Article from: www.thenewspaper.com/news/39/3959.asp
11/27/2012DC: Audit Shows Parking Ticket Contract Mismanaged
No bid contract with parking ticket firm ACS proves costly for Washington, DC.
Meter maids issue more than three tickets for every single resident of Washington, DC every year. Employees of the private contractor Affiliated Computer Services (ACS, now a part of Xerox) and other DC departments issue a total of 2.5 million citations. The revenue generated has been so substantial a report by the city's inspector general issued November 15 suggests officials are not interested in doing anything to upset the existing system.
Since 1985, ACS has been in charge of ticketing in the nation's capital, pocketing $52,712,209 in the past six years. This is an amount DC Inspector General Charles J. Willoughby says has been wildly inflated by city officials who failed to follow accepted contracting procedures. For example, in a report issued three years ago, Willoughby complained about the city giving ACS the contract without first putting it out for competitive bidding. As a result, ACS pocketed $6.4 million in extra revenue in 2009. DC never rectified the problem.
"The Office of Contracting and Procurement (OCP) and Department of Motor Vehicles (DMV) continue to issue sole source contracts to the same vendor since the contract expired 3 years ago," Willoughby wrote. "In addition, the recommendation to develop an advance procurement plan to acquire the ticket processing system in FY 2009 was not implemented."
As a result, ACS took another $8.7 million in extra cash during the most recent contract extension, which runs out on January 2, 2013. The report found no credible justification for skipping the bidding process.
"The Office of the Inspector General believes that OCP and DMV had sufficient time to plan the solicitation, solicit competitive bids from multiple vendors, and award a new ticket processing and related services contract," Willoughby wrote.
Once the contract was in place, District officials failed to abide its terms which require that an outside firm audit ACS's ticketing performance on a quarterly basis. Fifteen reports should have been filed, but only three audits were actually performed -- with negative results.
"Two of the three reports contained findings centering on a lack of controls for commingling vendor mail, inadequate controls for confirming that ticket images are uploaded to eTIMS, and third-party payment processing of invoices," Willoughby wrote.
The inspector general questioned the propriety of a contract provision that paid ACS $2 for each voided ticket, even though the company did not perform any additional processing for the canceled citation. In 2010, voided tickets and warning citations generated $107,200 in extra revenue for ACS. The process for voiding citations also raised eyebrows. When a meter maid asks to void a ticket, the request is sent to a DMV employee. This employee can remove the infraction from the database, but there is no follow-up verification done to reconcile the number of citations the DMV voids and the number of requests received from meter maids.
"As a result of not segregating these functions, there is a potential risk of malfeasance, errors, fraud, and abuse by the employee who has access to void transactions in the system," Willoughby wrote. "For instance, the employee charged with voiding tickets could easily void unauthorized tickets along with authorized tickets as favors for friends or for cash, without being detected. In this instance, DMV would lose the ticket revenue for the unauthorized voided ticket. We did not find any evidence of such activities, but the opportunity for malfeasance exists."
The report also found a city councilman abused the process by having the DMV to void citations he received that had already been upheld by a parking adjudicator.
A copy of the audit report is available in a 1.2mb PDF file at the source link below.
Source: Audit of DC DMV Ticket Processing Services (DC Inspector General, 11/15/2012)
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