vanpool services. SmarTrip is also the only way to pay 

for parking at Metro parking lots. The unique serial 

number located on the back of the SmarTrip card protects 

3 
the card value assigned to the card and is used by the FEC to direct transit benefits. The 

employee retrieves funds by swiping the SmarTrip card at specified kiosks located 

throughout the WMATA system. 

Use of the SmarTrip card benefits the employee by saving time spent visiting the FEC’s 

Finance Office to receive the monthly benefit, provides the employee a way to recoup losses 

if the card is lost or stolen and gives the employee the ability to consolidate all transit benefit 

funding in one place, including adding money of their own, up to the card’s maximum funds 

capacity. Employees who do not download the monthly benefit to their SmarTrip card by the 

last day of the benefit month lose that month’s funding, which will automatically revert to the 

agency as a credit posted on a future WMATA invoice which is applied to a future purchase. 

Employees who choose not to use the SmarTrip card or who commute to work on any form 

of transportation that does not accept SmarTrip, have the option of receiving their approved 

monthly transit benefit by Metrochek paper fare. Participants must go to the Finance Office 

each month to sign for and obtain their monthly benefit in Metrocheks. Annually, 

participants are provided a schedule of Metrochek distribution days. In addition, employees 

are reminded by e-mail of the upcoming distribution each month on the day before the 

beginning of the distribution of the next month’s subsidy. The Finance Office distributes 

Metrocheks generally on the last Thursday and Friday of the month and the following 

Monday. Additional distribution days are the next Monday through Friday after the initial 

three-day period. 

Employee Transit Benefit Program Costs 

Transit subsidy disbursements averaged $27,673 per month from January 2003 through 

December 2005. These disbursements resulted in annual costs of $247,467, $306,616, and 

$343,481 to the FEC for calendar years 2003, 2004, and 2005 respectively. 

Annual Expenditures for Transit Subsidy 

0 

100,000 

200,000 

300,000 

400,000 

Dollars 

2003 2004 2005 

4 
Program Administration at the FEC 

At the FEC, the Employee Transit Benefit Program is administered by three offices: the 

Administrative Division, the Human Resources and Labor Relations Office (HRO), and the 

Finance Office. 

The Administrative Division is responsible for the procurement of all Metrocheks for direct 

delivery to the Finance Office. As required by the program policy directive, the 

Administrative Division must also maintain and provide to HRO a monthly list of employees 

issued FEC parking permits, including a list of passengers who commute with the parking 

permit holders. Employees who participate in an FEC carpool or are issued an FEC parking 

permit are not eligible for the transit subsidy program. 

HRO is responsible for processing, approving, and maintaining the Transit Subsidy Program 

Participant Applications as well as maintaining a database of eligible program participants 

generated in the agency automated accounting system. Monthly, HRO prepares the Transit 

Subsidy Eligibility List used to distribute paper Metrocheks to eligible recipients. HRO is 

also charged with reviewing the monthly list of FEC parking permit holders and their 

passengers prepared by the Administrative Division to ensure that employees who receive an 

FEC parking benefit are not eligible for the transit subsidy. 

Establishing and maintaining the SmartBenefits (SmarTrip) accounts for those participants 

who receive their benefit electronically is another responsibility of HRO. Using WMATA’s 

web-based program, HRO staff can add, delete, modify, and edit information contained on 

the SmartBenefits database from the 1st through the 15th of each month. After the 15th of 

each month, SmartBenefits orders for the upcoming month are processed by WMATA. 

Since the FEC’s monthly SmarTrip order generates a permanent reoccurring record in 

Metro’s database, any changes due to employee separations should be processed in a timely 

manner by the 15th of each month. After the 15th of the month, changes in the SmarTrip 

order can not be made. However, the SmartBenefits program allows HRO to suspend usage 

of FEC transit benefits unclaimed during the last month of employment. For employees who 

depart after the 15th of the month, HRO staff can also suspend FEC paid transit subsidy for 

the upcoming month on the 28th or after to prevent the electronic transfer of additional 

subsidy to their SmarTrip card. 

The Finance Office is responsible for determining the monthly order quantity of Metrocheks, 

certifying payment of WMATA invoices, as well as the safeguarding and distribution of 

Metrocheks. Additionally, the Finance Office maintains monthly distribution records and is 

required to collect any unused Metrocheks during the employee separation clearance process. 

5 
Prior Audit Coverage of Employee Transit Benefit Program 

A prior OIG audit of the Employee Transit Benefit Program conducted in 1994 found that the 

program complied with statutory requirements and successfully achieved the intent of the 

program. The OIG also concluded that the internal controls were sufficient to prevent fraud, 

waste, or abuse. The prior audit revealed only a few minor weaknesses which did not 

warrant a formal finding. Since the OIG’s 1994 audit, significant changes have occurred to 

the FEC benefit program. The number of employees participating in the program nearly 

doubled, the maximum monthly benefit more than quadrupled, and the FEC introduced the 

new electronic SmarTrip card. 

Program Violations Noted Since Prior Audit of the Employee Transit Benefit 

Program 

As part of the OIG’s audit planning, the OIG requested information from the FEC on any 

program violations related to the transit program since the OIG’s last audit of the program. 

The OIG received records documenting program violations regarding a case in 2000. 

According to the records, the U.S. Attorney’s Office for the District of Columbia declined to 

criminally investigate the 2000 matter and referred the issue to the FEC for administrative 

action. The program violations involved three program recipients who received benefits, but 

participated in a private carpool that received an FEC parking benefit. 

According to the documentation obtained by the OIG during the audit, the driver of the 

carpool used a FEC paid parking permit. The three riders continued to ride with the driver 

and receive transit benefits. Program policy states that parking permit holders and their 

passengers who participate in an FEC carpool will not be eligible for the transit subsidy 

program. The three employees claimed that they were unaware of the FEC’s policy 

regarding parking permits and the transit benefits. The three employees were required to 

repay the transit benefits received while riding in the carpool, and adhere to the program’s 

participation requirements of the Employee Transit Benefit Program for the remaining period 

of their enrollment. The former Deputy Staff Director also restricted one of the employee’s 

access to a computer system as a result of the violation; the employee’s computer access was 

reinstated six months after a resolution agreement was signed. Additionally, since the 

employees successfully complied with the conditions of the resolution, no record of the 

incident was included in their Official Personnel Folder. 

It appears that the misuse of transit benefits by the three carpool members occurred because 

the FEC did not fully implement the program’s internal controls. The FEC’s program 

directive requires that the Administrative Office maintain a current list of employees who 

have been issued FEC parking permits, including passengers who commute with the parking 

permit holder. The policy also requires that HRO compare the list of parking permit holders 

and their passengers to the Transit Subsidy Eligibility List to ensure that ineligible employees 

are not on the transit subsidy list. However, there was no record that this was done. 

6 
Prior to the OIG’s audit, FEC management did not provide the FEC OIG with any 

information regarding the allegations of possible misuse within the agency’s Employee 

Transit Benefit Program. Nor was the FEC OIG contacted or approached by management to 

conduct/assist with the investigation. Subsequent to the matter, the Director of Personnel at 

the time suggested the OIG consider a future audit of the transit benefit program to ensure 

employees’ actual commute costs match their transit benefits. The Director of Personnel 

made no mention regarding the prior misuse or the need to assess the program’s internal 

controls to ensure the weakness that allowed the misuse to occur had been improved. In fact, 

the OIG’s 2006 audit found that management did not implement corrective action to address 

the internal control issues previously noted in 2000. 

In 2005, a hotline complaint was submitted to the FEC OIG alleging that some participants 

received transit benefits while on extended business travel, a violation of program policy. 

The complainant believed that one or more FEC employees claimed their full transit benefit 

while conducting extended out-of-town work assignments. Participants of the program who 

do not commute to their normal duty station (i.e. the FEC building located at 999 E Street, 

NW, Washington, D.C.) on a regular and reoccurring basis are not eligible to receive the full 

monthly subsidy amount. FEC policy requires participants to adjust their monthly subsidy 

amount when they vary their monthly commute to their official duty station. Employees 

must commute a minimum of 50% of the available number of commuting days (business 

days) per month between home and the official duty station on public transportation to be 

entitled to their full monthly transit subsidy. Employees who do not commute a minimum of 

50% in a month are only entitled to 50% of their full transit benefit for that month. 

7 
OBJECTIVES, SCOPE AND METHODOLOGY 

The objectives of this audit were to: 1) assess program policies and operating procedures for 

compliance with applicable regulations; 2) verify employee compliance with program 

participation requirements; and 3) ensure that the appropriate internal controls are in place. 

The audit fieldwork was conducted between February and November 2006. The audit scope 

included a review of program activity from January 2003 through July 2006. 

We conducted our audit in accordance with Government Auditing Standards issued by the 

Comptroller General of the United States. 

To accomplish the audit objectives, we performed the following audit procedures: 

• Compared Federal regulations authorizing the transit benefit program to the FEC 

Directive and current procedures to ensure that the program is consistent with the 

intentions of Federal regulations. The OIG also reviewed and compared current 

program policy to the policy in effect during the OIG’s 1994 audit to identify changes 

to the benefit program. 

• Conducted interviews with program staff in order to: verify policies are consistently 

followed; understand internal operating procedures; and to document any program 

violations noted since the OIG’s prior audit conducted in 1994. 

• For the sample of 45 participants, compared the participants’ claimed commuting 

costs to reasonable costs associated with the commuting options available based on 

their home address to ensure that the transit benefits paid by the FEC were 

appropriate. The OIG concluded that the commuting costs claimed by the 45 

participants were reasonable. 

• The OIG reviewed the transit benefit claiming reports to determine whether the 

randomly selected sample of 45 participants received their transit benefits in the first 

full calendar month after their application had been approved. We found that the 

sampled participants received their transit benefits in a timely manner. 

• The OIG reviewed the monthly WMATA invoices for SmartBenefits from January 

2005 to June 2006 to ensure the FEC was properly credited for unclaimed benefits. 

We found that the FEC was properly credited for unclaimed benefits during the 

period reviewed. 

• To evaluate whether employees adjusted their monthly benefit given actual leave 

usage, the OIG selected the FEC’s Office of General Counsel (OGC) for review, an 

office comprised of approximately 30 percent of the total FEC staff. The OIG 

reviewed calendar years 2003-2005 Annual Attendance Records for OGC employees, 

calculated the benefit amount the employees were entitled to receive and then 

examined transit subsidy claiming reports. [See page 13] 

8 
• The OIG selected a sample of 59 extended business trips (10 business days or more) 

by FEC staff taken between January 2003 and December 2005 to determine whether 

program participants correctly adjusted their monthly benefits due to business travel. 

For each business trip sampled, the OIG determined the number of days the 

participants commuted to work based on business trip length and any leave taken in a 

given month. [See page 13] 

• Analyzed monthly transit subsidy claiming reports from January 2003 through July 

2006 to determine whether employees placed on administrative leave claimed transit 

benefits for the period of absence from the FEC. [See page 14] 

• Reviewed all employee separations from January 2003 through July 22, 2006 to 

ensure that departed staff returned unused transit benefits during the clearance 

process, their names were promptly removed from the transit subsidy 

distribution/claiming lists and former employees did not claim benefits after 

separating from the agency. [See pages 16-18] 

• We cross checked transit subsidy recipients from January 2003 through December 

2005 against the monthly lists of FEC-paid parking permit holders to ensure 

employees were not inappropriately authorized to participate in both benefit 

programs. Additionally, we contacted current permit holders to identify passengers 

who participated in carpools and examined transit subsidy claiming reports to ensure 

that passengers did not receive transit subsidy while riding in a permit holder’s 

carpool. [See pages 19-20] 

• Randomly selected 45 transit benefit program applications to determine whether 

applications to participate in the program were properly completed and signed by the 

employee, and approved by the HRO. [See page 22] 

• Reviewed monthly Finance Office Metrochek reconciliation forms for January 2003 

through December 2005 to assess the monthly balance of Metrocheks on hand and to 

identify any overage or shortage in Metrocheks on-hand after the monthly 

distribution. [See pages 22-23] 

9 
AUDIT FINDINGS AND RECOMMENDATIONS 

Program Policy Needs Improvement 

Overall, the FEC’s Employee Transit Benefit Program policy is compliant with Federal 

regulations which mandate the implementation of a transit benefit program. However, the 

policy directive needs improvement because it does not include provisions for the 

management of SmartBenefits. We also found that the FEC does not have written operating 

procedures to implement the directive. 

When the FEC initially established the Employee Transit Benefit Program in 1992, program 

participants received the transit benefit in the form of paper Metrocheks and tokens. Since 

then, WMATA has allowed users to move beyond the original paper Metrochek to a 

SmarTrip card which is a reusable, rechargeable farecard for use on metrorail, metrobus or in 

a registered vanpool. The FEC provides SmarTrip cards as an optional form of transit 

subsidy. Employees who choose to use SmarTrip cards are able to download their transit 

subsidy at the machines located throughout the Metro system. 

Although the FEC has participated in the SmartBenefits program since 2003, we found that 

the current employee transit benefit directive has not been adequately updated to provide 

guidance regarding management of SmartBenefits or transit benefits assigned via the 

SmarTrip card. Specifically, FEC Directive 54 does not provide policies and procedures on 

the SmartBenefits’ administration tasks, such as: how to assign monthly benefit amounts, 

reassign benefits for misplaced SmarTrip cards or how to remove or suspend former 

employees to prevent benefits from being loaded to their account after separating from the 

FEC. Additionally, FEC Directive 54 stipulates a cutoff of the 20th day of each month to 

apply for the benefit for the following month; however, the actual cutoff is the 15th day of the 

month for participants applying for the SmarTrip card benefit. SmartBenefits orders for the 

upcoming month are processed on the 16th day of each month by WMATA. Further, we 

found that the FEC’s policy does not describe the appropriate method of processing transit 

subsidy benefits (SmarTrip) for incoming personnel who start working after the 15th of the 

month. 

Regarding SmartBenefits, we found that the FEC Directive 54 only briefly states the 

following: 

Departing employees who have transferred their fare media amount to a 

SmartCard will return any unspent portion of the issued subsidy to the Finance 

Office in the form of a Metrochek(s) rounded down to the nearest whole 

dollar value. 

The policy does not provide any other instruction pertaining to SmartBenefits or the 

SmarTrip card. Without guidelines addressing the proper management of SmartBenefits, the 

electronic transit subsidies become more susceptible to fraud or mismanagement. 

10 
Furthermore, we found that the FEC does not have written operating procedures to 

effectively implement the Employee Transit Benefit Program policy. FEC Directive 54 is 

not a comprehensive procedural document; it does not provide specific information regarding 

the tasks required to manage the Employee Transit Benefit Program. For example, FEC 

Directive 54 does not include procedures that instruct the program staff on how to verify 

employee data or how to compute the amount of monthly subsidy the applicant is entitled to 

receive based on the commuting cost calculation. Procedures are needed to ensure 

continuous execution of program responsibilities/duties despite changes in personnel 

assigned to program offices charged with administering the program. Comprehensive 

instructional guidelines need to be developed to assist staff charged with administering the 

program and to clarify tasks required to effectively and efficiently manage the program. 

Since the FEC’s program policy does not address management of SmartBenefits and program 

staff do not have internal operating procedures to implement the policy, program guidance is 

lacking in order to effectively manage and monitor the program. 

Recommendations 

1. Program management should revise FEC Directive 54 to include adequate guidelines 

on the management of the SmartBenefits program. Provisions should include the 

delegation of responsibilities and duties required to ensure the accurate electronic 

transmission of monthly transit subsidies to eligible employees. 

2. Program management should develop internal operating procedures for program 

offices involved in the management of the program to ensure the process is 

functioning in an efficient manner and is not subject to errors and manipulation. 

11 
Employees Did Not Comply With Program Policy 

FEC Directive 54 requires employees to adjust their monthly subsidy amount when they vary 

their monthly commute and do not take public transportation for the majority of the month. 

However, our audit results revealed that employees failed to adhere to the program’s policy. 

Specifically, 50 employees claimed $2,494 in FEC funds, of which $989 was inappropriately 

claimed for periods of extended travel and $1,505 was inappropriately claimed for periods of 

extended annual and/or sick leave from January 2003 through December 2005. Additionally, 

we identified three ineligible employees who claimed $527 in transit subsidies while on 

administrative leave. 

The Employee Transit Benefit Program is intended for FEC personnel who commute on a 

regular and recurring basis; FEC transit subsidy is to be used for the commute to and from 

the official duty station. However, for a variety of reasons, employees may vary their 

monthly commute to work. This may occur as a result of annual or sick leave, or official 

travel. Program policy states that employees must commute a minimum of 50% of the 

available number of commuting days (business days) per month between home and the 

official duty station on public transportation to be entitled to their full monthly transit 

subsidy. Employees who do not commute a minimum of 50% in a month are only entitled to 

50% of their full transit benefit for that month. 

It is the employees’ responsibility to designate the adjusted subsidy amount based on their 

anticipated use of public transportation. When employees know in advance that they will not 

be commuting to the office using public transportation for 50% or more of the business days 

in a given month, they are entitled to half of their transit benefit for that month. Conversely, 

if after accepting the full amount of transit subsidy for the monthly commute, an employee 

does not commute to work for at least 50% of the commuting (business) days because of 

unplanned or unscheduled absences, the employee is eligible for 50% of the transit benefit 

the following month. 

We found that employees did not always correctly adjust the amount of transit subsidy 

claimed for months when they commuted less than 50% of the available business days in a 

given month. In fact, the OIG’s review of travel and leave records identified employees who 

were on extended periods of absence from the FEC, but collected their full monthly benefit, 

inaccurately adjusted their subsidy amount or did not adjust their benefit in the following 

month. 

12 
Program Participants on Extended Travel 

In the OIG sample of 59 business trips taken between January 2003 and December 2005, we 

identified 50 vouchers/records that documented travel of employees who were not entitled to 

the full monthly benefit due to their extended absence from work. The remaining 9 travel 

vouchers/records documented trips taken by employees who did not participate in the transit 

benefit program or remained eligible for their full transit benefit despite the business trips. 

After examining the applicable transit subsidy claiming reports, we found that for 21 of the 

50 business trips, the employees were not compliant with the transit subsidy program 

requirements while on extended travel. Specifically, the employees inappropriately claimed 

$989 in transit benefits of which they were not entitled to due to their absence from the FEC. 

Program Participants on Extended Leave 

To evaluate whether employees adjusted their monthly subsidies given actual leave usage, 

we reviewed Annual Attendance Records for calendar years 2003-2005 for a sample selected 

from the total FEC population. The OIG selected the FEC’s Office of General Counsel for 

review, an office comprised of approximately 30 percent of the total FEC staff. Based on the 

leave records, the OIG calculated the amount the employees were entitled to and then 

examined transit subsidy claiming reports. 

We found that during the review period, January 2003 through December 2005, 73 program 

participants of the selected sample of FEC employees did not commute to the office for 50% 

or more of the business days in a calendar month. Accordingly, these 73 program 

participants were only entitled to 50% of their full transit benefit for that month. However, 

we identified 29 of the 73 sample employees who collected their full monthly transit benefit 

for the period of extended leave from the FEC, did not adjust their benefit in the following 

month, or inaccurately adjusted their subsidy amount. In fact, we calculated that those 29 

participants claimed $1,505 in transit benefits of which they were not eligible to receive. 

In summary, results from our testing of extended travel and leave revealed that a combined 

total of 50 employees did not comply with program policy and inappropriately claimed a 

total of $2,494 in transit subsidies. According to FEC Directive 54, employees are 

responsible for monitoring their use of the transit benefit under the program policy. These 50 

employees did not adjust their subsidy amount based on their actual commute to work, 

considering extended leave and/or travel. FEC employees must commute to the office using 

public transportation for 50% or more of the business days in a month to be entitled to their 

full transit benefit for that month. When a change in commuting pattern results in the 

employee commuting less than 50% of the business days in a month, the employee is entitled 

to only 50% of their monthly transit benefit. 

Program policies and procedures should be developed to provide participants with specific 

program instruction regarding adjustments to their transit subsidy. Specifically, SmarTrip 

users should be provided with proper guidelines for adjusting the amount of transit subsidy 

claimed at the kiosks located throughout the WMATA system. A statement should also be 

13 
included with the monthly transit subsidy distribution reminder that specifically instructs 

participants to make adjustments based on extended absences from the FEC. Also, transit 

benefit program applications should require a supervisory approval to provide managers the 

opportunity to advise their employees, as needed, on program requirements. 

Ineligible Employees Who Claimed Transit Subsidy While on 

Administrative Leave 

While reviewing employee compliance with FEC policy during periods of extended annual 

and sick leave, the OIG identified three ineligible employees who claimed transit subsidy 

while on administrative leave for various reasons during 2004, 2005 and 2006. 

Although the program is intended for FEC personnel who commute on a regular and 

recurring basis, the OIG discovered one former employee who was placed on administrative 

leave in September 2004, but retained $29 in unused subsidy from September and then 

claimed $65 in transit subsidy for the month of October 2004. In fact, in January 2005, the 

HRO concluded that due to the administrative leave, the employee was not entitled to the 

benefits. However, the HRO failed to suspend the benefits and the employee continued to 

claim an additional $260 in benefits while on administrative leave in February, May, June, 

and July of 2005. Another employee was placed on administrative leave in August 2005, but 

retained $30 in unused subsidy for August and claimed $60 in transit benefits for the month 

of September 2005. The third employee who was placed on administrative leave in October 

2005 claimed $83 while on leave before finally separating in February 2006. 

Due to the administrative leave status, the three employees did not commute on public 

transportation on a regular basis, and inappropriately received $527 in transit benefits. The 

OIG recognizes that administrative leave can occur unexpectedly and due to unforeseen 

reasons. However, the intent of the program is for employees commuting on a regular basis 

to work using public transportation. Based on our testing, it is apparent that internal controls 

are lacking to address employees placed on administrative leave and their ineligibility for the 

transit benefit program. 

Consistent with the policy directive, the OIG believes that generally, employees should not 

be able to use transit benefits after being placed on administrative leave. Management 

should review the current program policy, and then develop and implement procedures that 

include restrictions for employees on administrative leave. The OIG also suggests the HRO 

implement an administrative leave clearance process, similar to the process completed for 

separated employees. The administrative leave clearance process would alert the appropriate 

FEC offices to ensure all necessary obligations are suspended until the employee returns to 

work or other determinations are made. Further, the OIG suggests the form or other process 

include a notification to transit participants that their participation in the program has been 

suspended, pending resolution of the matter that necessitated administrative leave. 

14 
Recommendations 

3. Program management should ensure that program participants who are absent for an 

extended period, especially those who frequently go on official business travel for the 

FEC, are made aware of their responsibility to adjust their transit subsidy benefits 

when absent from their normal duty station for 50% or more business days in a 

calendar month. For example, the Finance Office should include a statement in their 

monthly distribution reminder that specifically instructs participants to make 

adjustments based on extended absences from the FEC. 

4. HRO should develop clear program policies and procedures to provide participants 

with specific instructions on how adjustments should be made for those who receive 

their transit subsidy electronically via the SmarTrip card. 

5. Program management should require supervisory review/signature of the employees’ 

transit benefit program applications. An awareness that an employee participates in 

the transit program will allow the supervisor to advise their employees, as needed, on 

the requirements of the program, such as instances in which participants commute 

less than 50% of the business days in a month. 

6. Program management should ensure that the program offices’ staff are properly 

trained on the guidelines and procedures regarding transit subsidy adjustments 

required when participants are on extended absence from the office. Properly trained 

program staff can provide accurate information to employees who contact HRO for 

advisement regarding program requirements. 

7. Program management should develop and implement procedures that include transit 

benefit restrictions for employees on administrative leave. 

8. HRO should implement an administrative leave clearance process, similar to the 

process completed for separated employees. The clearance form or other process 

should include a notification to transit participants that their participation in the 

program has been suspended, pending resolution of the matter that necessitated 

administrative leave. 

15 
Program’s Internal Controls Need To Be Strengthened 

We found that employees separating from the agency did not return unused transit subsidy, 

remained listed as eligible recipients after leaving the agency, and were allowed to retain 

their FEC assigned SmarTrip card thereby providing access to $30,935 in FEC paid transit 

subsidy (up to $105 per employee, per month). As a result, former employees 

inappropriately retained and claimed $4,073 (rounded to the nearest dollar) in transit benefits. 

We also found that program policy was not always followed. 

Participants Separating From the Agency Did Not Return Unused Transit 

Subsidy 

FEC policy states that it is not permissible for departing employees to use transit benefits 

provided by the FEC after their final date of employment at the FEC. 

Employees leaving the organization must complete a check-out process; the check-out 

process includes the return of unused transit subsidy benefits. An FEC Employee Clearance 

Form, used during the check-out process, provides for the recording of unused Metrocheks. 

A copy of the form can be found in Appendix 2. The program directive states that the 

Finance Office manages the receipt of unused transit benefits from departing employees. 

The OIG found that the clearance forms seldom included the collection of unused transit 

benefits. 

FEC policy also requires the maintenance of a log that captures the receipt of unused transit 

subsidy (Metrocheks) returned during the employee clearance process by departing 

employees. Based on our review, the OIG found that the Finance Office had not updated the 

returned transit subsidy log since August 2003; the transit subsidy log did not record receipt 

of unused transit subsidy returned in 2004, 2005 or 2006. 

The OIG’s audit testing revealed that employees who departed the FEC between January 1, 

2005 and July 22, 2006 returned only $118 of the $1,113 we calculated to be unused based 

on the separation dates of the employees. Furthermore, the FEC should have collected 

$1,190 from separating employees during calendar years 2003 and 2004. The employee 

clearance forms for those employees who departed in 2003 and 2004 were not readily 

available during the audit testing. Based on discussions with the Finance Office, and a 

review of the unused subsidy log, we concluded the FEC did not receive the entire $1,190 in 

unused transit subsidy from the former employees. In fact, the returned subsidy log recorded 

receipt of only $84 and had not been updated since August 2003. Hence, employees who 

separated from January 2003 through July 2006 retained $2,101 in unused transit subsidies 

that should have been collected during the clearance process. 

Allowing employees separating from the agency to retain FEC paid transit subsidies is not 

permissible under the provisions of FEC Directive 54. Once eligibility is terminated, all 

unused or partially used Metrocheks are to be returned to the Finance Office. The returned 

unused transit subsidy should be available to accommodate the current staff’s local travel 

16 
needs. To assist program staff when computing the amount of unused subsidy that should be 

returned on the last day of employment, the Finance Office suggested that the current 

employee clearance form is revised to accommodate the unused transit subsidy calculation. 

Recommendations 

9. The Finance Office should ensure the employee separation clearance process includes 

the computation and collection of unused transit subsidy from departing employees. 

Clearance forms should be revised to accommodate the unused transit subsidy 

calculation. 

10. The Finance Office’s monthly notification distribution e-mail should include a 

reminder that participants are required to return any unused transit subsidy during the 

employee clearance process. 

11. The Finance Office should develop internal procedures that describe how to calculate 

and record the amount of unused transit subsidy a departing employee must return 

during the employee separation process. 

12. The Finance Office should ensure proper training of staff responsible for the office’s 

employee separation clearance process. Staff should be familiar with unused transit 

subsidy requirements and the procedures used to calculate the correct amount of 

transit subsidy that should be returned by departing employees. 

13. The Finance Office should develop and maintain a record or log that captures the 

receipt of unused transit subsidy returned during the employee separation process by 

departing employees. The log should include the departing employee’s name, date of 

departure, computation of unused transit subsidy, actual amount received from 

departing employee and signature of Finance staff who received the subsidy. The log 

should also include disbursement of Metrocheks to employees for local travel, 

thereby providing an audit trail of transit subsidy returned and disbursed. 

14. The Finance Office should ensure that all FEC employees are made aware of unused 

transit subsidy available for official local travel. This will ensure economic use of 

program funds. 

15. The Finance Office should contact WMATA to research exchange opportunities 

available for disposition of unused Metrochek cards to ensure efficient use of returned 

transit subsidy. 

Former Participants Listed as Eligible Recipients 

Based on our review of FEC separated employees from January 2003 to July 22, 2006, the 

OIG found that 83 former employees had not been removed from the monthly transit subsidy 

claiming reports in a timely manner (the month following their last day of employment). 

Since the former employees had not been removed in a timely manner, 60 former employees 

17 
who received their transit benefits electronically on a SmarTrip card had access and could 

have claimed $30,935 in FEC paid transit benefits after separating from the FEC (a 

maximum of $105 per employee, per month). In fact, one former employee actually 

contacted their previous supervisor in April 2006 at the FEC to explain that he was still 

receiving FEC paid transit benefits monthly on his SmarTrip card after separating from the 

FEC. 

As a result of the HRO neglecting to suspend or remove non-eligible individuals from the 

FEC’s SmartBenefits account, we identified $1,972 in transit benefits inappropriately 

claimed by nine former employees after separating from the agency. 

It is important that HRO promptly suspend or remove non-eligible individuals from the 

program, especially since the FEC allows individuals to keep the SmarTrip card registered to 

receive FEC paid transit subsidy after they leave the program. However, there are certain 

timing constraints using the WMATA web-based SmartBenefits program to suspend or 

remove former participants’ SmarTrip benefits. Suspension of unclaimed benefits for the 

employee’s last month of employment can occur anytime during the month. However, 

suspension of unclaimed benefits for future months must be processed by the HRO on the 

28th of the month, or up until the 15th day of the following month. Likewise, removal of 

participants for future months must be processed on the 28th of the month, or up until the 15th 

day of the following 

Therefore, employees who separate from the FEC on or before the 15th of the month should 

be promptly removed from the SmartBenefits account by the 15th of the month. This will 

prevent the separated employee from receiving any unclaimed benefit in the current month 

and also prevent FEC paid benefits for upcoming months from being loaded on the SmarTrip 

card. For participants who separate after the 15th of the month, the HRO should promptly 

suspend the FEC SmarTrip benefits at the time of separation; this action does not suspend the 

SmarTrip card but merely prevents a separated employee from loading unclaimed FEC 

benefits onto their SmarTrip card during the current month. In addition, employees 

separating after the 15th of the month should be removed by the HRO starting on the 28th of 

the month to prevent benefits for the following month. 

The current program policy does not address proper management of SmartBenefits. 

Procedures must be established and implemented so that transit benefits are not transferred to 

the SmarTrip cards of separated employees. HRO management should also ensure that all 

program staff receives proper training on the procedures for managing the FEC’s 

SmartBenefits account. 

To conclude, due to weak program controls, our testing found that former employees 

inappropriately collected a total of $4,073 in transit benefits; this total represents $2,101 of 

unused transit benefits retained by employees separating from the agency and $1,972 of 

transit subsidy claimed by SmarTrip users after leaving the FEC. 

18 
Recommendations 

16. HRO should ensure the SmarTrip cards registered to receive FEC paid transit subsidy 

of separated employees are promptly suspended or removed. Further, HRO should 

develop and implement written procedures to prevent benefits from being transferred 

to the SmarTrip cards of separated employees. 

17. Program management should consider letters of remittance to those former employees 

to request repayment of transit benefits collected after their last day of employment. 

18. HRO management should also ensure that all program staff receives proper training 

on the procedures for managing the FEC’s SmartBenefits account. 

Program Staff Did Not Always Follow the Provisions of FEC 

Directive 54 

While conducting interviews with program staff and performing other tests, the OIG found 

that program staff did not always follow the provisions of FEC Directive 54. Employees 

who commute in a private FEC carpool or who receive a Federal parking benefit may not 

participate in the transit benefit program. FEC Directive 54 requires that a current list of 

employees, who have been issued FEC subsidized parking permits, including passengers who 

commute with the parking permit holders, is maintained and then compared to the Transit 

Subsidy Eligibility List to ensure that ineligible employees are not on the transit subsidy list. 

We found that the Administrative Division did not include the names of FEC carpool 

passengers, as required by FEC Directive 54, on the monthly listing of parking permit 

holders. Further, despite the prior program violations in 2000 regarding three employees 

who regularly participated in an FEC carpool and received transit subsidy, the HRO could 

not provide any evidence to support that the required comparison of the monthly list of 

parking permit holders to the Transit Subsidy Eligibility List was completed. 

Considering this, we compared the lists of transit subsidy recipients for January 2003 through 

December 2005 against the monthly lists of FEC-paid permit holders and discovered that a 

former Commissioner and two HRO employees had been issued a parking permit and also 

received a transit subsidy for several months during the period reviewed. In fact, the two 

HRO employees worked in one of the program offices responsible for administering the 

Employee Transit Benefit Program. 

Apparently, exceptions were made to the FEC’s policy regarding FEC parking permits and 

the Employee Transit Benefit Program through verbal agreements with management to 

accommodate the two HRO employees working during the weekends. Management should 

have established controls to prevent the employees from utilizing the parking permit during 

the week, considering the pass was specifically for Saturdays, Sundays and holidays, and not 

during regular work days. In the case of the former Commissioner, who received a paid FEC 

parking permit and was also a transit subsidy participant, HRO could not provide any 

explanation or documentation to support why the former Commissioner was permitted to 

participate in both programs. Although we found that these three individuals were issued 

19 
parking passes and at the same time were recipients of the transit benefit, no evidence of 

abuse was found. 

The OIG believes that any authorized exceptions to FEC policy should be documented to 

avoid the appearance of inappropriate use of FEC funds by staff. 

The FEC parking garage contains both FEC paid and employee paid parking spaces. 

Generally, senior level staff receive an FEC paid parking space. The OIG believes the 

Administrative Division should maintain a list of all FEC parking permit holders (FEC paid 

and employee paid), and their passengers. 

Passengers Who Commute With Parking Permit Holders Not Included on 

Monthly Listing of Subsidized Parking Program Participants 

During the audit, we contacted current FEC paid parking permit holders to identify any 

passengers who commuted as riders in their carpool. One permit holder provided the names 

of three employees who rode with him to work on a regular basis from January 2003 through 

December 2005. However, the three employees were not identified as passengers on the 

monthly permit holder lists provided by the Administrative Office, as required by the transit 

benefit directive. Moreover, one of the employees identified by the permit holder may have 

been a passenger in the carpool while receiving transit subsidy. Employees who commute in 

a private carpool or who receive a Federal parking benefit may not participate in the transit 

benefit program. The participant’s alleged misuse of benefits issued under the FEC’s Transit 

Benefit Program has been referred for further review within the FEC OIG. 

Based on the prior program violations in 2000 related to FEC carpool members receiving the 

transit subsidy, and the alleged inappropriate use of the transit subsidy program by yet 

another passenger who commuted with a permit holder, it appears that control procedures 

need to be strengthened. HRO has not closely monitored the parking permit list against the 

transit subsidy list in the past. However, HRO plans to coordinate with the Administrative 

Office to ensure that employees participating in the paid parking program are not receiving a 

transit subsidy. The Administrative Office also plans to ensure that employees who request 

paid parking permits are aware that they cannot participate in both programs. 

The FEC’s policy attempted to establish an internal control with the monthly comparison of 

the list of FEC paid parking permit holders with the Transit Subsidy Eligibility List to 

prevent employees from participating in both benefit programs. However, (1) the 

Administrative Division neglected to determine if FEC parking permit holders operated an 

FEC carpool thereby providing a parking benefit to other FEC employees; (2) permit holders 

were not made aware of their responsibility to inform the Administrative Division when 

other employees ride in their car/vanpool; and (3) HRO did not compare the list of parking 

permit holders and their passengers (if known) to the Transit Subsidy Eligibility List to 

ensure that ineligible employees are not on the transit subsidy list. 

Each FEC paid parking permit holder should be required to sign a certification statement that 

clarifies the permit holders' understanding of the responsibilities as well as documents their 

20 
acknowledgement of program requirements. Permit holders should also be made aware that 

they are required to inform management as changes occur in their commuting arrangements 

(i.e. new riders start or stop commuting with the permit holder). The monthly list of permit 

holders and their passengers should be provided to HRO for reconciliation with the Transit 

Subsidy Eligibility List in a timely manner. 

Recommendations 

19. Program management should revise the current policy to ensure that employees are 

not receiving FEC paid transit subsidy while riding as passengers in non-FEC paid or 

private carpools. 

20. The Administrative Division should maintain a current list of employees who 

commute in an FEC private carpool or have been issued FEC subsidized parking 

permits, including passengers who commute with the parking permit holders in their 

car/vanpool. Permit holders, both FEC subsidized and unsubsidized, should also be 

made fully aware of their responsibility to report the names of any regular passengers 

and any changes to the Administrative Division. 

21. HRO should fully implement program policy that requires the comparison of parking 

permit holders and their passengers to the Transit Subsidy Eligibility List to ensure 

that ineligible employees are not on the transit subsidy list. 

21 
Other Matters to be Reported 

SmarTrip Card Numbers Not Properly Maintained 

In the OIG sample of 45 program participants, we found only one application that had not 

been approved by the Director of Personnel due to management oversight. However, we 

discovered that SmarTrip card serial numbers assigned on the 45 sampled participants’ 

approved applications did not always match the SmarTrip card serial number maintained in 

the database. In fact, during the audit, HRO discovered three SmarTrip cards of which the 

FEC has no record of who the card belongs to. The three SmarTrip cards had been allotted 

transit benefits which were electronically transferred to the cards monthly. 

To ensure that only eligible participants receive electronically transferred transit benefits, 

program staff must maintain accurate records to identify the names of SmarTrip card holders. 

The SmarTrip card numbers on the applications should reflect the card number that is 

currently assigned transit benefits on a monthly basis. If a new SmarTrip card is assigned to 

the employee, then the original application should be updated to reflect the new card number 

or the applicant should complete a new application to record the newly assigned SmarTrip 

number. During the audit, HRO agreed to consider changes for keeping a record of 

participants’ names and SmarTrip card numbers. 

Monthly Balance of Metrocheks On-Hand Should Be Reduced 

The FEC OIG assessed the monthly balance of Metrocheks on-hand for distribution to 

program participants. Metrochek usage by program participants declined as a result of the 

introduction of the SmarTrip card in October 2003. However, the Finance Office did not 

reassess the amount of Metrocheks maintained on-hand for monthly distribution after the 

introduction of the SmarTrip card. We found that from September 2003 through December 

2005, the Finance Office only distributed 63% to 68% of the monthly balance of Metrocheks 

on-hand. However, before the SmarTrip cards were made available as a form of transit 

subsidy, the Finance Office distributed 76% of the monthly balance of Metrocheks on-hand. 

Maintaining a higher monthly balance of Metrocheks on-hand increases the possibility of 

loss or misuse. The FEC OIG recommends that the Finance reassess the monthly amount of 

stock on-hand for distribution to deter the possibility of loss or misuse and to reduce the 

number of Metrocheks included in the monthly subsidy count remaining after distribution. 

At least annually, the Finance Office should evaluate Metrochek orders based on prior usage, 

stock on hand, and estimated usage of stock. 

Furthermore, program policy states that the Finance Office is responsible for maintaining 

information on the distribution of Metrocheks. Accordingly, any differences found during 

the monthly reconciliation of Metrocheks purchased and disbursed must be recorded and 

resolved by the Finance Office. Yet we identified minor shortages noted during the 2003 

monthly media subsidy counts of Metrocheks on hand after distribution, but management did 

not provide any documentation to explain what actions were taken to identify the cause of the 

22 
shortages. During the audit, the Finance Office agreed that actions to resolve such variances 

should be documented. 

FEC Should Encourage Increased Usage of the SmarTrip Card 

The FEC should encourage increased usage of the SmarTrip cards. Use of the SmarTrip card 

benefits the employee by saving time spent visiting the Finance Office to receive the benefit, 

provides the employee a way to recoup losses if the card is lost or stolen and gives the 

employee the ability to consolidate all transit benefit funding in one place, including adding 

money of their own, up to the cards’ maximum funds capacity. Further, unlike paper 

Metrocheks which are issued in $5, $10, or $20 increments, SmarTrip cards allow the FEC to 

electronically distribute the exact dollar amount of approved transit subsidy to employees. 

From our sample of 45 program participants, we identified nine Metrochek recipients who 

could receive their monthly subsidy electronically since they utilize transit carriers that 

accept SmarTrip cards as a form of payment. The OIG believes that encouraging the use of 

SmarTrip cards will provide valuable benefits to employees, decrease program costs 

associated with the manual distribution of Metrocheks and allow the FEC to avoid 

overpayment of the transit benefit. 

Recommendations 

22. HRO should maintain accurate program records; the original application should be 

updated to reflect changes in SmarTrip card numbers or the applicant should 

complete a new application to record the newly assigned SmarTrip number. 

23. The Finance Office should regularly reassess the monthly amount of Metrochek stock 

on-hand for distribution. The Finance Office should annually evaluate Metrochek 

orders based on prior usage, stock on hand, and estimated usage of stock. 

24. The Finance Office should continue to document any shortages and overages in the 

monthly subsidy count, but also include management actions to identify the cause of 

the differences in Metrocheks maintained on hand and what actions were taken, if 

any, to prevent future shortages and overages. 

25. Program management should encourage Metrochek recipients who utilize transit 

carriers that accept SmarTrip cards to switch their monthly subsidy to SmarTrip 

cards. 

23 
CONCLUSIONS 

Although the Employee Transit Benefit Program is compliant with Federal regulations, the 

program’s policy directive needs to be revised and internal controls strengthened. Without 

proper guidelines addressing management of SmartBenefits, the electronic transit subsidies 

become more susceptible to fraud or mismanagement. Furthermore, we found that 

employees did not always comply with program requirements. For example, employees 

within our sample who were on extended periods of absence from the FEC, inappropriately 

collected their full monthly benefit, inaccurately adjusted their subsidy amount or did not 

adjust their benefit in the following month in cases of unplanned absences. Therefore, our 

audit work substantiated the 2005 OIG hotline allegation and enabled the OIG to provide 

recommendations for improvement. In addition, program controls over the return of 

unused subsidy, removal of former employees from the program as well as the consistent 

maintenance of the FEC’s SmartBenefits account must be strengthened to deter future 

abuse of program funds. 

MANAGEMENT’S COMMENTS 

FEC management was provided a draft copy of the audit report for review and comment. 

Management generally agreed with the audit findings and recommendations and plans to 

implement corrective action to address the weaknesses noted during the audit. In accordance 

with Commission Directive 50, Audit Follow-Up, April 20, 2006, the Staff Director shall 

recommend an audit follow-up official for this audit. The audit follow-up official shall 

develop a written corrective plan within thirty days of receiving the audit report. The 

corrective action plan shall be provided to the Commission and include the specific steps 

and/or tasks to be taken and a projected time frame of completion. 

24 
------------------------------------------------------------------------------------------------ 

___________________________________________ 

___________________________________________ 

Appendix 1 

FEC Transit Subsidy Program Application 

Certification: I hereby certify that I am employed by the FEC and commute on a regular and 

recurring basis, using public transportation and do not commute by means of a private commuter 

vanpool or carpool, or hold an FEC motor vehicle parking permit or utilize a car or vanpool issued an 

FEC parking permit. I therefore certify that I am eligible for a fare subsidy for use on participating 

public transportation systems, am obtaining it for my personal use, and will not transfer it to anyone 

else. I further understand that failure to comply with program requirements can result in disciplinary 

action, up to and including removal. I have received a copy of Commission Directive No. 54, dated 

8/15/01. The making of a false, fictitious or fraudulent certification may render the maker subject to 

criminal prosecution under Title 18, USC, Section 1001, Civil Penalty Action, providing for 

administrative recoveries of up to $10,000 per violation. 

SmarTrip Card User Certification: I understand that by uploading the monthly transit subsidy amount 

to my SmarTrip card at a Metro “Passes/Farecard” machine, I am certifying that I will use the transit 

subsidy solely for my commute to and from the Federal Election Commission and that I do not 

commute by means of a private commuter vanpool or carpool, or hold an FEC motor vehicle parking 

permit or utilize a car or vanpool issued FEC parking permit. 

Signature Date 

1. Short Description of My Commute: 

∗∗ Example: (I ride the orange line from Vienna to Metro Center to and from work for

 a total cost of $7.50 round trip per day. ) 

2. Complete the calculation table on the reverse of this form. 

3. Employee Information: 

Employee Name: __________________________________________ 

Home Address: ___________________________________________ 

Division: _________________________________________ 

25 
Commuting Cost Calculations for Transit Subsidy 

(Use Appropriate Daily and/or Monthly Costs to Depict your costs per month. Do not 

include parking costs.) 

Mode of 

Transportation 

Daily Costs 

(round trip) 

X 20 working 

days (part time 

schedule may be 

less than 20 

work days) 

= Monthly Costs 

Metro subway $ Times 20 work days $ 

Metro Bus $ Times 20 work days $ 

Mode of Transportation = Monthly Costs 

Rail (VRE or MARC) $ 

Other Bus (Example: PW Commute ride $ 

Van Pool $ 

Total Monthly Cost: Add all 

applicable monthly costs listed above. 

$ 

∗∗NOTE: PARKING CANNOT BE INCLUDED IN YOUR TOTAL MONTHLY COST 

CALCULATION!!!! 

4. Personnel Office Use Only 

SmarTrip Card No.________________________ 

Eligible: YES NO ____________________ 

 Director of Personnel 

Total Cost: $_________________ 

Transit Subsidy Amount: $___________________ 

26 
Appendix 2 

FEC EMPLOYEE CLEARANCE FORM 

Name (Last, First, 

MI)

A. SUPERVISORY CLEARANCE DATE SIGNATURE 

1. Files/Manuals/Reference Materials 

2. Documents & Related Materials 

3. Keys (Desk, Files, Office) 

B. FINANCE OFFICE (Room 820) DATE SIGNATURE 

1. Travel Advances 

2. Moving Expense Allowances 

3. Travel Vouchers 

4. Metro Fare Media/SmarTrip Card 

C. ADMINISTRATIVE OFFICE (Room 819) DATE SIGNATURE 

1. Parking Permit 

2. Credentials 

3. Kastle Key 

4. Government Credit Card 

5. Cellular Phone/Pager 

6. Sprint Calling Card 

D. LIBRARY (Room 801) DATE SIGNATURE 

E. PROGRAM MANAGEMENT BRANCH 

 (Room 506) DATE SIGNATURE 

F. HR & LR OFFICE (Room 500) DATE SIGNATURE 

1. Materials Returned 

2. Computer Access ID 

1. Personal Computer Password/Access Code 

2. Laptop Computer 

1. Obligated Service (Training, Relocation Expenses) 

2. Overdrawn Leave 

3. FEC’s ID Card 

27
G. FORWARDING ADDRESS (This will be used to forward all payroll related information, 

e.g., W-2s, Last SF-50, Last Statement of Leave & Earnings.) 

In compliance with the Privacy Act of 1974, the following information is provided: solicitation of this 

information is authorized by the Federal Property Administrative Service Act of 1949, as amended 

(63 Stat 377) 1 Part III, Title 5, USC, and EO 11652. Purpose is to ensure that you have satisfied all 

obligations to the government prior to your transfer or separation from FEC. This information may 

be transferred to appropriate government agencies, when relevant to civil, criminal or regulatory 

investigations or prosecutions. Disclosure by you is mandatory. Failure to provide requested 

information will prevent the processing of your final check, lump-sum leave payment, and retirement 

refund or retirement application. 

Employee’s statement—I hereby make the following statements in connection with my separation 

from FEC. I am returning and have surrendered to the responsible FEC official, all government 

property, official documents and materials with which I was charged, for which I was accountable, or 

which I had in my possession. I (have) (do not have) an unsatisfied period of obligated service for 

either moving expenses allowances or non-government training received while employed by FEC. I 

am aware that willful disclosure of confidential or restricted information to any unauthorized person 

or persons may be punishable by a fine or imprisonment under 2 U.S.C. subsection 437g(a)(12)(b) or 

other Federal statute. Therefore, I certify that I shall not communicate or transmit such information 

orally or in writing to any unauthorized person or agency. I further agree that my leave status (shown 

below) is accurate. 

As of _______date ________annual _____sick ____(none) (Advanced Leave should be indicated 

by negative numerals). 

Title 18, United States Code, Section 1001, makes it a criminal offense, punishable by a maximum of 

five year imprisonment, $10,000 fine or both, knowingly and willfully to make a false statement or 

representation to any department or agency of the United States, as to any matter within the 

jurisdiction of any department or agency of the United States. 

Employee signature: 

Date: 

All items listed on the reverse are necessary for the clearance of this employee. Clearance is 

approved for all items checked in section in section A through E, provided all appropriate authorized 

officials cleared each item. 

Human Rescources Director: 

Date: 

Original-----Finance 

Copy---------HR 

Copy---------Employee 

Copy---------FEC Administrative Office 

28 
Appendix 3 

Summary of Audit Findings and Recommendations 

Recommendation No. Finding Recommendation 

1 Program Policy Needs Improvement Program management should revise FEC Directive 54 to 

include adequate guidelines on the management of the Smart 

Benefits program. Provisions should include the delegation of 

responsibilities and duties required to ensure the accurate 

electronic transmission of monthly transit subsidies to eligible 

employees. 

2 Program Policy Needs Improvement Program management should develop internal operating 

procedures for program offices involved in the management of 

the program to ensure the process is functioning in an efficient 

manner and is not subject to errors and manipulation. 

3 Employees Did Not Comply With 

Program Policy 

Program management should ensure that program participants 

who are absent for an extended period, especially those who 

frequently go on official business travel for the FEC, are made 

aware of their responsibility to adjust their transit subsidy 

benefits when absent from their normal duty station for 50% or 

more business days in a calendar month. 

4 Employees Did Not Comply With 

Program Policy 

HRO should develop clear program policies and procedures to 

provide participants with specific instructions on how 

adjustments should be made for those who receive their transit 

subsidy electronically via the SmarTrip card. 

5 Employees Did Not Comply With 

Program Policy 

Program management should require supervisory 

review/signature of the employees’ transit benefit program 

applications. 

6 Employees Did Not Comply With 

Program Policy 

Program management should ensure that the program offices’ 

staff are properly trained on the guidelines and procedures 

regarding transit subsidy adjustments required when 

participants are on extended absence from the office. 

7 Employees Did Not Comply With 

Program Policy 

Program management should develop and implement 

procedures that include transit benefit restrictions for employees 

on administrative leave. 

8 Employees Did Not Comply With 

Program Policy 

HRO should implement an administrative leave clearance 

process, similar to the process completed for separated 

employees. The clearance form or other process should include 

a notification to transit participants that their participation in the 

program has been suspended, pending resolution of the matter 

that necessitated administrative leave. 

9 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office should ensure the employee separation 

clearance process includes the computation and collection of 

unused transit subsidy from departing employees. Clearance 

forms should be revised to accommodate the unused transit 

subsidy calculation. 

10 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office’s monthly notification distribution e-mail 

should include a reminder that participants are required to return 

any unused transit subsidy during the employee clearance 

process. 

11 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office should develop internal procedures that 

describe how to calculate and record the amount of unused 

transit subsidy a departing employee must return during the 

employee separation process. 

12 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office should ensure proper training of staff 

responsible for the office’s employee separation clearance 

process. 

29
Summary of Audit Findings and Recommendations 

Recommendation No. Finding Recommendation 

13 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office should develop and maintain a record or log 

that captures the receipt of unused transit subsidy returned 

during the employee separation process by departing 

employees. The log should include the departing employee’s 

name, date of departure, computation of unused transit subsidy, 

actual amount received from departing employee and signature 

of Finance staff who received the subsidy. The log should also 

include disbursement of Metrocheks to employees for local 

travel, thereby providing an audit trail of transit subsidy 

returned and disbursed. 

14 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office should ensure that all FEC employees are 

made aware of unused transit subsidy available for official local 

travel. 

15 Participants Separating From the Agency 

Did Not Return Unused Transit Subsidy 

The Finance Office should contact WMATA to research 

exchange opportunities available for disposition of unused 

Metrochek cards to ensure efficient use of returned transit 

subsidy. 

16 Former Participants Listed as Eligible 

Recipients 

HRO should ensure the SmarTrip cards registered to receive 

FEC paid transit subsidy of separated employees are promptly 

suspended or removed. Further, HRO should develop and 

implement written procedures to prevent benefits from being 

transferred to the SmarTrip cards of separated employees. 

17 Former Participants Listed as Eligible 

Recipients 

Program management should consider letters of remittance to 

those former employees to request repayment of transit benefits 

collected after their last day of employment. 

18 Former Participants Listed as Eligible 

Recipients 

HRO management should also ensure that all program staff 

receives proper training on the procedures for managing the 

FEC’s SmartBenefits account. 

19 Program Staff Did Not Always Follow 

the Provisions of FEC 

Directive 54 

Program management should revise the current policy to ensure 

that employees are not receiving FEC paid transit subsidy while 

riding as passengers in non-FEC paid or private carpools. 

20 Passengers Who Commute With Parking 

Permit Holders Not Included on Monthly 

Listing of Subsidized Parking Program 

Participants 

The Administrative Division should maintain a current list of 

employees who commute in an FEC private carpool or have 

been issued FEC subsidized parking permits, including 

passengers who commute with the parking permit holders in 

their car/vanpool. Permit holders, both FEC subsidized and 

unsubsidized should also be made fully aware of their 

responsibility to report the names of any regular passengers and 

any changes to the Administrative Division. 

21 Passengers Who Commute With Parking 

Permit Holders Not Included on Monthly 

Listing of Subsidized Parking Program 

Participants 

HRO should fully implement program policy that requires the 

comparison of parking permit holders and their passengers to 

the Transit Subsidy Eligibility List to ensure that ineligible 

employees are not on the transit subsidy list. 

22 SmarTrip Card Numbers Not Properly 

Maintained 

HRO should maintain accurate program records; the original 

application should be updated to reflect changes in SmarTrip 

card numbers or the applicant should complete a new 

application to record the newly assigned SmarTrip number. 

23 Monthly Balance of Metrocheks OnHand Should Be Reduced 

The Finance Office should regularly reassess the monthly 

amount of Metrochek stock on-hand for distribution. 

24 Monthly Balance of Metrocheks OnHand Should Be Reduced 

The Finance Office should continue to document any shortages 

and overages in the monthly subsidy count, but also include 

management actions to identify the cause of the differences in 

Metrocheks maintained on hand and what actions were taken, if 

any, to prevent future shortages and overages. 

25 FEC Should Encourage Increased Usage 

of the SmarTrip Card 

Program management should encourage Metrochek recipients 

who utilize transit carriers that accept SmarTrip cards to switch 

their monthly subsidy to SmarTrip cards. 

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