$908K for Vehicles for Biden's World Cup Trip--On Top of $2.2M for Hotels

    Vice President Biden's trip to Brazil in mid-June for the USA versus Ghana World Cup game and meetings the following day with the president and vice president of Brazil required rental of vehicles for Biden and his entourage costing over $900,000.  Added to the $2.2 million cost of hotels we reported a few weeks ago, the total costs of local lodging and transportation for the trip topped $3.1 million.
    The documents indicate two companies were used for vehicles and drivers:

    The $908,147 estimate far outstrips the $321,665 spent in February 2013 for a vice presidential trip to Paris. The documents for the World Cup trip do not contain enough details to explain why the cost for this trip is comparatively high, but asserts that the "anticipated cost to the Government will be fair and reasonable" and that the rates are comparable to "the rates charged for similar services during this season." The documents that accompanied the Brazil hotel contract posting noted that due to the World Cup, hotel rates were up anywhere from 75 to 365 percent, but a similar statement is not included in the vehicle documents.
    The State Department, the agency that handles arrangements for VIP trips, explained the reasons for the short notice and lack of full competition in awarding the contracts:

Security and logistics are the Department of State’s primary considerations when procuring vehicles rental. The Department of State must be able to provide a safe and secure vendor for VIP visitors. Frequently VIP visits are not announced or confirmed in sufficient time to conduct a competition, creating an urgent and compelling need.

    The two companies chosen were able to handle communications requirements and were accommodating to the security needs of the vice president's entourage.


Note: A version of this post first appeared at The Weekly Standard.

U.S. Delegation to Mandela Funeral: Five Hotels, Transportation Cost $19M

    Documents recently released by the government show that the value of hotels and local transportation contracts for the U.S. delegation to Nelson Mandela's funeral in December were considerably higher than previous estimates.  On December 19, THE WEEKLY STANDARD first reported the cost at about $11 million. However, rather than two hotels and one vehicle contractor, additional contracts have been disclosed bringing the total to five hotels and two vehicle contractors.
    The transportation contracts include passenger vehicles, SUVs, vans, buses, pickup trucks, box trucks, and "larger capacity vehicles," but do not include the cost of travelling from the U.S. to South Africa and back.  The combined total estimated cost of the two contracts is $12,521,851.
     The five hotel contracts estimated a total of 10,275 "lodging room nights" spanning December 6, 2013 to January 20, 2014.  The Johannesburg-area hotels include the Radison Blu Sandton, Radison Gautrain, Holiday Inn, Park Inn, and the Michaelangelo.  A sixth contract for the DaVinci hotel was subsequently canceled.  The total estimated cost of the remaining contracts is $6,489,627.  Adding the $12.5 million in transportation contracts brings the grand total for lodging and local transportation to $19,011,478.
   When asked for an explanation of the 6-week date range of December 6 to January 20 for the hotels, a State Department official replied via email:

Due to high demand during that time period, all hotels in the area had a requirement to book for a minimum of 15 nights.   The date span was written into the contract to give flexibility, but we did not pay for 45 days.

    When asked to explain why 45 days was written into the estimates when only a 15 day minimum was required, the official did not respond, nor was there any response to a follow up inquiry about how accurate the cost estimates turned out to be.


Note: A version of this post first appeared at The Weekly Standard.

Dept. of Transportation Audit of Stimulus Money Terminated Despite Estimated Improper Payments of $100M

    Despite an admission by the Department of Transportation (DOT) that the Federal-aid Highway Programs under the American Recovery and Reinvestment Act (ARRA) are "susceptible to significant improper payments," the DOT Inspector General has terminated an audit initiated in April "due to other higher priority work demands."  The original announcement of the audit of the ARRA programs (better known as the "stimulus") reported that DOT estimated improper payments of more than $100 million in 2012 alone [emphasis added]:

FHWA has funded approximately 13,000 State and local highway  infrastructure projects and has disbursed almost  $26 billion in ARRA funds.
The Improper Payments Information Act of 2002 makes Federal agencies accountable for preventing and detecting improper payments within their programs. The Improper Payment Elimination and Recovery Act of 2010 requires identification and estimation of improper payments. The Department of Transportation (DOT) has identified FHWA’s Federal-aid Highway Programs as susceptible to significant improper payments. In fiscal year 2012, DOT reported an estimate of $103.2 million  in improper payments in FHWA’s Federal-aid Highway Program.

    A report on another IG audit relating to the Federal Highway Administration and the ARRA was just issued on May 7, 2013 and found areas for improvement in DOT's oversight of the administration of program funds:

On May 7, 2013, we reported that FHWA inspections did not routinely verify whether States detected instances of noncompliance with some Federal requirements. For example, we projected that $125.6 million, or 12 percent, of ARRA progress payments made to contractors in three States were unsupported.

    The IG said that "all four recommendations" stemming from that audit were "resolved but open pending completion of planned actions" by DOT.

     The more recent audit, which began in April and was terminated this week, was intended to test DOT's internal controls to see if they were adequate to "prevent and detect improper payments" to ARRA grant recipients. The IG's termination letter stated that the audit may still take place at a later date.


Note: A version of this article first appeared at The Weekly Standard.