Bus Line’s Trip Expenses Criticized : L. B. Auditor Urges Cuts but Cites ‘Good Management’

The city auditor has criticized the city-owned Long Beach Transit bus company for “excessive” business travel by its officials, and recommended that its out-of-town trips be “sharply reduced.”

Earl Hobbs, who conducted the audit, said that, in 1983-84, bus company officials spent $52,825 on travel and meal expenses. In 1984-85, they spent more than $81,000, and exceeded their travel budget of about $66,000 by 20%, Hobbs said.

“Sixteen different employees and all seven board members traveled by air during the last year, and the General Manager took at least 18 trips,” the audit report said.

The operational audit, which covered the year ending June 30, 1985, also questioned the wisdom of spending $75,000 on billboard and newspaper advertising that urged readers to “catch the warmth,” “flavor,” “thrill,” “glow,” “style,” “spirit,” or “heart” of Long Beach, but did not directly address the needs of riders.

Despite the criticisms, Robert E. Fronke, city auditor, praised the company for “good management and leadership” in the audit report. In an interview, Fronke said the bus company has “a 15- or 20-year history of problems,” many of which have been corrected under the present administration. “In past years, we had much bigger fish to fry,” he said.

The audit report was presented to the City Council, which forwarded it to the seven-member Long Beach Transit board of directors. The transit board has full authority over the bus company’s $20-million annual operating budget. Board members, who reviewed the report at their February meeting, asked a few questions but did not indicate they were concerned about the criticisms.

Board Chairman Shirley Saltman said in a telephone interview that she sees “no reason for concern at all.”

“We have a fiscally very responsible management and they just don’t go off half-cocked. In my six years on the board, I have seen only legitimate expense and legitimate travel,” she said.

Saltman called the advertising campaign “a philosophical issue.” “We have targeted people who have the money to travel by car,” she said. “We want them to consider riding the bus, too.”

Laurence W. Jackson, president and general manager of Long Beach Transit, defended the 18-month-old campaign on similar grounds, and called it “the most positive that we have ever done in terms of reaction from the riding and non-riding public.”

Ad Strategy to Be Reviewed

Jackson said members of the marketing committee of the board of directors will review their advertising strategy when they discuss next year’s marketing program. Other transportation company officials noted that this particular campaign may end in a few weeks anyway, and be replaced by one aimed at people who have stopped riding buses since fares increased last July.

In a written reply that is part of the audit report, Jackson attributed the many out-of-town trips to “an extraordinary year with fierce battles being waged at both the federal and state level concerning the continuation of subsidies for mass transit.” He predicted “a significant overall reduction in travel and meetings cost” in fiscal year 1986.

In an interview, Jackson said the reduction in travel will result because the American Public Transit Assn. convention was held in Los Angeles this year. Last year, six members of the board of directors flew to Washington to attend the conference.

Jackson, elected president of the American Public Transit Assn. last October, said his own travel expenses will decrease this year because the association will pay him to attend meetings he charged the city for last year, when he served on the association’s executive committee. About nine of the 18 out-of-town trips he took last year would have been paid for by APTA had he been president, Jackson said. Jackson took six trips to Sacramento last year. So far this fiscal year, which began last July, he has taken only one trip to Sacramento. “Things seem to be quieting down this year,” he said.

51 Out-of-Town Trips

Jackson said he personally authorizes all out-of-town trips, including his own. Last year, transit company officials and transit board members took at least 51 out-of-town trips, the audit report indicated. The trips included lobbying efforts to Washington and Sacramento, and several out-of-state conventions, Jackson said.

City Auditor Robert E. Fronke said he hoped the board would “become a little more circumspect in their handling of out-of-town travel.”

The audit report also criticized the Long Beach Transit for:

--Approving payment of restaurant bills without requiring a written description of the business nature of the meal.

--Failing to have a written policy governing the use of the transit company’s four American Express cards.

--Giving all salaried employees a 4% bonus at the end of fiscal year 1985.

--Failing to disclose executive salaries to the City Council or to the public.

--Paying executives monthly mileage allowances ranging from $325 to $475. The city’s personnel ordinance limits mileage allowances for city management staff to $300 per month. (Transit company employees do not work for the city and are not governed by the ordinance.)

A policy requiring written explanation before payment of American Express bills has been implemented, Jackson said. Previously, use of the cards was restricted to five executives, and Jackson’s office authorized payment based on personal knowledge of the validity of the expense, he said.

Fronke called the lapse “a matter of internal control,” adding that “there is no evidence of any misconduct.”