FEDERAL ELECTION COMMISSION 

OFFICE OF INSPECTOR GENERAL 

FINAL REPORT 

AUDIT FOLLOW-UP REVIEW OF THE COMMISSION’S 

EMPLOYEE TRANSIT BENEFIT PROGRAM 

July 2009 

AUDIT ASSIGNMENT OIG-08-03 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

OFFICE OF INSPECTOR GENERAL 

TABLE OF CONTENTS 

DESCRIPTION	 PAGE 

Results in Brief 1 
 

Executive Summary 3 
 

Background 6 

Objectives, Scope and Methodology 11 

Audit Findings and Recommendations 

1.	 Transit Benefit Program Lacks Sufficient Oversight and Accountability 13 

2.	 Program Management has not Complied with Directive 50 14
 

3.	 FEC’s Transit Benefit Program Control Status Reported to OMB was not 

Fully or Accurately Assessed 16 

4.	 Program Policy and Procedures Need Improvement 19
 

5.	 Separated Employees were not Removed Timely 25 

6.	 Participants Separating from the Agency did not Return Unused Subsidy 27
 

7.	 Employees Have Access to Duplicate Benefits 29 

8.	 Employees did not Comply with Program Policy and Claimed Benefits While on 

 Extended Travel 

Extended Leave 

 Admin Leave 33 
 

9.	 Employee Claim Patterns Indicate They Do Not Meet Program Eligibility
 

Requirements 37 

10. Application, Change Request and Annual Certification Process is not 

Formally or Effectively Monitored 39 

11. Program Weaknesses Relating to Parking have not been Addressed
 42 

12. Employee Names in WMATA Systems are not Consistent with Other FEC Systems 46 

i 
 

 

 

13. Employees Have Been Assigned SmarTrip Cards that Remain Unregistered 47 

14. Single WMATA System Log-on Used for Multiple OHR Staff 48 

15. Monthly Balance of Metrocheks/Vouchers on Hand should be Reviewed
 50 

16. Metrochek Stock Level Variances were not Fully Documented 50 

Other Matters of Interest 

Employee Claim Patterns Indicate They May not Meet Program 

Eligibility Requirements 51 

Conclusions 55 
 

Attachment 1: Summary of Audit Follow-up Findings and Recommendations 56 

Attachment 2: OMB Memorandum 07-15 70 

Attachment 3: FEC Response to OMB Memorandum 07-15 75 

Attachment 4: FEC Transit Subsidy Program Application 76 

Attachment 5: FEC Employee Clearance Form 78 

Attachment 6: Prior Audit Corrective Action Plan with Current OIG Status 80 

ii 
RESULTS IN BRIEF 

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

audit follow-up review of the OIG’s 2007 audit of the FEC’s Employee Transit Benefit 

Program. The purpose of the audit follow-up review was to verify whether management 

had adequately implemented the OIG’s recommendations, as agreed, prior to closing the 

outstanding recommendations. After issuing the OIG’s final audit report on February 13, 

2007, a corrective action plan (CAP) was provided by management to the OIG on April 

4, 2007. Three recommendations were verified as implemented in May 2007 and closed 

by the OIG. The remaining twenty-two were planned to be implemented by September 

30, 2007. Subsequent to the CAP, management re-evaluated the expected 

implementation dates of the outstanding recommendations: eleven were extended to 

March 31, 2008; seven were extended to April 30, 2008; and one was left unchanged. 

The remaining three were described by management as fully implemented by March 31, 

2008. The results of this audit follow-up review show that only one of the 22 

recommendations was implemented as of July 31, 2008. 

The follow-up review results indicate program management does not have adequate 

program controls or quality assurance processes as shown by the number and nature of 

exceptions noted during detailed testing of the audit follow-up review. Therefore, the 

OIG has made several recommendations for improvement to the management of the 

program. In addition to the new listing of recommendations for the current exceptions 

noted, we have included the previous corrective action plan provided by management as 

Attachment 6 to this report. The corrective action plan shows that the OIG considers 21 

of the 25 recommendations contained in the 2007 audit report still open as a result of this 

audit follow-up review. 

A listing of the findings identified in this audit follow-up review is included below: 

NUMBER FINDING FINDING 

CLASSIFICATION 

1 Transit Benefit program lacks sufficient oversight and accountability New 

2 Program management has not complied with Directive 50 New 

3 FEC’s Transit Benefit program control status reported to OMB was not 

fully or accurately assessed New 

4 Program policy and procedures need improvement Repeat 

Program’s Internal Controls Need to Be Strengthened 

5 Separated employees were not removed timely Repeat 

6 Participants separating from the agency did not return unused transit 

subsidy Repeat 

7 Employees have access to duplicate benefits Modified repeat 

1 
NUMBER FINDING FINDING 

CLASSIFICATION 

8 

Employees did not comply with program policy and claimed benefits 

while on: 

 extended travel 

 extended leave 

 administrative leave 

Repeat 

9 Employee claim patterns indicate they do not meet program eligibility 

requirements New 

10 Application, change requests and annual certification process is not 

formally or effectively monitored New 

11 Program weaknesses relating to parking have not been addressed Modified repeat 

Program Administration Practices Weaken Potential Control Environment 

12 Employee names in the WMATA system are not consistent with other 

FEC systems Modified repeat 

13 Employees have been assigned SmartBenefits cards that remain 

unregistered in the WMATA system Modified repeat 

14 Single WMATA system log-on used for multiple OHR staff New 

Metrochek/Voucher Administration and Controls 

15 Monthly balance of Metrocheks/Vouchers on hand should be reviewed Modified repeat 

16 Metrochek stock level variances were not fully documented Repeat 

Other Matters Of Interest 

Employee claim patterns indicate they may not meet program eligibility 

requirements New 

As a result of this audit follow-up review, the OIG has concluded that management has 

failed to adequately respond to the OIG’s 2007 audit recommendations to improve the 

program. Further, as a result of the continued control weaknesses, the program was not 

effectively monitored thereby providing opportunity for fraud, waste and abuse of 

program funds. A table listing the 51 recommendations related to the 16 findings, as well 

as 5 suggestions relating to the other matter of interest listed above, is included as 

Attachment 1 of this report on page 56. The table also includes management responses to 

the OIG recommendations and OIG comment on management’s responses. 

Management’s response to the recommendations and OIG comment on those responses 

has also been included in the body of the report. 

2 
 

EXECUTIVE SUMMARY 

The Federal Election Commission (FEC) Office of Inspector General (OIG) issued a final 

audit report on the FEC’s Employee Transit Benefit Program on February 13, 2007. The 

OIG initiated the 2006 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. At that time, 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. In the final 2007 

report, the OIG made 25 recommendations to improve program operations and prevent fraud, 

waste and abuse by program participants. The report can be accessed at 

www.fec.gov/fecig/transit07.pdf. 

On April 24, 2007, the United States Government Accountability Office (GAO) issued a 

report, Ineffective Controls Result in Fraud and Abuse by Federal Workers, detailing its 

testimony before the Permanent Subcommittee on Investigations, Committee on Homeland 

Security and Government Affairs, U.S. Senate regarding the Federal Transit Benefit 

Program. GAO performed the study because the national capital region had approximately 

120,000 participants receiving roughly $140 million in benefits in 2006 and a number of 

inspectors general (IG) had found instances of fraud, waste and abuse. In its report, GAO 

stated ineffective program controls in the transit program resulted in fraud and abuse by 

federal workers. The investigation revealed federal employees: 

 fraudulently requested benefits and then sold them on eBay and Craigslist; 

 fraudulently requested benefits and gave them to family and friends; 

 collected transit benefits while receiving agency-provided parking; 

 inflated transportation expenses on their applications above actual commuting 

costs; 

 failed to return excess benefits on separation; and 

 continued to collect benefits after leaving the agencies. 

In conducting its investigation, GAO reviewed program controls at nine federal agencies1 

and, based on those results, determined at least $17 million in fraudulent claims occurred in 

the national capital region during 2006. Further, it was likely more than that amount was lost 

if a similar magnitude of fraud existed in the agencies GAO did not review. GAO stated that 

some of the fraud identified in its review could not be quantified and therefore could not be 

extrapolated to the program as a whole. The GAO report can be viewed at 

www.gao.gov/new.items/d07724t.pdf. 

As a result of the GAO investigation, the Office of Management and Budget (OMB) issued a 

Memorandum for the Heads of Departments and Agencies, Federal Transit Benefits 

Program, (OMB M-07-15) on May 14, 2007 requesting confirmation by June 30, 2007 that 

1

 The FEC was not among the nine agencies reviewed by GAO during its investigation. 

3 
 

each department and agency had implemented a minimum level of internal controls with 

respect to transit benefit programs. OMB included a listing of suggested internal controls as 

an attachment to the memorandum. The attachment of suggested internal controls included 

an agency notice to employees reminding them of proper and improper use of transit 

benefits, a transit application form and a monthly calculation worksheet. Refer 

http://www.whitehouse.gov/omb/memoranda/fy2007/m07-15.pdf at Attachment 2 of this 

report. On June 28, 2007, the FEC responded to OMB’s request for confirmation that a 

minimum of internal controls existed at the agency. The response is included as Attachment 

3 of this report. The OIG does not believe the response submitted to OMB accurately 

reflected the control environment in effect for the FEC at that time or currently. 

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

follow-up review of the FEC’s Employee Transit Benefit Program to verify whether 

management had adequately implemented the OIG’s recommendations, as agreed, prior to 

closing the outstanding recommendations. After issuing the final report on February 13, 

2007, a corrective action plan (CAP) was provided by management to the OIG on April 4, 

2007. Three recommendations were verified as implemented in May 2007 and closed by the 

OIG. The remaining twenty-two were planned to be implemented by September 30, 2007. 

Subsequent to the CAP, management re-evaluated the expected implementation dates of the 

outstanding recommendations: eleven were extended to March 31, 2008; seven were 

extended to April 30, 2008; and one was left unchanged. The remaining three were 

described by management as fully implemented by March 31, 2008. The results of this audit 

follow-up show that only one of the 22 recommendations was implemented as of July 31, 

2008. 

The OIG conducted the audit follow-up review with the objectives of assessing the adequacy 

of program policies and operating procedures, verifying employee compliance with program 

participation requirements, and ensuring that appropriate internal controls are in place. The 

audit follow-up review fieldwork was conducted between June 2008 and November 2008. 

The audit scope included a review of program activity from April 2007 through July 2008 

with limited testing on employees separated in fiscal year (FY) 20072

 and full testing on 

employees separated in FY 2008. 

As during the prior audit, the audit follow-up review revealed the Office of Human 

Resources (OHR) failed to properly suspend and remove program participants upon 

separation from the agency or change in commute pattern. As a result, former employees no 

longer eligible for the benefit had access to $13,556 in FEC transit funds, of which $1,181 

was inappropriately claimed. This value includes $200 claimed by an employee while on 

administrative leave who was ineligible to participate in the program. The OIG also 

identified several employees who separated from the agency, but failed to return $624 of 

unused transit benefits. Since the last audit report was issued, we noted the Finance Office, 

with assistance from OHR, has recovered $767 of the $1,416 in transit benefits owed by 

departing staff. It is noted, however, that documented procedures to ensure the process of 

2

 Testing for date of last transit subsidy receipt was not performed for some staff where records were not readily 

available due to elapsed time. This includes staff that received Metrocheks and separated prior to January 1, 

2007. 

4 
 

identifying, documenting, communicating and recovering funds is not yet in place or working 

efficiently. Weaknesses previously identified in FEC Directive 54, Employee Transit Benefit 

Program, August 2001, have not been addressed and a newly revised draft policy and 

procedures document provided by program management in January and July 2008 to the OIG 

for review does not address all program weaknesses identified in the prior audit, or this 

follow-up review. 

The FEC has had program administration responsibility over transit benefits for 16 years. It 

has received guidance and instruction from OMB, detailed illustration of control weaknesses 

in the GAO report, and detailed recommendations contained in the previous OIG audit 

report. We find, however, that program management has not implemented adequate controls 

and quality assurance processes to ensure the program is managed effectively. This is likely 

due to the current model where responsibility for program management is shared among 

three divisions with no single individual assigned over-all responsibility for program 

management and to ensure recommendations are fully implemented. The problem is further 

exacerbated by the fact that FEC Directive 50, Audit Follow-Up, is not applied fully at the 

Commission. For example, the Audit Follow-up Official did not produce semi-annual 

reports to the agency head describing the outstanding steps or tasks required to implement 

recommendations and a timetable for resolution. If the Commission were made more aware 

of the quantum of corrective actions required and the lack of progress in implementation, 

program management may have devoted the resources required to address the program 

weaknesses. 

The follow-up review results indicate program management does not have adequate program 

controls or quality assurance processes as shown by the number and nature of exceptions 

noted during detailed testing. Therefore, we have made several recommendations for 

improvement to the management of the program. In addition to the new listing of 

recommendations for the current exceptions noted, we have included the previous corrective 

action plan provided by management as an attachment to this report. The corrective action 

plan shows that the OIG considers 21 of the 25 recommendations contained in the 2007 audit 

report still open as a result of this audit follow-up. Refer to the corrective action plan issued 

by OHR on July 10, 2008 included as Attachment 6 of this report. 

5 
 

 

 

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. 

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. In 2008, the Federal tax-excludable amount for transit subsidy increased to $115 per 

month for transit/vanpool benefits. As of January 1, 2009, the maximum tax-excludable 

amount increased to $120 per month3. 

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 (Attachment 4) 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 Aug 2, 2008, 342 out of a total of 367 temporary and permanent employees 

were enrolled and approved to receive a total of $33,333 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. 

Effective November 15, 2008, paper Metrocheks will no longer be available for employers 

that participate in the Transit Benefit Program. SmartBenefit Vouchers will replace the 

Metrocheks and will be accepted beginning December 1, 2008 to purchase fares on transit 

providers that do not accept the SmarTrip card, such as Virginia Railway Express (VRE), 

Maryland Area Regional Commuter (MARC) Train and buses operated by Keller, Dillon, 

and Eyre Bus companies. SmartBenefit Vouchers will be available in $1.00, $10.00, and 

$30.00 denominations. Unlike Metrocheks, transit benefits received via voucher cannot be 

transferred to SmarTrip cards. Metrocheks that had previously been distributed to employees 

3 As part of the American Recovery and Reinvestment Act of 2009 (ARRA) signed into law by 

President Obama on February 17, 2009, available benefits under § 132(f) of the Internal 

Revenue Code in relation to transit benefits will be increased to $230 dollars per month. 

6 
were accepted until the close of business on March 6, 2009. After that time, only the new 

vouchers may be used, however, employees could exchange Metrocheks at Metro sales 

offices through March 31, 2009. 

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 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 then applied to a future 

purchase. 

Employees who commute to work on any form of transportation that does not accept 

SmarTrip, had the option of receiving their approved monthly transit benefit by Metrochek 

paper fare, but are now required to receive their fare in the form of vouchers. Participants 

must go to the Finance Office each month to sign for and obtain their monthly benefit. 

Annually, participants are provided a schedule of Metrochek/Voucher 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/vouchers 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. 

Due to the elimination of Metrochek paper fare, OHR required all FEC employees who are 

able to use SmarTrip for their commute to transition from Metrocheks by August 31, 2008 or 

have their benefit suspended. This is a necessary process as WMATA began limiting the 

amount of Metrocheks agencies were able to purchase each month in an effort to force 

federal agency transition to SmarTrip and the new voucher program before the deadline. 

After January 1, 2009, employees using transit systems that do not accept the SmarTrip card 

were issued vouchers that can be used to purchase fare media accepted by those transit 

providers (i.e. tokens, weekly or monthly fare cards). 

7 
Employee Transit Benefit Program Costs 

Transit subsidy disbursements averaged $28,228 per month in fiscal year 2006, 2007 and 

2008. These disbursements resulted in annual costs of $328,555, $320,393, and $339,123 to 

the FEC for fiscal years 2006, 2007, and 2008 respectively. Projected spending for fiscal 

year 2009 is more than $370,000. 

Annual Expenditures for Transit Subsidy 

340,000 

330,000

Dollars
 

320,000 

310,000 

2006 2007 2008 

Program Administration at the FEC 

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

Administrative Division, the Office of Human Resources (OHR), and the Finance Office. 

The Administrative Division is responsible for the procurement of all Metrocheks/vouchers 

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

Administrative Division must also maintain and provide to OHR 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. 

OHR 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, OHR prepares the Transit 

Subsidy Eligibility List used to distribute paper Metrocheks to eligible recipients. OHR 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. OHR is responsible for 

calculating the transit subsidy owed by separating employees, if any, and communicating the 

information to Finance. OHR also manages the annual certification process whereby 

employees certify their eligibility to participate in the program, document their commute 

pattern, frequency and total monthly cost. 

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

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

web-based program, OHR 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 

8 
 

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 cannot be made. However, the SmartBenefits program allows OHR to suspend usage 

of unclaimed FEC transit benefits at any time, including during the last month of 

employment. For employees who depart after the 15th of the month, OHR 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. This feature allows the 

employer to limit a former employee’s access to benefits due to system limitations for 

processing employee removal. 

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

Metrocheks/vouchers, certifying payment of WMATA invoices, as well as the safeguarding 

and distribution of Metrocheks/vouchers. Additionally, the Finance Office maintains 

monthly distribution records and is required to collect personal check, money order or 

process a payroll deduction for unused transit benefit during the employee separation 

clearance process. 

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. 

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. Based on 

the complaint, the OIG planned and conducted an audit in 2006 on the FEC Transit Benefit 

Program. 

9 
As part of the OIG’s audit planning for the 2006 audit, 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. 

Prior to the OIG’s 2006 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. The current follow-up review of the 

2006 audit also shows controls have not been implemented to prevent those who receive a 

permanent or temporary parking benefit, or pay for parking at 999 E Street, do not also 

receive transit benefits. 

As a result of the 2006 audit, the OIG made 25 recommendations to improve management of 

the transit benefit program. Since the report was issued in February 2007, the OIG has 

received several hotline complaints regarding potential transit benefit program violations. 

The complaints were referred to the OIG Chief Investigator and are under review. 

10 
OBJECTIVES, SCOPE AND METHODOLOGY 

The objectives of this audit follow-up review 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 follow-up fieldwork was conducted between June and 

November 2008. The audit follow-up review scope included a review of program activity 

from April 2007 through July 2008. 

To accomplish the audit follow-up review objectives, we performed the following 

procedures: 

•	 Reviewed Directive 54 and the draft (January and July 2008) Transit Subsidy Policy 

(intended to replace Directive 54), HR Transit Subsidy Procedures for New 

Employees, Transit Subsidy FAQ, FEC Employee Exit Clearance Form, and other 

documents submitted by management to the OIG for comment. Refer Finding 4 on 

page 19. 

•	 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 2006 and report issued in 

February 2007. 

•	 Reviewed the FEC response to OMB Memorandum 07-15 to determine whether the 

response correctly reflected the control weaknesses noted in the February 2007 OIG 

audit report. Refer finding 3 on page 16. 

•	 Reviewed employee separations since the February 2007 OIG audit report to 

determine whether their access to FEC provided transit subsidy was removed in a 

timely manner and whether the FEC correctly sought recovery of unused subsidy 

collected in the month separated. Refer findings 5 and 6 on pages 25 and 27. 

•	 Reviewed FEC transit applications of employees hired in fiscal year 2008 to 

determine whether their application for subsidy was processed in a timely manner, 

verified for accuracy and reasonableness, and formally approved by OHR 

management. Refer finding 10 on page 39. 

•	 Reviewed transit applications of employees hired in fiscal year 2008 to determine 

whether they were provided transit subsidy in accordance with FEC Directive 54. 

Refer findings 4 and 7 on pages 19 and 29. 

•	 Reviewed the annual certification process to determine whether sufficient review of 

employee certification occurs, whether the certifications are formally approved by 

OHR management and whether employees who fail to certify are removed from the 

program. Refer finding 9 on page 37. 

11 
•	 Reviewed FEC employees’ electronic leave records to identify employees who have 

taken greater than 80 hours of leave during a calendar month to determine whether 

the employees appropriately reduced their transit benefit in accordance with Directive 

54. Refer finding 8 on page 33. 

•	 Reviewed employee travel records for staff that may have traveled 50% or more 

business days in a month to determine whether the employees correctly reduced their 

transit benefit in accordance with Directive 54. Refer finding 8 on page 33. 

•	 Reviewed electronic SmartBenefit activity and manual Metrochek distribution reports 

from April 2007 through July 2008 to determine whether: 

o	 Employees have irregular claims that may indicate they do not meet program 

eligibility. For example, participants who failed to claim SmarTrip benefits 

for two consecutive months. Those with irregular claims had their transit 

activity compared to their leave activity for reasonableness; 

o	 Employees claimed full benefits after mid-month or had a pattern of 

consistently claiming benefits late in the month, indicating they may not be 

compliant with program Directive. 

o	 Registered program recipients who no longer claimed benefits were actually 

former employees not removed from the program or current employees who 

ceased to participate, but had not been removed; 

o	 Employees were incorrectly listed as eligible recipients under both the 

SmartBenefits and Metrochek programs; 

o	 Employees had more than one SmartBenefit card actively registered; 

o	 Employees who have/had been granted a temporary (handicap) parking pass, 

pay to park in the FEC parking garage, or are issued a permanent (FEC 

provided) parking benefit are not eligible for the transit subsidy. 

Refer findings 5, 7, 9, 11, and Other Matters of Interest on pages 25, 29, 37, 42, and 

51, respectively. 

•	 Reviewed monthly Finance Office Metrochek distribution reconciliation forms for 

January 2007 through July 2008 to assess whether Finance has reduced the balance of 

Metrocheks on hand, as recommended in the prior audit report. Refer finding 15 on 

page 50. 

•	 Created a reconciliation schedule of the monthly Finance Office Metrochek 

distribution listings for the period January 2007 through August 2008 to determine 

whether variances existed. Where variances were noted, reviewed supporting 

documentation to determine whether Finance documented the reasons for any 

overages or shortages in Metrocheks on-hand after the monthly distribution. Refer 

finding 16 on page 50.` 

•	 Performed a stock count after the November 2008 distribution to ensure the reported 

amounts in the monthly reconciliation were accurate. There was no discrepancy. 

12 
AUDIT FINDINGS AND RECOMMENDATIONS 

1. Transit Benefit Program Lacks Sufficient Oversight and Accountability 

Because the FEC is a relatively small agency, the responsibilities for managing programs are 

often shared between two or more divisions. With respect to internal audits, an Audit 

Follow-up Official (AFO) is assigned responsibility for monitoring and reporting on the 

status of outstanding audit recommendations, as described in FEC Directive 50, Audit 

Follow-Up. The AFO, however, does not have authority to direct implementation or timing 

of corrective actions by other divisions; the person merely reports the status of 

recommendations. 

In the case of the Transit Benefit Program, responsibility for program administration is 

shared between three separate divisions, Office of Human Resources (OHR), Finance, and 

the Administrative Division. Under this model, no one individual is responsible for ensuring 

that the three separate divisions design, document and implement an adequate control 

framework to ensure the transit benefit program is not susceptible to fraud, waste and abuse. 

Instead, each division is responsible for performing one or more key functions and does not 

report on whether it has established performance standards or monitoring controls over its 

area of responsibility. For instance, OHR should define the data processing standards and 

controls for OHR staff that process transit benefit applications, changes, or removals, and 

then monitor whether the standards for timeliness and accuracy are met. To date, OHR has 

not fully defined the standards and has not monitored staff performance. The Administrative 

Division had established standards for providing some parking data to OHR, but has not 

monitored whether the standard fully met program user needs or was met. Because no single 

person is assigned overall responsibility for program management, neither division is 

required to report on whether it has established adequate performance standards and whether 

it has monitored performance and met the standard. As such, the respective divisions are not 

able to monitor program performance as a whole, and information to assess program 

performance can only be obtained through detailed audits such as the prior audit and this 

audit follow-up review. 

The lack of overarching accountability has contributed to a general failure to address the 

control weaknesses identified in the prior audit report and is further illustrated in the nature 

and number of additional findings included in this follow-up report. It is apparent that 

managers from each of the three program divisions, each working independently on 

implementing the prior audit recommendations, have not yielded the desired result, which is 

an efficient program that serves the needs of FEC employees and is not susceptible to fraud, 

waste or abuse. 

Recommendation 

1a. The Commission should designate a single individual with the responsibility, 

authority, and accountability to oversee the program in its entirety, and to address the 

transit benefit program weaknesses identified in this follow-up report and the prior 

transit benefit audit report. 

13 
 

Management Response 

1a. Program responsibility, authority and accountability shall reside with an Office of 

Human Resource (OHR) Specialist with oversight from the Office of the Staff 

Director. The OSD prefers not to name specific individuals in this response but 

offices instead. The OSD will develop and maintain on the FECNet OSD Web page a 

list of staff, by name, responsible for critical actions and specific duties in offices 

under the purview of the OSD. This action will be captured and addressed in the 

Corrective Action Plan (CAP). 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendation. 

2. Program Management has not Complied with Directive 50 

FEC Directive 50, Audit Follow-Up, April 2006, was created in response to OMB Circular 

A-50, Audit Follow-Up, and details the roles and responsibilities of the FEC OIG and 

program management with respect to audit follow-up actions required to address audit 

findings. FEC Directive 50 mainly focuses on responsibilities for the OIG’s annual financial 

statement audits, but also includes the following guidance for “Other Audits,” such as the 

internal audit of the FEC’s Transit Benefit Subsidy program. 

“Other audits
 

For any other audits conducted by the Inspector General or other agencies (e.g., 

GAO) the Staff Director will recommend and the Commission shall approve, the 

follow-up official. This person shall: 

1.	 Develop a written corrective action plan, including specific steps and/or tasks to 

be taken to implement the corrective action plan and a time frame for completion 

of each step or task, to be presented to the Commission within thirty days of 

receiving an audit report; 

2.	 The written corrective action plan shall be presented to the Commission through 

the Staff Director, including any comments the Staff Director may add, for 

information, tally vote or for discussion at a Commission meeting; 

3.	 Conduct regular meetings with the Inspector General or other audit officials 

throughout the year to follow-up on outstanding findings and recommendations, 

and include reports on those meetings in the written corrective action plan and 

the semi-annual reports required to be presented to the Commission; 

4.	 Respond in a timely manner to all requests; 

5.	 Engage in good faith effort to resolve all disagreements; and 

6.	 Produce semi-annual reports to the agency head. These reports shall include the 

status of all unresolved audit reports, the outstanding steps or tasks required to be 

completed in order to resolve the recommendation raised in the audit reports, and 

a timetable for resolution of those steps or tasks; and the number of reports or 

recommendation resolved during the period.” 

14 
FEC management has not complied with FEC Directive 50. The final audit report of the 

2006 Transit Benefit Audit was issued on February 13, 2007. A corrective action plan was 

provided to the OIG on March 16, 2007 and the OIG provided comments on the plan to 

management on April 4, 2007. Management submitted the final corrective action plan to the 

Commission on May 1, 2007. While the CAP was eventually presented to the Commission 

for information or tally vote, the CAP was not provided within 30 days of receipt of final 

audit report in accordance with requirements one and two of Directive 50. 

Neither the AFO nor program management met with the OIG throughout the year to discuss 

the status of agreed actions in accordance with requirement three above. No semiannual 

reports on audit recommendation status were prepared and provided to the agency head in 

accordance with requirement six of Directive 50. In addition, during the follow-up audit 

testing period, responses to information requested by the OIG were not always received in a 

timely manner. In some instance, requests for information were not acknowledged by OHR 

staff and multiple requests were required, in some instances, in order for the OIG to receive 

documentation from OHR. 

Further, the OIG noted that the CAPs provided by program officials to the OIG were not 

consistent, and in some cases incorrect. In the most recent CAP provided by management in 

July 2008, a recommendation the OIG had reported as closed in mid-2007 was listed as 

“open,” had a revised implementation date, and new agreed management action. Because of 

the length of time needed to fully implement recommendations and the number of individuals 

responsible for implementation activities, several versions of the CAP were used. As such, 

there is the potential for error in reporting the status to the OIG. The incorrect and 

inconsistent reporting of the status of outstanding recommendations is further evidence of the 

failure of FEC management to properly implement OMB and FEC requirements for audit 

follow-up. 

The OIG has worked with the FEC’s Information Technology Division to develop an Audit 

Recommendation Tracking Database. This tool can be used to record all OIG 

recommendations for audits and inspections and report on the current status to interested 

parties. The database is designed to be a single point of input for both the OIG and program 

areas and record the following information: 

 FEC OIG Audit/Inspection number, report title and date final report is issued; 

 OIG recommendations (numbered audit recommendations as presented in the final 

report); 

 Agreed management action that will be required to resolve each recommendation; 

 Initial expected implementation date; 

 Revised implementation date if the action is not fully completed by the initial planned 

date; 

 Name of the FEC official responsible for implementing or monitoring implementation 

of the recommendation; 

 Final management actions taken to implement the recommendation; 

 Date final actions are taken by responsible official; 

15 
 Management status (open or closed); 

 OIG verification activity (action taken by OIG auditors to verify recommendation is 

fully implemented); and 

 OIG status (open or closed). 

Using the information input by OIG and FEC officials, the database can be used to display 

corrective action plans and status reports on audit follow-up activity by audit or by 

responsible official. The system is designed to be a single point of data input and will 

improve the transparency and reporting capabilities, while reducing the need to update 

various data management sources, such as Microsoft Word documents or Excel spreadsheets. 

Recommendations 

2a. FEC officials comply with Directive 50, to include the following: 

 provide corrective action plans to the OIG within 30 days of final report; 

 submit the corrective action plans within 30 days to the Commission via the Staff 

Director for information, tally vote or approval; 

 hold regular meetings with the OIG to discuss the status of the outstanding 

recommendations; 

 produce semi-annual reports to the Commission on the status of outstanding 

recommendations; and 

 use the FEC OIG Audit Recommendation Tracking System or similar system that 

records recommendations, agreed management actions and implementation status. 

Management Response 

2a. Concur with recommendation. Directive 50 will be updated and a first draft 

circulated to the Commission within thirty days (30) of receipt of the final report. A 

CAP will be provided within thirty (30) days of the final audit. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendation. The OIG believes any 

planned updates to Directive 50 should retain and emphasize the importance of regular 

meetings and monitoring of outstanding audit recommendations by FEC management with 

the OIG and Commission. 

3. FEC’s Transit Benefit Program Control Status Reported to OMB Was Not Fully 

or Accurately Assessed 

On April 24, 2007, the United States Government Accountability Office (GAO) issued a 

report, Ineffective Controls Result in Fraud and Abuse by Federal Workers, detailing its 

testimony before the Permanent Subcommittee on Investigations, Committee on Homeland 

16 
 

 

Security and Government Affairs, U.S. Senate regarding the Federal Transit Benefit 

Program. GAO performed the study because the national capital region had approximately 

120,000 participants receiving roughly $140 million in benefits in 2006 and a number of 

inspectors general (IG) had found instances of fraud, waste and abuse. In its report, GAO 

stated ineffective program controls in the transit program resulted in fraud and abuse by 

federal workers. The report highlighted a number of transit program abuses at other federal 

agencies where employees claimed too much, sold their benefits or gave them to others for 

use, or claimed benefits after leaving an agency. GAO estimated the annual projected loss to 

the government is at least 17 million dollars, in addition to unknown losses which could not 

be quantified, but were considered material. 

Based on the results of the GAO report and testimony before Congress, the Office of 

Management and Budget (OMB) issued a memorandum requesting all agency heads state 

whether a minimum level of controls exist over the administration of the transit program of 

their agencies. The response from federal agencies to OMB was due by June 30, 2007. The 

FEC’s response was prepared by the FEC’s former CFO, signed by a former FEC Chairman, 

and sent to OMB on June 28, 2007. In the response, FEC leadership stated: 

"Transit Benefit Internal Controls are in place for the FEC's Transit Benefits Program. 

Recently, our Office of Inspector General (OIG) conducted an audit of the FEC's 

Transit Benefit Program and found that the FEC is managing the program effectively. 

The OIG suggested additional improvements to the program, and the FEC will 

incorporate those suggestions into our procedures to ensure the program continues to 

operate effectively and as intended." 

The FEC’s response to OMB is not accurate because it implies the FEC OIG audit results 

support that the program is managed effectively. The 2007 OIG audit report made no such 

assertion, rather it illustrated a number of weaknesses existed and made 25 recommendations 

for correcting those weaknesses. 

In addition, the Deputy Inspector General’s memo accompanying the final audit report to the 

Commissioners states: 

"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." 

The "conditions" referred to were described in the report distribution memo and relate to 

instances where staff did not comply with program requirements. Specifically, participants 

of the program: 

 claimed benefits while on extended leave or travel; 

 failed to return excess benefits; 

 accepted subsidized parking and transit benefits; and 

 continued to have access to benefits after separation due to program office’s 

failure to monitor and remove access to benefits in a timely manner. 

17 
 

 

 

 

The OMB Memorandum 07-15 requested confirmation that a minimum internal control 

structure exists for the following: 

“Transit Benefit Internal Controls 

Application Requirements 

Employee Home Address 

Employee Work Address 

Commuting Cost Breakdown 

Employee Certification of Eligibility 

Warning Against Making False Statement in Benefit Application 

Note: Some agencies require employees to affix a copy of a completed 

Washington Metropolitan Area Transit Authority online trip planner, which 

employees can use to determine the participant's actual daily, and then 

monthly, public transportation costs. 

Independent Verification of Eligibility 

Commuting Cost Verified by Approving Official (e.g. employee's home 

address validated and commuting costs correctly calculated) 

Eligibility Verified by Approving Official 

Implementation 

Applicants Checked Against Parking Benefits Records 

Benefits Adjusted Due to Travel, Leave or Change of Address 

Removal from Transit Benefit Program Included in Exit Procedures.” 

While the FEC created and implemented a new form to be used for application, annual recertification, and removal, the form is not used completely. For instance, independent 

verification of eligibility by the OHR is rarely documented on the form. In addition, 

implementation control practices, such as parking benefit review and adjustment for travel 

and leave are not fully implemented, as indicated in the number of findings noted in the prior 

report and this follow-up report. At the time the response was submitted by the FEC to 

OMB, only three of the 25 recommendations had been implemented and verified by the OIG. 

It does not appear the FEC correctly assessed whether the control weaknesses identified 

during the prior audit had actually been addressed before providing a response to OMB. 

Further, the response presented to OMB incorrectly attributed the FEC OIG as determining 

the transit program was managed effectively when clearly the memorandum to the 

Commission, the executive summary of the report, and the audit report detail state the 

opposite, and recommended 25 actions to address program management weaknesses. 

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Recommendations 

3a. FEC management should implement control processes to ensure information prepared 

for external reporting is fully and accurately assessed prior to forwarding to the 

Commission for approval and release. 

3b. The FEC OIG requests that draft responses to OMB and other oversight entities are 

provided by management to the OIG as a matter of courtesy when those responses 

specifically refer to OIG audit activities and reported audit results. 

Management Response 

3a.	 Concur with recommendation. The intention is to develop an action within 90 days of 

the final report being published. This action will be listed in the Corrective Action 

Plan listed in 2a. 

3b. Concur with recommendation. OSD will adopt a policy where by communications 

made to outside agencies will be coordinated with CFO, OGC and OIG prior to 

release. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendations. The OIG only requests 

review of external communications where OIG activity or work products are mentioned or 

where the response attributes a status or opinion to the IG or OIG work. 

4. Program Policy and Procedures Need Improvement 

Directive 54 has been the official guidance on the transit benefit program at the FEC since 

March 1992. The current directive dated August 2001 replaced the previous version. The 

prior audit report recommended changes to Directive 54 which were not implemented. 

Instead, FEC OHR and CFO management teams created draft policies and procedures to 

replace the Directive. To date, those policies and procedures have not been finalized or 

formally communicated to staff. Therefore, Directive 54 remains the current guidance to 

FEC staff. 

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 fare card for use on metrorail, metrobus or 

in a registered vanpool. The FEC provides SmarTrip cards as its main form of transit 

subsidy, recently requiring all staff whose commutes accept SmarTrip to transition from 

Metrocheks to the SmarTrip card. Employees who use SmarTrip cards are able to download 

their transit subsidy at the machines located throughout the Metro system or assign their 

19 
benefit to a vanpool electronically via the transit system website. Since the 2006 audit, 

WMATA has replaced Metrocheks with vouchers in an attempt to decrease program fraud 

and increase rider’s ability to receive transportation benefits in an electronic form, even 

where the transportation provider does not accept the SmarTrip card. WMATA has 

increased the number of transportation providers who accept SmarTrip cards and improved 

electronic processes to eliminate the need for paper transfers between various bus and rail 

systems. The improvements result in a transit system and benefits program that is 

increasingly more electronic, cost efficient, and allows for transparent monitoring by riders 

and the agencies that supply them benefits. 

Although the FEC has participated in the SmartBenefits program since 2003, 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. 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. 

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. 

We found that Directive 54 does not describe the appropriate method of processing transit 

subsidy benefits (SmarTrip) for incoming personnel who are hired after the 15th of the month. 

Specifically, FEC Directive 54 states: 

“1. Applications for the transit subsidy are available in the Personnel Office 

(Attachment 1). Applications received by the 20th of each month will be processed 

and maintained by the Personnel Office for inclusion in the list of approved 

applicants to receive transit benefits the following month. Once an application is 

approved by the Personnel Office, the required application information is used to 

create the list of employees eligible for the transit subsidy. 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”. 

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The policy does not state that employees who apply for benefits before the 20th should 

receive full or partial benefits for the application month; however the FEC OHR clerk 

routinely authorizes full or partial benefits for the application month, based on actual 

commute costs for employees who apply before the 20th of the month. Finance does not 

question the distribution practice. Employees who apply after the 20th are routinely given 

full benefits for the following month and, in one case authorized partial benefits in the month 

applied. 

Review of transit applications and benefits received for employees hired between October 1, 

2007 and July 31, 2008 showed the following with respect to benefits received by new 

employees: 

 20 participants applied before the 20th and received full benefits in the month applied 

totaling $1,788; 

 8 applied before the 20th and received partial benefits the month applied totaling 

$520; 

 3 applied before the 20th and received no benefits in the month applied (complied 

with Directive); 

 24 applied after the 20th and received full benefits in the month following application 

totaling $2,355; 

 1 applied after the 20th and did not receive full or partial benefits in month applied or 

month following application (complied with Directive); and 

 1 applied after the 20th and was authorized partial benefits in the month applied and 

full benefits the month following application. 

The practice of authorizing full or partial transit benefits in the month an application is 

submitted, or full benefits in the month following application for those who apply after the 

20th, indicates program operating practices have diverged from program guidance, but are 

applied in a fairly consistent basis. Had Directive 54 been applied correctly, the FEC could 

have reduced program expenses by $4,663 for the period October 1, 2007 through July 31, 

2008. 

Despite the OIG recommendation and management agreement in the prior report, OHR staff 

members who are responsible for processing applications in the WMATA systems and 

administering the program have not been formally trained and do not have sufficient written 

instruction to manage the program effectively. During the audit testing period of January 

2007 through July 2008, no WMATA system guides or FEC prepared procedures manuals 

were in use by OHR. The OHR staff were not aware of, and did not use the WMATA 

system reports (“employee removed” and “currently enrolled”) to verify employee subsidy 

status when processing applications, change requests, certifications or separations. A one 

page Standard Operating Procedures draft provided by the OHR Director to the OIG is not 

sufficiently detailed and does not include instruction on verification or control actions to be 

performed before or after processing applications or change requests. A two page Transit 

Subsidy Internal HR Coding Instructions provided to the OIG for review is poorly 

constructed and does not include instruction on verification or control actions to be 

performed prior to or after processing applications and change requests. 

21 
Directive 54 has not been revised to reflect changes in the program, such as the 

implementation of alternative working arrangements adopted by many FEC staff. The 

alternative working arrangements include compressed work schedules and regular/episodic 

flexiplace (telecommuting) work arrangements. In addition, the FEC’s program policy does 

not address the following: 

•	 management of SmartBenefits, 

•	 transition from Metrochek to vouchers, 

•	 staff training needs, or 

•	 detailed program office instructions or reference to other internal operating 

procedures to implement the policy. 

To date, the OIG notes that Directive 54 has the following weaknesses: 

	 An inconsistency in the illustration for staff who work exactly 50%. The examples 

for scheduled absence (2a) show staff may claim all the benefit for a month where 

they are present 50% or more duty days. The example for unscheduled absence (2b) 

has a person present exactly 50% but only entitled to claim only 50%, 

	 the policy has not been updated to reflect the new operating environment of electronic 

SmartBenefit, or the requirement that employees use SmartBenefit if their commute 

allows (reduce Metrochek/voucher use), 

	 no mention regarding transition from Metrochek to SmartBenefits vouchers, 

	 lack of instruction for calculating the maximum number of commute days each month 

based on the changed operating environment for employees who have adopted 

compressed work schedules and/or regular/episodic Flexiplace, 

	 current policy does not reflect the annual certification process currently being used at 

the FEC, 

	 the transit application form does not address participants’ commuting costs where the 

fare is purchased on a monthly basis and therefore is a fixed price, rather than a daily 

rate as stated on the application form, and 

	 the policy does not define the point when a person is no longer considered an eligible 

participant of the program, e.g. failure to commute using public transportation at least 

50% of the time for a number of consecutive months would render a person 

ineligible. 

As an initial step to policy and program revision, management should first address the 

theoretical concepts of fairness to staff, protection of federal funds, and ability to effectively 

monitor, detect and prevent program abuse. In addition, management should document 

and/or revise the policy, procedures and forms required to serve each operational and control 

activity, and identify what elements/detail each document should contain. In order to do this, 

management should consider the other findings and recommendations in this report, process 

flow the activities within each division and between the three divisions, and document 

existing control weaknesses and recommended corrective actions. Management should then 

design and implement prevention and detection activities to decrease exceptions. 

Management should also develop and document quality assurance standards with 

performance goals to measure program performance. The performance goals should be used 

22 
in the performance plans for managers and staff responsible for administering the program. 

Management should then monitor and report program results to the Commission through 

business planning and as an element of follow-up to this audit report. 

Recommendations 

4a. Program management should consider the OIG’s findings and revise the program 

directive/policy and other procedure documents. 

4b. Management should request examples of transit benefit policies and procedure guides 

from other federal agencies, GAO, or OMB to use as examples in designing its 

revised policies and procedures. In addition, management should consider using the 

WMATA system user guide as a starting point for developing the procedures guide 

for OHR program officials. 

4c. The transit benefit application form should be modified to include elements suggested 

in the OMB memorandum sample form, such as compressed schedules; flexiplace; 

and age and handicap reduced commuter rates. The form should also include an 

employee release authorizing the FEC to obtain transit activity detail from WMATA 

for transit activity on the FEC issued SmarTrip card, as needed, to effectively monitor 

the program. The form should encourage employees who regularly use WMATA 

transit systems for personal use or metro parking to maintain a separate SmarTrip for 

those transactions. If agreed by management, the form should also reflect that staff 

may claim and retain transit subsidy where their commute payment is based on a 

monthly rate such as van pool or train pass, even if they do not meet the 50% 

participation rate for a given month. 

4d. Management should consider using greater than and less than values to define the 

maximum benefits claimable when an employee’s commuting costs vary based on 

days commuted each month. The less than/greater than scenarios could be used to 

ensure fairness to the employees while also limiting program expense to the FEC. 

The policy change would provide a quantifiable method for determining compliance. 

Refer to the examples below. 

Example 1: Employee has daily commute of $5 and maximum authorized $100 per 

month. Due to scheduled leave, an employee commutes 5 days in a given month. 

Employee is authorized to claim the lesser of actual cost or 50% of transit benefit. 

Actual cost $25 or 50% of the approved benefit equal to $50. Employee would claim 

$25. 

Assume same as above but employee commutes 12 days in a month. 

Actual cost $60 or 50% being $50. Employee would be authorized and elect to claim 

the actual cost of $60. 

23 
Example 2: Employee’s daily commute is $15 per day and actual monthly 

commuting cost is $300. Maximum subsidy claim per month is limited to $120. Due 

to unscheduled sick leave, employee commutes 3 days in a given month. 

Actual cost $45 or 50% of the approved benefit equal to $60 (rounded). Employee 

could claim up to $45, actual cost. 

Assume same as above but employee commutes 10 days. 

Actual cost $150 or 50% being $60. Employee elects to claim actual cost of $120 

and supplements with $30 additional personal funds. 

Management Response 

4a. Directive 54 will be updated and a final draft will be circulated to the Commission 

for a vote. 

4b. The OSD cannot support this recommendation. Given the timing of the audit report 

and requested management response, this is both unnecessary and not possible. 

OSD, OHR and other offices have conducted sufficient research to produce a revised 

policy that reflects cohesion of the WMATA system and FEC procedures. 

4c. The OSD cannot support this recommendation. WMATA will not release transit 

activity detail unless a criminal investigation and legal proceeding. The request must 

be pursuant to a court order or made by the employee. The transit benefit application 

form has been updated. 

4d. Concur with recommendation. Procedure will be incorporated in revised Standard 

Operating Procedures (SOP). 

OIG Comment 

The agency’s planned actions for recommendation 4a are responsive to the audit issues 

identified, and when fully implemented, should satisfy the intent of the audit 

recommendation. With respect to recommendation 4b, the OIG still believes the program 

offices would benefit by reviewing best practice examples of policies, procedures and 

guidelines obtained from other federal agencies. It was not the intent of the OIG that all 

policies, procedures, standard operating procedures or other guidance would be fully drafted 

and approved prior to the issuance of the final audit follow-up review report. With respect to 

recommendation 4c, the OIG now understands that WMATA will not provide detailed 

employee transit information except when the employee is subject to formal investigation. In 

the future, WMATA systems will allow registered users to access information relating to 

their own transit activity. At that time, management should consider reevaluating the 

recommendation as employees may voluntarily provide information when requested. With 

respect to the revisions recommended for transit application form in 4d, we note the transit 

form available via the OHR intranet website is dated June 15, 2008, does not reflect the 

changes recommended above, and may not be the updated version intended by FEC 

management for employee use from this date forward. 

24 
 

Program’s Internal Controls Need To Be Strengthened 

The following findings indicate that controls over transaction processing and monitoring of 

program activity needs to be strengthened. During the audit follow-up review, we noted no 

managerial review or quality assurance of key processes that would have allowed detection 

and correction of processing errors or omissions. There is no compilation of monthly transit 

claim activity and no consolidated review of employee claim activities for an extended 

period of time. If management had designed and implemented controls over transaction 

processing and program activities as a whole, management could have prevented or limited 

abuses and financial exposure of the FEC with respect to the transit program. 

5. Separated Employees Were Not Removed Timely 

Separated employees were not removed from the transit benefit system in a timely manner 

and seven former employees claimed benefits after they left FEC employment. One 

employee who separated in 2005 was still eligible to claim transit benefits until mid-2008. 

We reviewed the electronic report of WMATA claims from April 2007 through July 2008 to 

determine whether former FEC employees who had separated since February 2007 were still 

enrolled in the benefit program and claiming benefits. We also reviewed claim activity for 

current employees who had ceased to claim transit benefits and verified whether or not those 

individuals were still employed with the FEC. The review indicated that 55 former 

employees had access to $13,556 in SmartBenefits to which they were not entitled. These 

former employees continued to have access to FEC SmartBenefits due to a failure by the 

OHR to remove participants from the program in a timely manner or a failure to suspend 

benefits during the month the system removal was processed. One former temporary 

employee had access to benefits totaling $1,950 for 34 months after separating in March 

2005, but fortunately did not claim the available benefits. Further, seven former employees, 

including one individual on administrative leave, claimed $1,181 in benefits that the 

individuals were not entitled to receive. 

Of the 100 employees separated from FY 2007 to July 31, 2008, 81 participated in the transit 

subsidy program; 63 collected the subsidy using SmartBenefits and 18 used Metrocheks. Of 

those 81 program participants, 40 had transit subsidy removed timely with eight having their 

eligibility removed on the day they separated. Two could not be determined as they 

separated prior to availability of current electronic records. The remaining 39 employees 

were not removed from the transit system in a timely manner; 34 received SmartBenefits and 

5 participants received Metrocheks. Because separated employees who use Metrocheks are 

not likely to re-enter the FEC to claim their transit benefit, or if they did they would likely be 

detected and denied, it is more critical that those with access to the electronic SmartBenefits 

be removed from the system immediately upon separation. In total, 34 of the 63 

SmartBenefit recipients were not removed timely, a 54 percent failure rate. 

25 
 

Recommendations 

5a. Program management should implement internal controls and quality assurance 

processes to ensure employees who separate have their access to transit subsidy 

terminated at the earliest possible date. Examples of appropriate internal controls are 

listed below: 

	 An OHR clerk processes the removal and/or suspension of transit benefits on 

the day the employee performs the walkthrough of the separation clearance 

form, or at the earliest possible date in accordance with system limitations. If 

the system does not allow removal (16th through the end of the month), 

suspension for the next month should be processed between the 28th and the 

end of month to ensure benefits cannot be claimed for the next month. A 

reminder should be used to ensure the removal is processed at the earliest 

possible date. The clerk should print or record the action which shows the 

suspension and removal actions processed in the WMATA system. 

	 The OHR clerk should download the WMATA “currently enrolled” and 

“employee removed” reports each month and maintain the historical data for 

use by others in quality assuring transit benefit program transactions. 

	 Management should perform a monthly review of the separation listing and 

verify separated employees have been suspended and removed by logging on 

to the WMATA system or reviewing the downloaded “employee removed” 

and “currently enrolled” reports to verify the correct action was performed. 

	 Management should establish a performance standard for the program staff to 

assess their success in ensuring that no separated employees have access to 

transit benefits administered by the FEC. 

	 Noting that there are instances where some employees do not complete a 

separation clearance form, a failsafe approach should be developed whereby 

the National Finance Center payroll listing is compared to the WMATA 

“currently enrolled” listing and exception reporting is used to identify any 

employees not listed for payroll purposes who are registered for transit 

benefits. The transit benefit could then be suspended and removed. 

5b. Program management should consider whether to attempt recovery of the $1,181 in 

excess benefits claimed by the seven former employees. 

Management Response 

5a. Concur with recommendation. Procedure will be incorporated in a revised SOP. 

5b. FEC Management will review the specifics for the impacted employees and determine 

the best course of action for the agency. 

26 
 

 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendation. 

6. 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 checkout process, provides for the recording of unused transit benefits. A copy of the form can be 

found in Attachment 5. Because WMATA does not allow the return of partially used 

Metrocheks, Finance can no longer accept the unused Metrocheks. Instead, employees are 

required to return excess benefits claimed in the form of a check or money order. If neither a 

check nor money order is provided by the separating employee, Finance can use a payroll 

deduction from the employee’s final paycheck to collect the amount owed. 

The program directive states that the Finance Office manages the receipt of unused transit 

benefits from departing employees, however, Finance requires OHR to provide information 

on the amount claimed for the current month and the employee’s daily commute costs. The 

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

Currently, the process for seeking recovery of unused transit subsidy at employee separation 

is neither transparent nor consistently applied. Finance performs the calculation; however, 

based on the OIG’s review of clearance forms, the calculations by the Finance Office to 

determine the amount of unused benefits were not properly documented. It does not appear 

all departing staff were fully assessed and repayment sought. The revised draft policy states 

OHR is responsible for calculating the repayment value. During the audit follow-up, the OIG 

provided a template to OHR that could be used to calculate the repayment or show that a 

repayment is not due. The template is not yet in use. 

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

2007 and July 31, 2008 returned only $767 of the $1,416 calculated by the OIG to be unused 

based on the separation dates of the employees. Thirteen employees may still owe $6244

. 

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

permissible under the provisions of FEC Directive 54. To assist program staff when 

computing the amount of unused subsidy that should be returned on the last day of 

employment, the program management drafted a revised employee clearance form. The OIG 

provided input on the new draft form content as well as the sequential process necessary so 

that OHR has all relevant information to compute whether repayment is due. The revised 

employee clearance form is not yet in use. 

4

 The variance of $28 results from the difference between the amounts calculated as owed by OIG versus the 

amount requested returned by Finance/OHR. Evidence of how Finance/OHR calculated the repayment amount 

was not always present. 

27 
 

Recommendations 

6a. The OHR should ensure the employee separation clearance process includes the 

computation of unused transit subsidy to be recovered from separating employees. 

The revised clearance form should be used to show the unused transit subsidy 

repayment amount or the fact that no repayment is required. 

6b. The repayment calculation worksheet provided by the OIG in May 2008, or similar 

document, should be used to calculate whether repayment is due. A copy of the 

calculation worksheet should be attached to the employee clearance form so that 

Finance can request and collect the correct amount from separating employees. 

6c. If not already available, OHR employees should be given read only access to the 

WebTA system so that OHR can view time and attendance records for the month an 

employee separates and use actual attendance to calculate whether repayment is due. 

Alternatively, separating employees should be instructed to print a copy of their 

timesheets for the current month and provide the information to OHR to allow 

calculation of transit subsidy repayment. 

6d. OHR management 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. 

Management Response 

6a. Concur with recommendation. The OHR has updated the separation clearance 

process to incorporate transit subsidy as an item to check so that it is readily 

identifiable in order to calculate any unused transit subsidy, as outlined in the policy. 

The updated form is currently being used by OHR and the process will be 

incorporated in the revised SOP. 

6b. Concur with recommendation. The employee clearance form has been updated to 

reflect this recommendation. A copy of the updated form will be provided with the 

CAP. 

6c. The OSD cannot support this recommendation. The OSD does not find it appropriate 

for OHR to pull Time and Attendance for this purpose. OSD will consult further with 

OGC on this issue and advise OIG of OGC opinion. This will be added to the CAP. 

6d. Concur with this recommendation. OHR has requested additional training from 

WMATA. Details will be provided in the Corrective Action Plan. The training is done 

in cooperation with WMATA and OHR. 

28 
OIG Comment 

The agency’s planned actions for recommendations 6a, 6b and 6d are responsive to the audit 

issues identified, and when fully implemented, should satisfy the intent of the audit 

recommendations. With respect to 6c, prior to WebTA, OHR or Finance reviewed the 

employee timesheets in order to calculate whether a transit repayment was required. The 

timesheets were retained in the separating employee’s personnel file maintained in Finance, 

along with a copy of the employee clearance form and final pay and/or leave balance transfer 

details. This recommendation simply reflects the change in source documentation 

availability due to the transition to an electronic time and attendance system and the fact that 

the current management process assigns responsibility for calculating final transit repayment 

to OHR staff members. 

7. Employees Have Access to Duplicate Benefits 

According to FEC Directive 54, 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. Therefore, 

employees are not eligible to receive multiple benefits or benefits that exceed actual 

commute costs. Program controls should exist to ensure employees do not have access to 

multiple benefits. For the period of review, April 2007 through July 2008, employees had 

access to $4,680 in duplicate benefits and an additional $1,216 available from August 2008 

to November 2008. 

Our review identified two individuals who had transitioned from SmartBenefits to 

Metrocheks and another employee who had registered a new SmartBenefit card, but access to 

prior benefits was not immediately terminated for the three employees. In total, the three 

individuals could have claimed $2,848 in duplicate benefits, but did not. In one instance, the 

duplicate access to benefits was identified by Finance through comparison of the Metrochek 

distribution listing to the SmartBenefits listing, but only after duplicate benefits could have 

been claimed for seven months, totaling $770. In the second instance, an individual who 

registered a second SmartBenefit card had previously registered a card in another name. The 

initial card registered with the FEC was not in the name of the employee, and was not 

terminated when the new SmarTrip card was registered. From August 2006 until July 2008, 

that person could have claimed $1,748 in duplicate benefits. Access was removed based on 

OIG request. It is our understanding that OHR no longer allows employees to register cards 

that have previously been registered with WMATA under another name. Instead, the person 

is assigned a new card and required to register the card in their name (refer finding 12 on 

page 46). The third instance appears to relate to an employee transitioning from Metrocheks 

to SmartBenefits and then back to Metrocheks. The employee had access to download 

benefits to a SmarTrip card for three months, but did not. Instead, the employee claimed 

benefits via Metrocheks totaling $330. 

We also noted three recent instances (after July 2008) relating to new employees or 

employees who requested changes in transit subsidy benefits gaining access to duplicate 

benefits under SmartBenefits. The OIG identified two employees who had more than one 

29 
active SmartBenefit card registered in their names, which were identified by the OIG in 

November 2008 through a review of the “currently enrolled” listing. A third employee 

applied for SmartBenefits in June 2008 and then requested a change to Metrocheks in August 

2008. Because the SmartBenefit card was not registered in the employee’s name, the 

employee was given access to both SmartBenefits and Metrocheks. The employee claimed 

benefits in both forms for two months (September and October), informed Finance of the 

error, and then returned the excess portion to the FEC. It appears these three instances 

occurred when an initial transit benefit application was processed and, within a relatively 

short period of time, a second form was submitted requesting a change. It does not appear 

the status of the initial request was adequately confirmed, adjusted, or removed by OHR prior 

to processing the second request. The risk was likely compounded by the failure to register 

SmarTrip cards in the name of the employee on the day they were distributed (refer finding 

13 on page 47). The dollar value of access to duplicate benefits was $805 for the three 

employees. 

When a new employee or an employee not previously receiving transit benefits applies for 

benefits, the OHR clerk processes the application and sends an e-mail to Finance with the 

following information: 

 the new employee has been authorized benefits and the effective date; 

 a short description of the commute as well as the daily and monthly rate; 

 whether the employee is authorized partial or full benefit for the current month (based 

on effective date of employment, daily commute, and number of days remaining in 

the month); 

 the manner in which the employee will claim the benefit in the future, 

Metrochek/voucher or SmartBenefits; 

 SmarTrip card number (if applicable); and 

 Kick-off date on which SmartBenefits will be available for download and therefore 

the date the employee will no longer be eligible to collect transit benefits from 

Finance via Metrochek or voucher. 

Due to the limited dates for which transit benefit changes can be processed in the WMATA 

system, an employee who applies for benefits on the 16th of a month is frequently authorized 

partial benefit in that month, and full benefit the following month. However, the employee 

would not be able to download transit subsidy electronically (kick-off) until the first day of 

the second full month after being processed in the WMATA system. OHR authorizes the 

employee to collect transit subsidy from Finance twice before the employee can begin 

electronic download of benefits in the third month. If an employee is not listed on the preprinted hard-copy report for voucher distribution, Finance manually writes the name of the 

employee on the monthly Metrochek distribution listing and indicates the amount of benefit 

distributed based on the information from OHR. Finance also includes a copy of the e-mail 

from OHR with the monthly distribution report to document distribution to an employee who 

was not included on the hard-copy distribution listing. 

While conducting detailed testing to determine whether applications for benefits were 

processed timely, we noted 14 of the 53 applicants who registered and received a SmarTrip 

30 
card were also listed on the Metrochek distribution listing for one or more months. The 

temporary condition of appearing on two listings likely results from an attempt to manage the 

FEC transit benefit system (PeopleSoft) detail so that an employee appears on the 

Metrochek/voucher distribution listing the month of and/or month after the employee begins 

working to authorize collection of benefits at Finance, prior to a SmartBenefit kick-off date. 

By inputting a new employee into the PeopleSoft with no SmartBenefit card number, the 

employee will appear on the hard-copy Metrochek/voucher distribution listing. The OHR 

clerk must then remember to update the PeopleSoft system with the SmartBenefit card 

number assigned to the employee prior to the WMATA kick-off date in order to remove the 

employee from the Metrochek distribution listing and prevent access to duplicate benefits. 

The duplicate access to benefits results when the PeopleSoft listing is not updated by OHR 

prior to printing the transit voucher distribution list and sending the list to Finance. 

In order to prevent the access to duplicate benefits, new transit benefit participants who will 

eventually collect benefits using SmartBenefits should have their SmarTrip card number 

entered into PeopleSoft on the day they receive the card and their name should not be preprinted on hard-copy Metrochek distribution listing. The e-mail notification from OHR to 

Finance that provides notice of the employee subsidy amount and kick-off day to begin 

automated download of benefits is sufficient to authorize benefit collection via Metrochek or 

voucher prior to the SmartBenefit kick-off date. 

OIG notes that Finance often reviews the WMATA report on monthly benefits claimed and 

identifies employees who have access to both SmartBenefits and Metrocheks. Where 

duplicate benefits are noted, Finance notifies OHR to correct the problem by verifying which 

benefit claim method is correctly authorized and deleting the other. If Finance does not 

receive the monthly WMATA transit report from OHR, it cannot perform the quality 

assurance function. Currently, the process is not formalized through written instruction for 

OHR and Finance. OIG testing revealed that the Finance Office did not receive the 

WMATA reports for eight months during the follow-up testing period (April 2007 through 

July 2008). The reports for January through August 2008 were not received until September 

11, 2008. 

Recommendations 

7a. OHR should download the “currently enrolled” and “employee removed” listings 

monthly, as well as use the on-line WMATA system data and the FEC Transit Benefit 

Eligibility Listing to verify the status of employees prior to processing additions or 

changes to the transit benefit system. It is important to note that employees may have 

had several SmarTrip cards registered in their names over their term of employment, 

but should only have one active SmarTrip card at any point in time. OHR must verify 

and review system changes by SmarTrip card number as well as employee name to 

prevent access to duplicate benefits. 

7b. The record of change requests and the resulting changes processed should be retained 

in OHR transit files, along with the completed application/change request form. As a 

result, any OHR staff member who is responsible for processing transactions can 

31 
review the history of requests by employee name and determine whether previous 

requests have been completed. OHR should consider creating a shared e-mail 

directory to store communications from FEC employees regarding their transit 

inquiries and change requests. Any request for new benefits, termination of benefit, 

or change in the amount of benefit received, address and commute pattern, and type 

of benefit (voucher or SmartBenefit) should be documented using the Transit Subsidy 

Program Application form. 

7c. Program management should review change requests on a regular basis to ensure 

benefits are not available in two forms; voucher and SmartBenefits, or two or more 

SmartBenefit card numbers. This can be done by reviewing the “currently enrolled” 

listing and verifying only one card number is assigned to each employee (i.e. no 

duplicate names). Also, Finance should continue the practice whereby a staff 

member compares the monthly Metrochek/voucher distribution listing to the 

electronic listing of SmartBenefit recipients provided by OHR. Program management 

should consider an automated report comparison between the Transit Benefit 

Eligibility Listing (PeopleSoft) that records the participants’ names and benefit type 

(Metrochek/voucher or SmartBenefits) to the WMATA “currently enrolled” listing to 

highlight duplicate benefits. A second automated review of the “currently enrolled” 

listing could be performed to highlight employees listed with more than one SmarTrip 

card number. This would allow monthly comparison with exception reporting and 

minimize the need for manual review by OHR and Finance staff. 

7d. OHR should input the SmarTrip card number in the PeopleSoft system at the time the 

card is distributed to an employee and not attempt to manage whether the employee 

name prints on the monthly distribution listing for Finance. Employee names should 

be manually written on the distribution form for one or more months if the 

participants have elected to receive transit benefits via SmarTrip. 

7e. Finance should distribute benefits as indicated by OHR for the time period indicated. 

If WMATA system limitations require manual benefit distribution for more than one 

month, Finance should print the e-mail for reference and inclusion in distribution 

reports for both months. 

Management Response 

7a. Concur with this recommendation. OHR has already instituted a process to address 

this issue. Details will be provided in the Corrective Action Plan. Copies of the 

procedures will be provided. 

7b. Concur with this recommendation. OHR has already instituted a process to address 

this issue and will be outlined in the CAP. 

7c. Concur with this recommendation. Process has been adopted, although not 

automated. 

32 
 

 

7d. Concur with this recommendation. Process has been adopted, although not 

automated. 

7e. FEC management concurs with the recommendation for Finance to reconcile OHR 

reports and is already performing this internal control check for the vouchers. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendations. The OIG looks 

forward to reviewing the additional detail on planned implementation activities that will be 

provided in the CAP. 

8. Employees Did Not Comply With Program Policy 

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 percent 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 percent in a month are only 

entitled to 50 percent 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 percent 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 percent of the commuting (business) days 

because of unplanned or unscheduled absences, the employee is eligible for 50 percent of the 

transit benefit the following month. It is program management’s responsibility to design a 

control framework to prevent, detect and correct instances of non-compliance. However, our 

audit results revealed that employees failed to adhere to the program’s policy, and program 

management has not implemented sufficient monitoring and control activities to detect 

instances of non-compliance. Specifically, 48 employees claimed $2,612 in FEC transit 

benefits, of which $689 was inappropriately claimed for periods of extended travel and 

$1,923 was inappropriately claimed for periods of extended annual and/or sick leave from 

October 2007 through July 2008. Additionally, we identified one ineligible employee who 

claimed $200 in transit subsidies while on administrative leave. Refer to the three sections 

below for testing results detail and recommendations. 

33 
Program Participants on Extended Travel 

In order to determine whether program participants complied with the policy to reduce transit 

benefits claimed during periods of extended travel, the OIG reviewed business trips taken 

between October 2007 and July 2008 for travel that exceeded 10 days in a calendar month; or 

a high number of travel days that bridged consecutive months. We identified 23 

vouchers/records that documented travel of employees who were not entitled to the full 

monthly benefit due to their extended absence from work. After examining the applicable 

transit subsidy claiming reports, we found that five employees correctly reduced their benefit 

for planned travel, and four claimed nothing in the month of travel or subsequent month even 

though they were entitled to claim fifty percent. For the remaining 14 of the 23 business 

trips, the employees were not compliant with the transit subsidy program requirements while 

on extended travel. Specifically, the employees inappropriately claimed $689.50 in transit 

benefits of which they were not entitled to due to their absence from the FEC. It was also 

noted that one employee claimed transit benefits electronically during the period of travel 

absence, indicating that the SmarTrip card may have been used by someone other than the 

employee. 

Program Participants on Extended Leave 

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

we reviewed a download of National Finance Center time and attendance records for the 

period October 2007 to July 2008. Using electronic analysis, we identified 141 employees 

whose leave may have exceeded 80 hours in a calendar month. The data was further 

reviewed and 23 were eliminated from testing because they did not participate in the transit 

subsidy program. The remaining 118 employees were reviewed to determine whether they 

commuted less than 50 percent of the days in the month of leave and, if so, whether they 

correctly reduced their transit subsidy in the month of or month following leave taken. 

We found that during the review period, October 2007 through July 2008, 67 of the 118 

program participants identified for review commuted to the office for more than 50 percent 

of the business days in a calendar month. Accordingly, these 67 program participants were 

entitled to their full transit benefit for that month. We identified 12 participants who 

commuted exactly 50% of the commutable days who did not reduce their benefit and five 

employees who correctly reduced their benefit based on less than 50% attendance. However, 

we identified 34 of the 118 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 34 participants 

claimed $1,922.50 in transit benefits of which they were not eligible to receive. 

Directive 54 provides an example for scheduled absence (2a in the directive). Specifically, 

Directive 54 illustrates that staff may claim all the benefit for a month where they are present 

50% or more of the business days in the month. The directive’s example for unscheduled 

absence (2b) has a person present exactly 50%, but only entitled to claim 50% of the monthly 

benefit. Under the two scenarios, the 12 employees who commuted exactly 50% of 

commutable days may be entitled to all or half of their monthly subsidy, depending on 

34 
 

whether the leave was scheduled or unscheduled. For the purposes of this review, we did not 

include those instances as errors. The total inappropriately claimed by the employees was 

$679.50. 

Although a program Directive exists and a policy statement has been included in the monthly 

transit benefit distribution reminders to participants, it does not appear that either is effective 

at ensuring program compliance with respect to employees on extended leave or travel. 

Although previously recommended by the OIG, program policies and procedures have not 

been developed to provide participants with specific program instruction regarding 

adjustments to their transit subsidy. Specifically, SmarTrip users have not been provided 

with proper guidelines for adjusting the amount of transit subsidy claimed at the kiosks 

located throughout the WMATA system. Transit benefit program applications have not been 

amended to require a supervisory approval to provide managers the opportunity to advise 

their employees, as needed, on program requirements. With respect to leave and travel, 

supervisors should advise employees at the time leave and travel are approved that the 

employee should adjust their transit benefit accordingly. 

Ineligible Employee 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 one ineligible employee who claimed transit subsidy while 

on administrative leave in 2007. The employee claimed benefits of $100 per month for two 

months while on administrative leave. This was due to the fact that OHR failed to suspend 

the benefit in a timely manner, despite a new process whereby employees placed on 

administrative leave are required to complete an employee clearance form as if they were 

separating from the agency. In this instance, the employee clearance form was not completed 

until the employee legally separated from the agency, nearly a year later. 

Recommendations 

8a. Transit benefit policies and communications should convey to participants that FEC 

management or other officials may periodically compare extended leave and travel 

records to transit benefit claims for compliance with FEC program requirements. 

Although the current directive and monthly reminders to program participants provide 

the program policy for extended leave and travel, given the continued compliance 

issue, additional controls are necessary. 

8b. Division management should regularly communicate the transit benefit policy to their 

staff to ensure participants are fully aware of their responsibility to reduce the 

benefits claimed during extended absences for travel or leave. This communication 

could be done during normal staff or team meetings. 

8c. OHR 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. 

35 
 

 

 

8d. 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 percent of the business days in a month. 

8e. 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. 

8f. Program management should ensure participants placed on administrative leave have 

benefits suspended or removed, as appropriate. Although program management has 

implemented procedures that include transit benefit restrictions for employees on 

administrative leave, additional controls are warranted. It should take care to suspend 

and remove access to transit benefits at the earliest possible date following an 

employee’s placement on administrative leave. 

8g. Program management should implement a process to identify staff who are absent for 

an extended period of time and review their claim activity to determine whether the 

control processes implemented result in program compliance. 

Management Response 

8a. The OSD cannot support this recommendation. This is not possible without audit 

authority, which the FEC does not have except in the case of a criminal investigation. 

Currently, OHR has a periodic review process in place and compares claimed and 

unclaimed reports. The process will be codified in the revised SOP. OSD will 

encourage management at all levels to incorporate informational briefings into any 

venue where it is appropriate. 

8b. The OSD cannot support this recommendation. Line supervisors should bear no 

responsibility, oversight or otherwise, of the benefit. However, OSD will encourage 

management at all levels to incorporate informational briefings into any venue where 

it is appropriate. 

8c. Concur with recommendation. Policy and procedures are being revised with a no 

later than date of August 1, 2009 and will be posted on FECNet. 

8d. The OSD cannot support this recommendation. It is far-reaching to expect 

supervisors to adhere to this recommendation. Communication and awareness will 

be increased via FECNet. 

8e. Concur with this recommendation. The OSD is working to revise the FEC Parking 

Policy as well as the revised Transit Policy. OHR and Administrative Services staff 

36 
will be trained in procedures on how to process terminations and removals based on 

employees’ circumstances. Employees and/or managers will be instructed to notify 

OHR when employees will be absent from duty station for an extended time. 

8f. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

8g. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. This may be done in cooperation with timekeepers, but again, the 

responsibility lies with the employees. 

OIG Comment 

With respect to 8a, the recommendation does not require audit authority. Management is 

responsible for ensuring effective internal controls of the program. One type of internal 

control is the comparison of different types of data, such as benefit claims and leave/travel 

records, and taking corrective action, when necessary, to resolve exceptions. Excessive 

claims for periods of extended leave and travel has been a longstanding program issue and 

management should implement additional controls to ensure program compliance. 

The process for reviewing claimed and unclaimed activity would not detect excessive 

benefits claimed during periods of extended leave or travel. 

With respect to 8b, the recommendation is not suggesting the line supervisors oversee the 

benefit program, merely use team meetings and employee training sessions to communicate 

the policy in a more direct communication method. 

With respect to 8c and 8d, we accept management’s response. Awareness and management 

review are important. With respect to 8e, 8f and 8g, the agency’s planned actions are 

responsive to the audit issues identified, and when fully implemented, should satisfy the 

intent of the audit recommendation. 

9. Employee Claim Patterns Indicate They Do Not Meet Program Eligibility 

Requirements 

Per Directive 54: 

“The purpose of the FEC transit subsidy program is to provide financial incentives to 

employees who regularly commute via public transportation. For the purposes of this 

program, "regularly commute" shall mean that the employee commutes via public 

transportation on a regular and recurring basis and that a minimum of 50% of the 

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

the official duty station are on public transportation. FEC transit subsidy is to be 

used for the commute to and/or from the official duty station. The official duty station 

for all FEC employees is 999 E Street, NW, Washington, DC, other designated leased 

office space in the Washington, DC metro area or temporary local duty station.” 

37 
Examples of eligibility: 

a.	 Mr. Doe works full time 5 days a week, taking public transportation both to and from 

work on an average of 20 work days (or 40 one-way trips) per month. Since Mr. Doe 

takes public transportation to and from work over 50% of the time, he is eligible to 

participate in the FEC Transit Subsidy program. 

b.	 Ms. Jones rides to work with Mrs. Doe most of the time, and uses public transportation 

only occasionally (less than 50% of the business days per month). Ms. Jones is not 

eligible for a transit benefit because her use of public transportation is not regular and 

recurring. 

The examples provided in Directive 54 clearly illustrate those employees who commute less 

than 50 % per month are not eligible for transit benefits. 

A number of employees with long-term irregular claims indicate they do not meet program 

eligibility requirements or comply with the program directive. We reviewed the electronic 

claims listings for the period April 2007 to July 2008 and noted 20 employees had irregular 

claims which may indicate they do not meet program eligibility requirements as their 

commute may not in fact be “regular.” In total, those employees failed to claim 71 percent of 

their available benefit dollars over the 16 month review time period. Some employees 

consistently claimed below 50 percent of their available benefit dollars. Review of leave 

activity showed 18 of the employee’s leave was not aligned to the periods where they had 

reduced or no transit benefit claims. Several employees did not claim any transit benefit for 

eight of the sixteen months reviewed. 

Recommendations 

9a. OHR should review the detailed results of this testing and consider the implications 

for revising program policy and operating procedures. 

9b. OHR should review the detailed results of this testing and request staff certify that 

they met program eligibility requirements and comply with the Directive. OHR 

should request written explanation from employees who have a history of irregular 

claims. 

9c. OHR should download the monthly WMATA claim activity listings each month. The 

data should be compiled and reviewed annually for irregular claims to ensure 

employees who received benefits use them as intended. 

Management Response 

9a. Concur with this recommendation. 

9b. Concur with this recommendation. OHR maintains a log of this activity. This will be 

codified in the revised policy and procedures. 

38 
9c. Concur with this recommendation. OHR maintains a log of this activity. This will be 

codified in the revised policy and procedures. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendations. We look forward to 

reviewing the additional detail on planned implementation activities that will be provided in 

the CAP. 

10. Application, Change Requests and Annual Certification Process is not Formally 

or Effectively Monitored 

FEC Directive 54 states: 

“The Personnel Director is responsible for the approval/disapproval of all transit 

subsidy applications.” 

Currently, FEC employees who submit transit benefit application forms, change requests or 

annual certifications are not required to submit proof of commute with the application. The 

employee is, however, required to include their home address on the form. Based on the 

information provided by the employee, the OHR clerk verifies the reasonableness of the 

calculated commute cost using the WMATA system Trip Planner feature. The OHR clerk 

does not maintain a record that the commute cost is reasonable and does not use a checklist 

or other form to record that the cost verification control step has been performed. Review of 

FY 2008 transit benefit application forms for new hires showed only 3 of 55 were subject to 

management review and approval. None of the application forms had an OHR clerk sign-off 

on the data entry portion of the form. In addition, a review of the 2008 annual certification 

forms showed little or no evidence of management review or data entry processing that 

would be evidenced by signatures and date entry in the appropriate fields of the form. As 

such, there is little evidence that the Personnel Director has formally approved the transit 

subsidy applications, change requests and annual certifications processed by OHR. 

Discussion with management indicated a period in which a signature stamp for a former 

Acting OHR Director was provided to OHR staff to use in approving transit applications. 

Use of a signature stamp does not provide sufficient evidence that separation of duties was 

maintained between those responsible for approving transit applications and those 

responsible for processing the application in FEC and WMATA systems. 

Further, we concluded the annual certification process is not formally or effectively 

monitored as shown by the following types of exceptions noted: 

 employees who failed to certify annually were not removed from the program; 

 employees who stopped claiming and did not certify were not removed; 

 employees who claim infrequently continue to certify but were not questioned; 

and 

39 
	 terminated employees had their benefits increased to the highest value for 2008 

($115) even though they were no longer employed and had not certified. 

The level of authorized benefits typically increases annually to keep pace with increased 

transportation costs in the DC metropolitan area. The maximum authorized level has 

increased five dollars per year for the last four years, to the current maximum of $120.00. In 

February 2008, the process used to update the authorization level was to have WMATA run a 

program to automatically update those receiving the previous maximum benefit (previous 

value $110.00) to the new level ($115.00 in February 2008). The OHR clerk then went 

through the listing of those increased to make sure the employee was authorized (eligible) at 

or above the new level. If the clerk noted a person authorized exactly at the previous level or 

below the increased level, the clerk adjusted the benefit level in the WMATA system to 

reflect the maximum authorized benefit for the employee. 

Because regular review of account activity was not performed, this process allowed increases 

to employees who had not re-certified their commute for the year, were no longer employed 

by the FEC, had ceased claiming benefits, or were not claiming their benefits in a manner 

consistent with their certified amount. Also, the OHR does not maintain a listing of the 

maximum amount each staff member is certified to receive. For instance, if a staff member 

has a calculated monthly commute cost of $200.00, they would be approved to receive 

$115.00. A listing of those staff who could receive a higher value if the government 

authorized and the FEC funded the payment is not maintained. Because the WMATA 

system does not contain a field for maximum certified amount, the FEC should maintain a 

listing of the authorized level for each participant and provide WMATA a listing of those 

authorized an increase. By doing so, the FEC can ensure increases are applied only to those 

actually authorized the benefit and is not dependent on subsequent review to remove the 

increased benefit. 

Recommendations 

10a. OHR should require all FEC employees submit proof of their commute with their 

certification by using the trip planner features of WMATA website. This would 

enable rapid review and approval by the OHR Director or designated official 

responsible for approving applications, change requests and annual certifications. 

10b. After reviewing the commute information, costs, and transit application mathematical 

calculations, OHR management should sign the form authorizing the OHR clerk to 

process the application, change request, or certification. 

10c. Clerks who process applications, change requests, or annual certifications should sign 

and date the form in the fields provided after entering the data in the system and 

verifying the transaction was processed. 

10d. Signature stamps should not be used to authorize transit benefit applications, change 

requests, and annual certifications. 

40 
10e. OHR should track annual certification forms submitted by FEC staff. For those who 

fail to submit a form, an e-mail reminder should be used followed by benefit 

suspension or removal. Failure to certify by FEC employees should be considered an 

informal request to cease participation in the program. 

10f. OHR should not use the WMATA automatic increase function which automatically 

increases those receiving the maximum benefit ($115) to the next maximum benefit 

level ($120.00). Instead, OHR should submit a listing to WMATA of FEC staff that 

have certified and are authorized to receive the increase. If the auto increase function 

is used, the FEC should first create a listing of each staff member, benefit type 

(SmartBenefit or voucher), the amount certified (actual monthly commute costs) and 

the maximum authorized each month (previously limited to $115 and recently 

increased to $120). The listing can then be sorted to identify those staff that were 

authorized to receive the previous maximum but do not have commute costs in excess 

of that amount. Those individuals would have their system increase reduced to the 

previous value ($115). 

Management Response 

10a. Concur with this recommendation. The process is being incorporated into the policy 

and procedures. 

10b. Concur with this recommendation. The Human Resources Specialist/Employee 

Relations will sign the form authorizing the Human Resources Assistant to process 

the application, change request or certification. The process will be incorporated 

into the policy and procedures. 

10c. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

10d. Concur with this recommendation. 

10e. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

10f. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendations. We look forward to 

reviewing the additional detail on planned implementation activities that will be provided in 

the CAP. 

41 
11. Program Weaknesses Relating to Parking have not been Addressed 

According to 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; this includes 

those who receive long or short term handicap parking privileges. 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, be maintained and then 

compared to the Transit Subsidy Eligibility List to ensure that ineligible employees are not 

on the transit subsidy list. 

Parking information on FEC employees who receive FEC paid parking benefits, to include 

senior executives, long and short term handicap permit holders, employees who pay to park 

in the FEC parking garage, and their passengers, are not provided to OHR in a manner or 

frequency sufficient to ensure employees do not have access to duplicate transit benefits. 

When the Administration Division does prepare listings for distribution, the information does 

not always reach the OHR staff responsible for processing changes and/or monitoring 

employee participation compliance. Since the prior audit report was issued in February 

2007, we found that the Administrative Division did not: 

 regularly communicate the names of employees who have been issued monthly or 

annual FEC paid parking permits, including handicap permit holders; 

 communicate the names of FEC employees who pay to park in the basement to OHR 

for comparison against the Transit Subsidy Eligibility List; 

	 implement a control where employees who pay to park in the basement or those who 

receive FEC paid parking benefits certify whether other FEC employees commute 

with them and include the names of FEC carpool passengers, as required by FEC 

Directive 54, on the monthly listing of parking permit holders; 

	 receive any information on which FEC employees paid to park in the basement from 

the FEC parking provider from May 2007 through July 2008; or 

	 maintain sufficient documentation to determine whether employees who had been 

issued handicap permits also claimed transit benefits for any portion of the time the 

employee held the permit (e.g. document the date a handicap permit was issued, the 

expected period of use, and communicate the information to OHR). 

Further, OHR did not suspend or remove access to benefits for staff who received temporary 

handicapped parking benefits. 

Prior to March 2008, the Administrative Division did not record and monitor the short and 

long term (daily, weekend or handicap) passes issued to FEC staff or visitors. Since March 

2008, the Administrative Division began using a sign-out sheet to record the name, permit 

number, date issued, date returned, and whether the pass was issued for one day use or 

longer. Because the information on temporary passes issued is now maintained, it can be 

provided to OHR. However, we noted the sign-out sheet does not include a field to record 

the date a pass is expected to be or should be returned. When reviewing the sign-out sheets 

we identified instances where a parking permit(s) were: 

42 
 issued to staff and not returned within a day or two; 

 issued and recorded as permanently issued (line out the permit number as unavailable 

for distribution) but no detail was recorded of who had been issued the pass; 

 issued to a contract firm but an individual did not sign for receipt of the permit; 

 issued to a business area or division rather than an individual, and an individual did 

not sign for receipt of the permit. 

If parking passes are issued to staff on a temporary or long-term basis but not fully and 

accurately recorded, OHR cannot determine whether the employee access to transit benefits 

should be removed. 

Because the necessary information on FEC paid parking was not provided timely or 

reviewed, we noted the following: 

	 a Commissioner has access to both parking and transit benefits; 

	 seven employees retained access to transit benefits while issued handicap parking 

permits. We are unable to determine whether employees claimed transit benefits 

while also having access to FEC paid parking due to the lack of detailed records 

retained by the Administrative Division; 

	 an employee who pays to park in the basement retained access to transit benefits via 

SmartBenefits from April 2006 until present totaling $3,750. The individual had a 

former last name listed in the transit system and parking benefits listed under a 

different last name. It is unclear whether the person notified OHR of the change in 

eligibility status. The employee has not claimed the transit benefits available; 

	 an employee previously absent from the FEC for eight months due to medical 

reasons retained access to Metrocheks during the period of absence. After returning, 

the employee claimed Metrocheks for several months and then transitioned to pay 

parking in the FEC garage. Finance questioned the employee’s failure to collect 

Metrocheks at which time the employee notified OHR and Finance that they were 

testing paid parking as a commute option; 

	 an existing employee assumed a position which authorized FEC paid parking 

benefits and accepted the paid benefits. The employee retained access to 

SmartBenefits for six months but did not claim the benefits; and 

	 other exceptions were noted during detailed testing and were referred to the OIG 

Investigator for further review. 

Despite the prior program violations in 2000 regarding three employees who regularly 

participated in an FEC carpool and received transit subsidy, and an exception in the prior 

audit where a staff member received transit subsidy while participating in a carpool, the OHR 

does not consistently perform a comparison of the monthly list of parking permit holders to 

the Transit Subsidy Eligibility List, due largely to the fact that the information was not 

collected and provided by the Administrative Division. 

The planned coordination between the OHR and the Administrative Division to ensure that 

employees participating in the paid parking program are not receiving a transit subsidy has 

not occurred. The Administrative Division has not yet implemented a process to ensure that 

43 
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 a 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; (3) the Administrative Division did 

not obtain information on staff who pay to park from the parking provider and communicate 

the information to OHR; (4) OHR 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, and (5) OHR did not request parking 

information from the Administrative Division when the necessary data was not provided 

monthly. 

In order to ensure individuals do not have access to duplicate benefits, each FEC paid 

parking permit holder and those who pay to park in the FEC garage should be required to 

sign a certification statement that clarifies the permit holders' understanding of the 

responsibilities as well as documents their 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 OHR for reconciliation with the Transit Subsidy Eligibility List in a timely 

manner. 

Recommendations 

11a. 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. 

11b. The Administrative Division should create and maintain a complete and accurate 

listing of employees who receive long-term FEC paid parking benefits, such as SL 

and those considered permanently handicapped. Although the current practice is to 

provide annual passes for these employees, the listing should be reviewed and 

updated regularly for changes in staff. The listing should be saved on a shared 

network directory to allow OHR staff access to the most recent data at all times. 

11c. The Administrative Division should receive the listing of FEC employees who pay to 

park in the basement from the building parking manager each month. It should scan 

the document and save it on a shared network directory to allow OHR staff access to 

the most recent data at all times. 

11d. The Administrative Division should maintain a listing of employees who have been 

issued short term handicap parking permits. Where possible, the length of time the 

44 
permit is needed should be included to allow OHR to suspend or remove access to 

transit benefits for that period of time. The information should be included in a 

shared directory to allow OHR access to the most recent data at all times. 

11e. Employees who receive transit benefits and who will be absent for an extended period 

of time, or their supervisor, should notify OHR of the intended absence and change in 

eligibility status so that access to benefits can be suspended or removed until the 

employee returns. 

11f. The Administrative Division should require all staff who receives FEC paid parking 

benefits, including handicap parking benefits, and those who pay to park in the FEC 

garage certify the names of FEC staff that carpool with them. The listing of 

carpoolers should be included in a shared directory to allow OHR access to the most 

recent data at all times. 

11g. OHR should review the Transit Subsidy Eligibility Listing monthly to ensure no staff 

listed as receiving FEC paid parking benefits is included. If an exception is noted and 

the employee elects to receive the transit benefit, OHR and Administrative Divisions 

should verify the FEC paid parking pass has been returned. OHR should also review 

the listing to ensure staff that pay to park in the basement and their carpoolers do not 

have access to transit benefits. 

Management Response 

11a. Concur with this recommendation. Communication and awareness will be increased 

via FECNet informing the employees of the procedures of the transit program. 

11b. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

11c. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

11d. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

11e. Concur with recommendation. This is an employee responsibility but will be covered 

in the revised SOP which will be posted on FECNet. 

11f. The OSD cannot fully support this recommendation. However, as a security measure 

(not related to the transit authority benefit program) a policy will be drafted which 

states that all members of any car pool accessing the underground parking at 999 E 

Street NW must be identified. 

11g. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

45 
OIG Comment 

The agency’s planned actions are responsive to the audit issues identified for 

recommendations 11a through 11e, and 11g, and when fully implemented, should satisfy the 

intent of the audit recommendations. With respect to 11f, this recommendation was 

previously agreed by management during the prior audit but not fully implemented. Refer 

Attachment 6, Prior Audit Corrective Action Plan with Current OIG Status, recommendation 

19 on page 98. Program management should take the steps necessary to identify employees 

who have access to either paid or unpaid FEC parking benefits and prevent their access to 

FEC provided transit subsidy benefits. 

Administrative Practices Weaken Potential Program Controls 

The following findings illustrate OHR business practices that individually and collectively 

decrease the ability of program staff to effectively monitor the FEC transit benefit program. 

12. Employee Names in the WMATA System are not Consistent with Other FEC 

Systems 

Our review of electronic claims listing and “currently enrolled” reports identified eight 

employees whose names were not the same as that listed in NFC payroll/leave listings or 

FEC e-mail and intranet employee listings. One person had the first and last name reversed 

and another had their last name truncated. The remaining individuals appear to have changed 

their names due to marriage and the WMATA system data has not been updated. 

If the employee names in the WMATA system were the same as that in FEC transit benefit 

and payroll systems, automated system analysis for timely removal and duplicate benefits 

could be performed. When the names are not consistent, it is possible for an employee to 

apply for transit benefits under different names and be granted duplicate benefits. Further, 

when names are not consistent, it is difficult for program management to identify whether 

transit recipients are currently employed and whether employees have been granted access to 

duplicate benefits. 

Recommendations 

12a. OHR should amend the WMATA system detail to reflect the name used in the NFC 

system. 

12b. OHR should ensure all future applications for transit benefit have the name reflected 

as that in the NFC. 

12c. When processing changes to personnel records which impact name, OHR should 

consider whether any adjustment to WMATA or PeopleSoft systems are required. 

Where necessary, OHR should input changes to ensure names are consistent between 

FEC systems. 

46 
 

Management Response 

12a. Concur with this recommendation. This will be added to the CAP with an 

approximate date for it to take effect in both systems. 

12b. Concur with this recommendation. This will be included in the revised SOP. 

12c. Concur with the recommendation. The process is being incorporated into the policy 

and procedures. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendations. We look forward to 

reviewing the additional detail on planned implementation activities that will be provided in 

the CAP. 

13. Employees Have Been Assigned SmartTrip Cards That Remain Unregistered 

When an employee applies for transit subsidy and their commute allows use of 

SmartBenefits, the OHR clerk inputs the information into the WMATA system to authorize 

benefit claims via SmarTrip card but does not register the card to an employee by name. 

Instead, OHR records the card number on the transit application form and in the e-mail 

notifying Finance to provide Metrocheks for the period prior to the date the SmartBenefit 

system will allow electronic download (kick-off). OHR also requests the employee go to the 

WMATA SmartBenefit system and register the card in their name and create a system log-on 

and password. According to the OHR clerk, she monitors employee registration and those 

who fail to register their card are sent reminders and will be terminated if they fail to register 

their SmarTrip card. 

As of November 24, 2008, five SmarTrip cards authorized to download benefits using FEC 

funds totaling $416 per month did not have an employee named assigned. The OIG 

requested OHR provide a listing of who the cards should have been registered to, but OHR 

was unable to provide the information. As such, we cannot be assured that the employees 

assigned these cards do not have access to duplicate benefits or are not former employees 

who retain access to FEC funded transit benefits. 

The online registration could and should be accomplished at the time the card is distributed 

to an employee. The OHR clerk could look away while the employee types in the private 

password or OHR could register the card and assigned a password. The employee could then 

log on to the WMATA system and change the password. 

47 
Recommendations 

13a. In order to restrict access to duplicate benefits and ensure employees are removed 

timely, OHR should register all SmarTrip cards distributed in the employee’s name at 

the time the card is issued. The employee can elect to input a user name and 

password at the OHR terminal while the clerk looks away. Alternatively, the OHR 

clerk can input the username and assign a password, such as derivative of employee 

name, and the employee can then change the password at a later date. 

13b. If OHR is unable to determine which FEC employees have been assigned the 

unregistered cards; it should suspend the cards and send notice to all FEC staff for the 

employees with the associate cards to contact OHR. At that point, the cards should 

be registered with an employee name. 

Management Response 

13a. Concur with this recommendation. The revised policy will articulate that all 

employees must register their cards to receive benefits and/or receive the card. This 

will be codified in the revised SOP. 

13b. Concur with this recommendation. The revised policy will articulate that all 

employees must register their cards to receive benefits and/or receive the card. 

Currently there are no unregistered cards. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendations. 

14. Single WMATA System Log-on Used for Multiple OHR Staff 

The FEC manages the SmarTrip benefits by logging on to the WMATA website using an 

account number and password. Using the secure log-in, FEC OHR staff input employee 

name, benefit level, and SmarTrip card number assigned. The system logs all changes such 

as additions, removals, benefit level changes, and name change by the user log-on. The 

system records a date/time stamp as well indicating when the last change was processed. The 

system does not record the maximum authorized benefit level. For instance, if a calculated 

monthly commute was $165.00, the authorized level in the SmarTrip system is $120.00, the 

current maximum benefit authorized by the FEC. 

FEC OHR currently has only one log-on and password that is shared by OHR staff. Without 

a separate log-on for each staff member authorized to input system changes, OHR is unable 

to determine whether system additions or changes were appropriate and authorized. The 

FEC is not able to hold a single employee responsible for potential abuses detectable through 

management review or audit such as: 

48 
 

 assigning transit benefits to employees who do not participate in the program and 

collecting the benefit for themselves or for family and friends; 

 assigning duplicate benefits; and/or 

 increasing benefit levels for self or others above the actual level authorized. 

Lack of individual log-on also hinders the ability of management to review and understand 

processing errors that unintentionally lead to assignment of duplicate benefits. It is unclear 

how many OHR staff members have access to the log-on and password but it is estimated 

three or four. For effective customer service and continuity of operations, more than one 

OHR staff member, including those who supervise those staff, should have system access 

and procedural knowledge of how to assign, remove and amend SmarTrip benefits for FEC 

employees, as well as manage internal systems used to maintain the Transit System 

Eligibility listing (PeopleSoft). Discussion with the WMATA account representative 

indicates the FEC can request multiple log-on accounts linked to the FEC account and 

establish a separate password for each. By doing so, OHR would improve the transparency, 

accountability, and ability to audit transit benefit system transactions processed by OHR 

staff. 

Recommendation 

14a. OHR employees should be assigned separate log-on/passwords for both WMATA 

systems and FEC systems. Program Management should consider formal training 

and read-only access to WMATA systems for those in both Finance and 

Administration Division to create the best possible control environment for the FEC. 

Management Response 

14a. Concur with this recommendation. OHR has requested from the WMATA 

representative separate logins and training. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendation. 

49 
Metrochek/Voucher Administration and Controls 

15. Monthly Balance of Metrocheks/Vouchers On-Hand Should Be Reviewed 

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

program participants. Between January 2007 and August 2008, Finance maintained a 

monthly balance of $15,050. During that same period, Finance distributed between 60 and 

70 percent of that balance each month with the average distribution of 64 percent. Since 

OHR has required new and existing employees transition to SmartBenefits if their commute 

allowed, Finance has reduced the monthly stock level by 33 percent to $10,100. In 

November 2008, Finance distributed $6,125 in Metrocheks (61 percent) indicating that 

further reduction in stock level for Metrocheks or vouchers may be possible. Maintaining a 

higher monthly balance of Metrocheks on-hand increases the possibility of loss or misuse. 

The Finance Office should evaluate Metrochek/voucher orders based on prior usage, stock on 

hand, and estimated usage of stock. Given the change in policy to require FEC staff to use 

SmartBenefits if possible, the overall monthly stock level should be assessed more 

frequently. 

Recommendation 

15a. Finance should continue to review and reduce the level of Metrochek/vouchers held. 

The current and previous rates of distribution between 60 to 70 percent indicate 

additional reductions could be achieved while still maintaining sufficient reserves to 

meet ad hoc demands. 

Management Response 

15a. Finance reduced the inventory at the end of February 2009 by approximately 35%. 

FEC management will continue to annually evaluate the appropriate level of 

inventory necessary to effectively support the organization. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit recommendation. 

16. Metrochek Stock Level Variances Were Not Fully Documented 

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. For the period January 2007 to August 2008, we identified four instances 

where a variance existed but management did not provide any documentation to explain what 

actions were taken to identify the cause of the variances. During the audit follow-up review, 

50 
the Finance Office agreed that actions taken to investigate and resolve such variances should 

be documented as had been agreed in the prior audit. 

Recommendations 

16a. Finance should document all variances and the actions taken to investigate and 

resolve the variance in the monthly distribution records. 

16b. To ensure mathematical accuracy of the monthly distribution and stock counts, 

Finance staff should use a spreadsheet or adding tape to calculate the total distributed 

and expected and actual closing stock levels. An example spreadsheet to reconcile 

actual stock to calculated distribution levels was provided by the OIG. 

Management Response 

16a. Concur with this recommendation and is currently documenting all variances and 

discrepancies. 

16b. FEC management believes that the current spreadsheet utilized by Finance is 

sufficient to monitor and reconcile all voucher balances. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified for 

recommendation 16a, and when fully implemented, should satisfy the intent of the audit 

recommendation. With respect to 16b, the OIG’s testing noted the spreadsheet used was 

ineffective in preventing mathematical errors. Any revised reconciliation methods 

implemented will be reviewed as part of future follow-up activity. 

OTHER MATTERS OF INTEREST 

Employee Claim Patterns Indicate They May Not Meet Program Eligibility 

Requirements 

Per Directive 54: 

“The purpose of the FEC transit subsidy program is to provide financial incentives to 

employees who regularly commute via public transportation. For the purposes of this 

program, "regularly commute" shall mean that the employee commutes via public 

transportation on a regular and recurring basis and that a minimum of 50% of the 

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

the official duty station are on public transportation. FEC transit subsidy is to be 

used for the commute to and/or from the official duty station. The official duty station 

51 
for all FEC employees is 999 E Street, NW, Washington, DC, other designated leased 

office space in the Washington, DC metro area or temporary local duty station.” 

A substantial number of employees with late claims indicate they may not meet program 

eligibility requirements or may not comply with the program directive. Transit benefits 

claimed on or after the 15th of the month were considered “late” claims. We reviewed the 

electronic SmartBenefits claims activity and noted that 103 employees claimed benefits after 

the 15th of the month in 440 instances. The claims made after mid-month for the 16 month 

period April 2007 to July 2008 totaled $32,616. Of those, 313 claims totaling $27,788 were 

for the full amount and 127 claims totaling $4,828 were for partial amounts. Technically, 

applying the 50% rule as described in Directive 54, employees who had not claimed by midmonth should have reduced their claims by 50%, resulting in a savings of $16,308.35 for the 

Commission. In total: 

 30 employees had only one late claim; 

 44 employees had 2 to 5 late claims; 

 23 employees had 6 to 10 late claims; 

 3 employees had 11 to 14; and 

 3 employees had more than 15 late claims. 

Some employees claimed multiple times in a given month and indicated a possible 

"managed" claim practice to ensure the maximum value was maintained on the SmarTrip 

card at any given time. For these employees, it appeared they regularly made the initial 

claim of the month after mid-month, then replenished the card through additional downloads 

(sometimes more than once per week or even per day) to ensure they were able to claim the 

maximum benefit each month despite what appears to be a transit card that cannot hold the 

full subsidy allotment at the beginning of the month. This practice is likely due to previous 

FEC benefits accumulating over time or personal funds applied to the card and a balance 

maintained at or near the maximum value of $300. 

The WMATA system allows the account holder (FEC) to project the amount of claims that 

will be made and temporary suspend claims for the remainder of the month. By using the 

feature, the FEC could suspend all employees’ ability to claim benefits in a given month 

when benefits have not been claimed by a certain date. This is the electronic equivalent of 

requiring employees to seek formal approval for late claims, the same as employees who use 

Metrocheks or vouchers issued by the Finance Office. If employees do not claim their 

benefit by a certain date, they would be required to notify HR and request their benefit be 

reinstated for the month by authorizing voucher distribution. At that time, the HR staff 

member could determine the reason for failure to claim by midmonth and could adjust the 

amount of the transit benefit to reflect the actual commute costs for the month. If a balance 

is retained from prior periods, the staff member would be asked to expend previously issued 

benefits before being provided additional funds. By using this feature, the FEC could 

manage SmartBenefits and Metrochek/voucher program participants under the same 

standards, better utilize agency funds, and identify and appropriately remove staff who may 

not meet program eligibility requirements. 

52 
A review of monthly Metrochek distributions for late claims showed two employees received 

full benefits for months when they did not commute more than 50% of the commutable days 

in the month based on review of the late distribution form and/or leave records. The form 

used to document approval and receipt of late distributions does not include an area to 

calculate the amount that should be received under the transit policy, i.e. the full or reduced 

amount. There were also several instances where employees acknowledged receipt of 

benefits while assigned to a temporary duty location, a practice supported by Directive 54 if 

the employee continues to commute via public transportation. The form used to authorize 

receipt of benefits while assigned to the temporary duty location was signed by the 

employees’ Division Head, but does not list the location of the temporary duty location. As 

such, program management would not know if the change in duty location resulted in a lower 

monthly commute cost for the employee, and therefore whether full or reduced benefit 

should be provided. 

Suggestions 

1. OHR should review the detailed results of this testing and consider the implications 

for revising program policy and operating procedures. 

2. OHR should review the detailed results of this testing and request staff certify that 

they met program eligibility requirements and comply with the Directive. OHR 

should request written explanation from employees who have a history of late claims. 

3. OHR should download the monthly WMATA claim activity listings each month. The 

data should be compiled and reviewed annually for late claims to ensure employees 

who received benefits use them as intended. 

4. OHR should obtain information and training on system features that allow forward 

projection and suspension of funds that can be claimed when the benefits are not 

claimed by mid-month. In conjunction with policy revision, it should consider 

whether to implement the control feature to allow parity between SmartBenefit and 

voucher recipients. 

5. Program management should revise the Request for Late Distribution of Fare Media 

form to include calculation of the benefit authorized under the policy and the 

Acknowledgement of Receipt of Fare Media While at Temporary Duty Station form to 

include the location of the temporary duty station and whether full or reduced transit 

subsidy is authorized. 

Management Response 

1.	 Concur with this recommendation. The Human Resources Specialist/Employee 

Relations is already doing this. A one-month period is required to download for the 

current month. 

53 
2.	 Concur with this recommendation. The Human Resources Specialist/Employee 

Relations is already doing this. A one-month period is required to download for the 

current month. 

3.	 Concur with this recommendation. The Human Resources Specialist/Employee 

Relations is already doing this. A one-month period is required to download for the 

current month. 

4.	 Concur with this recommendation. OHR has requested additional training from 

WMATA. 

5.	 Concur with this recommendation. The process will be incorporated into the policy 

and procedures. 

OIG Comment 

The agency’s planned actions are responsive to the audit issues identified, and when fully 

implemented, should satisfy the intent of the audit suggestions. The OIG provided the 

detailed results of testing to OHR on May 18, 2009. The OIG suggests the OHR download 

the monthly claim activity data and review the information to identify trends in claim activity 

over an extended period of time. 

54 
CONCLUSIONS 

The OIG continues to note 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, employees do not have 

access to duplicate benefits, and that ineligible persons do not have access to FEC transit 

benefits. Based on the results of this audit follow-up, the OIG has concluded that 

management has failed to adequately respond to the OIG’s 2007 audit recommendations to 

improve the program. Further, as a result of the continued control weaknesses, the program 

was not effectively monitored thereby providing opportunity for fraud, waste and abuse of 

program funds. 

The FEC Transit Benefit Program requires immediate correction and ongoing monitoring to 

ensure that the program weaknesses and abuses described in this report are prevented, 

detected, and corrected in the future, thus preventing program fraud, waste and abuse. To 

date, program management has failed to implement 21 of the 25 recommendations contained 

in the prior audit report, largely due to a lack of centralized program monitoring and 

reporting. This lack of central oversight and accountability has negatively impacted program 

management’s willingness to prioritize program administration and to devise an effective 

control framework. The transit benefit program has undergone financial increases annually 

since 2005 as well as major program and system changes as WMATA continues to enhance 

its systems and processes to more effectively serve to the public. Given the cash equivalent 

nature of the program and the high inherent risk of fraud, the FEC transit benefit program 

remains a financial risk to the FEC as well as to the government as a whole. 

Program management should take the steps necessary to plan, monitor, report, review and 

modify program administration to ensure the program achieves its intended objective and is 

not susceptible to fraud waste and abuse. 

55 
Attachment 1 Summary of Audit Follow-up Findings and Recommendations 

SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

1a 

Transit Benefit Program Lacks Oversight and Accountability 

The Commission should designate a single individual with the responsibility, authority, and accountability to oversee the program in its entirety, and to address the transit benefit program weaknesses identified in this follow-up report and the prior transit benefit audit report. 

Program responsibility, authority and accountability shall reside with an Office of Human Resource (OHR) Specialist with oversight from the Office of the Staff Director. The OSD prefers not to name specific individuals in this response but offices instead. The OSD will develop and maintain on the FECNet OSD Web page a list of staff, by name, responsible for critical actions 

Thresideimintrec

and specific duties in offices under the purview of the OSD. This action will be captured and addressed in the Corrective Action Plan (CAP). 

2a 

Program Management has not Complied with Directive 50 

FEC officials comply with Directive 50, to include the following: 

 provide corrective action plans to the OIG 

within 30 days of final report; 

 submit the corrective action plans within 30 

days to the Commission via the staff Director for information, tally vote or approval; 

 hold regular meetings with the OIG to discuss 

the status of the outstanding recommendations; 

 produce semi-annual reports to the Commission 

on the status of outstanding recommendations; and 

Concur with recommendation. Directive 50 will be updated and a first draft circulated to the Commission within thirty days (30) of receipt of the final report. A CAP will be provided within thirty (30) days of the final audit. 

ThresideimintrecbeDiemregof 

 use the FEC OIG Audit Recommendation 

Tracking System or similar system that records recommendations, agreed management actions and implementation status. 

recmaCo
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

3a 

FEC’s Transit Benefit Program Control Status Reported to OMB was not Fully or Accurately Assessed 

FEC management should implement control processes to ensure information prepared for external reporting is fully and accurately assessed prior to forwarding to the Commission for approval and release. 

Concur with recommendation. The intention is to develop an action within 90 days of the final report being published. This action will be listed in the Corrective Action Plan listed in 2a. 

Thresideimintrec

3b 

FEC’s Transit Benefit Program Control Status Reported to OMB was not Fully or Accurately Assessed 

The FEC OIG requests that draft responses to OMB and other oversight entities are provided by management to the OIG as a matter of courtesy when those responses specifically refer to OIG audit activities and reported audit results. 

Concur with recommendation. OSD will adopt a policy where by communications made to outside agencies will be coordinated with CFO, OGC and OIG prior to release. 

ThexOIare resop

4a 

Program Policy and Procedures Need Improvement 

Program management should consider the OIG’s findings and revise the program directive/policy and other procedure documents. 

Directive 54 will be updated and a final draft will be circulated to the Commission for a vote. 

Threcresideimintrec

4b 

Program Policy and Procedures Need Improvement 

Management should request examples of transit benefit policies and procedure guides from other federal agencies, GAO, or OMB to use as examples in designing its revised policies and procedures. In addition, management should consider using the WMATA system user guide as a starting point for developing the procedures guide for OHR program officials. 

The OSD cannot support this recommendation. Given the timing of the audit report and requested management response, this is both unnecessary and not possible. OSD, OHR and other offices have conducted sufficient research to produce a revised policy that reflects cohesion of the WMATA system and FEC procedures. 

W4bproby exanothnopoopguanissfol
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

4c 

Program Policy and Procedures Need Improvement 

The transit benefit application form should be modified to include elements suggested in the OMB memorandum sample form, such as compressed schedules; flexiplace; and age and handicap reduced commuter rates. The form should also include an employee release authorizing the FEC to obtain transit activity detail from WMATA for transit activity on the FEC issued SmarTrip card, as needed, to effectively monitor the program. The form should encourage employees who regularly use WMATA transit systems for personal use or metro parking to 

The OSD cannot support this recommendation. WMATA will not release transit activity detail unless a criminal investigation and legal proceeding. The request must be pursuant to a court order or made by 

W4cthadeinfeminvWreginf

maintain a separate SmarTrip for those transactions. If agreed by management, the form should also reflect that staff may claim and retain transit subsidy where their commute payment is based on a monthly rate such as van pool or train pass, even if they do not meet the 50% participation rate for a given month. 

the employee. The transit benefit application form has been updated. 

tramareerecmainf

4d 

Program Policy and Procedures Need Improvement 

Management should consider using greater than and less than values to define the maximum benefits claimable when an employee’s commuting costs vary based on days commuted each month. The less than/greater than scenarios could be used to ensure fairness to the employees while also limiting program expense to the FEC. The policy change would provide a quantifiable method for determining compliance. 

Concur with recommendation. Procedure will be incorporated in revised Standard Operating Procedures (SOP). 

Wrecapthe OHJuthe abupFEus

5a 

Separated Employees Were Not Removed Timely 

Program management should implement internal controls and quality assurance processes to ensure employees who separate have their access to transit subsidy terminated at the earliest possible date. 

Concur with recommendation. Procedure will be incorporated in a revised SOP. 

Thresideimintrec

5b 

Separated Employees Were Not Removed Timely 

Program management should consider whether to attempt recovery of the $1,181 in excess benefits claimed by the seven former employees. 

FEC Management will review the specifics for the impacted employees and determine the best course of action for the agency. 

Thresideimintrec
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

6a 

Participants Separating From the Agency Did Not Return Unused Transit Subsidy 

The OHR should ensure the employee separation clearance process includes the computation of unused transit subsidy to be recovered from separating employees. The revised clearance form should be used to show the unused transit subsidy repayment amount or the fact that no repayment is required. 

Concur with recommendation. The OHR has updated the separation clearance process to incorporate transit subsidy as an item to check so that it is readily identifiable in order to calculate any unused transit subsidy, as outlined in the policy. The updated form is currently being used by OHR and the process will be incorporated in the revised SOP. 

Threcresideimintrec

6b 

Participants Separating From the Agency Did Not Return Unused Transit Subsidy 

The repayment calculation worksheet provided by the OIG in May 2008, or similar document, should be used to calculate whether repayment is due. A copy of the calculation worksheet should be attached to the employee clearance form so that Finance can request and collect the correct amount from separating employees. 

Concur with recommendation. The employee clearance form has been updated to reflect this recommendation. A copy of the updated form will be provided with the CAP. 

6c 

Participants Separating From the Agency Did Not Return Unused Transit Subsidy 

If not already available, OHR employees should be given read only access to the WebTA system so that OHR can view time and attendance records for the month an employee separates and use actual attendance to calculate whether repayment is due. Alternatively, separating employees should be instructed to print a copy of their timesheets for the current month and provide the information to OHR to allow calculation of transit subsidy repayment. 

The OSD cannot support this recommendation. The OSD does not find it appropriate for OHR to pull Time and Attendance for this purpose. OSD will consult further with OGC on this issue and advise OIG of OGC opinion. This will be added to the CAP. 

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SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

6d 

Participants Separating From the Agency Did Not Return Unused Transit Subsidy 

OHR management 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. 

Concur with this recommendation. OHR has requested additional training from WMATA. Details will be provided in the Corrective Action Plan. The training is done in cooperation with WMATA and OHR. 

Threcresideimintrec

7a 

Employees Have Access to Duplicate Benefits 

OHR should download the “currently enrolled” and “employee removed” listings monthly, as well as use the on-line WMATA system data and the FEC Transit Benefit Eligibility Listing to verify the status of employees prior to processing additions or changes to the transit benefit system. It is important to note that employees may have had several SmarTrip cards registered in their names over their term of employment, 

Concur with this recommendation. OHR has already instituted a process to address this issue. Details will be provided in the Corrective Action Plan. Copies of the procedures will 

Thresideimintrecloo

but should only have one active SmarTrip card at any point in time. OHR must verify and review system changes by SmarTrip card number as well as employee name to prevent access to duplicate benefits. 

be provided. ad

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7b 

Employees Have Access to Duplicate Benefits 

The record of change requests and the resulting changes processed should be retained in OHR transit files, along with the completed application/change request form. As a result, any OHR staff member who is responsible for processing transactions can review the history of requests by employee name and determine whether previous requests have been completed. OHR should consider creating a shared e-mail directory to store communications from FEC employees regarding their transit inquiries and change requests. Any request for 

Concur with this recommendation. OHR has already instituted a process to address this issue and will be outlined in the CAP. 

Thresideimintreclooad

new benefits, termination of benefit, or change in the amount of benefit received, address and commute pattern, and type of benefit (voucher or SmartBenefit) should be documented using the Transit Subsidy Program Application form. 

imwi
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

7c 

Employees Have Access to Duplicate Benefits 

Program management should review change requests on a regular basis to ensure benefits are not available in two forms; voucher and SmartBenefits, or two or more SmartBenefit card numbers. Program management should consider an automated report comparison between the Transit Benefit Eligibility Listing (PeopleSoft) that records the participants’ names and benefit type (Metrochek/voucher or SmartBenefits) to the WMATA “currently enrolled” listing to highlight duplicate benefits. 

Concur with this recommendation. Process has been adopted, although not automated. 

Thresideimintreclooadimwi

7d 

Employees Have Access to Duplicate Benefits 

OHR should input the SmarTrip card number in the PeopleSoft system at the time the card is distributed to an employee and not attempt to manage whether the employee name prints on the monthly distribution listing for Finance. Employee names should be manually written on the distribution form for one or more months if the participants have elected to receive transit benefits via SmarTrip. 

Concur with this recommendation. Process has been adopted, although not automated. 

7e 

Employees Have Access to Duplicate Benefits 

Finance should distribute benefits as indicated by OHR for the time period indicated. If WMATA system limitations require manual benefit distribution for more than one month, Finance should print the e-mail for reference and inclusion in distribution reports for both months. 

FEC management concurs with the recommendation for Finance to reconcile OHR reports and is already performing this internal control check for the vouchers. 
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

8a 

Employees Did Not Comply With Program Policy 

Transit benefit policies and communications should convey to participants that FEC management or other officials may periodically compare extended leave and travel records to transit benefit claims for compliance with FEC program requirements. Although the current directive and monthly reminders to program participants provide the program policy for extended leave and travel, given the continued compliance issue, additional controls are necessary. 

The OSD cannot support this recommendation. This is not possible without audit authority, which the FEC does not have except in the case of a criminal investigation. Currently, OHR has a periodic review process in place and compares claimed and unclaimed reports. The process will be codified in the revised SOP. OSD will encourage management at all levels to incorporate informational briefings into any venue where it is appropriate. 

WrecreqMencotypcodaleaconeExexbeissimenThclawobeof 

8b 

Employees Did Not Comply With Program Policy 

Division management should regularly communicate the transit benefit policy to their staff to ensure participants are fully aware of their responsibility to reduce the benefits claimed during extended absences for travel or leave. This communication could be done during normal staff or team meetings. 

The OSD cannot support this recommendation. Line supervisors should bear no responsibility, oversight or otherwise, of the benefit. However, OSD will encourage management at all levels to incorporate informational briefings into any venue where it is appropriate. 

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8c 

Employees Did Not Comply With Program Policy 

OHR 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. 

Concur with recommendation. Policy and procedures are being revised with a no later than date of August 1, 2009 and will be posted on FECNet. 

WmaAwrev
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

8d 

Employees Did Not Comply With Program Policy 

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 percent of the business days in a month. 

The OSD cannot support this recommendation. It is far-reaching to expect supervisors to adhere to this recommendation. Communication and awareness will be increased via FECNet. 

WmaAwrev

8e 

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. Properly trained program staff can provide accurate information to employees who contact OHR for advisement regarding program requirements. 

Concur with this recommendation. The OSD is working to revise the FEC Parking Policy as well as the revised Transit Policy. OHR and Administrative Services staff will be trained in procedures on how to process terminations and removals based on employees’ circumstances. Employees and/or managers will be instructed to notify OHR when employees will be absent from duty station for an extended time. Th

resideimint

8f rec

Employees Did Not Comply With Program Policy 

Program management should ensure participants placed on administrative leave have benefits suspended or removed, as appropriate. Although program management has implemented procedures that include transit benefit restrictions for employees on administrative leave, additional controls are warranted. It should take care to suspend and remove access to transit benefits at the earliest possible date following an employee’s placement on administrative leave. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

8g 

Employees Did Not Comply With Program Policy 

Program management should implement a process to identify staff who are absent for an extended period of time and review their claim activity to determine whether the control processes implemented result in program compliance. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. This may be done in cooperation with timekeepers, but again, the responsibility lies with the employees. 
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

9a 

Employee Claim Patterns Indicate They Do Not Meet Program Eligibility Requirements 

OHR should review the detailed results of this testing and consider the implications for revising program policy and operating procedures. 

Concur with this recommendation. 

Thresideimintrecforadimwi

9b 

Employee Claim Patterns Indicate They Do Not Meet Program Eligibility Requirements 

OHR should review the detailed results of this testing and request staff certify that they met program eligibility requirements and comply with the Directive. OHR should request written explanation from employees who have a history of irregular claims. 

Concur with this recommendation. OHR maintains a log of this activity. This will be codified in the revised policy and procedures. 

9c 

Employee Claim Patterns Indicate They Do Not Meet Program Eligibility Requirements 

OHR should download the monthly WMATA claim activity listings each month. The data should be compiled and reviewed annually for irregular claims to ensure employees who received benefits use them as intended. 

Concur with this recommendation. OHR maintains a log of this activity. This will be codified in the revised policy and procedures. 

10a 

Application, Change Requests and Annual Certification Process is not Formally or Effectively Monitored 

OHR should require all FEC employees submit proof of their commute with their certification by using the trip planner features of WMATA website. 

Concur with this recommendation. The process is being incorporated into the policy and procedures. 

Thresideimintrecforadimwi

10b 

Application, Change Requests and Annual Certification Process is not Formally or Effectively Monitored 

After reviewing the commute information, costs, and transit application mathematical calculations, OHR management should sign the form authorizing the OHR clerk to process the application, change request, or certification. 

Concur with this recommendation. The Human Resources Specialist/Employee Relations will sign the form authorizing the Human Resources Assistant to process the application, change request or certification. The process will be incorporated into the policy and procedures. 

10c 

Application, Change Requests and Annual Certification Process is not Formally or Effectively Monitored 

Clerks who process applications, change requests, or annual certifications should sign and date the form in the fields provided after entering the data in the system and verifying the transaction was processed. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

10d 

Application, Change Requests and Annual Certification Process is not Formally or Effectively Monitored 

Signature stamps should not be used to authorize transit benefit applications, change requests, and annual certifications. 

Concur with this recommendation. 

Thresideimintrecforadimwi

10e 

Application, Change Requests and Annual Certification Process is not Formally or Effectively Monitored 

OHR should track annual certification forms submitted by FEC staff. For those who fail to submit a form, an email reminder should be used followed by benefit suspension or removal. Failure to certify by FEC employees should be considered an informal request to cease participation in the program. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

10f 

Application, Change Requests and Annual Certification Process is not Formally or Effectively 

OHR should not use the WMATA automatic increase function which automatically increases those receiving the maximum benefit. Instead, it should submit a listing to WMATA of FEC staff that have certified and are authorized to receive the increase. If the auto increase function is used, the FEC should first create a listing of each staff member, benefit type (SmartBenefit or voucher), the amount certified (actual monthly commute costs) and the maximum authorized each month. The 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

Monitored listing can then be sorted to identify those staff that were 

authorized to receive the previous maximum but do not have commute costs in excess of that amount. Those individuals would have their system increase reduced to the previous value. 

11a 

Program Weaknesses Relating to Parking have not been Addressed 

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. 

Concur with this recommendation. Communication and awareness will be increased via FECNet informing the employees of the procedures of the transit program. Th

reside11imintrec

11b 

Program Weaknesses Relating to Parking have not been Addressed 

The Administrative Division should create and maintain a complete and accurate listing of employees who receive long-term FEC paid parking benefits, such as SL and 

those considered permanently handicapped. Although the current practice is to provide annual passes for these employees, the listing should be reviewed and updated regularly for changes in staff and saved on a shared network directory to allow OHR staff access to the most recent data at all times. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

11c 

Program Weaknesses Relating to Parking have not been Addressed 

The Administrative Division should receive the listing of FEC employees who pay to park in the basement from the building parking manager each month. It should scan the document and save it on a shared network directory to allow OHR staff access to the most recent data at all times. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

Threside11imintrec

11d 

Program Weaknesses Relating to Parking have not been Addressed 

The Administrative Division should maintain a listing of employees who have been issued short term handicap parking permits. Where possible, the length of time the permit is needed should be included to allow OHR to suspend or remove access to transit benefits for that period of time. The information should be included in a shared directory to allow OHR access to the most recent data at all times. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

11e 

Program Weaknesses Relating to Parking have not been Addressed 

Employees who receive transit benefits and who will be absent for an extended period of time, or their supervisor, should notify OHR of the intended absence and change in eligibility status so that access to benefits can be suspended or removed until the employee returns. 

Concur with recommendation. This is an employee responsibility but will be covered in the revised SOP which will be posted on FECNet. 

11f 

Program Weaknesses Relating to Parking have not been Addressed 

The Administrative Division should require all staff who receives FEC paid parking benefits, including handicap parking benefits, and those who pay to park in the FEC garage certify the names of FEC staff that carpool with them. The listing of carpoolers should be included in a shared directory to allow OHR access to the most recent data at all times. 

The OSD cannot fully support this recommendation. However, as a security measure (not related to the transit authority benefit program) a policy will be drafted which states that all members of any car pool accessing the underground parking at 999 E Street NW must be identified. 

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SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

11g 

Program Weaknesses Relating to Parking have not been Addressed 

OHR should review the Transit Subsidy Eligibility 

Listing monthly to ensure no staff listed as receiving FEC paid parking benefits is included. If an exception is noted and the employee elects to receive the transit benefit, OHR and Administrative Divisions should verify the FEC paid parking pass has been returned. OHR should 

also review the listing to ensure staff that pays to park in the basement and their carpoolers do not have access to transit benefits. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

Thresideimintrec

12a 

Employee Names in the WMATA System are not Consistent with National Finance Center Listings 

OHR should amend the WMATA system detail to reflect 

the name used in the NFC system. 

Concur with this recommendation. This will be added to the CAP with an approximate date for it to take effect in both systems. Th

resideimintrecforadimwi

12b 

Employee Names in the WMATA System are not Consistent with National Finance Center Listings 

OHR should ensure all future applications for transit benefit have the name reflected as that in the NFC. 

Concur with this recommendation. This will be included in the revised SOP. 

12c 

Employee Names in the WMATA System are not Consistent with National Finance Center Listings 

When processing changes to personnel records which impact name, OHR should consider whether any adjustment to WMATA or PeopleSoft systems is required. Where necessary, OHR input changes to ensure names are consistent between FEC systems. 

Concur with the recommendation. The process is being incorporated into the policy and procedures. 

13a 

Employees Have Been Assigned SmartBenefit Cards That Remain Unregistered 

In order to restrict access to duplicate benefits and ensure employees are removed timely, OHR should register all 

SmarTrip cards distributed in the employee’s name at the time the card is issued. 

Concur with this recommendation. The revised policy will articulate that all employees must register their cards to receive benefits and/or receive the card. This will be codified in the revised SOP. 

Thresideimintrec

13b 

Employees Have Been Assigned SmartBenefit Cards That Remain Unregistered 

If OHR is unable to determine which FEC employees have been assigned the unregistered cards; it should suspend the cards and send notice to all FEC staff for the employees with the associate cards to contact OHR. 

Concur with this recommendation. The revised policy will articulate that all employees must register their cards to receive benefits and/or receive the card. Currently there are no unregistered cards. 
SUMMARY OF AUDIT FOLLOW-UP FINDINGS AND RECOMMENDATIONS 

Recommendation 

No. Finding Recommendation Management Response 

14a 

Single WMATA System Log-on Used for Multiple OHR Staff 

OHR employees should be assigned separate logon/passwords for both WMATA systems and FEC systems. Program Management should consider formal training and read-only access to WMATA systems for those in both Finance and Administration Division to create the best possible control environment for the FEC. 

Concur with this recommendation. OHR has requested from the WMATA representative separate logins and training. 

Thresideimintrec

15a 

Monthly Balance of Metrocheks/Vouchers On-Hand Should Be Reviewed 

Finance should continue to review and reduce the level of Metrochek/vouchers held. The current and previous rates of distribution between 60 to 70 percent indicate additional reductions could be achieved while still maintaining sufficient reserves to meet ad hoc demands. 

Finance reduced the inventory at the end of February 2009 by approximately 35%. FEC management will continue to annually evaluate the appropriate level of inventory necessary to effectively support the organization. 

Thresideimintrec

16a 

Metrochek Stock Level Variances Were Not Fully Documented 

Finance should document all variances and the actions taken to investigate and resolve the variance in the monthly distribution records. 

Concur with this recommendation and is currently documenting all variances and discrepancies. 

Threside16imintrec

16b 

Metrochek Stock Level Variances Were Not Fully Documented 

To ensure mathematical accuracy of the monthly distribution and stock counts, Finance staff should use a spreadsheet or adding tape to calculate the total distributed and expected and actual closing stock levels. An example spreadsheet to reconcile actual stock to calculated distribution levels was provided by the OIG. 

FEC management believes that the current spreadsheet utilized by Finance is sufficient to monitor and reconcile all voucher balances. 

WtesuspreAnmerevfol
Other Matters of Interest 

1 

Employee Claim Patterns Indicate They May Not Meet Program Eligibility Requirements 

OHR should review the detailed results of this testing and consider the implications for revising program policy and 

operating procedures. 

Concur with this recommendation. The Human Resources Specialist/Employee Relations is already doing this. A one-month period is required to download for the current month. 

ThresideimintThres18OHclathe in ex

2 

Employee Claim Patterns Indicate They May Not Meet Program Eligibility Requirements 

OHR should review the detailed results of the testing and request staff certifies that they met program eligibility requirements and comply with the Directive. OHR should request written explanation from employees who have a history of late claims. 

Concur with this recommendation. The Human Resources Specialist/Employee Relations is already doing this. A one-month period is required to download for the current month. 

3 

Employee Claim Patterns Indicate They May Not Meet Program Eligibility Requirements 

OHR should download the monthly WMATA claim 

activity listings each month. The data should be compiled and reviewed annually for late claims to ensure employees who received benefits use them as intended. 

Concur with this recommendation. The Human Resources Specialist/Employee Relations is already doing this. A one-month period is required to download for the current month. 

4 

Employee Claim Patterns Indicate They May Not Meet Program Eligibility Requirements 

OHR should obtain information and training on system features that allow forward projection and suspension of funds downloaded when they are not claimed by midmonth. In conjunction with policy revision, it should consider whether to implement the control feature to allow parity between SmartBenefit and voucher recipients. 

Concur with this recommendation. OHR has requested additional training from WMATA. 

Thresideimint

5 

Employee Claim Patterns Indicate They May Not Meet Program Eligibility Requirements 

Program management should revise the Request for Late Distribution of Fare Media form to include calculation of 

the benefit authorized under the policy and the Acknowledgement of Receipt of Fare Media While at Temporary Duty Station form to include the location of the temporary duty station and whether full reduced transit subsidy is authorized. 

Concur with this recommendation. The process will be incorporated into the policy and procedures. 

Thresideimint
 

 

Attachment 2 OMB Memorandum 07-15

EXECUTIVE OFFICE OF THE PRESIDENT 

OFFICE OF MANAGEMENT AND BUDGET 

WASHINGTON, D.C. 20503 

May 14, 2007 

M-07-15
 

MEMORANDUM FOR THE HEADS OF DEPARTMENTS AND AGENCIES 

FROM: Robert Shea 

 Associate Director for Management 

SUBJECT: Federal Transit Benefits Program 

The Federal Transit Benefits Program is designed to subsidize Federal employees’ cost of using 

public transportation to travel to and from work. On April 24, 2007, the Government Accountability 

Office (GAO) reported numerous instances of fraud and abuse of Metrocheks by Federal 

employees.1

 In one instance, GAO found, after a three-day investigation, an employee who drove to 

work, parked for free in an agency-provided parking, and still collected $105 per month in 

Metrocheks, most of which he sold on the Internet auction site, eBay. In several instances, Federal 

employees were caught selling their benefits on the popular community website, Craigslist. In other 

instances, former Federal employees continued to receive transit benefits even after they left their 

agencies. 

We must preserve the benefits of this program while eliminating the opportunity for waste, fraud, 

and abuse. In response to press reports, many agencies immediately notified their employees of the 

proper and improper uses of transit benefits. To prevent further abuse, GAO and others have 

identified additional internal controls to improve administration of the program. 

Please confirm to me, in writing, no later than June 30, 2007 that you have implemented at a 

minimum the internal controls listed in the attachment, Transit Benefit Internal Controls. If you 

believe other, existing controls are in place and that additional controls are unwarranted, please 

make that assertion also in writing. For your additional reference, attached to this memo are copies 

of (1) an agency note to employees reminding them of the proper and improper use of transit 

benefits, (2) a transit benefit application that adopts the application controls described below, and 

(3) a mass transit expense work sheet to assist employees in calculating their usual monthly mass 

transit commuting cost. 

Attachments 

1 Federal Transit Benefits Program: Ineffective Fraud and Abuse by Federal Workers, GAO-07-724T, (Washington, D.C., 

April 24, 2007). 

70
 

 

Attachment 2 OMB Memorandum 07-15

Transit Benefit Internal Controls 

Application Requirements 

Employee Home Address 

Employee Work Address 

Commuting Cost Breakdown 

Employee Certification of Eligibility 

Warning Against Making False Statements in Benefit Application 

Note: Some agencies require employees to affix a copy of a completed Washington Metropolitan 

Area Transit Authority online Trip Planner, which employees can use to determine the participant’s 

actual daily, and then monthly, public transportation costs. 

Independent Verification of Eligibility 

Commuting Cost Verified by Approving Official (e.g. employee's home address validated and 

commuting costs correctly calculated) 

Eligibility Verified by Approving Official 

Implementation 

Applicants Checked Against Parking Benefits Records 

Benefits Adjusted Due to Travel, Leave, or Change of Address 

Removal from Transit Benefits Program Included in Exit Procedures 

2
 71
 

 

 

 

 

 

 

Attachment 2 OMB Memorandum 07-15

----- Original Message -----

From: Postmaster 

To: DL-EOP-ALL 

Sent: Fri May 04 18:45:18 2007

Subject: Transportation Subsidy Benefit 

Use of Your Transportation Subsidy Benefit 

This is a reminder to all employees who receive the transportation

subsidy that it is a benefit and may only be used to pay the costs of

YOUR public transportation to and from work, which may include Metro

subway/bus, Virginia Railway Express (VRE), MARC trains, and other

eligible commuter buses and vanpools. The amount of the transit benefit

will equal the actual amount paid for public transportation, not to

exceed $110.00 per month. 

The certification that each recipient signed on the Transportation

Subsidy Benefit Program application form states: 

· I work for the Executive Office of the President, and I am not

listed as a member of a Federal commuter vanpool or carpool. 

· I am not the holder of any other form of workplace motor vehicle

parking permit, nor am I receiving transportation benefits from another

Federal organization. 

· I am eligible for a transportation subsidy benefit for use on a

participating public transportation system, am obtaining the subsidy

for my work-related commuting use, and will not transfer the benefit to

anyone else. 

· I have accurately listed the commuting cost to and from my home to

work using public transportation. 

· I acknowledge that it is my responsibility to return any unused

transportation subsidy to the component (e.g., subsidy unused due to

leave taken or separation). 

· I understand that this certification and making false, fictitious,

or fraudulent certification may render me subject to criminal

prosecution under Title 18, United States Code, Section 1001, and/or

adverse action, including removal from the Federal service. 

Should you have questions regarding the Transportation Subsidy Benefit

Program, please contact the Office of Administration, Human Resources

Management Division on 202-395-1088. 

Thank you. 

72
FORM CD-544 

REV. 02107 DOC APPLICATION FOR -SIT BENEFIT 

( Please Print ) 

New Application Modification RecertificationQ 

Name: 

(J-4 (First) . (Last 4 Di~bof Sod Secunty No.) (GHome Address: 

(NumberESwdApt. No.) (C~Y) (5~). (ZIP) 

Duildind (Room Number) (MailStop) (Phone Number) 

CURRENT MODE OF TRANSPORTATION USED FOR COMMUTING: (Please check allthat apply) 

-Car (single or double occupancy, not including:drive to Commuter Parking Lot) Other -Ed 

CarNan Pool Commuter Bus Commuter Train -Metro Bus -Me~oRail 

MASS TRANSIT BENEFIT MODE OF COMMUTING:(Please check all that apply) 

-Commuter Bus Commutes Train Metro Bus Mem Rail Metro-Approved Vanpool 

DO YOU IUECEIVE REDUCED FARE PUBUC TRANSPORTATIONRATES (Employee with habilitiesor Semor Citizen) YES KO 

EMPLOYEE Certification: I hereby certify that 1 am employed by the Department of Commerce (DOC) and am not named on a worksite parking permit 

wlthDOC m any other fedwl agency. I also certi@ that I am eligble for a public banspmbon subsldy beneEt. wIIl be using it for my regular My commute 

to mdror hwork and will not transfer It to anyone else. In addition, I certify that the monthly transh beneflt I am receiwing does not exceed my average 

monthly commutmg cost (bad on my workweek schedule). 

This cdhh~nrnm a matter wtlun the pisdiction of an agency of the United States and making a false, fictitious, or fraudulent ~~catjon may render 

the maker subject to crlrmnal prosecuhon under title 18, United Sbtes &ode, section 1001, civlI penalty achon provihng for adrnimstrative recoveties of up 

to $5000 per violation, andm agency dfsdplkry actions up to and indudjng disrnlssal. 

X 

(Applim S-1 0~) 

mACY ACT STATEMENT: Ths informahon is xlIicited under authority of 5 U.S. C. Semons 301 and 7905. Furnishing the information on this form 

is vduntmry, but failure to do so may result m disappd of your request fa a public aanslt fare benefir The purpose of this information is to facilitate timely 

pdng of ywr reqmf, tu enntre your ellgibihy, and to prevent misuse of the fun& involved. This information will be matched with Ihts at other Fed& 

agendes to emure that you are not ltsted as a qwl or \panpool pamcipnt or a holder OF any orher form of vehicle work site parking pemt wth Dement 

of Cornmaceor any other Fed& agency. 

Accounting Cldcation Code: (Print Clearly) 

Enter AppropriateDollar Amount of the Fare Media Requested: $ Lblonthly Cost) mot to Exceed $110 00per month) 

X 

[Supenisor's Signature) (Print Name) (Date) VOTE: Approval is based on person's eligibility ta receive bemlits in the amount stated above.) 

COMPLETED BY BUREAU'S BUDGET OFFICl I 

Servicing Accounting Office: 

pILc: 

APPROVED FOR AVAILABILITYOF FUNDS: 

X 

(Signatureof Budget Approving OffibaIJ (Print Name) 

ICOMPLETED BY TRANSIT POINT OF CONTACT: 

(Signatureof Transit Point of Cordact) (Print Name) late) 

Attachment 2 OMB Memorandum 07-15 73
-- 

R/IASS TRANSIT EXPENSE WORK SHEET 


NOTE DOC AppIlcafionfor Pubk TranslrFare Bdt, re* DOC pdcipmts ta calculatetheir usual mmthIy maw &t mmmuhg cast to tha marcstdoIk fmthmd& commute to work lhrs work Bhect must be cormplctedto rscelvs subsidy benefits dwll assist tmphyees m compuangthm usual mwthly mass@ansitcommunng cost 

INSTRUCTIONS: Calculateyour Tom!Mo71rhIvMass7hnrrr Erpmes hy &e way you pay for m a Listym mode of mass mpdon, and bow much it cosr )rou; or ~f 

pard &or if purchased m e passes. Then usingthe work sheet below, men all COSTA to a total monthly amom. It 11:possible that an emplv my h~vea combinahonof 

daily,weckly or monthly txpcuscs m coquang thcu total dly mass Uamprkdon orpcapc~ 

REMEmER: Parbtgfecs are wt atlowed and caanot be induded whca compufingmonthly transit cwk If you area pmn with a dig=bilify or ~eniorcitken raceiving 

reduced fate rate%you must &late he dud rata vou uav. 

MODE OF TWNSPORTATION DAILY 1 WEEKLY PASS I MONTHLY PASS 

EXPENSE 1 EXPENSE EXPENSE 

BUS TO WORK NAME OFCOMPANY 

(&&I i 

BUS FROM WORK /
 NAME OF COMPANY

(LdJ a 

OTHER BUS MODE TO WORK 1 NAME OF COMPANY 

(Cammut8r0fC0110~ 

OTHER BUS MODE FROM WORK NAME OF COMPANY 

(Cornnuder orCwn!y) 

RAlL TO WORK FROM WHAT STATION 

(bght Rall ar Subwavl 

RAIL FA1 FROM WHAT STATION 

pght Re 

COMMUTER RAIL FROM WORK NAME OF COMPANY 

(TmfnJ 

OTHER 

LIST MODE TO WORK NAME OF COYPAW $ 

LIST MODE FROM WORK S I 

VAN POOL COST PER MONTH NAME OF COMPANY 

TOTAL t $0.00 

CONVERTING DAILY AND WEEKLY COST TO MONTHLYCOST 

40-HOUR WORKWEEK SCHEDULE CONVERSION 

ElGKT HOUR WORK DAY CONVERSION NINE HOUR WORK DAY CONVERSION TEN HOUR WORKDAY CC INVERSION 

3AlLY COST 

I 

NO DAYS 

WORKED I TOTAL DAlLY COST PER MONTH I .0.00 

TOTAL DAILY COST PER MOMH 

$ 0.00 

DAILY 

COST 

NO. DAYS I WORKED 

., -.>, k, #.A* TOTML WL ibuaT I PER MOMH 

LESS TH4N 4hFtOUR WORKWEEKSCHEDULE CONVERSION , I MEKLY PASS CONVERSION 

Cmpleteffpu work less lhen 404~1~ per week ,7elemmmuter,pad-me, eel WEEKLY PASS 

COSTS 

NUMBER OFWEEKS PER I MONTH TOTAL WEKLY CDST ll PEEMONTH 

DAILY MASS TRANSIT CDST NUMBER OF DAYS TOTAL DAILY OST PER MONTH 

WORKED PER MONTH 

NOTE: If me scheduled numhr of hours y~uwnrk per month changes, see your Transd polntof con!aa. 

MAME OF EMPLOYEE (Pleaseprinty~wnanm Mfl TOTAL DAILY COST PER MONTH (Hany) t 

TOTAL WEEKLY COST PER MONTH Pany) t 

I 

SIGNATURE OF EMPLOYEE TOT& MONTHLY COST PER MONTH [fi any] t 

I 

GRANDTOTAL COST PER MONTHPany) I 

MY GRANDTOTAL MONTHLY MASS TRANSlT CI3MMCTTlNG COSTS ROUNDEDTO THE NEAREST DOLLAR 


(Round s11herup w down to nearest dollar) t $ 


Attachment 2 OMB Memorandum 07-15 74
FEDERAL ELECTION COMMISSION 

OFFICE OF THE CHAIRMAN June 28,2007 

Mr. Robert Shea 

Associate Director for Management 

Executive Office of the President 

Office of Management and Budget 

Washington, DC 20503 

Dear Mr. Shea: 

In response to your memorandum, M-07-15, dated May 14,2007, the Federal Election 

Commission (FEC) is confirming that the internal controls listed in the attachment, Transit Benefit 

Internal Controls, are in place for the FEC's Transit Benefits Program. Recently, our Office of 

Inspector General (OIG) conducted an audit of the FEC's Transit Benefit Program and found that the 

FEC is managing the program effectively. The OIG suggested additional improvements to the 

program, and the FEC will incorporate those suggestions into our procedures to ensure the program 

continues to operate effectively and as intended. 

The Commission appreciates and shares OMB's commitment to sound internal controls and 

management practices. Should you need any additional information, please do not hesitate to contact 

Erin Singshinsuk, Chief Financial Officer at 202-694- 12 17. 

Sincerely, 

Robert D. Lenhard 

Chairman 

Attachment 3 FEC Response to Office of Management and Budget Memorandum 07-15 75
 

 

 

 

Attachment 4 FEC Transit Subsidy Program Application 

FEDERAL ELECTION COMMISSION 

TRANSIT SUBSIDY PROGRAM APPLICATION 

(Please type or print legibly in blue or black ink) 

ACTION REQUESTED (CHECK ONE): ___New ___Change ___Cancellation ___Annual Recertification ___ Temporary NTE 

DATE: ______________ 

NOTE: Items 1 through 12, and the reverse side of this form must be completed in full before submitting to Human Resources. 

APPLICANT INFORMATION 

1. NAME OF APPLICANT (Last, First, Middle 

Initial) 

2. LAST FOUR DIGITS OF SSN 3. DIVISION 

4. HOME ADDRESS (Street, City, State, Zip 

Code) 

5. MODE (S) OF TRANSPORTATION TO BE 

USED DAILY TO COMMUTE TO AND FROM 

WORK. 

___Bus ___Light Rail ___ Subway 

___Ferry ___Train ___Authorized 

Vanpool ___Other (Specify) 

6. TYPE OF FARE MEDIA YOU USE.

 SmarTrip Card (Card No.) 

___________________________ 

___Fare card ___Tickets ___Pass 

___Tokens __Voucher 

___SmarTrip Card 

___Other (Specify) _______________ 

7. WORK TELEPHONE NUMBER 8. MONTHLY COMMUTING COSTS (from 

worksheet on back) 

EMPLOYEE ACKNOWLEDGEMENT AND CERTIFICATION 

• I certify I am employed by the Federal Election Commission. 

• I certify I am eligible for a public transportation fare benefit. I will use it for my daily commute to and from work. I will not give, sell, or 

transfer it to anyone else. 

• I certify I am not a member of a carpool. Furthermore, I do not receive disability or executive parking privileges. 

• I certify that the monthly transit benefit I receive does not exceed my monthly commuting costs. 

• I certify that in any given month, I will not use the Government-provided transit benefit in excess of the statutory limit. If my commuting costs 

per month exceed the monthly statutory limit, I will supplement those additional costs with my own funds. 

• I certify I am responsible for returning unused FEC funded fare subsidy to the Office of Finance no later than my effective date of resignation, transfer, 

retirement, etc. from the FEC. 

• I certify my usual monthly public transportation commuting costs (excluding any parking costs) is the amount listed above (amount is supported by 

completed worksheet.). 

• I understand that I must submit a new Transit Subsidy Program Participant application if there is any permanent change in the information provided 

above. 

• I understand that it is a Federal crime under 18 United States Code, Section 1001, to make a false fictitious or fraudulent statement on this form. If I 

make a false statement, I may be subject to criminal prosecution and punishment, including a fine and/or administrative punishment, which may result on 

the termination of my federal employment. 

11. SIGNATURE OF EMPLOYEE 12. DATE 

TO BE COMPLETED BY THE HUMAN RESOURCES OFFICE 

VERIFICATION – HR BENEFIT COORDINATOR 

13. NAME OF HR BENEFIT COORDINATOR 14. AGENCY MAXIMUM BENEFIT (Enter monthly payable amount for 

each participant based upon commuting costs, statutory limitations, 

agency policy, Union Negotiations, etc.). 

15. SIGNATURE OF HR BENEFIT COORDINATOR 16. DATE 

17. ENTERED IN METRO SYSTEM AND FEC DATABASE BY: 18. DATE 

PRIVACY ACT STATEMENT 

This information is solicited under authority of Public Law 101-509. Furnishing the information on this form is voluntary, but failure to do so may result 

in disapproval of your request for a public transportation transit fare benefit. The purpose of this information is to facilitate timely processing of your 

request, to ensure your eligibility, and to prevent misuse of the funds involved. This information will be provided to the Human Resources and Finance to 

administer this program and to ensure that you are not listed as a carpool participant or a holder of any other form of vehicle work site parking permit 

with FEC or any other Federal Agency. 

76 
 

 

CALCULATION OF COMMUTING COST 

To be completed by applicant: Use Appropriate Daily and/or Monthly Costs to calculate your 

costs per month. Note: Do not include parking costs. 

Mode of 

Transportation 

Daily Costs 

(round trip) 

Multiplied by 

# of work days 

(20 for F-T) 

Equals 

Monthly 

Commute Costs 

Subway (METRO) $ Multiplied by

 ___ work days 

$ 

Metro Bus $ Multiplied by

 ___ work days 

$ 

Commuter Train 

(VRE, MARC, etc.) 

$ Multiplied by

 ___ work days 

$ 

Other Bus 

(e.g., Ride-On) 

$ Multiplied by 

___ work days 

$ 

Van Pool $ Multiplied by 

___ work days 

$ 

Other $ Multiplied by 

___ work days 

$ 

Total – all costs $ Multiplied by 

___ work days 

$ 

Routing Pattern (Required): ________________to______________ and return 

________________ to _____________ and return 

Example 1: Vienna to Metro Center and return 

Example 2: Line 1 Bus from residence to New Carrollton 

 Line 2 Metro to Navy Archive and return. Bus back to residence. 

77 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Attachment 5 FEC Employee Clearance Form 

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 

78 
 

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 Resources Director: 

Date: 

Original-----Finance 

Copy---------HR 

Copy---------Employee 

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

79 
Attachment 6 - Prior Audit Corrective Action Plan with Current OIG Status 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

Program Policy Needs Improvement – Finding #1 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. 

FEC management has updated its policy to incorporate guidance related to the SmartBenefits Program. The policy is current under review and is expected to be final March 31, 2008. 

OCFO – Brian Duffy, ext. 1230 

March 31, 2008 

OPEN 

Draft policDirective provided. formally acommunicdraft policRefer find
OPEN 

According staff, trainSOP is nomanage prSOP does operating processing additions, changes, aquality assto ensure edetected amanner. R

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

HR – James Wilson, ext. 1082 and Brian Duffy, ext. 1230 

March 31, 2008 

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. 

FEC management has updated the policy to incorporate procedures related to this program. The policy is currently under review and is expected to be final March 31, 2008. Also, FEC management will provide training to the primary staff responsible for administering and monitoring the transit subsidy program. FEC has updated the Transit Subsidy application to enhance the management of the program. Finally, FEC management will prepare procedures that each office (e.g., HR, Finance, and Administration) should complete as part of their assigned duties to ensure the objective of the transit subsidy program is being achieved. 

Complete HR has developed a SOP for the operations of the transit benefit program, including new guidance addressed in the policy. Also, appropriate staff will be trained two times per year on their respective roles and responsibilities. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

Employees Did Not Comply With Program Policy – Finding #2 

CLOSED The Finanadditional distributiorequiremeperiods of recommenThe OIG nthe monthto be effeccontinued on extendefinding 8 p

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. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 

FEC management has prepared an updated draft of the policy to address the need for adjustment should an employee’s transit subsidy costs incurred be less than that of what they received. Employees will be notified of the revised policy once it has been finalized. 

HR – James March 31, 

Wilson, ext. 2008 1082 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management has updated its policy (formerly Directive 54) to incorporate guidance related to the SmartBenefits Program. The policy is current under review and is expected to be final March 31, 2008 

HR – James Wilson, ext. 1082 

March 31, 2008 

OPEN The draft pbeen finalimprovemhave not bsufficientlprogram onot define procedureactivities ssuspensioncertificatioprocesses/not occur corrected Applicatiobeen postepolicy/Dirfinding 4 p

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. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

HR – James Wilson, ext. 1082 

March 31, 2008 

OPEN Supervisonot occurrannual cerreview noformal revdocumenta monthly to be an efbased on texceptions up reviewnot been fand has nointranet. Rpg. 33. 

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. 

FEC management will ensure all FEC employees receive a copy of the updated policy highlighting the requirements to adjust one’s subsidy benefits when necessary. Furthermore, FEC management will send out reminders via e-mail, on a monthly basis, to all employees of this requirement. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 
OPEN 

Refer abovdraft policsufficientlfollow for It does not assurance prevent fraprogram pprovided tnot receivtransit sysand 10 on 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management will ensure all FEC employees receive a copy of the updated policy. Furthermore, FEC management will send out reminders, on a monthly basis via e-mail, to all employees of this requirement. 

HR – James Wilson, ext. 1082 

March 31, 2008 

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. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management has updated the policy to incorporate guidance related to employees on leave. The policy is current under review and is expected to be final March 31, 2008 

HR – James Wilson, ext. 1082 

March 31, 2008 

7. Program management should develop and implement procedures that include transit benefit restrictions for employees on administrative leave. 

Complete The transit benefit policy has been updated. HR has also developed FAQs that include questions on leave. 

OPEN Draft policdisseminainclusion oprovided bfollow-up FAQ giveon the OHfrom Dire50% rule. Directive commutabthe guidanemployee claimed bebefore bei
OPEN 

OIG proviclearance on order olines needcommunicbenefit to provided a be used to recovery. clearance administrathose sepauses the sathat the fodepending physically leave. Foror be comwithout th5 and 7 on 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

HR – James Wilson, ext. 1082 

March 31, 2008 

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. 

FEC management has updated current policy to address leave situations. The policy is current under review and is expected to be final March 31, 2008. Furthermore, FEC management will review the current clearance form to incorporate requirements relative to official administrative leave. 

Complete The transit benefit policy has been updated. HR has also developed an administrative leave clearance form, similar to the form completed for separating employees. 
OPEN 

The OIG pexit compTo date, it use by OHhad transit returned, icalculation appear the implemenpage 27. 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

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. Program’s Internal Controls Need To Be Strengthened – Finding #3 

Since October 2007, the HR – James April 30, Finance Office has been Wilson, ext. 2008 documenting the return of any 1082 unused transit subsidy on the current clearance form, as well as maintains a copy of any checks obtained. HR intends to update the separation clearance process to incorporate transit subsidy as an item to check so that it is readily identifiable in order to calculate any unused transit subsidy, as outlined in the policy. 

Complete The transit benefit policy has been updated. HR has also updated the exit clearance form to ensure the proper computation and collection of unused transit subsidy from departing employees. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management does not believe that monthly reminders are necessary. The updated policy will provides guidance on this matter, as well as the fact that the separation clearance form will be updated to reflect the transit subsidy. 

HR—James Wilson, ext. 1082 

April 30, 2008 

OPEN The informincluded ie-mail. It clearance intended. Finance rathe amounOHR. Hois not tranis sought, was becauwhether Fconsider oshould calworksheet actual calcpg. 27. 

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. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 
OPEN 

No traininOHR calcform does calculation repayment how that wshould calsystem anshould colthe clearanpg. 27. 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management intends to update the separation clearance process to incorporate the Finance Office to calculate any unused transit subsidy, as outlined in the policy. Training will also be provided, as necessary. 

HR – James Wilson, ext. 1082 

April 30, 2008 

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. 

Complete The transit benefit policy has been updated. HR has also updated the exit clearance form to ensure the proper computation and collection of unused transit subsidy from departing employees. Appropriate staff will be trained two times per year on their respective roles and responsibilities. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management will provide additional training to the Finance Office as it pertains to processing employees separating from the agency. 

HR – James Wilson, ext. 1082 and OCFO – Brian Duffy, ext. 1230 

April 30, 2008 

OPEN The SOP ito manage SOP does operating processing additions, changes, aquality assto ensure edetected amanner. Nyet. It is uthe trainin

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. 

Complete HR has developed a SOP for the operations of the transit benefit program, including new guidance addressed in the policy. Also, appropriate staff will be trained two times per year on their respective roles and responsibilities. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management has updated its current policy to address the unused subsidy. Since Metro does not accept partially used Metrocheks, it has been determined to ensure consistency between Metrochek users and SmarTrip users that any unused subsidy must be returned via a personal check or through a payroll offset. The policy is currently under review and is expected to be final March 31, 2008. Finance Office documents the return of unused subsidy on the current separation clearance form and maintains a copy of the personal check submitted by an employee. 

OCFO – Brian Duffy, ext. 1230 

October 2007 

Completed OPEN 

This proceto Financewhether it transparenclearance showing trthere is no showing thowed (i.e. cost is grecollected ffinding 6 p

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. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management does not agree with this recommendation, given the fact that Metro does not accept partially used Metrocheks any longer. Furthermore, FEC management is trying to reduce the amount of Metrocheks maintained on hand, as the SmarTrip/card is more widely accepted. 

OCFO – Brian Duffy, ext. 1230 

January 2008 

Completed CLOSED 

Metrochek from prior used in the that levels commuterbe requirewho use mtravel will form for rRefer find

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. Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management contacted WMATA regarding unused Metrocheks. WMATA indicated that they do not accept any unused Metrocheks for reimbursement or credit to FEC’s account. Accordingly, the Finance Office was able to exchange the partially used Metrocheks at Metro Center for full cards to be issued under the transit subsidy program. The Finance Office has implemented a procedure to accumulate partially used Metrocheks and trade them in at Metro Center on a semiannual basis or when the amount of the Metrocheks accumulated exceeds $500, whichever comes first. Partially used Metrocheks will only occur now when someone uses a full Metrochek for FEC business and returns the unused portion. 

OCFO – Brian Duffy, ext. 1230 

March 31, 2007 

Completed CLOSED 

Returned distributioseparating subsidy in money ordreceives MEmployeeexpense re
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

Former Participants Listed as Eligible Recipients – Finding #4 

OPEN Audit folloseparated timely. Thsufficientlremoval. managemeassurance not receivfinding 5 o

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. 

FEC management has also HR – James March 31, provided additional training to Wilson, ext. 2008 the HR staff ensuring they are 1082 aware of this procedure. FEC management has updated its procedures currently in place to ensure to suspend or remove separated employees from receiving additional SmarTrip benefits. The policy is current under review and is expected to be final March 31, 2008. 

Complete HR has developed a SOP for the operations of the transit benefit program, including new guidance addressed in the policy. Also, appropriate staff will be trained two times per year on their respective roles and responsibilities. HR will send quarterly emails on transit benefits to all FEC employees. 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

FEC management will assess the costs compared to the benefits to collect any overpayment of funds. Furthermore, FEC management will ensure any collection is done in accordance with the Debt Collection Improvement Act, as amended. 

OCFO – Brian Duffy, ext. 1230 

April 30, 2008 

OPEN 

The FEC dprior fundsought to rreceived bsince the pissued. Re

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. 
OPEN 

According staff, trainunclear whtraining. Tsufficientlprogram onot define procedureactivities ssuspensioncertificatioprocesses/not occur corrected 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

HR – James Wilson, ext. 1082 

March 31, 2008 

18. HRO management should also ensure that all program staff receives proper training on the procedures for managing the FEC’s SmartBenefits account. 

FEC management has provided the HR staff that are primarily responsible for managing the SmartBenefits. Furthermore, FEC management has updated its policy to incorporate guidance related to the SmartBenefits Program. The policy is current under review and is expected to be final March 31, 2008. 

Complete HR has developed a SOP for the operations of the transit benefit program, including new guidance addressed in the policy. Also, appropriate staff will be trained two times per year on their respective roles and responsibilities. 
OPEN 

Policy has shared witdoes not mdocumentare passenparking or the garagenot routineensure thobenefit do benefits. R

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

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. Program Staff Did Not Always Follow the Provisions of FEC Directive 54 – Finding #5 

FEC management will ensure HR – James March 31, 

all FEC employees receive a Wilson, ext. 2008 copy of the updated policy. 1082 Furthermore, the policy will be updated to clarify when an employee is eligible to receive benefits and when he/she is not. The Administrative Division will also provide Finance a list identifying individuals receiving parking passes each month, which will be compared to the transit subsidy lists to ensure that individuals do not receive both. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 
 OPEN 

Transit apacknowledthat emplocar pool oexecutive LAZ parkthe possesand was ohas not esthe informdissemina11 pg. 42. 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

Admin --Diane Cappuccio, ext. 1245 and Brian Duffy, ext. 1230 

April 30, 2008 

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

FEC management has also updated the Transit Subsidy application in an effort to capture this information. Administrative Division receives a report from LAZ of all FEC employees that commute to work and have received a parking permit for the FEC garage. FEC management will develop a form that requires parking permit holders to certify, on an annual basis, whether or not they have carpoolers. The form will require the permit holder to identify the individuals that are carpoolers. 
OPEN 

Training his not suffprogram onot define procedureactivities ssuspensioncertificatioprocesses/not occur corrected Parking inprovided ofinding 11 

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

HR – James Wilson, ext. 1082 

March 31, 2008 

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. 

Admin Division will develop a form that requires parking permit holders to certify, on an annual basis, whether or not they have carpoolers. The form will require the permit holder to identify the individuals that are carpoolers. The Finance Office will modify its policies to incorporate a comparison between the list of parking permit holders (prepared for the Administration Division) to the required annual certification form to the Transit Subsidy Eligibility List (prepared by HR). FEC management will provide additional training to the program staff to ensure that they are aware of this procedure. 

Complete (HR) HR has developed a SOP for the operations of the transit benefit program, including new guidance addressed in the policy. Also, appropriate staff will be trained two times per year on their respective roles and responsibilities. 
OPEN 

Policy has disseminaprovided ito direct phas been ufew of the have indicreview and OHR staff completed

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

Other Matters to be Reported – Finding #6 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. 

FEC management has updated its current transit subsidy application to incorporate pertinent information. Furthermore, the policy will be updated to indicate that “if any of the key information changes, an employee is required to submit a new application.” The Finance Office will evaluate the usage of Metrocheks on a regular basis, no less than annually. Based on this evaluation, the Accounting Officer will determine is the stock level can be reduced. 

HR – James March 31, 

Wilson, ext. 2008 1082 OCFO – April 30, Brian Duffy, 2008 ext. 1230 

Complete (HR) HR has developed a SOP for the operations of the transit benefit program, including new guidance addressed in the policy. Also, appropriate staff will be trained two times per year on their respective roles and responsibilities.  CLOSED 

Since OHR accept Smallowed, Famount of percent. IMetrochek been exhathe new vofinding 15 
Audit 

Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

The Finance Office researches the cause for significant differences and documents the reasons accordingly. The results of the research are documented directly on the monthly distribution list and any related correspondence is attached. The documentation is maintained by the Assistant Accounting Officer. 

OCFO – Brian Duffy, ext. 1230 

June 30, 2007 

Completed OPEN 

OIG noted three mon(January 2Documentthe varianmonthly dfinding 16 

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. 
OPEN 

OHR updahas not bestaff. OHemployees identified SmarTrip notified thtransition Refer find

Audit Recommendation 

Audit of FEC’s Transit Benefit Program Corrective Action Plan 

Responsible Office 

Anticipated Completion Date 

Final Action OIG Sta

HR – James Wilson, ext. 1082 

June 30, 2007 

25. Program management should encourage Metrochek recipients who utilize transit carriers that accept SmarTrip cards to switch their monthly subsidy to SmarTrip cards. 

HR will develop communication to encourage FEC employees to utilize transit carriers that accept SmarTrip cards and to switch their monthly subsidy to SmarTrip cards. For those employees that are bargaining unit, management will work through the FEC union to ensure the communication occurs. 

Complete The transit benefit policy has been updated. HR will provide copies to all FEC employees, post an electronic version on the intranet, and incorporate this subject into the New Employee Orientation. HR will send quarterly emails on transit benefits to all FEC employees. 
 

 

 

 

 

CONTACTING THE OFFICE OF INSPECTOR GENERAL 

The success of the OIG mission to prevent fraud, waste, and abuse depends on the

cooperation of FEC employees (and the public). There are several ways to report

questionable activity. 

Call us at 202-694-1015 (a confidential or anonymous message can be

left 24 hours a day/7 days a week) or toll-free at 1-800-424-9530 (press 0; 

then dial 1015 - Monday - Friday 8:30am – 5:00pm). 

Write or visit us - we are located at: Federal Election Commission 

 Office of Inspector General

 999 E Street, N.W., Suite 940

 Washington, D.C. 20463 

Mail is opened by OIG staff members only. 

You can also fax (202-501-8134) or contact us by e-mail at: oig@fec.gov. 

Website address: http://www.fec.gov/fecig/fecig.shtml 

Individuals may be subject to disciplinary or criminal action for knowingly making 

a false complaint or providing false information.