Additional Staff Positions for the Capital Program

Transcription

1 Finance & Administration Committee Action Item III-D April 14, 2011 Additional Staff Positions for the Capital Program

2 Washington Metropolitan Area Transit Authority Board Action/Information Summary Action Information MEAD Number: Resolution: Yes No TITLE: Approval to Increase Positions for OIG & PRMT PURPOSE: To obtain Board approval to add up to 30 positions to the Capital Budget for the Office of Inspector General and the Office of Procurement and Materials to advance the capital program. DESCRIPTION: The Capital Program has increased substantially between FY2010 and FY2012. The Proposed FY2012 Capital Improvement Program (CIP) budget would be a 122% increase over FY2010 Metro Matters expenditures. However, the program development staffing levels have not been materially adjusted and additional staff resources are required to effectively support implementation of the much larger Capital Program which will support Metro`s goal of using every resource wisely. The Office of Inspector General (OIG) fulfills a critical requirement of the Federal Transit Administration (FTA) by performing cost and pricing analyses on procurement actions to determine the reasonableness of a contract proposal as it relates to pre-negotiation and pre-award contract proposals, as well as billing rates. This analysis is known as an "attestation". Since OIG came into existence in May 2007, OIG auditors have suggested contract pricing adjustments to the Office of Procurement and Materials (PRMT), which have saved millions of dollars in contract costs. OIG currently has a backlog of over 50 attestation requests and expects to receive an additional 150 requests in the next 12 months. Its current staff of five auditors expects to complete approximately 100 attestations this year. Attestation requests are expected to exceed 200 annually due to an increased procurement workload commensurate with the size of the capital program in coming years. The OIG reviews the cost and pricing information on sole source procurements

3 over $250,000, contract modifications, and contract claims and with PRMT executes certain procurement action. OIG faces a significant backlog of contract attestations and lacks the capacity to meet anticipated future demands. OIG seeks up to six additional staff, with an annual cost estimated at $0.54 million, to eliminate the backlog and improve timeliness of the attestation requests. This type of work requires seasoned professionals with some knowledge of Metro operations and activities, Government Auditing Standards, AICPA Standards, and the Federal Acquisition Regulations. PRMT is dedicated to providing quality goods and services to support Metro`s mission in a professional and ethical manner while striving to exceed customers expectations. PRMT facilitates the following procurement activities: a) simplified acquisitions; b) invitation for bids; c) request for quotations; d) request for proposal; and e) modifications to contracts. These processes are applied for all acquisitions of services, construction, equipment, and parts procurement that support the Rail, Bus, Plant, and Administrative Operations with a current staff of 34. PRMT seeks up to 24 additional staff, with an annual cost estimated at $3.41 million, to achieve a twelve week procurement cycle in order to facilitate effective implementation of capital project awards. The current procurement cycle exceeds six months, which results in the inability to maintain project schedules and achieve expenditures on a timely basis. FUNDING IMPACT: Fiscal Year 2012 Program: Capital Improvement Program (CIP) Project: All CIP Projects Project Manager: Carol Kissal Project Department/Office: DGMA/CFO Budget: $3.95M This Action: $3.95M Prior Approval: $0.00M Remaining Budget: $0.00M These costs are directly related to the Capital Program and will be allocated across the FY2012 Capital Budget and future annual Capital Budgets as approved by the

4 Board. There might be a small impact to FY2011, as the majority of the hiring would not be expected to occur until Remarks: after July 1, These costs are included in the capital budget. Operating Budget Impact: None RECOMMENDATION: Board approval to add up to 30 positions to the Capital Budget for the Office of Inspector General and the Office of Procurement and Materials at an estimated annual cost of $3.95 million, increasing the current headcount from 11,093 to 11,123.

5 Washington Metropolitan Area Transit Authority Additional Staff Positions for the Capital Program Finance and Administration Committee April 14, 2011

6 Purpose Board approval to add up to 30 positions to advance the capital program for: Office of the Inspector General to perform contract attestations Office of Procurement and Materials to perform procurement actions and contract management for capital program

7 The Capital Program The Capital Program has grown substantially since FY2010 The Passenger Rail Investment and Improvement Act funding and local jurisdictional match increased the program by $300 million starting in FY2011 Proposed FY2012 CIP budget would be a 122% increase over FY2010 Metro Matters expenditures Program development staffing levels have not been materially adjusted Much larger Capital Program requires additional staff resources to effectively implement

8 Background OIG and PRMT Office of the Inspector General (OIG) Fulfills FTA requirement by performing cost and pricing analyses, or attestations, on certain procurement actions to determine reasonableness of contract proposal Backlog exceeds 50 attestation requests, 150 expected annually previously received about 100 requests a year Office of Procurement and Materials (PRMT) Needs additional staff to achieve industry standard of a three-month procurement cycle Current procurement cycle exceeds six months

9 Additional OIG Staff Needed Six additional staff to eliminate attestation backlog and improve timeliness Additional staff to streamline e contract award a processing under the Capital Improvement Program Requires seasoned auditors with knowledge of Metro operations, Government Auditing Standards, AICPA Standards, and the Federal Acquisition Regulations OIG input related to its attestations annually saves millions of dollars in contract costs Annual cost is estimated at $0.54 million

10 Additional PRMT Staff Needed 34 staff currently support the contracting ti function for both operating-funded solicitations and capital-funded solicitations totaling approximately $550M 58 staff (24 additional) to accommodate increased contract management needs and establish more efficient contract modification, task order and final close out reconciliations The annual cost of these 24 positions is estimated at $3.41 million

11 Costs 30 additional staff would cost approximately $3.95 million, including fi fringe benefits Staff costs will be directly charged to the FY2011 and future capital budgets Additional staff costs are included in the capital budget Staffing request is appropriate, based on budget levels projected over the next six years Positions would be term employees; positions would be eliminated if p y ; p the capital program is curtailed

12 Recommendation Board approval to add up to 30 positions to support the expanded Capital program

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