[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
OVERSIGHT OF FEDERAL VEHICLES
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON
TRANSPORTATION AND PUBLIC ASSETS
OF THE
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 26, 2016
__________
Serial No. 114-106
__________
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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
JASON CHAFFETZ, Utah, Chairman
JOHN L. MICA, Florida ELIJAH E. CUMMINGS, Maryland,
MICHAEL R. TURNER, Ohio Ranking Minority Member
JOHN J. DUNCAN, JR., Tennessee CAROLYN B. MALONEY, New York
JIM JORDAN, Ohio ELEANOR HOLMES NORTON, District of
TIM WALBERG, Michigan Columbia
JUSTIN AMASH, Michigan WM. LACY CLAY, Missouri
PAUL A. GOSAR, Arizona STEPHEN F. LYNCH, Massachusetts
SCOTT DesJARLAIS, Tennessee JIM COOPER, Tennessee
TREY GOWDY, South Carolina GERALD E. CONNOLLY, Virginia
BLAKE FARENTHOLD, Texas MATT CARTWRIGHT, Pennsylvania
CYNTHIA M. LUMMIS, Wyoming TAMMY DUCKWORTH, Illinois
THOMAS MASSIE, Kentucky ROBIN L. KELLY, Illinois
MARK MEADOWS, North Carolina BRENDA L. LAWRENCE, Michigan
RON DeSANTIS, Florida TED LIEU, California
MICK, MULVANEY, South Carolina BONNIE WATSON COLEMAN, New Jersey
KEN BUCK, Colorado STACEY E. PLASKETT, Virgin Islands
MARK WALKER, North Carolina MARK DeSAULNIER, California
ROD BLUM, Massachusetts BRENDAN F. BOYLE, Pennsylvania
JODY B. HICE, Georgia PETER WELCH, Vermont
STEVE RUSSELL, Oklahoma MICHELLE LUJAN GRISHAM, New Mexico
EARL L. ``BUDDY'' CARTER, Georgia
GLENN GROTHMAN, Wisconsin
WILL HURD, Texas
GARY J. PALMER, Alabama
Jennifer Hemingway, Staff Director
David Rapallo, Minority Staff Director
Michael Kiko, Subcommittee on Transportation and Public Assets Staff
Director
Betty Ward Zukerman, Counsel
Willie Marx, Clerk
------
Subcommittee on Transportation and Public Assets
JOHN L. MICA Florida, Chairman
MICHAEL R. TURNER, Ohio TAMMY DUCKWORTH, Illinois, Ranking
JOHN J. DUNCAN, JR. Tennessee Member
JUSTIN AMASH, Michigan BONNIE WATSON COLEMAN, New Jersey
THOMAS MASSIE, Kentucky MARK DESAULNIER, California
GLENN GROTHMAN, Wisconsin, Vice BRENDAN F. BOYLE, Pennsylvania
Chair
C O N T E N T S
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Page
Hearing held on February 26, 2016................................ 1
WITNESSES
Ms. Lori Rectanus, Director, Physical Infrastructure Issues,
Government Accountability Office
Oral Statement............................................... 6
Written Statement............................................ 9
Mr. Bill Toth, Director, Office of Fleet Management, General
Services Administration
Oral Statement............................................... 19
Written Statement............................................ 21
Mr. Tom Howard, Inspector General, Amtrak
Oral Statement............................................... 25
Written Statement............................................ 27
Mr. Joseph H. Boardman, President and Chief Executive Officer,
Amtrak
Oral Statement............................................... 39
Written Statement............................................ 41
APPENDIX
Amtrak's Answers to the Committee's Questions for the Record,
Entered by Chairman Mica....................................... 62
General Services Administration's Answers to the Committee's
Questions for the Record....................................... 67
OVERSIGHT OF FEDERAL VEHICLES
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Friday, February 26, 2016
House of Representatives,
Subcommittee on Transportation and Public Assets,
Committee on Oversight and Government Reform,
Washington, D.C.
The subcommittee met, pursuant to call, at 9:07 a.m., in
Room 2154, Rayburn House Office Building, Hon. John L. Mica
[chairman of the subcommittee] presiding.
Present: Representatives Mica, Duncan, Amash, Massie,
Grothman, Duckworth, DeSaulnier, and Cummings.
Mr. Mica. Good morning. I'd like to welcome everyone to the
Committee on Oversight and Government Reform and our
Subcommittee on Transportation and Public Assets hearing this
morning.
First, let me say that we will have our ranking member join
us in just a few minutes here. This is a get-away day, and
everybody is consumed on the floor or in a series of hearings
this morning. But we do have a member to proceed, and Ms.
Duckworth will be joining us shortly.
The topic of today's oversight hearing deals with oversight
of our Federal vehicles, of our own fleet and also leased
fleet.
And the order of business is going to be as follows: I'll
start with my opening it statement. I'll yield to others
members for opening statements. Then we'll turn to our
witnesses. We have four witnesses this morning, and we'll
introduce them, get them sworn in and proceed, and then we'll
go to questions. So that will be our order of business.
And, with that being said, without objection, the chair is
authorized to declare a recess at any time. And I'll start with
my opening statement this morning.
One of the great things about our committee is that we look
at waste, fraud, and abuse in the Federal Government, and we
have an opportunity to save the taxpayer money to make programs
more efficient, to look at where we can do a better job with
public assets, and we focus on a whole host of areas. And just
a few of those areas that we've looked at in the past: public
assets, such as vacant or empty buildings. We are on the verge
of saving hundreds of millions, billions of dollars.
Conferences that were abusively expensive, spending funds that
were unnecessary, I know we've saved over $1 billion just in
that area. Our committee has looked at duplications in IT
equipment, data, et cetera, consolidation. We spend 50, 60
billion dollars there and found half of that money wasted.
So, today, we're focusing on another area, these are some,
you might term them, meat-and-potato hearings, but I think it's
one of the most important responsibilities at Congress: look at
what we're doing and how we can save money or do it better for
the taxpayers.
Kind of interesting getting into Federal vehicle fleet and
how it's managed and operated. It sounds look a small
operation, but, in fact, the Federal Government's spent over
$4.4 billion a year, and that is probably the biggest vehicle
fleet in the world of 650,000 vehicles. Some of those are our
own; some of those are leased. The Federal Government's fleet
mileage exceeds 5 billion miles per year, and we consume and
spend $400 million just on fuel in that fleet. So it's a pretty
sizable operation, and almost every agency has either owned by
the government or leased their vehicles. Roughly a third of the
Federal fleet is leased, while the remainder is owned.
You've seen some reports that indicate that between 2010
and 2014, more than 2.5 million, 2.4 to 2.5 million, in fraud
recoveries occurred from Federal credit, fuel credit card
abuse. I have a picture of this Federal fuel credit card. I
think that's being changed out as we meet today, but we issue
those cards, and in that short period of time, we've detected
about $2.5 million in fraud and recovered some of that.
Fuel card waste and vehicle underutilization are part of
the problem we've seen with the fleet, and we've got to pay
attention to, again, all losses that the Federal Government
occurs with this fleet.
GAO recently found that two-thirds of the agency's leased
vehicles did not meet annual mileage criteria. That means they
weren't traveling or being used to a satisfactory level that is
established by the government and under Federal property
regulations that we set for like the minimum utilization that
would justify leasing. In fact, we found--and we didn't conduct
all the reports, but we have two reports we'll focus on today.
First, we've got a GAO report, which is issued in January of
this year, federally leased vehicles, agencies should
strengthen assessment processes to reduce underutilized
vehicles. So this is some of the investigation that was done by
GAO. And then we have a document prepared by the inspector
general of Amtrak, and this is titled ``Asset Management and
Its Observations on Vehicle Fleet Management.'' And I'll quote
from both of those. This is, again, their findings and part of
what we're going to look at in this hearing.
The GAO found that half the Federal vehicles that they
examined in May of 2015 travelled less than 600 miles that
month. While the management of Federal vehicles is highly
decentralized across the individual agency, the fleets that GAO
looked at and several inspector generals have identified, they
all found problems with agency's performance of the management
responsibility for these fleets.
Agencies that GAO most recently reviewed have not--and
we've looked at those--those agencies have not consistently
followed best practices such as one of the most important
things is conducting a cost-benefit analysis for the basis of
determining whether to buy or whether to lease. I think we have
a slide showing leased vehicles.
In a sampling of just a handful of these agencies--again, I
refer to the report; they looked at four agencies--GAO found
that one in 10, or 1,500, of the leased vehicles really weren't
justified in having any inventory, but the agency paid $5
million for these vehicles in a single year.
Now, this is just a sampling of four agencies, and you see
them up there: National Park Service, Veterans Health, Air
Force, Bureau of Indian Affairs.
Now, in the sampling they took, if you apply that to the
entire number of federally leased vehicles across the
government, we have wasted in the neighborhood of $80 million
annually through bad leased fleet management. So we've leased
vehicles that we don't need. When we lease them, we don't drive
them or utilize them to their maximum. So there's a lot of
money being wasted, and GAO found that in their report.
The owned fleet is another story, and the Government
Accountability Office is currently conducting an audit for the
committee on this topic. I'm sure we'll be following up on that
with another hearing or at least an inquiry.
Today, I'm pleased to announce that GSA will have a new
management agreement with Amtrak to save taxpayer dollars on
many of Amtrak's leased vehicles. This is significant news,
because, unfortunately--and, again, this is not just something
I'm saying, but if you look at the report that we have from
Amtrak conducted by their inspector general, and we'll have him
here to talk about it--but this report details some troubling
history of Amtrak's management in leasing and operations of its
fleet. In some instances, Amtrak was spending nearly $4,500
more than what it could have been paying through GSA when they
leased vehicles. We found, again, that Amtrak's--well, not we,
but the inspector general found that Amtrak's fleet is also
subject to severe underutilization and weak fuel card
oversight. We have some pictures--also some slides that we can
show. Many vehicles just sat idle not only for months but
sometimes not driven for a year. In May of last year, there
were 153 Amtrak vehicles that consumed less than 15 gallons of
fuel for the month that was examined, 26 of which were Amtrak
police vehicles; two were SWAT vans. I think one of the SWAT
vans--if you look at it up there--it doesn't appear moved or
was driven for a year. We know some of these assets are
infrequently needed to deploy, but, again, we have a
significant fleet. We have significant expenditures and losses.
It appears that Amtrak has also--and this is from the
automotive fleet report, from their engineering department,
February 2, 2016, in that month, it showed vehicles showing no
fuel purchase for the month, 138 vehicles. There's no fuel at
all purchased for them, which means a lot of those vehicles
were underutilized.
It remains clear that proper fleet management practices at
all agencies, big and small, can save significant amounts of
money.
Today, we'll hear both from GAO, and we'll also hear from
the inspector and from Amtrak representatives and others on how
improvements in Federal management of vehicles can move
forward. Amtrak has taken some steps to correct some of their
deficits that have been uncovered, and we'll hear about that
too.
We'll also hear how GSA and Amtrak have executed their
management responsibilities and what they have done or will do
to address some of the problems that have been uncovered by
both GAO and the inspector general.
I look forward to hearing the testimony from all of our
witnesses.
I'm pleased to now yield to the ranking member, Ms.
Duckworth. Welcome.
Ms. Duckworth. Thank you, Mr. Chairman.
And thank you, ladies and gentlemen, for being here.
Mr. Chairman, I must apologize for my late arrival. I have
simultaneous hearings this morning. The other one is on the
Army's 2017 budget proposal. So, having just concluded that,
I'm glad I made it here in time for the start of this and to
hear the chairman's excellent opening remarks.
Today's hearing is a chance to continue our subcommittee's
oversight of Federal fleet management to ensure that taxpayer
dollars are being used properly and efficiently. This is
significant--in fiscal year 2014, the Federal fleet totaled
just over 633,000 vehicles, nearly one-third of which were used
by the United States Postal Service. Agencies spent more than
$4 billion to buy and operate these vehicles, including more
than $1 billion used to lease more than 186,000 vehicles from
the GSA. This is a significant expenditure that is vulnerable
to waste, fraud, and abuse. While the vast majority of civil
servants serve our country honorably and are always mindful of
the need to use taxpayer dollars responsibly, the unfortunate
reality is that with more than half a million vehicles being
used across the Federal Government, it is almost certain that
bad apples would seek to take advantage of the system. The size
of the Federal fleet has declined in recent years, and the
administration has taken important steps to improve fleet
management.
In 2015, the President issued an executive order that set
aggressive goals for reducing the Federal fleet emissions over
the next decade and required each agency with more than 20
vehicles to focus on eliminating unnecessary or nonessential
vehicles from the agency's fleet inventory. However, much work
remains to be done according to the GAO. Current fleet
management policies may fragment responsibility and, in the
process, weaken accountability and oversight.
For example, although GSAsupplies agencies with a vast
majority of leased vehicles and maintains the database that
houses leased fleet information, GSA is not responsible for
monitoring agencies' vehicle-use policies. GSA has developed
and issued standards for optimizing fleet utilization, but
agencies do not have to follow these recommendations or comply
with their own internal guidelines. As GAO noted in its most
recent review of five large agency fleets when justifying
adding a vehicle to the agency's fleet, agencies appeared to be
either disregarding GSA's recommended standards or not
following their own. Specifically, GAO found four of the five
agencies in our review could not readily provide justifications
for vehicles that had not met utilization criteria defined in
agency policy. This finding appears to be at odds with the
administration's efforts to get agencies to regularly review
the sizes of their fleets and eliminate any vehicle that is not
meeting an essential agency need.
I look forward to examining today what specific steps we
can take to enhance the President's efforts to ensure the
Federal fleet is as cost-effective and fuel-efficient as
possible. In particular, since GSA has gone to the trouble of
developing best practices standards for assessing fleet-use
needs, one wonders whether Congress should mandate the adoption
of a single, uniform standard at least as a default option.
Before closing, I also want to note that today's hearing is
an excellent opportunity to address fleet management problems
within Amtrak highlighted by Amtrak's IG. According to the IG,
deficiencies in cost-control systems and ineffective oversight
has allowed waste, fraud, and abuse to infect Amtrak's fleet
program. One of the most alarming incidents of fuel card fraud
identified by the IG was when an individual, who was not an
employee of Amtrak, obtained an Amtrak fuel card and proceeded
to spend more than $57,000 on it. Every dollar Amtrak wastes
through poor management of its vehicle fleet is a dollar that
cannot go to meet urgent maintenance needs of the system or to
support long overdue infrastructure improvements.
Moving forward, I am pleased that Amtrak has announced an
aggressive effort to review its vehicle management practices
and the size and composition of its fleet. I urge Amtrak to
complete these reviews quickly and, more importantly, take
decisive steps to ensure that employees understand fraud will
not be tolerated.
I thank the chairman, and I yield back.
Mr. Mica. I thank the gentlelady.
Other members?
Mr. Duncan.
Mr. Duncan. Well, just very briefly.
And, Mr. Chairman, I want to thank you for calling this
hearing, the abuse of these vehicles and these fuel cards, this
is something that could be very easily abused, and I think we
would see much more abuse if it were not for you calling a
hearing such as this. And it has been something that I'm
interested in, because I remember, several years ago, I had a
constituent in Tennessee who complained to me because the
Forest Service was being very excessive in the number of
vehicles that they had, and then this constituent told me that
they were selling off these vehicles when they weren't very old
at all and didn't have many miles on them at all.
I can tell you, I generally have two cars. One of my cars
right now has 149,000 miles on it; it is still doing just
great. And I had two other vehicles before I bought a used car
last year: one that had 194,000 miles on it and another one
that had about 200,000 miles. So we can get much more use out
of these vehicles, and I think that we need to ask how many
miles these cars are being used or driven before they are sold
off.
And, also, I've heard that they have been selling to people
who are connected to Federal employees, and they learn about
these auctions when nobody else does. And so I think it would
be interesting to see, what is the average number of miles
driven before these cars are sold, and what steps are being
taken, if any, to prevent these cars from just going to
insiders, so to speak?
So thank you very much for calling this hearing.
Mr. Mica. Thank you, Mr. Duncan.
Any other members?
If not, we will leave the record open, with agreement from
the ranking member, for a period of 10 days. Without objection,
so ordered.
We'll now turn to our witnesses and welcome them this
morning. We have four witnesses, and let me introduce them.
And what we'll do is we'll introduce you. We'll have you
sworn in. We swear in all of our witnesses, because we're an
investigative and oversight committee, and let you go through
your statements.
Several of you have been here before. We try to have you
limit your statements to 5 minutes, summarize, and then you can
ask through the chair or a member to include additional
material with your testimony or for the record.
So we'll go through all of the witness testimony, and then
we'll go through questions. So that's going to be the order.
So we have with us today: Ms. Lori Rectanus, and she is the
director of physical infrastructure issues with GAO, Government
Accountability Office, and I referred to their report. Mr. Bill
Toth, he is the director of Fleet Management with the General
Services Administration. Welcome. We have Mr. Tom Howard,
inspector general--I referred to his report--of Amtrak. And
then we have the chief executive officer and president, Joe
Boardman, from Amtrak back with us.
So welcome to all of you. If you will stand, please, and
we'll swear you in.
Raise your right hand.
Do you solemnly swear or affirm that the testimony you are
about to give before this subcommittee of Congress is the whole
truth and nothing but the truth?
Let the record reflect that all of the witnesses answered
in the affirmative, and we'll start right out.
Welcome, again, the director of physical infrastructure
issues at GAO, Ms. Lori Rectanus.
Welcome, and you are recognized.
WITNESS STATEMENTS
STATEMENT OF LORI RECTANUS
Ms. Rectanus. Thank you, Mr. Chair.
Good morning. Chairman Mica, Ranking Member Duckworth, and
members of the subcommittee, I'm pleased to be here today to
discuss the Federal fleet, a $4.4 billion activity that covers
over 630,000 nontactical vehicles. My statement today
highlights key fleet characteristics and provides information
on how selected agencies are carrying out their fleet
responsibilities.
As a bit of context, the idea that there's a single Federal
fleet is misleading. In reality, there are dozens, if not
hundreds, of fleets that range in size from just a few vehicles
to more than 200,000. Almost 80 percent of those vehicles are
managed by seven agencies, but just about every agency has some
vehicle, and about 70 percent of all Federal vehicles are
owned, while about 30 percent are leased.
Agencies have sole responsibility for managing their
fleets. This means that they determine the number and types of
vehicles they need, whether they want to lease or purchase
those vehicles, whether a vehicle is sufficiently utilized, and
whether a vehicle should be removed from the fleet. This
decentralized approach gives agencies the flexibility to
structure their fleets to reflect their diverse missions.
However, the financial well-being of this approach depends on
agencies managing their fleets in the most cost-effective
manner possible.
While GSA provides advice and guidance to agencies, it does
not have formal oversight responsibility over agency actions.
Each agency is responsible for collecting and reporting data on
its vehicle fleet. Those agencies that lease vehicles from GSA
can utilize the services provided by GSA for this, and we
recently found those data were generally reliable. However,
information on owned vehicles is less available, and its
reliability is less clear. This is because each agency collects
and maintains its own data and reports limited information. We
have also found that agencies' fleet management information
systems did not always have the elements recommended by GSA.
Most often missing were direct and indirect costs, which are
essential for conducting life-cycle analysis, which is needed
to determine true vehicle costs and whether to buy, lease, or
eliminate vehicles.
Agencies should also identify their optimal fleet size and
ensure that vehicles are fully utilized. In the past, we found
selected agencies often lacked supporting documentation to
explain how they identify their optimal sized targets, or they
did not follow GSA's guidance on conducting this analysis.
Regarding utilization, agencies are allowed to define their own
utilization criteria so they may adopt the GSA suggested
mileage criteria, or they may use other criteria, such as the
number of vehicle trips per month. We recently found that 66
percent of the selected leased vehicles from five agencies we
reviewed did not travel the number of miles recommended by GSA,
and 29 percent did not even meet the agencies' own utilization
criteria.
When vehicles do not meet the identified utilization
criteria, agencies can subsequently justify vehicles using any
additional criteria. We found that four of the five selected
agencies could not readily provide the justifications for about
1,500 leased vehicles that did not meet the original criteria.
Finally, agencies should also eliminate unnecessary
vehicles. In our recent review, we found that three of the five
agencies studied retained 500 leased vehicles that did not meet
the agencies' own utilization criteria and had no other
justification. Altogether, we identified almost 2,500 vehicles
from our sample of about 16,000 that either did not meet
utilization criteria, did not have documentation, or were
retained even when agencies determined that they were not
justified. These vehicles cost the agencies about $9 million in
fiscal year 2014. It would be an interesting exercise to see
what this number might be for the 600,000 vehicles currently in
use.
In conclusion, while agencies need the appropriate number
and type of vehicles to meet their missions, they also need to
be good stewards of Federal resources. Agencies must have
adequate data and appropriate procedures that provide assurance
that they are using the provided flexibility to meet their
missions in the most cost-effective way possible.
Chairman Mica, Ranking Member Duckworth, and members of the
subcommittee, this concludes my prepared statement. I would be
pleased to respond to any questions.
[Prepared statement of Ms. Rectanus follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Mica. Thank you.
And we'll hear now from Bill Toth, and he's the director of
the Office of Fleet Management of GSA.
Welcome, and you're recognized, sir.
STATEMENT OF BILL TOTH
Mr. Toth. Thank you. Good morning, Chairman Mica, Ranking
Member Duckworth, and members of the subcommittee. I appreciate
the opportunity to speak with you today regarding General
Services Administration's role in the Federal fleet. My name is
Bill Toth, and I'm the director of GSA's Office of Fleet
Management. I've been the director for over 8 years and with
GSA for over 25 years.
The mission of GSA's Office of Fleet Management is to
deliver safe, reliable, and low-cost vehicle solutions that
allow Federal agencies to effectively and efficiently meet
their missions. The Federal fleet can be broken down into three
categories of roughly equal size. One-third is owned by GSA,
and it's leased to eligible entities. A second third is owned
and maintained by the U.S. Postal Service. And the final third
is owned and maintained by non-Postal Service Federal agencies.
GSA's status as a mandatory source of vehicle purchasing
guarantees that all Federal agencies benefit from the
government's buying power inherent in having a single,
strategically sourced point of purchase. In fact, in fiscal
year 2015, GSA negotiated a discount on light-duty vehicles
that average 19 percent below dealer invoice. Given GSA's FY
2015 procurement of 47,409 vehicles, this discount saved the
American taxpayer an estimated $306 million. As a full service
leasing option for Federal agencies, GSA drives down costs for
Federal customers by providing end-to-end fleet management
services at an all-inclusive rate. The leasing program has
demonstrated savings year after year by leveraging the
government's buying power and consolidating redundant fleet
management functions duplicated in many different agencies.
GSA's motor vehicle program provides customers with a
comprehensive fleet solution that includes vehicle acquisition,
maintenance and accident management of fleet service cars with
a dedicated waste, fraud, and abuse detection team, and many
other solutions, as outlined in my written testimony.
GSA fleet leasing supports over 15,000 unique customers,
who collectively lease over 205,000 vehicles. To demonstrate
our commitment to providing customers with the best possible
value, GSA decreased its leasing rates for the past 2 fiscal
years by 2 and 2.75 percent, respectively. In addition to the
leveraged buying power and governmentwide administrative cost
savings inherent in a centralized fleet management program, GSA
prioritizes helping customers make smart decisions about the
composition and size of their leased fleet. While GSA is proud
of the progress it has helped customers make in optimizing
their fleet size and composition, Federal agencies themselves
are empowered to analyze their mission needs and, accordingly,
make the final decision about how many vehicles they need to
successfully fulfill the mission tasked to them by Congress.
Ultimately, authority for vehicle purchasing and operating
decisions remain with each Federal agency. GSA partners with
its customer agencies to help them stretch limited resources
and maximize their mission impact. Each year, GSA replaces
eligible vehicles within its leased fleet with new, safe, fuel-
efficient vehicles. Over the past 6 fiscal years, vehicles
added to the fleet had an average of 19 percent higher miles
per gallon rating than the corresponding vehicles they replace.
In addition, two of GSA's unique solutions available to all
Federal customers include the Short Term Rental program for
vehicle and equipment rentals and the Dispatch Reservation
Module, which is an electronic car-sharing program for
scheduling vehicles and providing utilization reports.
As a motor vehicle leasing provider, GSA assumes
responsibility for providing solutions that save American
taxpayer money. Our strategy for meeting these goals involve
maintaining the vehicles in superior condition, thus decreasing
the need for costly maintenance and repair and vehicle down
time. GSA replaces vehicles on a schedule designed to maintain
a safe, modern, dependable, and fuel-efficient fleet while
taking advantage of manufacturer warranties to minimize
maintenance costs. Used vehicles are actively remarketed to the
general public to ensure the highest possible proceeds are
captured upon the sale of each vehicle.
Through these and the other solutions outlined in my
written testimony, GSA is able to reduce the need for
administrative overhead across the government by centralizing
operational and administrative fleet support functions. We also
offer the opportunity to consolidate agency-owned vehicles and
commercially leased vehicle requirements into the GSA fleet to
reduce governmentwide cost and redundancies. I appreciate your
support for GSA's concerted efforts to drive continuous
improvements in the Federal fleet and your partnership in
delivering best value to the American taxpayer.
Thank you for the opportunity to testify today, and I look
forward to answering your questions.
[Prepared statement of Mr. Toth follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Mica. Thank you, sir.
And we'll now turn to Tom Howard, who is the inspector
general of Amtrak.
Welcome, sir, and you're recognized.
STATEMENT OF TOM HOWARD
Mr. Howard. Good morning, Chairman Mica, Ranking Member
Duckworth, and members of the subcommittee. Thank you for the
opportunity to discuss our work on Amtrak's vehicle fleet.
Within the last year, three of our reports have addressed
recurring issues with Amtrak's management and oversight of its
fleet of vehicles. The issues include unexplained growth in the
size of the fleet, potential underutilization of some vehicles,
and unnecessarily costly leasing practices. We also found that
ineffective oversight of fuel card use has led to fraud and
abuse. The root cause of the specific issues with the fleet are
weaknesses in Amtrak's management controls, an issue we have
identified as the cause of operational and programmatic
problems throughout the company. Amtrak management has been
responsive to our observations and recommendations and is
taking or plans corrective action.
In that regard, we believe that Amtrak has opportunities to
improve controls and reduce expenses by enhancing the
management and oversight of the vehicle fleet. I will briefly
summarize some of our work on the areas where we think there
are opportunities.
Since 2008, Amtrak's fleet grew by 28 percent, and it now
maintains over 2,500 vehicles. While we are aware that Amtrak
has added some vehicles in support of discretely funded
projects, it is unclear why the fleet has grown as much as it
has. In addition, the number of vehicles that employees can
take home when off duty increased by 20 percent over the last 3
years. Those vehicles now account for 23 percent of Amtrak's
fleet. As GAO noted, some Federal agencies have reduced the
size of their fleets to save money, and we believe that this is
an opportunity where Amtrak may be able to reduce expenses.
Even as the fleet is expanding, some vehicles appear to be
underutilized. As you mentioned, Mr. Chairman, in one month
last year, the company identified 153 vehicles that used less
than 15 gallons of fuel, an indicator of potential
underutilization. Evaluating the cause of the low fuel usage
and redeploying or disposing of vehicles where possible, could
reduce the need for additional vehicles and help decrease
expenses for Amtrak.
Another opportunity for improvement is reducing Amtrak's
overall leasing costs by taking better advantage of GSA leases.
Amtrak currently obtains 73 percent of its vehicles from GSA;
however, it also has some relatively high-cost commercial
leased vehicles that may be available from GSA at lower cost.
For example, on one project, we estimate that Amtrak could have
saved as much as $212,000 a year by obtaining GSA vehicles
instead of leasing 26 vehicles from commercial vendors.
Also, Amtrak doesn't require a lease purchase comparison
before obtaining additional vehicles. As a result, it has
entered into commercial leases that have cost more money than
it would have if they had bought the vehicles outright. For
example, the company could have saved more than $127,000 by
purchasing eight utility trucks rather than leasing them from
commercial vendors.
The third area for improvement is fuel card oversight. Our
investigations have identified employees who were making
fraudulent purchases with Amtrak- and GSA-issued fuel cards. In
most cases, those employees have been prosecuted and convicted
of criminal charges. We found that the employees were able to
use the cards for personal expenses because of systemic
weaknesses in internal controls. For example, supervisors were
not tracking who was using the cards. They were not monitoring
fuel and vehicle usage logs, and they were not retrieving cards
when employees left the company. Our reports have addressed the
issues I just summarized, and Amtrak management has included
corrective actions in its plan for improving the management and
oversight of the vehicle fleet. We are encouraged by
management's responsiveness to our observations and
recommendations as well as the development of its plan. We
note, however, that Amtrak's work on the plan is in the very
early stages and that effective implementation will require
sustained management attention and a long-term commitment to
changing the status quo.
This concludes my remarks, and I'm happy to answer any
questions you might have.
[Prepared statement of Mr. Howard follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Mica. Well, thank you.
And we'll hear from everyone after we've heard from Mr.
Boardman.
Welcome, president, CEO of Amtrak, Mr. Boardman. Thank you.
STATEMENT OF JOSEPH H. BOARDMAN
Mr. Boardman. Good morning, Mr. Chairman, and Ranking
Member, and the rest of the committee. At any given moment, an
Amtrak train is on the move somewhere in the United States.
Lots of things can happen, and we maintain a vehicle fleet for
our transportation organization so that our managers can
respond quickly to incidents out on the road. We also run a
police department of more than 400 people with national
responsibilities, and our engineering department that
undertakes construction and maintenance work not only on 400
miles of the Northeast Corridor but on more than 200 miles of
railroad in Michigan. Our footprint can be quite substantial.
For example, in northern Florida, we have several station
facilities and the Auto Train facility in Sanford where we do
maintenance work on contract for SunRail.
Amtrak does have 2,568 vehicles: 1,800 of them come from
GSA; Amtrak owns 531; and we lease commercially 237. GSA is
always our first choice. The annual cost to operate this fleet
is roughly $25 million. In the fall of last year, at the
request of management, me to Tom Howard, OIG reviewed our
vehicle fleet management program and noted some issues with the
internal control and monitoring processes for our vehicle
fleet. These were ultimately memorialized in the IG report
published in October, which identified a set of weaknesses in
the way in which our vehicle fleet is managed as well as
specific control weaknesses and vulnerabilities to fraud,
waste, and abuse.
There was some underutilization of portions of the fleet.
Not all required inspections were being completed, and leasing
decisions needed improvement. Alternate garaging and fuel
overfills were also identified as areas of concern.
I'd like to stress a couple of important points. We have
worked closely with the IG as they developed their findings,
and this partnership has helped us to work collaboratively to
develop the very specific response plan, which has been
reviewed in detail with your staff and which I will outline for
the committee.
In a more global sense, this partnership is a key component
of a much larger framework of control, audit, and risk-
management functions that we work to implement at Amtrak over
the past 4 years. This system of enterprise risk management has
been a particular priority of mine, and it stems, in part, from
a recommendation of our inspector general that Amtrak should
have and develop an enterprise risk-management function.
Our management-control framework provides the company with
a formal process for ensuring that we identify risks to both
the business and the enterprise within the context of our
strategic objectives and our business process objectives. The
foundation of our framework is a system of risk assessments
undertaken by the controls organization that we have created to
implement the management-control framework. The framework
itself provides a consistent methodology for identifying
control-improvement opportunities, documenting them, and
managing the organizational response to ensure that we have a
consistent and effective response and implementation across the
organization.
We've also sought to incorporate external review and audit
processes into the framework, because I believe they bring a
different perspective, and this helps us to identify and
address potential risks.
The IG report's recommendations are captured and tracked
through this same process. Our plan to address the management
challenges with our vehicle fleet should be understood within
the context of the management-control framework. It's not just
that we've created a plan to address and identify an issue;
there is now a mechanism for facilitating plan development,
monitoring progress, and ensuring that the identified risks are
addressed and properly carried out.
We've benchmarked BNSF railroad centralized vehicle fleet
program and see many opportunities to improve our program.
We've created an action plan to improve compliance oversight
for drivers and vehicles, and we're in the process of updating
our policies and procedures. We've implemented a pilot program,
which supports our transportation department, and we're now in
the process of implementing improved management programs for
our police and engineering departments. We anticipate
completion of a rollout for all three programs, all
departments, by June. We're creating a governance council to
oversee the vehicle management program and determine whether
Amtrak should ultimately continue to administer the program or
outsource some or all of the program to a third party through a
competitive process.
I think it's important to emphasize that this plan is not
something that we pursue in isolation. There's a system of
controls in place and an organization that's empowered to
monitor and oversee the implementation of new processes. We
also have a system of independent checks, including external
audits and our inspector general, to provide effective
oversight. Creation of a system of this type is, I think, the
most important single action we could take to address
weaknesses of the type addressed in the IG report. And I'm
confident we will be able to use it to ensure that issues are
properly addressed.
Thank you very much.
[Prepared statement of Mr. Boardman follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Mica. Thank you, Mr. Boardman.
And thank all of our witnesses.
And now we'll turn to some questions.
First of all, I want to turn to GAO. Ms. Rectanus, your
little study--you didn't study all of the agencies. As you
said, we have a very diverse and scattered agency fleet
operations and management, but you looked at five agencies, was
it?
Ms. Rectanus. Yes, sir. We looked--excuse me. We looked at
four departments, and then, within Interior, we looked at
National Park Service and----
Mr. Mica. I said four or five----
Ms. Rectanus. So five, yes.
Mr. Mica. Okay. And you found that we could save
approximately how much to--describe that again?
Ms. Rectanus. Again, what we found in looking at the
various steps along the way of what agencies should be doing to
ensure they fully utilized their vehicles and justify, we found
almost--about 2,500 vehicles that cost them about $9 million.
How we calculated that is that's what they paid to GSA in
fiscal year 2004 to maintain those vehicles.
Mr. Mica. Didn't the President put out an order some years
ago saying that all of the agencies had to set forth a plan for
management of their fleets?
Ms. Rectanus. There's been a number of those mandates that
have come out. Yes, in 2011, there was a Presidential memo that
talked about optimizing the fleets and eliminating unnecessary
vehicles.
Mr. Mica. I think the deadline was last year.
Ms. Rectanus. December 2015, correct.
Mr. Mica. And I think you're also doing another report for
us, a review for us?
Ms. Rectanus. Yes. You have given us a request to look at a
number of issues with owned vehicles, not just vehicles but
construction vehicles, aircraft. You're keeping us busy.
Mr. Mica. Well, we extrapolated some of the savings, and I
estimate, you know, you just take from your four samplings,
it's somewhere between 80 and 100 million dollars is lost a
year. It's fairly significant fleetwide.
We've got some instances of purchases that got us down.
We've got about a third of the fleet, I guess, is the post
office, 600,000 vehicles, whatever we have. And the GAO
reported the Postal Service had purchased about 43 alternative
fuel vehicles and indicated the post office might not be able
to operate vehicles using alternatives as fuel, because the
fuel, one, wouldn't be available, or it would be more costly.
That was your finding there?
Ms. Rectanus. Yes. That work was from several years ago,
where we looked at some of the challenges the Postal Service
was having with its outdated fleet. It doesn't have the money
to replace the fleet, but, yes, we found----
Mr. Mica. When they bought replacements that had
alternative fuel, some of the vehicles wouldn't have access to
the fuel, or they turned out to be a much more costly exercise.
Ms. Rectanus. Correct. They either had vehicles that were
not within proximity of fuel availability, or just because they
didn't want their carriers to have to go way out of the way to
get alternative fuel in, they sought a waiver from DOE----
Mr. Mica. The IG of Amtrak produced a very good report. And
could we put up that chart 6? It shows a comparison of GSA and
commercial leased costs for common vehicles in Amtrak's fleet,
and it showed that the type of vehicle, if you look at the red
there, that's what they paid. So--and GSA cost, they could
acquire the same type of vehicle, in most instances, for less
than half and sometimes they paid--Amtrak paid 10 times as
much. If you look at the fuel and waste truck comparison, the
dump truck, SUVs, three times as much. Is this what you found,
Mr. Howard?
Mr. Howard. Yes, that's correct.
Mr. Mica. And you said just on one sale, it was like a
quarter of a million, some $200,000----
Mr. Howard. --212,000, yes, on commercial leases.
Mr. Mica. I'm sorry. That was a lease, and then we looked
at purchase. Where is the chart here on the purchase? Here's
eight vehicles, just eight vehicles--and this is also yours--
that they purchased. They could have purchased new for 295,000.
They did a 44-month commercial lease and paid 422,000? Is that
correct?
Mr. Howard. That's correct.
Mr. Mica. So a substantial saving both in leasing at lower
costs and then lease versus purchase, which brings us back to,
we haven't had the cost-benefit analysis of looking at whether
it's better to lease than purchase. That seems to be ignored
kind of agencywide. You found that at Amtrak, Mr. Howard?
Mr. Howard. Yes, we did, sir.
Mr. Mica. And you found that, Ms. Rectanus, governmentwide?
Ms. Rectanus. We have not actually looked individually by
vehicle that lease versus purchase.
Mr. Mica. Well, maybe in your upcoming report we can----
Ms. Rectanus. Yes, sir.
Mr. Mica. --we can get more information on that.
Then we had another issue, it's kind of interesting. I
worked some on the railroad when I was going to college in the
summer, and I know sometimes they have to buy more fuel than
they put in the tank of the vehicle. But there were a number of
instances, pretty extensive number of instances, in which the
purchase of fuel exceeded the capacity of the vehicle tank.
Did you find that, Mr. Howard?
Mr. Howard. Yes. Yes, sir. We had several investigations of
those issues. They were referred to our office by GSA's fraud
unit. They monitor the fuel usage of vehicles on the GSA--that
are leased with the GSA.
Mr. Mica. And speaking of fraud, I mentioned the fuel
credit card, and I just got, a day or two ago, a notice from
you of a case, one case, I guess this employee was ripping off
the credit card, and he, I guess, has been fired. But you had
mentioned that you have gone after these folks. This is just
one instance in the last 2 days. How many people have we had to
go after on this, or have we successfully prosecuted?
Mr. Howard. We have done nine cases that we've completed.
We will still have a couple of cases that are under
investigation.
Mr. Mica. Well, that's a, again, unfortunate but, again,
something we have to pay attention to.
I know Amtrak has a lot of issues, and I've worked over the
years with Mr. Boardman on food service, for one, and we
reviewed accidents. They have a pretty tough safety record of
accidents with their trains, but this was quite interesting,
this operational data. And I believe this is from your report
too, Mr. Howard. These are accidents with vehicles, and it
showed accidents percentage of times the government--or a
government employee was at fault versus the employees in all
the agencies. And in accidents in which an Amtrak employee was
involved, they were at fault 97 percent, 96.8 percent, versus,
in other accidents across the government, 65 percent.
Is that pretty accurate--is this accurate? This is your
production, sir?
Mr. Howard. No, sir, that's not mine. That's the----
Mr. Mica. I'm sorry, this is the GSA.
Mr. Howard. Oh.
Mr. Mica. Mr. GSA, Mr. Toth, this was a document we got
from you, then?
Mr. Toth. I don't believe we submitted that document. We do
provide that information to all of our leasing customers, so
Amtrak would have that.
Mr. Mica. But, again, this is information that we have from
one of the investigative agencies showing, in fact, 97--that's
Amtrak's leased fleet I'm told. But, again, 97 percent of the
time, we have an Amtrak employee--sounds like we need to do a
little bit better job of driver training at Amtrak.
Just a couple of quick questions for Mr. Boardman, and then
I'll yield to the ranking member.
Where are we on the use of charge card for food service
with Amtrak?
Mr. Boardman. Charge card for food service?
Mr. Mica. Yes.
Mr. Boardman. I'll have to get back to you on that. I do
not----
Mr. Mica. Are we at 100 percent?
Mr. Boardman. I do not know, sir. I will get you----
Mr. Mica. We are going to leave the record open----
Mr. Boardman. --a written response to that.
Mr. Mica. I said even people who do lawn maintenance now,
you can charge on--and we've not had that on Amtrak either for
purchase of tickets onboard or for food, and we've lost a
billion dollars in 12 years in food--Amtrak food service.
What was Congress' contribution to Amtrak in this current
fiscal year? I think it's $1.9 billion?
Mr. Boardman. It has been 1.390 for the last 3 years, sir.
Mr. Mica. But it's a significant underwriting, and if you
have 31 million passengers, you divide that, that's a cost of
about $40 million per ticket we're underwriting, and some of
those we're not sure on the sale.
Mr. Boardman. That does include the capital cost, sir.
Mr. Mica. Yes. But, again, it's a cost that the Federal
Government is paying. I would love to operate any company and
have the government subsidize my capital cost.
You were moving forward on purchasing passenger vehicles,
and I thought that was in the $2-plus billion range to replace
Acela, is it?
Mr. Boardman. Passenger rail vehicle, sir?
Mr. Mica. Yes.
Mr. Boardman. Yes.
Mr. Mica. Is that still underway?
Mr. Boardman. Yes, sir.
Mr. Mica. Have you done a cost-benefit analysis to see if
they can be leased?
Mr. Boardman. Yes, they are a business plan. I don't think
we've done a leasing cost, but almost all of our trains wind up
being leased in the end through a financial institution of some
sort.
Mr. Mica. Well, I think it would be interesting to see some
of what's being considered in that regard. I know across the
world, in some instances, State supported rail and then private
rail are leasing their vehicles as opposed to purchasing them,
and that's pretty significant purchase; $2 plus billion is the
estimate, I believe.
Ms. Boardman. You're talking, sir, excuse me, just about
the high-speed rail trains?
Mr. Mica. Yes. Well, Acela trains.
Mr. Boardman. Yes, sir.
Mr. Mica. Okay. Maybe you can get back to us on the record
with that. So, with that--and I'll have additional questions
we'll either ask or submit--I'd like to yield to our ranking
member.
I see, also, we have the member--the ranking member of the
full committee has joined us. But we will take go to Ms.
Duckworth first.
Ms. Duckworth. Thank you, Mr. Chairman.
I am of the opinion that Amtrak is a public good, and it's
worth the investment from the government. And, with that said,
I understand that Amtrak has initiated a significant
restructuring of its fleet management program focused on
centralizing the decisionmaking and oversight process.
Mr. Boardman, can you describe the specific steps your
company is taking to improve the management of its fleet, and
what's your timeline for full implementation of the planned
changes?
Mr. Boardman. Our planned changes for the three areas that
we're concentrating on right now would be June of this year,
which is the operations, the engineering, and the police
department, where we saw the need most at first.
We have worked hand in hand--maybe the initial kinds of
issues that were really raised by the Office of the Inspector
General really defined for me the need to get in a much deeper
view of what was happening with our vehicle fleet. So one of
the early things that we did was we went out and benchmarked
against what we considered a well-managed vehicle fleet on a
railroad, being Burlington Northern Santa Fe. And at the same
time, we began to look at what the real problems were, and it
was something that Amtrak suffers with, and the chairman has
pointed this out as well as the IG for a while now, and that is
internal controls.
And, in 2012, the IG provided for us an evaluation of our
risk and risk management, enterprise risk management. And when
they did that, we created a management-control framework. And
that management-control framework included looking at business
risks and also the objectives that we were trying to get done
with projects.
And so coming together from all of that, one of the things
that was important in looking at vehicle fleet management was
having consistent regulations, consistent controls that would
maintain. Amtrak existed, really, with all these independent
sort of organizations, and they set their own criteria for what
they were going to provide vehicles for. So what we're pulling
together is a centralized look at how we do that with a
governance program that identifies and evaluates what needs to
be done for the future and that those independent decisions
won't be made like that in the future, and that's what's being
done.
Ms. Duckworth. Are you doing that also in terms of fraud,
waste, and abuse when it comes to the fuel card program as
well?
Mr. Boardman. We're looking at the fuel card program to try
to find a way that we can find quicker that there was--there is
waste fraud and abuse. We would like to have a better system to
do that, so it's included in that particular part of it. We've
had discussions with GSA about how we might be able to get that
quicker. We're a very small part of what GSA really does, but
we think--we look to GSA first, and for example, in the
testimony that I heard, over two-thirds of our fleet comes from
GSA, and it's two-thirds of other fleets that are actually
owned. So we really do look for GSA to help us with that.
Ms. Duckworth. Mr. Howard, do you believe that the steps
that Amtrak is proposing would address your findings and ensure
that Amtrak can effectively and efficiently both manage its
fleet and prevent waste, fraud, and abuse, both in the fleet
program and in the charge card program?
Mr. Howard. Yes. I think that there's steps in the right
direction that they have taken. As I mentioned in my remarks, I
think that there needs to be a sustained commitment to that and
senior management attention on changing the status quo.
Ms. Duckworth. So, Mr. Boardman, how are you going to
ensure that sustainment through the effort occurs? Is there a
periodic review? How are you holding people responsible? Or is
there an actual timeline? How are you going to make sure that
that sustainment, that commitment to a real culture shift is
going to happen along with the programmatic changes that must
happen also?
Mr. Boardman. Well, the Governor's group, for one. But,
more importantly, in the overall and--overall element of what
we're trying to make happen is this management-control
framework. We're tracking IG recommendations. We're tracking
our business risks. We call them control-improvement
opportunities. And we're looking for ways that we reduce the
risk on the company for these kinds of incidents.
And as long as this company continues in that fashion, then
we're going to see that sustained commitment for the future.
And I believe--and the way that it's currently structured--and
every month, I sit across from Mr. Howard at the board
meetings, and we go through all the elements of what he's
providing as recommendations.
For example, since 2014, I think we looked at, in 2014, we
had 174 open recommendations from the IG, and that was just too
many. So we began right away really looking at, how do we
control this and the management-control process? And in that
period of time until the end of this last year, we closed 158
of these recommendations while 49 were being added, so we wound
up with 65 recommendations.
And those kinds of things really indicate to me that our
system works so that we can keep control of it.
Ms. Duckworth. Mr. Chairman, I am out of time, but I wanted
to follow up with the GSA.
Mr. Mica. Go ahead.
Ms. Duckworth. Okay. Thank you. Thank you for your
indulgence.
Mr. Toth, speaking to what Mr. Boardman said that, you
know, going to rely on GSA for help, you provide many tools and
services to help with management of these vehicles, such as the
Federal Automotive Statistical Tool. Does Amtrak participate in
FAST or take advantage of fleet information-management services
you offer?
Mr. Toth. So the FAST tool was actually administered by the
Department of Energy on behalf of GSA and our office of
governmentwide policy. I believe, as a quasi-government entity,
they are not required to.
And I actually would defer to them. I'm not sure whether
you participate in the FAST process or not.
Mr. Boardman. I do not know the proper answer to that. We
may or may not, but I will respond to you.
Ms. Duckworth. Great. Thank you.
Mr. Toth, it does not appear that Amtrak is included in the
Federal Fleet Report. Is that accurate? And can you explain why
this would be the case.
Mr. Toth. It's my understanding they are not in the Federal
Fleet Report. And, again, that data is compiled through the
FAST process, so depending on what they're submitting into the
FAST process. Therefore, it's not compiled into the Federal
Fleet Report.
Ms. Duckworth. Okay.
Mr. Boardman, what percentage of your corporation's
vehicles meet the use criteria recommended by GSA--or either
the ones developed by GSA or by Amtrak itself?
Mr. Boardman. One of the issues that the IG identified was
that each one of these independent organizations creates their
own criteria for the selection of a vehicle and the use of the
vehicle. And so we don't have that. That's something we're
centralizing as a part of this process.
Ms. Duckworth. Okay. Thank you.
I yield back, Mr. Chairman.
Mr. Mica. I thank the gentlelady.
Vice chair of the subcommittee, Mr. Grothman.
Mr. Grothman. Sure. I just want to go over some numbers
that were previously stated. You said there were 153 cars
with--I think it was Mr. Howard--153 cars using less than 15
gallons of fuel.
Mr. Howard. Yes, that was in 1 month last year. The company
had identified that. They track fuel usage, and they've set the
standard of less than 15 a month to identify potential
underutilization.
Mr. Grothman. Okay. Just a general question for Mr. Toth:
About how many miles or years on a car before you turn them
over?
Mr. Toth. So there's standard requirements for the entire
Federal fleet in the fleet management regulations. All agencies
are bound to abide by those. Then, on top of that, in our
leasing program, we have more stringent requirements. And they
vary by the class and the type of the vehicle, you know, from a
sedan on up to, say, a coach bus, where a coach bus has to go
10 years and a million miles. I can provide those standards for
you all in the record.
Mr. Grothman. Just a basic about, you know, like a basic--
--
Mr. Toth. The Federal standards for like a Sedan are 3
years, 36,000 miles. GSA extends both the years and the miles
on its fleet. A truck runs like 7 years, 60,000 miles. These
are minimum replacement criteria, not shall be replaced.
Mr. Grothman. What's the norm?
Mr. Toth. It varies by agency and by use, as well as
vehicle condition.
Mr. Grothman. You'd sell a car after 36,000 miles?
Mr. Toth. The regulations allow it. That's the minimum
before it's allowed to be sold.
Mr. Grothman. But what's the norm? Do you know? Do you have
any just ballpark idea?
Mr. Toth. Again, it varies all over the place, depending on
the condition and the usage of the vehicle.
Mr. Grothman. Okay.
Question for Mr. Howard, and this goes back a little bit on
the fuel cards. You uncovered criminal actions related to fuel
cards following the 2013 review by the Amtrak Finance
Department's Management Controls Group that identified
weaknesses in internal controls. Is that right?
Mr. Howard. Correct.
Mr. Grothman. Okay. Mr. Boardman, why didn't Amtrak take
action at that time to address the weak controls?
Mr. Boardman. Actually, we have been taking those actions.
That's part of the process that we're doing.
Mr. Grothman. Okay. Up here--and maybe it's just a small
amount. The chart was up here before, but when they say that 97
percent of the accidents in these cars are the government
driver's fault, or your guy's fault, is that----
Mr. Boardman. I have never seen that chart. I don't know
where it comes from. And if somebody can tell me where it comes
from, we'll respond to it.
Mr. Grothman. Okay. Kind of alarming. I guess GSA's fleet
report.
Maybe, Mr. Toth, do you know more about that chart?
Mr. Toth. I don't know who provided it to the committee or
directly what report it comes from. For our leased vehicle
program, we do maintain statistics and provide that to our
customer agencies, so it could have come from that information.
I did not provide it or prepare for it today.
Mr. Grothman. I guess Amtrak itself provided it to the
committee, I'm told here. Is that possible? Maybe you don't----
Mr. Boardman. I don't think that's--at least from the
people that are here, I don't believe that. But----
Mr. Grothman. We should track it down, because if that's
true, that's just almost beyond belief.
Mr. Boardman. I agree. The only thing--again, I just don't
understand it. That's all.
Mr. Grothman. Okay. Kind of amazing.
Why don't you tell us a little more--Mr. Howard, we talked
about the take-home policy on vehicles. Are there any problems
about that? Could you maybe tell us a little bit more your
opinion of that policy?
Mr. Howard. We think that the policy needs to be improved.
It requires that the take-home vehicle be justified, but
there's no specific criteria for supervisors to use when
they're approving the take-home of the vehicle, so there's no
cost-benefit analysis. So it kind of boils down to employees
just basically making a case that it's good for them to have a
vehicle. We would like to see some very structured criteria
that could be applied and audited.
Mr. Grothman. Are there any standards? I mean, if I take
home a vehicle at night, are there any standards to make sure
I'm not using it to, you know, everywhere under the sun, or are
there tight standards to just make sure I'm going home?
Mr. Howard. No, sir.
Mr. Grothman. So I could take it home on a Friday night and
drive a million miles or whatever and use it to bomb around all
weekend, just kind of a perk of the job?
Mr. Howard. Right. You'd be driving something probably with
a big Amtrak logo on it though, so hopefully that's a bit of a
deterrent. But, no, sir, there's not. And we have some cases
that we're investigating, looking at those abuses.
Mr. Grothman. Okay. Thanks.
My one final comment, Mr. Boardman, is it does look like we
have problems here. And, obviously, your agency is always being
scrutinized, you know, look at the subsidy and that sort of
thing. And it's something I would be very--feel more contrite
about. I mean, I know you understand that.
Mr. Boardman. I understand that, sir, and that's part of
the reason I asked the IG to help us with this.
Mr. Grothman. Okay. Can I just say----
Mr. Mica. Go right ahead.
Mr. Grothman. Staff is handing me a binder here, which says
on the front, ``GSA Department of Transportation Amtrak
National Account Report, Third Quarter.'' And right under their
contacts, Tom Moriarty, Stephen Olds. And right beside there,
on page 8, it gives the percentage of government at fault in
accidents and incidents. And that's where we get it from. If
you don't have it, I suppose we can give you a copy of it.
Mr. Boardman. I just got handed something here.
Mr. Grothman. Yeah, you can see on page 8 there, it says:
96.8 percent of the time, accidents and incidents, the Amtrak--
the person driving the Amtrak car is at fault, or at least
that's what it implies on here.
Mr. Boardman. So I have got to understand what that means.
Does it mean the vehicles that are out on the right-of-way that
are engineering vehicles, operations vehicles that are single
car, damaged by something along the right-of-way of the
railroad? I don't understand the report. So we'll find out what
the report means and respond.
Mr. Grothman. Maybe there's statistical anomaly. It does
compare to government agencies in general at 65 percent. So
it's alarming on the face, but why don't you get back to us.
Mr. Mica. I thank the gentleman.
Mr. Boardman. Can I just ask a question? Would this be
against the 644,000, our 65 percent, and this report would be
against our 2,500?
Mr. Toth. This report is an annual report we provide to
Amtrak with all of the data on their vehicle usage, to include
accidents and incidents. And it summarizes the number of
accidents and incidents and those that are at Amtrak's fault
and/or they are liable for.
Mr. Mica. And it's comparable to it?
Mr. Toth. It's not necessarily vehicle accidents, but it
could be improper usage where a fender was dented, you know,
operating off-road or something like that and where they bring
the vehicle back an in unsatisfactory condition.
Mr. Grothman. But this would just include--and I'm sorry.
I'm over here--but would it include normal, over-the-road
vehicles? Or is this some anomaly here where they're including
like those vehicles they have that operate on the railroad
itself where it would have to be----
Mr. Boardman. It would be anything that would be leased
from GSA. So, since nearly 80 percent of our fleet is leased,
we probably have all of those conditions exist. And that's why
I'm looking at it and say: That's just never hit me before, nor
has it hit the IG. So we will find out what it really is,
Congressman, and get back.
Mr. Grothman. Okay. Well, thanks.
Mr. Mica. I thank the gentleman.
Let me yield now to the ranking member of the full
committee, Mr. Cummings.
Mr. Cummings. Thank you very much, Mr. Chairman, for
holding this hearing today and for your oversight and the
ranking member's oversight over vehicle leases entered into by
Federal agencies and by Amtrak.
I'm deeply concerned by the inspector general's findings
about Amtrak's fleet and management practices and urge Amtrak
to expedite the implementation of the efforts it has underway
to centralize and strengthen the management of its vehicles.
However, I want to direct my time that I have available to
an ongoing issue of great concern to me and to my district and
to the entire Baltimore area congressional delegation, and that
is the redevelopment of Baltimore's Penn Station. I want to
acknowledge that some improvements have been made at the
station, but they are generally improvements to the most basic
amenities, like the bathrooms. And I note that it required
significant persistence before these improvements were made.
Penn Station is a central gateway into Baltimore, and we
need that station to be an economic engine. For nearly a
decade, there have been many fits around the station without
any actual starts. Much of the building is still empty, and in
no way does it serve as the anchor point for Baltimore that it
could and should be.
Obviously, today, we have both Mr. Boardman, the head of
Amtrak, and Mr. Howard, the Amtrak inspector general here. You
both received letters from the Baltimore delegation led by
Senator Mikulski. So let's get to the central issue.
Mr. Boardman, why do you believe that enlisting a master
development team is the most effective and efficient way to
develop the Penn Station?
Mr. Boardman. We think that there is an ability to do a
tremendous amount of improvement because you have people that
have a larger view of what could be done. And just, for
example, last week, we received almost--I think it was nine
proposals to improve that. There's tremendous interest in
developing Baltimore station.
Mr. Cummings. Now, Mr. Howard, you wrote that you were,
quote, ``skeptical of Amtrak's readiness to undertake and
oversee a master development procurement approach of this scope
in a timely manner.''
Why are you skeptical, and what other options do you
believe are available to Amtrak to redevelop the Penn Station,
particularly given current budgetary constraints? And do you
believe that any of those options would more efficiently and
effectively lead to the redevelopment of the station?
Mr. Howard. Sir, we're skeptical of Amtrak's ability to do
this because of our past work, which has identified significant
problems with program and project management. We've reported to
those. The company has taken action to improve them, but given
its track record, we're skeptical.
We have not yet looked at other alternatives to the
terminal development issue. Based on the last letter that we
received from you and the other delegation, we have initiated
some additional work to do that. And it's our hope that we
can--out of this additional work--we can identify perhaps some
alternatives that the company may be able to consider or at
least offer it--some suggestions on how the terminal
development initiative can be better implemented.
Mr. Cummings. Now, Mr. Boardman, Amtrak has moved ahead
with a two-pronged effort to redevelop Penn Station. One effort
involves undertaking the work needed to bring Penn Station into
a state of good repair. The other effort will move forward with
the selection of a master developer. I want to understand both
efforts in more detail.
What is the specific work that will be undertaken to bring
Penn Station into a state of good repair, and what is the
status of that effort? Particularly, how much do you expect to
spend in 2016 on the state of good repair work? What projects
will be completed this year? How long will it take to complete
all of the state-of-good-repair projects? And what do you have
the funding--or do you have the funding that you need to
complete all the work?
Mr. Boardman. So I'd like to follow up with a written
response to you, but let me give you kind of a thumbnail here.
We're planning on spending about $3 million this year on the
projects. Part of that has to do with this master development
partnership, which is about $300,000; part of that has to do
with a program development with a consultant to identify and
prepare for the redevelopment activities. So a lot of those
activities are not identified and fully completed in what needs
to be done this next year.
But there's a new generator going in; platform lighting and
construction upgrades; station WiFi upgrades; Penn Station
master plan planning activities, which I'm covering; and then a
B&P Tunnel new lighting. And some of the $22 million that we've
spent since 2010 in Penn Station, some of it you identified as
restrooms and other facilities, basic stuff. We did have to
start with basic stuff.
And I know you know that, Congressman----
Mr. Cummings. Yeah.
Mr. Boardman. --because you've been involved with it.
Mr. Cummings. Very much so.
Mr. Boardman. But we will get back, even with an analysis
of this program partnership, to the delegation just as soon as
we've gotten through it. There's about nine proposals that are
in there.
Mr. Cummings. Just with the chairman's indulgence, I just
have two more questions.
If all went according to plan, when would the master
development process be finished and a redeveloped Penn Station
be ready to open its doors?
Mr. Boardman. I don't have that final date.
Mr. Cummings. Okay. And, finally, what opportunities will
stakeholders in Baltimore have to weigh in with the master
development process? And, as you know, many stakeholders in
Baltimore have been working for years--for years--with Amtrak
officials to jump start the redevelopment of Penn Station. And
we want to make sure we have a say.
Mr. Boardman. We have had--Congressman, I think you know--
ongoing quarterly meetings with all the stakeholders. We could
expect to continue doing that. I think we have the March, April
meeting coming up here very shortly. So we're going to stay
very tight with the stakeholders for Baltimore.
Mr. Cummings. Thank you very much, Mr. Chairman.
I really appreciate your indulgence.
Mr. Mica. Thank you so much, Mr. Cummings.
The gentleman from Tennessee, Mr. Duncan, you're
recognized.
Mr. Duncan. Thank you, Mr. Chairman.
Ms. Rectanus, you said earlier that your agency had studied
or looked at 16,000 and found 2,500 were underutilized or
misused or whatever. And you said it would be an interesting
exercise to expand that out to the vehicle, to the total fleet.
And so it's, you know, pretty easy math. That comes out to
about 100,000 of the 635,000 or 640,000 vehicles that would fit
into that category. So it's quite a significant number.
And you heard me mention that my wife and I have had
several vehicles that we've driven 200,000 miles, and yet I
mentioned that a constituent who, many years ago, met with me
complaining about the Forest Service. And I don't remember if
he said that their vehicles were being auctioned off either
with less than 40,000 miles or with an average of 40,000 miles,
but I remember the 40,000-mile figure.
Do either you or Mr. Toth, in looking into this or studying
this, can you tell me what is the average mileage when these
vehicles are replaced?
Ms. Rectanus. We did not look at that specifically vehicle
by vehicle, again, because that would be asset-level
information. I think what we did find, however, in our work is,
in many cases, agencies are not doing the life-cycle cost
analysis to really know when is the right time to replace a
vehicle or eliminate a vehicle, because in some cases, it's the
opposite; they keep a vehicle longer than they should. In some
cases, they get rid of it before they should. So the work we've
done has really supported having them have better data so that
they make the right decisions.
Mr. Duncan. Can either of you tell me how many new vehicles
were purchased by the Federal Government last year?
Mr. Toth. Yes. It was just under 50,000 vehicles.
Mr. Duncan. 50,000 new vehicles were purchased. And how
many new leases were entered into last year?
Mr. Toth. The leased fleet has been about--been stable for
the past several years. Some are turned in as agencies downsize
the fleets, as other agencies either reduce their commercial
leases and lease from GSA or have new mission requirements
increase them. But the leased fleet has not grown or declined
much over the past several years.
Mr. Duncan. Well, how many new leases are entered into each
year though, roughly?
Mr. Toth. About 2,000. We've also had some consolidations,
which has varied year over year, but we seem to have 2,000 come
in and 2,000 go out roughly each year.
Mr. Duncan. And what department has the largest number of
vehicles? Would that be the Department of Defense or----
Mr. Toth. Yes, sir.
Mr. Duncan. And how many have--I understand that--I'm told
that, in the Department of Defense, that some of the vehicles
come under your control, and some do not. Is that correct?
Mr. Toth. Yes, sir. We only lease nontactical vehicles or
nonmilitary-type vehicles, if you will.
Mr. Duncan. So how many vehicles would that be in the
Department of Defense?
Mr. Toth. Of our 200,000 vehicles that we lease, they are
about 50 to 60 percent of all vehicles. So 100,000, 110,000
vehicles total across the Department of Defense.
Mr. Duncan. So 200,000 of your vehicles are leased, and the
total fleet is 635,000 or 640,000. Is that correct?
Mr. Toth. Yes, sir.
Mr. Duncan. All right. Thank you very much.
Mr. Mica. Thank you, Mr. Duncan, and other members, for
participating.
A couple of quick questions. Now, these hearings are nice,
and I think this hearing has--and some of your review, both at
GSA, also GAO, and Amtrak IG have resulted in some action being
taken. Now, GSA, it's my understanding that you have a new
agreement or pending agreement that you've done with Amtrak on
your commercial leases. Is that----
Mr. Toth. Yes, they are eliminating over 100 of their
commercial-leased vehicles and going to acquire them from GSA
through a lease.
Mr. Mica. And that should result in substantial savings.
And we have evidence of both from the IG and Amtrak and GAO
about cost savings, correct?
Mr. Toth. Yes, sir.
Mr. Mica. Okay. Because you don't want to just do these
hearings and not have anything.
And, Mr. Boardman, you're cooperating. And I mean, you
cited some of the steps you've been taking since some of these
things that have been revealed here today, but you're going to
cooperate on that basis.
Are there any other major areas in purchases that were in
fleet management that you can cite today, Mr. Boardman or Mr.
Toth? Mr. Boardman.
Mr. Boardman. No. I think we're moving--as I said, we had,
to begin with, over 70 percent of our fleet was leased from
GSA, and with this addition, it just goes up more. And I think
that helps us save more.
Mr. Toth. And we'll continue to partner with Amtrak to
assist them in any way we can in managing their fleet.
Mr. Mica. Well, this is--again, I said a meat-and-potato
hearing. Let me just say, also, we solicited and received a
somewhat troubling report from Amtrak. It's an automotive fleet
report. And this is just for 1 month at the last--I guess we
could get before the hearing. It's a monthly data information
collected by Amtrak engineering department. This is December of
2015.
Now, you go down and you see at the bottom some of the
problems with fuel cards. This is just for 1 month: purchases
exceeding fuel tank capacity, 26; incorrect type of fuel
purchased, 87 transactions; incorrect mileage entered at the
pump, 28 vehicles; nonfuel purchases, 102 transactions.
Then we go down to some of the compliance and safety review
under Federal motor carrier roadside inspection affecting
Amtrak's compliance here. Out of compliance vehicles: expired
DOT inspections, 33; expired high-rail inspections, 35; expired
crane inspections, 19; expired--looks like diesel--the electric
inspections, 3.
Then we look at the drivers, and you have, out of
compliance drivers: expired medical cards, 52 drivers;
expired--this is I'm not sure exactly how--but it's a violation
list, I guess, for drivers--36 drivers. This is very troubling,
and this also needs attention.
So this is provided by Amtrak. It isn't from the
investigations you've done, but this is just 1 month showing
that it's not operating the way it should operate. So we'd like
attention to that, maybe for the record, Mr. Boardman, if you
want to respond. I don't want to put you on the spot here, but
we would like a response.
Mr. Boardman. Part of the response is this is a yearly
total. This isn't 1 month. This is at the end of December.
Mr. Mica. It says monthly data.
Mr. Boardman. Right, it's the monthly data summarized at
the end of December.
Mr. Mica. Again, even if it is for the year, it's still
troubling.
Mr. Boardman. I understand. Just, it's a lot more troubling
if it's for the month, in my view.
Mr. Mica. Well, again, we'd like to see that. And we have
the 1 month that we did review and that was provided for us. So
this is the status. It's not acceptable. We need improvement.
And if it was for the year, it's just as troubling.
Mr. Boardman. Understand.
Mr. Mica. But, again, we're leaving the record open for the
next 10 days.
Did you have any additional questions, Ms. Duckworth?
Ms. Duckworth. Not at this time.
Mr. Mica. Mr. Cummings?
Mr. Cummings. No.
Mr. Mica. And I thank the members for participating.
We have some open recommendations from GAO that remain for
GSA. And we will actually be submitting some questions to some
of the witnesses today after this hearing. We'd like a response
so it could be included in the record. And we will get you the
specific questions after the hearing.
There being no further business before the subcommittee, I
want to thank our witnesses for their participation, the good
work that they've been doing in helping with this important
study. We look forward to having you back as you complete your
study on some of our vehicle review of the Federal fleet. And,
again, I thank everyone for their attention to that.
I'm sorry. I don't want to preclude anyone. Our vice
chairman of the committee would like to make a closing remark.
Mr. Grothman. Right. I just will say, both as far as Amtrak
and the government as a whole, what we've heard here today is
alarming. I mean, this isn't the type of hearing that attracts,
you know, 30 people from the press corps, and you're lucky we
don't attract 30 people from the press corps, because it's--I
mean, unless there are things that we're told on the followup
answers or if we have another hearing that kind of explains
some of these numbers, it's kind of alarming, kind of sloppy.
I mean, you know, how quickly we're turning in the cars or
not knowing how quickly we turn in the cars. I would think, you
know, there are always some irresponsible people who turn over
their cars really quickly, and if they want to be spendthrifts,
that's with their own money. But the possible numbers out there
are alarming. The number of accidents perhaps caused by
government employees is alarming.
I sometimes think--you know, I'm a new guy up here in
Washington--that people here just think this is good enough.
But, you know, people right now are very alarmed about what
they feel is an out-of-control government. And I'll just say
that I think the government collectively is lucky we don't have
a lot of members of the press paying attention today because
this is the type of thing if I talked back home to a Rotary
Club or Kiwanis Club or something, they're like, holy cow.
So I hope you leave here with a sense of urgency in
changing the way we spend people's money. But I'd like to thank
the subcommittee chairman for bringing the very interesting
topic to our attention.
Mr. Mica. Again, I thank the vice chairman, the ranking
member of the subcommittee, full committee, and others for
their participation, our witnesses. This hearing is adjourned.
[Whereupon, at 10:37 a.m., the subcommittee was adjourned.]
APPENDIX
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