Auditors Cite Lax Control, Lavish Spending at LACTC

Independent auditors on Tuesday confirmed problems with lax management practices and lavish spending at the Los Angeles County Transportation Commission, citing such examples as improper approval of multimillion-dollar contracts and $6,000 a month spent on coffee for employees.

The audit, conducted by county Auditor-Controller Daniel O. Ikemoto and City Administrative Officer Keith Comrie in response to an article in The Times, also found that Transportation Commission staff was ignoring several new corrective measures aimed at bringing spending back under control.

For example, most of the commission’s unusually large fleet of cars are no longer assigned full-time to individual employees, but the cars still could be used by employees on personal business. Also, supply purchases are haphazard and sharply overbudget, and internal auditors still do not conform to generally accepted standards of independence.

The Transportation Commission, meanwhile, said it has already taken steps to improve its spending practices. Company credit cards, including “pool” cards available to any employee, have been revoked, and strict limits have been imposed on travel, expense-account lunches and free doughnuts for office meetings.

The external audit of spending practices comes as the Transportation Commission is completing an internal audit of its payments to one of its most-often used consultants, Booz-Allen & Hamilton. That probe, also spurred by an article in The Times, has identified $400,000 in “questioned” costs that the consultant billed to the commission--and commission staff paid without challenging.

Neil Peterson, the commission’s executive director, said the consultant and commission staff are being asked to explain the questioned costs, and the final sum to be repaid to the agency may be less than $400,000.

The audit report made public Tuesday is scheduled to be presented today to the Los Angeles County Board of Supervisors. That audit was requested by Mayor Tom Bradley and Supervisor Mike Antonovich, who both sit on the Transportation Commission’s board of directors. Bradley and Antonovich plan to ask the commission to establish an audit committee.

With the responsibility to oversee construction of the Metro Red Line subway, the Green Line trolley, Metrolink commuter-rail network and other transportation improvements, the Transportation Commission plans to spend $183 billion in tax receipts over the next 30 years.

Most of the money will come from two half-cent sales tax surcharges now being collected in the county. The rest of the 30-year plan will be funded with hundreds of millions of dollars in federal transportation grants and tens of millions in state aid.

The Transportation Commission, however, may not make it to the end of its own plan. The Legislature earlier this week approved and sent to Gov. Pete Wilson a proposal to merge the commission, which builds rail transit lines, with the rival Southern California Rapid Transit District.