STATUS OF OPERATING ADMINISTRATIONS’ 

PROCESSES TO CONDUCT LIMITED QUALITY 

REVIEWS OF RECOVERY ACT RECIPIENT DATA 

Department of Transportation 

Report Number: MH-2010-002 

Date Issued: October 6, 2009 
U.S. Department of 

Memorandum

Transportation 

Office of the Secretary 

of Transportation 

Office of Inspector General 

Subject: ACTION: Status of Operating Administrations’ 

Processes to Conduct Limited Quality Reviews of 

Recovery Act Recipient Data 

Report Number MH-2010-002 

Date: October 6, 2009 

From: Calvin L. Scovel III 

Inspector General

Reply to 

Attn. of: J-1 

To: All Secretarial Officers 

Federal Aviation Administrator 

Federal Highway Administrator 

Federal Railroad Administrator 

Federal Transit Administrator 

Maritime Administrator 

This report presents our audit results of the Department of Transportation 

Operating Administrations’ plans for ensuring Recovery Act1

 fund recipients 

submit accurate, complete, and timely data on the use of these funds, as required 

by Section 1512 of the Recovery Act. Office of Management and Budget (OMB) 

guidance states that starting October 22, 2009, Federal agencies are to perform a 

limited data quality review of recipient information and notify the recipients of 

two key data problems—material omissions and significant reporting errors. Our 

audit objective was to determine whether the Department’s Operating 

Administrations have established processes to perform such reviews and notify 

recipients of the need to make appropriate and timely changes. 

We found that the Department’s Operating Administrations overseeing the 

implementation of the Recovery Act—Federal Aviation Administration (FAA), 

Federal Highway Administration (FHWA), Federal Railroad Administration 

(FRA), Federal Transit Administration (FTA), and Maritime Administration 

(MARAD)—have taken steps to ensure that Recovery Act recipients comply with 

Section 1512 reporting requirements. These steps range from conducting outreach 

to recipients regarding the specific reporting requirements to drafting processes for 

performing limited data quality reviews. Each Operating Administration aims to 

have a process in place before conducting the reviews, and as of 

September 25, 2009, two of five Operating Administrations have drafted 

 

1

 American Recovery and Reinvestment Act of 2009. 
2

processes. However, it is too early to determine whether these processes will 

adequately identify omissions and significant reporting errors. 

BACKGROUND 

Section 1512 of the Recovery Act requires that not later than 10 days after the end 

of each calendar quarter, each recipient that received Recovery Act funds from a 

Federal agency submit a report to that agency to include the following: (1) the 

amounts spent on projects or activities; (2) a list of projects or activities funded by 

name, including a description and completion status; (3) estimates of the number 

of jobs created and retained by those projects or activities; and (4) details on subawards and other payments. On June 22, 2009, OMB issued guidance2

 to provide 

Federal agencies and funding recipients with information to effectively implement 

Section 1512 reporting requirements. The guidance requires that prime recipients3

enter their data to www.FederalReporting.gov,

4

 the online Web portal for 

collecting all Recovery Act recipient reports beginning on October 10, 2009. 

The guidance also requires that 22 to 29 days after each quarter (e.g., 

October 22, 2009, to October 29, 2009), Federal agencies perform a limited data 

quality review of the submitted information and notify recipients of two key data 

problems—material omissions and significant reporting errors. No later than 30 

days following the end of the quarter (e.g., October 30, 2009), the detailed 

recipient reports will be made available to the public on the www.Recovery.gov

website. Figure 1 presents OMB’s timeframes of key Section 1512 reporting 

activities. 

 

2

 OMB Memorandum for the Heads of Departments and Agencies, M-09-21, “Implementing Guidance for 

the Reports on Use of Funds Pursuant to the American Recovery and Reinvestment Act of 2009,” 

June 22, 2009. 3

 Prime recipients are non-Federal entities that receive Recovery Act funding as Federal awards in the form 

of grants, loans, or cooperative agreements directly from the Federal Government. 4

 Reporting recipients and reviewing Federal agencies must be registered as authorized parties prior to 

submitting or receiving recipient reports on www.FederalReporting.gov. Registration opened on 

August 17, 2009.
3

Figure 1. Recipient Reporting Timeline 

No less than 35 days 

prior to the end of the 

quarter 

1-10 days after the end of 

Quarter 

11-21 days after end of 

Quarter 

22-29-days after end of 

Quarter 

30 days after 

end of 

Quarter 

 

Prime Recipients 

& Delegated Subs 

Enter Draft 

Reporting Data 

Prime 

Recipients 

Review 

Data 

Submitted 

By Sub(s) 

Agency 

Review of 

Data 

Submitted 

Recipient 

Reports 

Published on 

recovery.gov 

Prime and Sub 

Recipient 

Registration 

Initial 

Submission 

Prime 

Recipients & 

Subs Make 

Corrections 

Prime 

Recipients & 

Subs Make 

Corrections 

 

By 10 days 

after end 

of Quarter 

 

Agency “View Only” Agency Comment Period 

Recipient Report Adjustments Possible 

Source: Office of Management and Budget 

Operating Administrations Expect to Have Processes in Place in 

Time to Conduct Data Quality Reviews 

With the October 10, 2009, deadline fast approaching for Recovery Act fund 

recipients to start submitting data on the use of these funds, the Department and 

Operating Administrations have been proactive in assisting recipients in meeting 

the Recovery Act reporting requirements and deadlines. For example, FTA 

officials alerted all of its Recovery Act prime recipients via email of registration 

requirements and conducted webinars to clarify reporting requirements. Further, 

MARAD officials contacted all 70 of its grant recipients by telephone to 

encourage registration and reporting. In addition to these efforts, Operating 

Administration officials inserted language in grant agreements requiring 

compliance with Section 1512 reporting requirements. 

Officials from all the Operating Administrations told us that they will conduct data 

quality reviews of recipient data, notify recipients of errors, and address systemic 

or chronic reporting problems when data become available. At the time of our 

review, the Operating Administrations were in various planning stages for 

conducting the reviews. 

 FAA has prepared a process that includes a description of the data entry 

process, agency validation processes, validation rules, and advanced 

validation using statistical analysis. 
4

 FTA has drafted a process for conducting data quality reviews, which 

includes tasks ranging from conducting an initial overview of the reports to 

identify blank data fields to preparing analysis of data submitted. 

 FHWA has yet to draft a process, but has taken steps toward doing so. 

FHWA developed a Recovery Act Database System to track all Recovery 

Act data, including the key data elements required by Section 1512. 

FHWA described how it plans to validate the data by comparing 

Section 1512 data with prior recipient report data. 

 FRA and MARAD have yet to draft processes but stated that they plan to 

modify other Operating Administration’s processes for such use. 

Operating Administrations plan to have processes in place by October 22, 2009—

in time to conduct limited data quality reviews, as required by OMB. Department 

officials stated that once completed, they expect the Operating Administrations 

will continue to revise the review processes based on lessons learned during the 

initial data quality reviews (e.g., October 2009). Further, based on recipient 

reports and data quality review results, Operating Administration officials told us 

they could withhold funds of recipients who have systemic or chronic reporting 

problems. 

Based on the results of our work to date, it is too early to determine whether the 

Operating Administration processes will adequately identify and remediate 

omissions and significant reporting errors. Consequently, we are making no 

recommendations. As we continue to conduct our Recovery Act work, we will 

monitor the Operating Administrations’ progress, and may conduct additional 

work of the adequacy of Operating Administrations’ and recipients’ internal 

control procedures for ensuring data quality. 

AGENCY COMMENTS AND OFFICE OF INSPECTOR 

GENERAL RESPONSE 

We provided our draft report to the Department on September 29, 2009. The 

Department provided several technical comments that it characterized as minor. 

We incorporated these comments in the final report as appropriate. 

We appreciate the courtesies and cooperation of Department representatives 

during this audit. If you have any questions concerning this report, please call me 

at (202) 366-1959, or Madeline Chulumovich, Special Assistant for Economic 

Recovery, at (202) 366-6512. 

# 

cc: Members of the DOT TIGER team
5

EXHIBIT A. OBJECTIVES, SCOPE, AND METHODOLOGY 

The objective of this audit was to determine whether the Department had 

established a consistent process to perform limited data quality reviews intended 

to identify material omissions and/or significant reporting errors and notify 

Recovery Act recipients of the need to make appropriate and timely changes. To 

address our audit objective, we conducted expeditious reviews of the 

Department’s and each relevant Operating Administration’s plans for establishing 

internal controls to conduct limited data quality reviews of information submitted 

by Recovery Act recipients to ensure the data are accurate, complete, and timely. 

Specifically, we: 

 coordinated with the Recovery Accountability and Transparency Board5

and Office of Inspectors General at Health and Human Services, 

Agriculture, and National Endowment for the Arts to develop a 

structured review guide that included the audit objective, scope, and 

audit approach; 

 interviewed officials from the Office of the Secretary of Transportation 

(OST) and each Operating Administration receiving Recovery Act 

Funds—FAA, FHWA, FRA, FTA, and MARAD—to obtain an 

overview of the actions taken to date to develop, document, and 

implement internal controls for performing limited data quality reviews 

of Recovery Act recipient data pursuant to Section 1512 of the 

Recovery Act and OMB Memorandum M-09-21; and 

 obtained and analyzed, when available, Department and Operating 

Administration documentation of policies and procedures for reviewing 

quarterly Recovery Act data pursuant to OMB Memorandum M-09-21 

(Section 3.12). 

Because the Department’s Operating Administrations have yet to complete their 

documentation for conducting data quality reviews to identify multiple omissions 

and significant reporting errors, we could not evaluate the effectiveness of the 

methodology the Operating Administrations used to conduct their reviews. Also, 

 

5

 The Recovery Accountability and Transparency Board was created by the American Recovery and 

Reinvestment Act of 2009 with two goals: (1) to provide transparency in relation to the use of Recoveryrelated funds, and (2) to prevent and detect fraud, waste, and mismanagement. Twelve Inspectors 

General from various Federal agencies serve with Chairman Earl E. Devaney. The Board issues 

quarterly and annual reports to the President and Congress, and if necessary, “flash reports” on matters 

that require immediate attention. 

Exhibit A. Objective, Scope, and Methodology 
Exhibit A. Objective, Scope, and Methodology 

6

the first quarter data quality reviews will not include the Office of the Secretary’s 

discretionary grants or the Federal Railroad Administration’s high speed rail 

grants because no funds have been obligated. 

We conducted this performance audit in September 2009 in accordance with 

Generally Accepted Government Auditing Standards. Those standards require 

that we plan and perform the audit to obtain sufficient, appropriate evidence to 

provide a reasonable basis for our findings and conclusions based on our audit 

objectives. We believe that the evidence obtained provides a reasonable basis for 

our findings and conclusions based on our audit objectives.