2017 MARTA Internal Audit

Audit: #17-04-O-1
DATE: June 28, 2017
TO: David Springstead – AGM Office of Capital Programming & Development
FROM: Charles Middlebrooks – Manager Operational Audit
SUBJECT: Review of the Capital Improvement Program_____________________

Internal Audit has completed a review of the Capital Improvement Program (CIP) and
management process. Internal Audit was aware that an assessment and evaluation of
the Capital Improvement Program was performed by an independent consultant during
Fiscal Year (FY) 15 with a draft final report issued February 2015 and a follow-up
assessment performed one-year later, in FY16, with a final draft report issued April
2016. Some of the conclusions identified during this audit may be similar to or a
furtherance of the recommendations of these assessments. Key to these assessments
was the recommendation of a new centralized department to manage and deliver
MARTA’s Capital Improvement Program which resulted in the formation of the
Department of Capital Programs & Development effective FY16. In July 2015 Mr.
Parker appointed David Springstead as acting AGM of Capital Programming &
Development. In July 2016 Mr. Springstead was promoted to the position of AGM of
Capital Programming & Development and started developing the Capital Improvement
Program team.
In addition to the formation of the department, there was a critical need to establish a
strong internal control environment to monitor the Capital Improvement Program. As a
result, Internal Audit scheduled an audit of this area as a part of its FY 17 audit plan.
The work performed was an in-depth audit of the CIP function which identified certain
Key Control GAPS, Cause & Effect of Control Issue (where applicable), Control Risks to
MARTA and provided Recommendations that could mitigate the risks identified.
Based on the time that had elapsed since the assessment and evaluation was
completed and the critical need to have a strong internal control environment within the
Capital Improvement Program, Internal Audit scheduled an audit of this area as a part of
its FY 17 audit plan. The work performed was an in-depth audit of the CIP function
which identified certain Key Control GAPS, Cause & Effect of Control Issue (where
applicable), Control Risks to MARTA and provided Recommendations that could
mitigate the risks identified.
During the course of our audit, Internal Audit noted that CIP Management has made
great strides to establish a stronger internal control environment and continue in its
effort to make CIP a world class program.
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The scope of the audit was conducted in two phases:
Phase 1: Understand the CIP Budget Process

The objectives of this phase included the following:
• Obtain an understanding on the purpose of the Capital Improvement Program.
• Roles & Responsibilities of each department that is directly and indirectly aligned
with the Office of Capital Programming & Development.
o Interviews were conducted with the CIP Scoping & Screening department,
CIP Monitoring & Reporting department, Office of Accounting, Office of
Treasury, and the Office of Contracts & Procurements.
o Interviews were also held with the AGM of the Office of the Capital
Programming & Development and with the Chair of the CIP Change
Control Subcommittee.
• Understand how the CIP Budget is put together by understanding the roles of the
following departments in the budget process:
o Project Managers/Project Sponsors
o CIP Scoping & Screening Department
o Capital Improvement Committee (CIC)
o CIP Change Control Subcommittee (CCSC)
o CIP Monitoring & Reporting
o Treasury Department.
• Monitoring of CIP Budgets versus YTD (year-to-date) Project Cost
• Monitoring of Project Milestones
Phase 2: Perform substantive test of ‘Approved’ CIP 10 YR Projects

The objectives of this phase included the following:
• Obtain a reasonable explanation and documentation to support changes to the
CIP Budget from FY 15 to FY 17. Furthermore, ensure that changes to the CIP
Budget was authorized.
• Determine whether internal controls over the CIP process from initiation to
closeout of projects are adequate. Also, to determine that projects are being
managed and controlled to ensure project objectives are being met.
• Determine whether CIP Budgets to Life to Date Costs are being monitored.
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• Determine if an analysis of the 'Current Year' CIP Budget to the 'Current Year'
Cost is performed. Are projects that are 'under' or 'over-budget' addressed? If
projects are 'over-budget' are there procedures in place to ensure that additional
approval is obtained to 'increase' the CIP Budget for the affected Project or
conversely to move monies from the under-performing project?
• Validation of 'Current Year' Cost (i.e. for FY 16 since FY 17 is still in progress).
• Determine how costs associated with CIP Projects are recorded into the General
Ledger.
• Determine whether the Capital Improvement Program is properly administered
and monitored on a regular basis.
• Determine whether the new SharePoint site is restricted to authorized personnel.
Furthermore, determine if excel files are secured on a shared network drive;
providing a 'read-only' access to authorized users.
• Determine if access to Oracle (i.e. MARTA OGA GRANTS_MGMT module) is
restricted to authorized personnel.
o Per discussion with the Treasury Analyst responsible for entering the CIP
Budget into Oracle and via observation, Internal Audit noted that the
aforementioned module above gives access to the following: I). Award II).
Award Status III). Projects IV). Project Status V). MARTA Project Tasks
(such as Budgets, Expenditures, etc.).
NOTE 1: Refer to Appendix 1 for an Overview of the Capital Improvement

Program.
SCOPE LIMITATION
In respect alone to the limitation of work relating to the review of Access to the MARTA
OGA GRANTS_MGMT module in Oracle, Internal Audit was not provided with the
information and explanations that we would consider necessary to determine the
following objectives:
• Access to MARTA’s Project Tasks, can an employee manually enter the CIP
budget into Oracle, can the employee also enter Grant information into Oracle,
can an employee update/modify the CIP Budget once it is entered into Oracle,
and can an employee enter Project Cost information into Oracle?
• Is there an exception report in Oracle that shows when changes are made to the
'CIP budget' within the 'MARTA OGA GRANTS_MGMT' module in Oracle?
o If a report exists, who is responsible for running the exception report and
who performs the review of the report. Furthermore, what is the frequency
of the review?
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CONCLUSION
AUDIT RATING: SIGNIFICANT
Based on our review and the testing performed with regards to controls over the
initiation, execution, and management of the Capital Improvement Program, we
determined the key to be as follows:
• A lack of consistency in the management of Projects across MARTA exist due to
the fact that no centralized Project Management Office exist.
Management’s Response
➢ Agree - in Fiscal Year 2016 and 2017, the Department of Capital Programs
and Development (CPD) took steps to establish the foundation of a
centralized Project Management Office.
➢ Discussions and briefings (reports) were held to status the PMO function at
MARTA. There are currently 26 different PMO offices delivering the CIP. All
offices are not following a single set of standards and processes as
historically numerous business units “self-manage” and “self-deliver” their
projects and programs.
➢ Many PMs Report up to a Director, Senior Director, AGM or Chief.
➢ Examples: Elevators/Escalators, ESCO, Automated Parking, Bus Shelters,
General Planning, Scoping & Screening and Upgrading Aging IT Equipment
(servers, desk tops, network).
➢ MARTA must commit to a single PMO office and one Standard Operating
Procedure that sets the standard and mandates complete business case for
all Capital Projects, Programs and Initiatives that include: valid scopes,
resource loaded schedules, dedicated resources, accurate budgets, and
rigorous project controls.
➢ All PMO’s must actively participate in the centralized PMO transition
(software, procedures and reporting requirements).
• There is no documented evidence to show that every Project Manager is

monitoring project milestones. Thus, MARTA could potentially be paying for a
project and not receiving the appropriate and/or required deliverable for that
project.
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➢ Disagree that there is “no” evidence – as many of the milestones and

deliverables are managed in different systems within each of the 26 project
management offices. MARTA has numerous contracts with schedules and
milestones, however there are projects and programs that have no or limited
milestone management.
➢ By implementing a centralized PMO structure, the disparate information on
milestones and deliverables reporting will become more transparent. This will
be painful at first!
• Standard Operating Procedures that govern the Office of Capital Programming &
Development relative to CIP should be documented to cover the initiation,
execution and completion of a Capital Improvement Projects.
➢ Agree - a Standard Operating Procedure (SOP) to assist the PMO in

executing the CIP is needed.
➢ The first phase of the CIP development process was to fully automate the
system and create an electronic work flow that includes all relevant Authority
levels and specifically the Executive Sponsor and Champion to foster
transparency and accountability. A charter, system wide training materials
and implementation are completed and the SOP is partially underway.
➢ In Fiscal Year 2017, CPD initiated phase one of developing SOPs by
identifying processes from each office – see WO# 20016-01, Capital
Improvement Program Process Analysis (CIPPA), A&E 35014..
➢ Phase II will begin in Fiscal Year 2018 with the continuation of SOP
development.
• No formal policy and procedure was provided to Internal Audit during the audit
that addresses the use/purpose of the CIP Reserve and/or how to account for
budgetary monies moved in and out of the CIP Reserve account.
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➢ Partially Agree - the current Change Control Policy includes the CIP Reserve
Policy however a documented procedure for reserve transactions needs to be
completed.
• There is no official documented methodology for forecasting of Project Costs.
Consequently, the year-to-date spending report for Fiscal Year 2016 showed the
year-to-date forecast and year-to-date cost for each project as the same
number.
➢ Non-issue - the Budget office is in agreement that MARTA begins each
fiscal year with an annual fixed budget by project, which remains
unchanged throughout the fiscal year, unless a new project is launched.
Forecast (spend plan) is updated monthly and will change based on
performance. Actuals are compiled roughly 60 days after date expensed
based on MARTA’s current invoice process. This will be memorialized in
the Change Control Policy.
➢ Depending on the maturity, comprehensiveness, and phase of the project
the forecast methodology will change.
• There is no validation of Project Forecasts and Project Costs by the CIP

Monitoring & Reporting Department. Thus, there is no way to ensure that the
project costs and project forecasts are accurate and/or complete.
➢ Agree - the Branch of Monitoring and Reporting will review all available
reports (Oracle vs Primavera or Access or Microsoft project) to conduct “Cost
Validation” in Project Controls Logs based on the available information from
each PM.
• A Lack of system Interface between Primavera 6, SharePoint and Oracle allows
for a limited transparency into the CIP process, increases dependency on
manual interventions instead of more reliance on an automated process, lack of
‘real-time’ reports, and decreased efficiency in monitoring of Project
milestones/Costs/Budgets.
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➢ Agree – this effort is near completion (with the exception that SharePoint
does not integrate with Oracle as stated in the recommendation).
• Robust Training of Project Managers does not exist.
➢ Partially Agree - well over 150 employees, including all PMs at MARTA on
the CIP development process and SharePoint and issued certificates. We
also provided support for more than 10 Project Managers to obtain Project
Management Professional (PMP) Certification Training in Fiscal Year 2017.
Training was conducted by the Project Management Institute (PMI) and PMI
approved partners. A MARTA wide PM certification process does not
exist, is not funded but will be launched in FY18.
• A lack of reporting and monitoring exist with regards to comparing work order
costs & Deliverables to CIP Budgets and vendor invoices to the work orders.
➢ Agree - this is an Authority issue for all professional services. CPM and
Legal have issued memorandums with signature authority and a new
Work Order Procedure is near completion and will be routed by Dept. of
Planning for final sign-off.
• No documentation exists to support the validation of life to date project cost
against current year project cost.
➢ Partially Agree - for all legacy projects life to date (LTD) costs are
questionable as MARTA’s financial system and process did not capture all
individual project expenses and activities. In 2006 MARTA aggregated all LTD
financial data in Oracle into a single year.
➢ Prior to implementation of Oracle, project start dates, and therefore
original costs were documented using a paper-based file.
➢ All invoices need to be centralized for processing and none should be
processed without PM approval. PMs validate year-to-date costs using
the best available information released from Oracle.
• There is no process in place to ensure that unauthorized projects are deactivated
in Oracle in an effort to provide reasonable assurance that unauthorized
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expenditures from authorized projects or unauthorized project expenditures are
not booked into Oracle.
➢ Partially Agree - the Office of Capital Programming tracks unauthorized
expenditures and shares this report MARTA wide on a monthly basis. We
also discuss these items with the Budget Office’s Capital Oversight Group.
PMs are contacted and asked to validate expenses. CPD will work with
Treasury, Accounting and Grants to prepare a Policy and Procedures for
Project Closeout in Oracle. The process will be presented to the Change
Control Sub Committee (CCSC) and Capital Improvement Committee
(CIC) for review and approval.
If you require additional information or wish to discuss the results of this review,
please contact me, Charles Middlebrooks, at ext. 5491.
cc: Keith T. Parker, General Manager/CEO

Gordon Hutchinson, CFO
Emil Tzanov, Assistant General Manager Internal Audit
Sola Akintoye, Internal Audit Consultant
Patrick Minnucci, Director Office of Project & Contract Management
Kevin Hurley – Senior Director Treasury Capital Program (Office of Treasury)
Walter Jones – Senior. Director Management & Budget (Office of Treasury)
Jacquelyn Christophe – Manager CIP Management Oversight
Dorinda McCombs – Manager CIP Scoping & Screening
Kirkwood Russell – Manager CIP Monitoring & Reportons
Cynthia Beasley – Senior Accounting Director (Office of Accounting)
Lisa DeGrace – Chief Contract Officer
Chris Jackson - Project Controls Analyst (Office of CIP Monitoring & Reporting)
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SUMMARY OF FINDINGS
A). POLICIES & PROCEDURES
1. Capital Improvement Program (CIP) Policies & Procedures - There are no
documented Standard Operating Procedures that govern the Office of Capital
Programming & Development CIP function with regards to covering the
initiation, execution and completion of a Capital Improvement Project.
2. Succession Plan for MARTA Employees and/or Contractors - A
contingency or succession plan is not in place for when MARTA employees
and/or contractors leave a project and/or MARTA.
3. CIP Reserve – No formal policy and procedure was provided to Internal Audit
during the audit that addresses the use/purpose of the CIP Reserve and/or
how to account for budgetary monies moved in and out of the CIP Reserve
account.
NOTE: The CIP Reserve Account is a 'budgetary' account and not a General
Ledger Account and as such does not show up on MARTA's financial
statements.
B). PROJECT MANAGEMENT
I. Project Initiation
1. Scoping of CIP Projects – Projects added to the CIP Budget List by the
Executive Management Team (EMT) and/or C-Team are added without going
through the CIP Scoping &Screening Department. Consequently, the CIP
Scoping & Screening Department does not have the opportunity to work with
the potential Project Manager/Project Sponsor in coming up with a detailed
and thorough project scope, design and financial analysis
2. Project versus Program Definitions within the Capital Improvement
Process - There appears to be a difference between the Capital
Improvement Program’s (CIP) definition of a Project vs. the definition of a
Project by the ‘Project Managers’ listed on the CIP Budget Spreadsheet.
Based on discussions with some Project Managers, the projects listed on the
CIP Budget Spreadsheet are actually departmental programs and do not
have a definitive start and end date as is typical for a Capital Project.
Consequently, Project Managers may not present adequate and/or complete
information to warrant the approval of their respective
programs/initiatives/projects by the Capital Improvement Committee (CIC).
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Thus, affecting the timing of when the program/initiative/project starts and
when the funds can be used.
3. CIP Budget on Project Schedule vs. CIP Budget on Project Origination

Document
The CIP budget on the Project Schedule does not always match the CIP
budget on the POD (Project Origination Document), because the POD only
shows the CIP budget for up to 10 YRS. However, if the life span of the
project is over 10 YRS, both the life span and the cost to implement the
project over the life span this is not reflected on the POD or the CIP Budget
Spreadsheet. Consequently, the approval of the CIP Project, by the Capital
Improvement Committee, could be based on an incomplete or inadequate
cost estimate and scope.
4. Insufficient Completion of Project Origination Document (POD) - The
project origination document (POD) for some projects are incomplete in
SharePoint.
The project origination document (POD) is used by the Capital Improvement
Committee (CIC) as a basis for deciding whether to ‘approve’ or ‘reject’ a CIP
project. Furthermore, the POD also serves as a support documentation that
the CIC uses in the prioritization of the ‘approved’ CIP projects into the
Annual CIP budget for approval by the Board of Directors.
Project Scope, Budget, Cash Flow Analysis and other pertinent information
could be based on an incomplete and/or inaccurate data.
5. Timely resolution of Change Requests in SharePoint - As of November

15, 2016 there were 141 change requests in SharePoint; 44 of which were
denied change requests with no explanation provided for the rejection.
Consequently, there were 97 change requests still awaiting a resolution (i.e.
approved or rejected). Thus, implying that change requests were not
processed in a timely manner and as such could have resulted in delays in
the continued execution of the CIP Project as well as a non-conformance to
funding guidelines for the project.
II. Project Planning
1. The Development of Project Scope for the construction of Hard Assets
does not include all applicable costs - Project specifications, realistic
budget (that includes soft costs such as consultant fees), and project work
schedules are not adequately scoped out for CIP projects that require the
construction of ‘hard’ assets (e.g. buildings, inventory, machinery etc.).
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2. Insufficient communication between the Office of Capital Programming
and MARTA departments - There appears to be an inadequate
communication from the Department of Capital Programs to Project Sponsors
and/or Project Managers on the following: a). Approvals or rejections of a
Project Change Request b). Defunding of an existing project.
3. Meeting Resolutions noted on the CIP Change Control Subcommittee
(CCSC) Minutes are not reflected on the Change Requests in SharePoint
and/or the Project Origination Document (POD) - Changes requested on
the CIP Change Control Subcommittee Meeting Minutes and the resolutions
for those requests (i.e. approved or rejected) are not consistently reflected on
the actual Change Request in SharePoint. Furthermore, budgetary changes,
approved or rejected by the CIP Change Control Subcommittee are not
adequately reflected on the POD (Project Origination Document). Thus, the
CIP Budget in Oracle may or may not be based on the budget numbers that
was approved by the Capital Improvement Committee (CIC) and/or the CIP
Change Subcommittee (CCSC).
4. Project setup forms are not consistently approved by
Treasury/Accounting prior to setup of a Project in Oracle – Per the Capital
Improvement Training Manual (dated Jan. 6, 2016) all CIP projects must have a
‘Project Setup’ form signed by either the Treasury or Accounting department
prior to the project setup in Oracle.
III. Project Execution
1. Individuals listed as Project Managers for CIP Projects - The individuals
listed as Project Managers on the CIP Budget Spreadsheet, for the most part,
do not act in the capacity of a Project manager. This implies that these
Project Managers do not perform the following functions: a). Manage the
project b). Prepare the monthly Project Expenditure Forecast c). Review the
monthly reports issued each month by the CIP Monitoring & Reporting
Department (e.g. Project Expense Reports and Project Labor reports).
2. Insufficient and/or Inadequate Training of Project Managers - It would
appear that employees with no professional certifications and/or training are
tasked with overseeing projects for which they lack the skill set and training.
3. Unauthorized Approval of Work Orders - The Authority Wide Approval
Matrix for Work Orders is not consistently followed. AGMs are approving
work orders and/or ‘Limited Notice to Proceed’ that are in excess of their
approval limit.
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4. Automation of Work Orders- An automated system does not exist to track
change order requests and work orders. Thus, there is no ‘real time’ visibility
into the work order initiation, approval and work order status.
5. Monitoring of Work Order Costs & Deliverables, CIP Budget and
Invoices– There appears to be no report to confirm an oversight or
comparison of Work Order Costs & Deliverables to the CIP Budget for the
related project. Furthermore, there is no report or evidence to show the
comparison of the Vendor Invoice to the Work Order; to ensure that the Work
Order amounts are being drawn down correctly.
6. Invoice Approvals - It would appear that individuals with the closest
knowledge about a project (e.g. the Project Manager) are not signing off on
the vendor/contractor invoices, prior to payment, to ensure the accuracy and
completeness of work performed. NOTE: All invoices are manually approved
(i.e. signed) prior to the invoice being processed by the Accounts Payable for
payment. However, the individuals signing these invoices are not necessarily
involved with the project or do not possess detail knowledge about the
project.
IV. Project Monitoring & Control
1. Management of Project Costs in Oracle - Project Managers or Project
Sponsors, do not have the authority to determine the type of cost that gets
booked into their respective project numbers in Oracle, nor can they decide
who gets to book the related cost entries into Oracle. Consequently, Project
Managers cannot readily ‘validate’ or ‘substantiate’ the ‘current’ or YTD (year-
to-date) Costs that is noted on the Capital Improvement Project Expense
Report.
2. Validation of the Accuracy Project Costs - There is no documentation to
support the validation of project costs (i.e. the Life to Date Costs and the
Current Year Cost) by the CIP Monitoring & Reporting department.
NOTE: On a monthly basis, the CIP Monitoring & Reporting department
extracts project costs (such as labor costs, material costs etc.) from Oracle
and downloads it into Access, in conjunction with costs sent by Project
Managers and/or designees via email for costs not captured in Oracle.
Access is then used to create the monthly Capital Expenditure Report.
However, the CIP Monitoring & Reporting Department does not check (on a
sample basis) if the projects costs that is pulled from Oracle and/or sent via
email is a valid cost. Essentially, there is no review of the documentation that
supports the project costs.
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3. Detailed schedules do not exist in Oracle or Primavera 6 (Project
Management Software) to track project milestones. Consequently, the
Capital Improvement Committee (CIC) and the CIP Change Control
Subcommittee (CCSC) do not have the information to adequately assess the
progress of a project (i.e. project milestones/deliverables) in order to validate
its decision to approve or reject an increase or a decrease of a project’s
budget and/or scope of work.
4. Accuracy and Completeness of Project Forecasts – There is no
formalized official process for forecasting project costs, project performance
and the quality of project deliverables for CIP projects. Consequently, project
forecasts are ‘arbitrary’ and not based on a formalized forecasting technique
with an underlying basis in substantive data.
5. Deactivation of Unauthorized Projects in Oracle – There is no process in
place to ensure that unauthorized projects are deactivated in Oracle.
Approximately $1.8M of Project expenditures were incurred or accrued in FY
16 for unauthorized CIP Projects.
6. Entry of CIP Budget into Oracle – CIP Budgets are entered into Oracle at
the ‘project’ level by Treasury, while project expenses are entered at the ‘task’
level by accounting, project managers etc. Consequently, it is impossible to
run a variance report at a ‘task’ level in Oracle to see the differences between
the ‘CIP’ budget and the ‘Project’ expense by task; because the CIP budget
can only be viewed at the project level and the project expense can only be
viewed at the task level.
7. Visibility into Original CIP Budget for Existing Projects - The ‘Original
Budget’ at project inception is not included in Oracle, on the POD (Project
Origination Document) or on the CIP Change Spreadsheet that is used by the
CIP Change Control Subcommittee to make decisions on whether to
‘approve’ or ‘reject’ a change request.
NOTE: Currently, the decision to either ‘approve’ or ‘reject’ a request is
based on a). If a reason is provided b). If the monetary request can be
accommodated by the monies set aside in the CIP reserve account.
8. System Interface - The 3 systems (Primavera 6, SharePoint and Oracle)
currently used in initiating, executing and monitoring the Capital Improvement
Program are not inter-phased or linked to each other. Having these systems
inter-phased allows for a greater transparency into the following: a). Tracking
of the percentage of completion of a project to percentage of monies spent.
b). Ensuring that the individuals with direct knowledge about the project
details (e.g. Project managers), in conjunction with authorized approvers, also
sign-off on work orders or invoices prior to payment by Accounts Payable. c).
Oversight of project costs and project milestones.
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9. Utilization of Oracle Software – The ‘Projects’ Module of Oracle is not fully
utilized to generate the monthly Capital Improvement Report that is created
by the Department of CIP Monitoring & Reporting. Consequently, the CIP
Monitoring & Reporting department is forced to extract information from
Oracle into Microsoft Access in order to create the month-end cost reports.
This is an inefficient method for creating a report, when there is an ERP
system (i.e. Oracle) that could perform report writing functionalities.
10. SharePoint 'User' Training for CIP Module – It appears that SharePoint
Training is not mandatory for Project Managers, Project Sponsors or
designated Departmental Representatives involved in the initiation and/or
approval of the Project Origination Checklists (POC), Project Origination
Document (POD), and Project Change Requests.
NOTE: The Office of Capital Programming & Development did conduct
trainings in FY 15 and FY 16 on the Capital Improvement Program and
SharePoint. However, it would appear that these training were not mandatory
and such there wasn’t a 100% attendance from all interdependent
departments.
V. Project Closing
1. Timing of closing out CIP Projects - Project # 31662 (Rehabilitation of at-
grade track slab on the NE, South and Proctor Creek Rail Lines) was
completed in FY 15 and is still in a 'close out' phase half way through FY 17.
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A). POLICIES & PROCEDURES
1. Capital Improvement Program (CIP) Policies & Procedures
There are no documented Standard Operating Procedures that govern the
Department of Capital Programming & Development CIP function with regards to
covering the initiation, execution and completion of a capital improvement project.
Recommendations:
The Office of Capital Programming should create a ‘Policies and Procedures’
manual that addresses the following within the CIP Process:
• Initiation of a ‘New’ CIP Project

o Who is authorized to ‘initiate’ a CIP Project?
o Required checklist and/or documentation that is needed before a POC
(Project Origination Checklist) can be initiated in SharePoint.
o Approval authority for a POC.
o $ Threshold for a POC that requires a POD vs. $ Threshold for a POC
that does not require a POD.
o Who can create a ‘POD’ (Project Origination Document) in
SharePoint?
o What fields within the POD document are required fields and
information that is required to properly scope a project?
o Who is authorized to sign-off on a Project’s POD in SharePoint?
• For Existing Projects
o Required documentation for change in Project Scope, Budget,
Business Case, Labor etc.
o Who is authorized to ‘initiate’ a change request form in SharePoint?
o Approval limits for a Change Request.
o Who is authorized to update the existing POD with the requirements
from the Change Request Form?
• CIP Budget Planning Process:
o Policy that states that all ‘New Projects’ must have an approved POC
and approved POD.
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o All documentation for a new project must be on file (i.e. in SharePoint)
before being presented to the CIC team for inclusion into the CIP list
for the current year.
• Capital Improvement Committee (CIC) Approval Process:
o Explicit statement on the Role and Responsibility of the CIC Team.
o Due Diligence that is expected from the CIC Team.
• How to calculate and/or derive the budget numbers for a Prospective CIP
Project
o Provide an example or a checklist that shows what type of data should
be used in coming up with a CIP Budget. Examples include a). Cost
for Materials b). Cost of Indirect materials c). Machinery cost (build vs.
lease), d). Labor Costs (MARTA employees vs. use of external
contractors) etc.
• CIP Change Control Subcommittee (CCSC)

o Explicit statement on the Roles & Responsibilities of the CIP Change
Control Subcommittee.
o $ Threshold or Scope Changes etc. that should go through the CIP
Change Control Subcommittee for approval.
o A report that ties the CIP Change Control Subcommittee approval or
rejection of a change request to the CIP Budget.
The Department of Capital Programming and Development should develop and

document a Standard Operating Procedure that addresses the following:
o The purpose, role and function of the Department of Capital

Programming and Development within MARTA.
o How the Department of Capital Programming & Development
ensures that MARTA’s Capital resources are fully aligned with the
Authority’s overall strategic goals and objectives.
o The Role and Responsibility of the Department of Capital
Programming and Development in relation to the 6 departments it
oversees - The Office of Capital Programming, Architecture & Design,
Engineering & Development, Project Management and Construction.
o How the Department of Capital Programming and Development
facilitates the coordination between ‘Capital Needs’ and ‘Operating
Budgets’ across the 6 departments it oversees.
▪ That is, how the Department of Capital Programming and
Development identify the most economical means to finance a
capital project and/or increase the opportunities for obtaining
Federal and/or State Funding.
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Management Action Plan: Agree: The Department of CPD has Procedures for
different groups such as the RE manual, and Contracts and Procurement Manual,
there is a need for additional procedures which are included in the plan.
Target Date(s): 12-01-2017
Responsible Party: Office of Capital Programming & Development.
2. Succession Plan for MARTA Employees and/or Contractors

A contingency or succession plan is not in place for when MARTA employees and/or
contractors leave a project and/or MARTA.
Recommendations:
• Develop an integrated approach to succession management.
o Organizations with an integrated, rather than a just-in-time,
approach to succession management experience higher retention
rates, increased employee morale, and an environment that stimulates
innovation and organizational change. Key components of an
integrated succession management approach include: workforce
planning, succession planning, knowledge management practices, and
recruitment and retention practices.
• Continually assess potential employee turnover.
o Making career planning discussions a part of a regular and ongoing
performance review process assists in assessing potential turnover.
Department heads are a good resource in helping to identify
employees that may be planning to leave.
• Provide a formal, written succession plan as a framework for succession
initiatives.
o Without a formal plan, workforce/succession planning tends to take
place in a haphazard fashion. A formal plan identifies risks and
strategies, thereby providing a guiding framework for specific
succession initiatives, including how employees are eligible to
participate and what being part of a succession plan means.
• Develop written policies and procedures to facilitate knowledge transfer.
o Knowledge transfer is a critical component of succession
management. There should be written procedures in place to formalize
the knowledge transfer. A meeting should be held with departing staff
to document job responsibilities.
• Development of leadership skills should be a key component of any succession
planning initiative.
17
o When leadership development occurs, the organization benefits
from developing a leadership pool for other positions.
Management Action Plan: Disagree: Although it would be ideal to have succession

planning for all employees and contractors, it is not practical at MARTA and most
government agencies as funding is constricted. Management will seek out training on
how to develop an informal succession plan for the Department.
Responsible Party: The Office of Capital Programming & Development as well as all
other departments within MARTA are responsible for ensuring that a succession plan is
in place for their varied departments.
3. CIP Reserve
There is no policy and procedure that addresses the purpose of the CIP Reserve
and how to account for budgetary monies moved in and out of the CIP Reserve
account.
A CIP reserve budget reconciliation was not performed for FY 16. Subsequently, the
increase of $56M reflected on the Final CIP budget spreadsheet could not be tied
back to a reconciliation that would show a). The beginning CIP Reserve Balance b).
Detail of Changes made to the CIP Reserve Budgetary Account c). The Ending CIP
Reserve Balance.
Furthermore, a CIP Change Request does not exist to support the $56M change
made to the CIP Reserve account in FY 16.
Recommendations:
• A written policy and procedure should be put in place to address the following:
o Purpose of the CIP Reserve Budgetary Account
o Department and/or Personnel authorized to move budgetary monies ‘in’ and ‘out’
of the CIP Reserve account.
o Procedures on how to reconcile the CIP Reserve Account to Change Requests
approved by the CIP Change Control Subcommittee during the fiscal year.
▪ NOTE: The reconciliation should clearly show the beginning CIP
balance, approved change requests, and the ending CIP balance.
o Personnel responsible for performing the CIP Reconciliation
o Personnel responsible for reviewing the Reconciliation
▪ NOTE: To ensure appropriate segregation of duties, the ‘Preparer’
of the CIP Reconciliation and the ‘Reviewer’ of the reconciliation
should not be the same individual. Furthermore, the ‘Preparer’ can
be a person from the ‘CIP Scoping & Screening’ Department and
18
the ‘Reviewer’ be a person from the ‘CIP Monitoring & Reporting’
Department or vice-versa.
• Treasury should consider working with the Office of Capital Programming &
Development in streamlining the process of moving monies in and out of the CIP
Reserve, in order to ensure that the changes are appropriately reflected in Oracle for
the related Project.
Management Action Plan: Agree: The control point is the Sr. Director of Treasury and
the Sr. Director of Budget serving on the CCSC to review and approve any use of the
CIP Reserve. Although, this is documented in the CIC Charter, it should be
documented formally in a procedure.
Target Date(s): 08/01/2017
Responsible Party: Office of Capital Programming and Treasury
B). PROJECT MANAGEMENT
I. Project Initiation
1. Scoping of CIP Projects

Projects added to the CIP Budget List by the Executive Management Team (EMT)
and/or C-Team are added without going through the CIP Scoping & Screening
Department. Consequently, the CIP Scoping & Screening Department does not
have the opportunity to work with the potential Project Manager/Project Sponsor in
coming up with a detailed and through project scope, design and financial analysis.
For example, there was no business case, financial analysis, cost-benefit analysis
done for the ‘Articulated Buses’ project (Project #32007). Per the CIP Scoping &
Screening Department, a thorough scoping work should be performed for all
prospective CIP projects prior to its inclusion on the list of projects to be approved or
rejected by the Capital Improvement Committee (CIC).
Recommendations:
• A policy and procedure should be put in place to address instances of when
project initiatives come from the C-Team or EMT (executive management team).
• New project initiatives coming from the C-Team or EMT should be thoroughly
mapped out before its inclusion on the CIP List for the current fiscal year.
• Furthermore, monies should not be spent till a thorough analysis (i.e. business
case, justification for new asset, cash flow analysis, cost-benefit etc.) has been
done and the project has been vetted by the CIC Team.
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Management Action Plan: Agree: In rare instances the EMT has identified projects,
programs and initiatives to be launched immediately. In those cases, the Office
Scoping & Screening must work in parallel with the Sponsor to quickly develop Scope,
Schedule and Budget. We agree, there should be a procedure that addresses urgent or
unplanned CIP requests.
Responsible Party: MARTA Executive Management and the Office of Capital

Programming & Development
2. Project versus Program Definitions within the Capital Improvement Program

There appears to be a difference misunderstanding between the Capital
Improvement Program (CIP) definition of a Project vs. the definition of a Project by
the ‘Project Managers’ listed on the CIP Budget Spreadsheet.
Based on discussions, some Project Managers view the projects listed on the CIP
Budget Spreadsheet as programs or initiatives and as such do not have to adhere to
a project start or end date.
Consequently, Project Managers may not present adequate and/or complete
information to warrant the approval of their respective programs/initiatives/projects
by the Capital Improvement Committee (CIC). Thus, affecting the timing of when the
program/initiative/project starts and when the funds can be used.
Moreover, there is some confusion on the documentation that is needed to initiate a
POC (Project Origination Checklist) and a POD (Project Origination Document) for a
‘Project’ versus a ‘Program’.
Recommendations:
CIP Management should consider the following:
• Defining a ‘Project’ versus a ‘Program’
o By definition, a Project has a defined start and end date with specific
objectives that when attained, signify completion. While a Program can be
defined as a group of related initiatives managed in a coordinated way to
obtain benefits not available from managing a ‘Project’ individually.
• Preparing a checklist on the documentation that is needed to initiate a POC
(Project Origination Checklist) and POD (Project Origination Document) for a
Project versus a Program.
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• Making a distinction between a Project and a Program on the CIP Budget
Spreadsheet.
Management Action Plan: Agree There are both projects and programs eligible for
Capital Funding. The CIP is approved and funded annually by the MARTA Board. The
hierarchy of programs and projects will be more accurately defined with the use of
Oracle sub-projects where appropriate to capture this in the Oracle initiative.
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Responsible Party: Office of Capital Programming & Development and Finance
3. CIP Budget on Project Schedule vs. CIP Budget on Project Origination

Document
The CIP budget on the Project Schedule does not always match the CIP budget on
the POD (Project Origination Document), because the POD only shows the CIP
budget for up to 10 YRS. However, if the life span of the project is over 10 YRS,
both the life span and the cost to implement the project over the life span is not
reflected on the POD or the CIP Budget Spreadsheet. Consequently, the approval
of the CIP Project, by the Capital Improvement Committee, could be based on an
incomplete or inadequate cost estimate and scope.
Recommendation:
The CIP Scoping & Screening Department should consider modifying the POD
(Project Origination Document) to show both the 10 YR CIP budget and the actual
budget cost for projects that exceed the a 10YR life span; to ensure that the Capital
Improvement Committee (CIC) is making decisions based on complete data.
Management Action Plan: Agree: However, this is not significant as the CIP is
reviewed and approved annually, one fiscal year at a time. We will add a flag for any
project that exceeds 10 years for awareness purposes – not a significant issue.
Responsible Party: CIP Scoping & Screening Department
4. Insufficient Completion of Project Origination Document (POD)
The project origination documents (POD) for some projects were incomplete in
SharePoint.
The project origination document (POD) is used by the Capital Improvement
Committee (CIC) as a basis for deciding whether to ‘approve’ or ‘reject’ a CIP
project. Furthermore, the POD also serves as a support documentation that the CIC
also uses in the prioritization of the ‘approved’ CIP projects into the Annual CIP
budget for approval by the Board of Directors.
Recommendations:
• The Scoping & Screening Department should ensure that all POD’s (project
origination document) are completed by the Project Managers or designees with
accurate information about the CIP Project.
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• The Office of Capital Programming & Development should emphasize to Project
Managers and/or Project Sponsors the need to include ‘clear’, ‘concise’ and
detailed information about their prospective project(s) on the POD.
Management Action Plan: Agree: There is room for improvement. For new projects or
current projects that will impact the CIP for multiple years it is important that the POD be
updated. Staff has prioritized new projects and existing projects are considered backlog
that staff are bringing current.
5. Timely resolution of Change Requests in SharePoint

As of November 15, 2016 there were 141 change requests in SharePoint; 44 of
which were denied change requests with no explanation provided for the rejection.
Consequently, there were 97 change requests still awaiting a resolution (i.e.
approved or rejected). Thus, implying that change requests were not processed in a
timely manner and as such could have resulted in delays in the continued execution
of the CIP Project as well as a non-conformance to funding guidelines for the
project.
Below is a breakdown of the change requests:
Status of Change Request Number of Change Requests

Waiting on Review from Project Champion 1
Waiting on Review from Scheduler and 48
Screeners
Waiting on Project Manager Approval 16
Waiting on approval from AGM Project 1
Sponsor
Waiting on Review from Project Control 1
Analyst
Denied Change Requests* 44
Blank (i.e. no status update) 30
*Denied change requests did not have any explanations to justify the denial of the
request.
NOTE 1: The Change Request Report from SharePoint covered the period of
January 2016 through November 2016. Furthermore, on the report there were
change requests dating back to January, February and March of 2016.
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Recommendations:
• The Scoping & Screening Department should develop a more efficient way to
streamline the 'Approval' and 'Rejection' process of a Change Request in
SharePoint. The following measures can be performed:
o The creation of a 'Change Request' checklist - the checklist should list out
all information that is needed to initiate a change request.
▪ SharePoint should be configured to not allow a user to proceed to
the next step without completing the change request checklist.
o Capability to load data to support a change request - this would give the
'Approvers' of a Change Request the visibility into why a 'Change
Request' is needed.
o An 'Alert' that is sent at each stage of the Change Request process
notifying 'required' users (i.e. Project Managers, Project Sponsors,
Scoping & Screening Members, CIC members etc.) on the status of a
change request.
▪ NOTE: A required user would be a Project Manager, Project
Sponsor, AGM, Scoping & Screening Personnel and/or CIC
member that is assigned to that specific project.
Management Action Plan: Agree: This is a quality control and culture change issue.
The minimum requirements for a change were not met and therefore not approved.
Cycle time will improve as personnel become more competent and compliant with the
new system. Change requests must be thoroughly documented and justified.
Responsible Party: CIP Monitoring & Reporting Department
II. Project Planning
1. Insufficient communication between the Office of Capital Programming and

MARTA departments
There appears to be an inadequate communication from the Department of Capital

Programs to Project Sponsors and/or Project Managers on the following:
• Approvals or rejections to a Project Change Request – some Project Managers

have expressed frustrations in not knowing if their project requests or changes
have been approved or rejected.
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o For ‘Rejected’ Project Change Requests, POC’s (Project Origination Checklist) or
POD’s (Project Origination Document), a detailed explanation is not provided to
the Project Manager/Project Champion/AGM on ‘why’ the aforementioned
documents are rejected. It would appear that citing ‘insufficient’ documentation
does not provide adequate information on what is needed to ensure that a POC,
POD or Change Request is approved by the Capital Improvement Committee
(CIC) or the CIP Change Control Subcommittee (CCSC).
• Defunding of an existing project - The Project Champion/Project Manager, for

Project #’s 32181 and 32183 noted that he was not informed and/or notified
about the defunding of the aforementioned projects for FY 17 by the Office of
Capital Programming & Development.
Recommendations:
The Department of Capital Programs should establish an effective method of
communication with AGM’s, Project Managers and Project Champions on the status
of ‘Change Requests’, ‘POC’s’ (Project Origination Checklist), ‘POD’s (Project
Origination Document) and if a Project is ‘defunded’.
• Establish workflow in SharePoint to notify respective individuals on status of a

POC, POD and a Change Request.
• Provide a detailed explanation to respective individuals for a ‘rejected’ POC,
POD and Change Request. Furthermore, include a detailed checklist of
‘required’ documentation that is needed to expedite the approval of a POC, POD
or Change Request.
• If feasible, have an in person meeting or phone conference to discuss projects
that have been ‘defunded’ with the respective AGM, Project Sponsor and/or
Project Manager.
Management Action Plan: Disagree: We are working to improve transparency and

multiple levels of communication to all clients and departments. Nearly all CIP
Information is accessible on the CPD SharePoint site. In addition, multiple reports and
workflows are in place. Training was also provided to stakeholders. This is a
competency and compliance issue, not a failure to provide transparent information. It’s
also part of our plan and was identified by McCloud, hence the creation of an
independent CPD group.
Responsible Party: CIP Scoping & Screening, Office of Capital Programming
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2. Meeting Resolutions noted on the CIP Change Control Subcommittee (CCSC)
Minutes are not reflected on the Change Requests in SharePoint and/or the
Project Origination Document (POD)
Changes requested on the CIP Change Control Subcommittee Meeting Minutes and
the resolutions for those requests (i.e. approved or rejected) are not consistently
reflected on the actual Change Request in SharePoint. Furthermore, budgetary
changes, approved or rejected by the CIP Change Control Subcommittee are not
consistently reflected on the POD (Project Origination Document). Thus, the CIP
Budget in Oracle may or may not be based on the budget numbers that were
approved by the Capital Improvement Committee (CIC) or the CIP Change
Subcommittee (CCSC).
Recommendations:
• The CIP Change Control Subcommittee should consider ‘Approving’ or
‘Rejecting’ Change Requests in SharePoint.
• The CIP Scoping & Screening Department should work with the SharePoint IT
personnel to facilitate updating of POD’s (Project Origination Document)
subsequent to the ‘Approval’ or ‘Rejection’ of a Change Request.
Management Action Plan: Agree: We will incorporate this field into the form it is
currently reported in the meeting minutes.
3. Project setup forms are not consistently approved by Treasury/Accounting

prior to setup of a Project in Oracle
A project set-up form with a written approval from Treasury/Accounting does not
exist for Project # 31918 (Police Service Vehicles). Furthermore, the
aforementioned project was setup in Oracle without a signed and approved project
set-up form.
NOTE: Per the Capital Improvement Training Manual (dated Jan. 6, 2016) all CIP
projects must have a ‘Project Setup’ form signed by either the Treasury or
Accounting department prior to a Project setup in Oracle.
Recommendation:
26
The Treasury/Accounting Department should consider including existing CIP
Projects, initiated under the old format for approving projects setups, into Oracle; to
mitigate the risk of setting up unauthorized project in Oracle.
Management Action Plan: Disagree: Not a finding. This problem no longer exists
because we fully automated the process via workflow.
Responsible Party: Treasury and Accounting
III. Project Execution
1. Individuals listed as Project Managers for CIP Projects

The individuals listed as Project Managers on the CIP Budget Spreadsheet, for the
most part, do not act in the capacity of a Project Manager. We found the following
instances with regards to Project Managers (PM):
A PM could not provide adequate information and/or explanation to support the

change in their CIP Budget. The PM referred Internal Audit to the supposed
responsible party who indicated that they made purchases but did not participate in
forecasting, CIP Budgeting, or management of the Project.
Internal Audit could not obtain an explanation and/or substantiate the changes to the
CIP Budget from FY 15 to FY 17 for Project # 32210 due to a lack of response from
the Project Manager. Consequently, Internal Audit can only conclude that
documentation may not exist for the aforementioned project.
Recommendations:
• MARTA should establish a centralized project management office.
• All approved CIP Projects should be assigned a 'Project Manager' that is well
abreast of the project and will be responsible for the management of that project
(from the initiation, planning, design, execution and close out of the project).
Management Action Plan: Agree: This is not a finding; part of our plan. We are taking
steps to set minimum requirements for PMs. Please provide evidence supporting this
statement.
The C-Team, EMT and staff have been briefed on this issue, not all PMs listed in CIP
have received formal PM training.
27
Responsible Party: CIP Scoping & Screening Department and Project Management &
Construction
2. Insufficient and/or Inadequate Training of Project Managers

Potential knowledge gap exists with MARTA employees regarding the execution and
management of a CIP Project.
o There are MARTA employees who possess the professional certifications

to warrant been a Project Manager, however, these employees are not
given clear directions as to their roles & responsibilities on a project.
o There are also MARTA employees with no professional certifications (e.g.
PMP – Project Management Certification) who are tasked with overseeing
projects for which they lack the skill set and training.
o Internal Audit selected a sample of 20 Project Manager Names from the
projects reviewed and noted that only 6 Project Managers had a PMP
(Project Management Certification license), while the remaining 12 did not
have a certification.
▪ The 6 certified PMP’s selected manage a total of $9.8M of the FY
2017 CIP Budget and $13.5M of the FY 2017 10YR CIP Budget.
▪ The 12 non-certified PMP’s manage a total of $48.5M of the FY
2017 CIP Budget and $410M of the FY 2017 10YR CIP Budget.
Recommendations:
• MARTA should develop and document a set of minimum requirement to be met
by all Project Managers assigned to a CIP Project.
• MARTA should ensure that Project Managers and/or MARTA representative skill
sets and qualifications are appropriately matched to initiate, execute and manage
a CIP Project.
Management Action Plan: Agree: Not a finding, part of the plan
Responsible Party: Project Management & Construction
3. Unauthorized Approval of Work Orders
28
The Authority Wide Approval Matrix for Work Orders is not consistently followed. AGMs
are approving work orders and/or ‘Limited Notice to Proceed’ that are in excess of their
approval limit.
During our audit we observed the following:
o A Limited Notice to Proceed was issued, in April 2016, by the AGM of the
Department of Safety and Quality for the Environmental Engineering
Consulting Services Work (Contract # A/E 30754, Purchase Order #
201407521) for $10M.
o Limited Notice to Proceed was issued and approved by the by the AGM of
Capital Programs & Development on January 10, 2017 in the amount of
$829,797.77 to the contractor (Parsons Transportation Group Inc.).
o Limited Notice to Proceed was issued and approve by the Interim AGM of
Capital Programs & Development on September 25, 2015 to the
contractor (Harris Miller & Hanson Inc.) for the amount of $152,024 for
Contract # A/E 22527, Purchase Order # 201501058.
Furthermore, there are no set guidelines in the Work Order Procedures (reference #
10.3.146) on when a Work Order should be created and approved subsequent to the
issuance of a ‘Limited Notice to Proceed’.
o NOTE: A ‘Limited Notice to Proceed’ may be issued should
unforeseen circumstances occur involving a need to continue
service. Approval of the Notice will be based on the established
Delegation of Authority.
Recommendations:
• An amendment to the ‘Limited Notice to Proceed’ section of the Contracts &
Procurements policies and procedures should be updated to include a time frame
in which a corresponding work order should be created.
o For example, if a Limited Notice to Proceed is issued, the corresponding
work order should be created and approved within 10 business days.
• The Authority Wide Approval Matrix should be adhered to by all relevant parties
and should be enforced by the Contracts & Procurement Department.
o NOTE: The Authority Matrix shows the following thresholds for Work
Order approvals:
▪ Directors/Senior Directors <=$10,000
▪ AGM/s (excludes CFO) <=$35,000
29
▪ CFO <=$100,000
▪ GM/CEO > $100,000
Management Action Plan: Disagree: This issue no longer exists. CPM and Legal have
issued memorandums with signature authority and a new Work Order Procedure. It is
being reviewed by a Work Order Task Force led by Planning as assigned by the GM.
Responsible Party: Contracts & Procurement Department, AGMs of all MARTA

departments.
4. Automation of Work Orders

An automated system does not exist to track change orders and work orders. Thus,
there is no ‘real time’ visibility into the work order initiation, approval and execution
process.
Recommendations:
• The Contracts & Procurement Department should consider automating the Work
Order process and ensuring that the following is addressed:
o Work Order numbers match the Project Number and/or Sub-Project
Number. This would ensure that correct invoices get paid for the work
performed based on the right work order.
o For Non-MARTA labor, the work order total amount should not exceed the
dollar amount identified on the CIP budget spreadsheet for that project
and/or sub-project.
o Work Order costs and duration (i.e. start and completion date) should not
exceed the cost and duration of the underlying contract. The work order
cost and date should coincide with the related contract to ensure that
MARTA is not incurring and paying for services beyond the approved
contract date and terms.
• The Contracts & Procurement Department should work with the Capital
Programming Department to review of a Project’s Resource Labor (i.e. both
Internal MARTA labor and External labor) before the creation of a work order for
the project and/or sub-project.
30
Management Action Plan: Agree: This is a statement, and an enhancement
opportunity not a finding. There are efforts being discussed on how to automate the
Work Order process with the support of Contracts and Procurement.
Responsible Party: Contracts & Procurement Department
5. Monitoring of Work Order Costs & Deliverables, CIP Budget and Invoices
• There appears to be no report to confirm an oversight or comparison of Work
Order Costs & Deliverables to the CIP Budget for the related project.
o NOTE: A work order shows the anticipated cost to complete a task or

tasks on a project. The total cost of a work order should not exceed the
CIP Budget for that project in Oracle. However, since there is no report to
show a comparison of the CIP Budget to a work order, it is possible for a
work order to be created, approved, and completed, with work executed
without enough money in the CIP Budget to cover the cost of work
performed.
• There is no report or evidence to show the comparison of the Vendor Invoice to

the Work Order; to ensure that the Work Order amounts are being drawn down
correctly.
o Consequently, there is no clear and concise way for management to know
if a project is overspending or underspending and if the invoices that are
being paid are truly related to the work order, or if the invoices coming in
have exceeded the authorized work order limit.
• On Call’ Work Orders and MARTA’s Internal Labor charges are authorized and
booked to Projects Numbers in Oracle without the knowledge of the Project
Manager. Thus, the opportunity exists for charges to be booked to an unrelated
Project.
o Example:
▪ Internal Labor cost of $23,761, incurred in FY 2017, was booked
against Project #31583 (Facilities Security) in Oracle, even though
the aforementioned project was not authorized or active for Fiscal
year 2017.
• An email correspondence sent from the Project Manager for
Project 32158 alerted Treasury to the incorrect charge that
was posted to the project. Furthermore, based on the email
sent to Treasury, the Project Manager was not aware and
consequently did not approve the labor charges.
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Recommendations:
• The Contracts & Procurements Department should consider automating the
Work Order Process, which would allow for ‘real time’ access to Work Orders
and report writing functionality.
• The Office of Capital Programming, Contracts & Procurements Department and
Finance should solicit the assistance of the IT department with creating an
Interface between an Automated Work Order System to Primavera 6 and Oracle.
This would greatly assist Project Managers and/or other oversight functions with
creating and reviewing system generated reports that would show the
comparison of a Project’s Budget to a Work Order(s) to the Invoice(s) paid to
date.
• On Call Work Orders and Internal Labor Charges should be approved by the
Project Manager first before being booked to the Project Number in Oracle.
Management Action Plan: Agree: We agree that there is no formal report, however
there is a process where the contract specialist and COTR circulate the invoices for
review by the owner or PM for validation. With future improvements planned in Oracle,
the capability to place a work order into the work breakdown structure and oversee draw
down will be possible. This will be addressed on a case-by-case basis.
Responsible Party:
Project Managers, Contracts & Procurement, Finance, Office of Capital
Programming.
6. Invoice Approvals
It would appear that individuals with the closest knowledge about a project (e.g. the
Project Manager) are not signing off on the vendor/contractor invoices, prior to
payment, to ensure the accuracy and completeness of work performed.
NOTE: All invoices are manually approved (i.e. signed) prior to the invoice being
processed by the Accounts Payable for payment. However, the individuals signing
these invoices are not necessarily involved with the project or do not possess detail
knowledge about the project.
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Recommendations:
• To allow for ‘real-time’ visibility into the invoice approval process, MARTA should
consider switching from a ‘manual’ to an ‘automated’ method for invoice
approvals.
o If MARTA decides to go with an automated invoice system - MARTA

should ensure that dollar thresholds are included in the workflow for the
invoice approvals as well as an automated notification (e.g. email) that
would alert an authorized approver to ‘approve’, ‘reject’ or ‘suspend’ and
invoice. Furthermore, an ‘upload’ feature should be allowed in the
workflow to allow for the upload of support documentation for an invoice (if
deemed applicable by the approver).
• Persons closest (e.g. Project Manager) to the details of a project and/or is
directly involved with a project should also sign-off on an invoice in conjunction
with authorized approvers; to ensure that the invoice is accurate and is based on
work performed and/or completed.
• Automate the invoice approval process, so that invoices are approved
electronically before they are paid by Accounts Payable.
Management Action Plan: Agree: All invoices need to be centralized for processing
and none should be processed without PM approval. Will coordinate with Contracts and
Procurement and IT to support new automated invoicing requirements.
Responsible Party: Office of Capital Programming, Contracts & Procurement, Finance

(i.e. Accounts Payable)
IV. Project Monitoring & Control
1. Management of Project Costs in Oracle

Project Managers or Project Sponsors, do not have the authority to determine the
type of cost that gets booked into their respective project numbers in Oracle, nor can
they decide who gets to book the related cost entries into Oracle. Consequently,
Project Managers cannot readily ‘validate’ or ‘substantiate’ the ‘current’ or YTD
(year-to-date) cost that is noted on the Capital Improvement Project Expense
Report.
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NOTE: The Capital Improvement Project Expense Report shows the current year’s
fiscal budget, YTD Actual Cost, and monthly expense for all authorized projects.
Recommendation:
• Finance/Accounting should consider restricting who has access to post expenses
to Projects in Oracle.
Management Action Plan: Agree: All invoices need to be centralized for processing
and none should be processed without PM approval. PMs validate year-to-date
costs using the best available information released from Oracle.
Responsible Party: Office of Capital Programming Project Management &

Construction
2. Validation of the Accuracy of Project Costs

There is no documentation to support the validation of project costs (i.e. the Life to
Date Costs and the Current Year Cost) by the CIP Monitoring & Reporting
department.
NOTE: On a monthly basis, the CIP Monitoring & Reporting department extracts
project costs (such as labor costs, material costs etc.) from Oracle and downloads it
into Access, in conjunction with costs sent by Project Managers and/or designees
via email for costs not captured in Oracle. Access is then used to create the monthly
Capital Expenditure Report. However, the CIP Monitoring & Reporting Department
does not check (on a sample basis) if the project cost that is pulled from Oracle
and/or sent via email is a valid cost. Essentially, there is no review of the
documentation that supports the project cost.
Recommendation:
The CIP Monitoring & Reporting department should be tasked with the responsibility
of validating (on a sample basis) the project costs (actuals) in Oracle and the costs
received from sources outside of Oracle.
Management Action Plan: Agree: This was identified by CPD and is part of the plan.
See Oracle and P6 initiative schedule for FY18, and centralized PMO processes. Steps
are being taken to develop work breakdown structures that will allow CIP Monitoring
34
and Reporting to validate costs. At the current time, the system is limited and data is
belated. Not a finding; part of our plan.
Responsible Party: CIP Monitoring & Reporting Department
3. Detailed schedules do not exist in Oracle or Primavera 6 (Project Management

Software) to track project milestones.
Detailed schedules do not exist in Oracle or Primavera 6 (Project Management

Software) to track project milestones. Consequently, the Capital Improvement
Committee (CIC) and the CIP Change Control Subcommittee (CCSC) do not have
the information to adequately assess the progress of a project (i.e. project
milestones/deliverables) in order to validate its decision to approve or reject an
increase or a decrease of a project’s budget and/or scope of work.
NOTE: A milestone by definition, is a reference point that has no duration itself, but
marks an important event in a project task or group of tasks. A project milestone is a
way to observe, measure and monitor the progress and/or performance of a project.
In terms of its usefulness, milestones can serve as the foundation from which
progress is monitored and serve as proof for explaining and reporting the status of a
project. Furthermore, milestones are also used to determine when payments are
due to vendors and service providers. Key characteristics of a project milestone
include the frequency and potential for providing opportunities for corrective actions
and learning experiences, maintaining accountability and motivating staff.
Recommendations:
• Setup a project in Primavera 6 by project phases similar to the ‘task’ in Oracle.
For example, in Oracle there are 6 ‘task’ levels – initiation, planning, design,
procurement, construction/implementation and closeout. Where feasible, a
project ‘phase’ should be set up for each ‘task’. For example,
Project Task in Oracle Project Phase in Primavera 6

Initiation Concept Phase
- Gather Data
- Identify the need and
practicability of the project.
- List out goal/objective for the
project.
- Identify risks and strategies
35
to mitigate the risk for the
potential project.
- Obtain required approvals
(e.g. from a Project Sponsor,
Department Manager and/or
AGM)
Planning/Design Development Phase
- Feasibility study for project
- Objective/Rationale for project
- Project specs/drawings etc.
- Identification of internal and external
resources to assist in the design and
execution of project.
- Development of project schedule
- Development of proposed budget
- Identification of financing sources
- Cash flow analysis
- Development of project charter or
brief.
- A ‘go’ or ‘no go’ scenario*
*A ‘go’ or ‘no go’ scenario implies
should MARTA continue with project or
not based on the known formation thus
far.
Procurement, Construction & Execution Phase
Implementation - Detail design & specs for project
- Technical requirements
- Procurement
- Execution of project schedule or work
- Monitor progress of work
- Develop forecast for the costs to be
incurred.
- Delivery of project within deadline
Close out Transfer/Close out Phase
- Finalization of project – to ensure that
the project is operating as expected.
- Review and accept project as
complete
- Assemble the start-up team for
training of employees within the
Authority.
- Transfer responsibility of project from
the Project Manager to persons
involved in the management of the
underlying asset or service
subsequent to the completion of the
project.
36
- Settle all accounts
- Deliver final report for project
- Close out project in ERP system (i.e.
Primavera 6 and Oracle).
37
• Prepare a report that shows the status for each ‘phase’ of the project and what
milestones have been achieved or not achieved.
• Develop a ‘dash board’ reporting tool that allows for project milestone and project
phase ‘start date’ and ‘completion date’ to be entered into Primavera 6 by the
project manager.
• Setup an ‘approval’ section within the dash board to show approvals at the
completion of each phase and milestone for the project by a Project Manager,
Project Sponsor, and AGM etc. prior the payment of a vendor invoice.
Management Action Plan: Agree: Not a finding. This is part of our Plan. We are
currently resource loading all schedules (with Milestones) for new projects and working
down the backlog of existing projects so that we can have a thorough account of the
Schedule, Scope and Budget for each project within the CIP portfolio. Keep in mind that
cost information lags 30 to 60 days due to current invoice and accounting processes.
However, MARTA must still direct and manage the Capital Program despite the fact that
Oracle and Project Management software are not integrated
Responsible Party: Project Managers, Project Management & Construction
4. Accuracy and Completeness of Project Forecasts

There is no formalized official process for forecasting project costs, project
performance and the quality of project deliverables for CIP projects. Consequently,
project forecasts are ‘arbitrary’ and not based on a formalized forecasting technique
with an underlying basis in substantive data.
• The ‘FY Forecast’ (Fiscal Year Forecast) and the ‘YTD Actual’ (Year-to-Date)
numbers for the June 2016 MARTA Capital Improvement Program Monthly
Status Report are the same. All 168 Approved Projects have the same
‘Forecast’ and ‘YTD Actual’ Cost numbers.
• Internal Audit could not validate the YTD FY 2016 project forecasts for 12 of the
14 selected CIP Projects due to Project Managers not being able to or not being
responsive to providing the requested information.
• Explanations and documentation was not provided by Project Managers to
support Internal Audit’s questions on the differences noted between the YTD FY
38
2016 project forecast and the FY 2016 CIP Budget for 11 of the 14 projects
selected for testing.
Recommendations:
• Develop a formalized technique for forecasting project costs, time and
deliverables within the project life cycle of a CIP Project.
o Consider using Industry best practices such as the EAC Method (i.e. the
Estimate at Completion Method).
▪ The EAC Method provides the forecast value of a project based on
the completion date of the project. There are 4 methods for
evaluating the Estimated Cost of Completion.
• Refer to www.pmi.org for further details on the
aforementioned forecasting method.
• The CIP Monitoring & Reporting Department should investigate why the Forecast
and Actual costs are the same at the end of the fiscal year for all projects.
• The CIP Monitoring & Reporting Department, on a sample basis, should validate
the monthly ‘Forecast’ numbers that is obtained from the varied Project
Managers and/or Project Sponsors to ensure that Project Forecasts are valid.
• Project Managers should be trained on ‘how’ to create a Forecast and to monitor
Project Costs, if a knowledge gap exists and/or the Project Manager is new to the
Project.
• All approved CIP Projects should be assigned a 'Project Manager' that is well
abreast of the Project, involved in coming up with the budget, monitoring of
project costs and the preparation of the monthly project forecast.
Management Action Plan: Disagree: There is an un-official printed procedure manual.

Forecasting in some cases is done on a project-by-project basis. There are also
Programs and Initiatives funded in the CIP. This is not a finding; part of the plan.
Responsible Party: Project Managers, CIP Monitoring & Reporting Department
39
5. Deactivation of Unauthorized Projects in Oracle
There is no process in place to ensure that unauthorized projects are deactivated in
Oracle. Thus, ensuring that that unauthorized expenditures from authorized projects
or unauthorized projects are not booked into Oracle.
Approximately $1.8M of Project expenditures were incurred or accrued in FY 16 for

unauthorized CIP Projects.
Recommendations:
• Access to ‘Setup’ and/or ‘Close’ a project should be restricted to authorized
personnel only.
• If a project number is not listed on the current year’s approved CIP Budget list –
there should be a functionality in Oracle that allows for previous project numbers
to be ‘inactivated’ or ‘turned-off’. Thus, if a cost is charged to a project number
not authorized for the current fiscal year – the cost can be rejected.
o The CIP Monitoring & Reporting Department should work with both
Treasury and the Accounting Department with the facilitation of the above
recommendation.
Management Action Plan: Agree: A process needs to be developed for de-activation

of projects in Oracle.
Responsible Party: CIP Monitoring & Reporting Department, Treasury, and Accounts
Payable
6. Entry of CIP Budget into Oracle
CIP Budgets are entered into Oracle at the ‘project’ level by Treasury, while project
expenses are entered at the ‘task’ level by accounting, project managers etc.
Consequently, it is impossible to run a variance report at a ‘task’ level in Oracle to see
the differences between the ‘CIP’ budget and the ‘Project’ expense by task; because the
CIP budget can only be viewed at the project level and the project expense can only be
viewed at the task level.
NOTE: ‘Task’ Level in Oracle refers to the following phases of a project:
Initiation, Planning, Design, Procurement, Construction& Implementation and
Closeout.
40
The CIP budget is manually entered into Oracle, due to the fact that there is no
automatic upload feature that allows an excel file to be loaded into Oracle;
consequently, it takes the Treasury Analyst a substantial amount of time to manually
input the CIP budget numbers into Oracle.
Recommendations:
• The Office of Capital Programming, in conjunction with Treasury should consider
requesting for the IT department to modify the method in which the CIP budgets
are loaded into Oracle. CIP Budgets can be loaded at the ‘project’ level but
should be broken down at a task level as well. Consequently, it would be feasible
for a variance report (Project Expense to Project Budget) to be generated out of
Oracle; instead of having budget and project expense information downloaded
into an excel file into Microsoft Access in order for the CIP Monitoring &
Reporting Department to create its monthly Capital expense report.
• The Oracle IT department should create a script that allows for an automatic
upload of excel file data into Oracle; as this would significantly reduce the
amount of time needed to manually input the CIP budgets into Oracle.
Management Action Plan: Agree: However, this will have to be worked out with
Treasury, Budget and Accounting to ensure Oracle Hyperion software integration with
P6 is achievable.
Responsible Party: Office of Capital Programming and Treasury
7. Visibility into Original CIP Budget for Existing Projects

The Original Budget at project inception is not included in Oracle, on the POD
(Project Origination Document) or the CIP Change Spreadsheet that is used by the
CIP Change Control Subcommittee (CCSC) to make decisions on whether to
‘approve’ or ‘reject’ a change request.
Currently, the decision to either ‘approve’ or ‘reject’ a request is based on a). If a
reason is provided b). If the monetary request can be accommodated by the monies
set aside in the CIP reserve account.
Recommendations:
• The Original Budget for each project should be reflected on the POD (Project
Origination Document) and on the CIP budget spreadsheet that is used by the
Capital Improvement Committee (CIC) and CIP Change Control Subcommittee
(CCSC) for making CIP decisions and in Oracle.
41
o NOTE: Management should attempt to research and obtain
documentation for the original budget amount for projects predating FY
2016.
• Going forward, the original budgets for approved CIP projects (2016 and beyond)
should be maintained in SharePoint and not maintained in Excel; in order to
improve transparency and visibility into the CIP budget numbers.
Management Action Plan: Agree: This is not a significant finding. The historical data
with the original budget field is in the POD. It is not available as a field in Oracle. It can
be added to the Change Request form going forward. We are already working on the
revised Change Request form as part of our existing plan.
Caution: Original project budgets are typically established as ROMs or early design
efforts where based on industry standard the budgets are subject to change. This
should not be confused with running over a budget on a project.
Responsible Party: Office of CIP Monitoring & Reporting, CIP Scoping & Screening
Department, Treasury/Finance
8. System Interface
During our review of System Interface, we noted the following:
The 3 systems (Primavera 6, SharePoint and Oracle) currently used in initiating,
executing and monitoring the Capital Improvement Program are not inter-phased or
linked to each other. Having these systems inter-phased allows for a greater
transparency into the following:
• Tracking of the percentage of completion of a project to percentage of monies

spent.
• Ensuring that the individuals with direct knowledge about the project details
(e.g. Project managers), in conjunction with authorized approvers, also sign-
off on work orders or invoices prior to payment by Accounts Payable
• For the Accounts Payable department to be have to match a work order, a
project schedule (which should be maintained in Primavera 6) to a vendor
invoice (which can be uploaded and/or keyed into Oracle) before processing
the vendor invoice for payment in Oracle. This would reduce the amount of
time it would take to collate the hard copy work orders, project schedule and
other supporting documentation to the physical invoice before manually
processing the invoice in Oracle.
42
There currently is no way of mapping ‘Project Costs’ entered into Primavera to what
is entered in the Oracle Time & Labor database, to what is entered into the
Contracts Database. Consequently, the CIP Monitoring & Reporting department has
to manually extract the project costs from the aforementioned databases into Access
to generate the monthly reports.
Recommendations:
• Ensure that all software used are tailored to department needs and are utilized to
the maximum capacity.
• Re-training of personnel may be needed for modules that are critical to the
execution of a task or responsibility.
• The Office of Capital Programming should request for the IT departments
assistance with creating an Interface between the project management system
(Primavera 6) and Oracle.
Management Action Plan: Partially agree: This is not a significant finding. This is in
the current plan. We are in the process of integrating Oracle and P6 which is to “go
live” in FY18.
SharePoint serves as an information dashboard to increase transparency and was

never intended to be the primary tool used to monitor and control project performance.
Responsible Party: Office of Capital Programming, Project Management &

Construction, IT Department
9. Utilization of Oracle Software

The ‘Projects’ Module of Oracle is not fully utilized to generate the monthly Capital
Improvement report that is created by the Department of CIP Monitoring &
Reporting.
Detail reports that show project cost, labor costs and other relevant project
information cannot be generated from Oracle. Consequently, the CIP Monitoring &
Reporting Department is forced to download information from Oracle into Microsoft
Access in order to create the month-end reports it sends out to Project
managers/Sponsors, AGM's, members of the CIP Change Control Subcommittee
(CCSC) and the Capital Improvement Committee (CIC). This is an inefficient
method for creating a report, when there is an ERP system (i.e. Oracle) that could
perform report writing functionalities.
43
Recommendations:
• Ensure that MARTA’s Oracle software include report writing capabilities for the
Office of CIP Monitoring and Reporting.
• Re-training of personnel may be needed for modules that are critical to the
execution of a task or responsibility.
Management Action Plan: Agree: This will require MARTA (largely Finance and
Accounting) to utilize the Oracle “Project Structure” as well as the “Financial Structure”
for Capital Project execution.
A study to assess utilizing the Oracle Project Structure should be initiated to determine
the impact on financial reporting as there has been historical hesitancy to fully explore
this option.
Responsible Party: CIP Monitoring & Reporting Department and MARTA’s Oracle IT
Team
10. SharePoint ‘User’ Training – CIP Module

It appears that SharePoint Training is not mandatory for Project Managers, Project
Sponsors or designated Departmental Representatives involved in the initiation
and/or approval of the Project Origination Checklists (POC), Project Origination
Document (POD), and Project Change Requests.
Based on conversations with several Project Managers and observations, Internal

Audit noted that some individuals did not know how to access the POC and/or
POD’s for their respective projects in SharePoint. Furthermore, other information
such as the business case for a project could not be accessed/retrieved by the
Project Manager.
NOTE: The Office of Capital Programming & Development did conduct trainings in
FY 15 and FY 16 on the Capital Improvement Program and SharePoint. However, it
would appear that these training were not mandatory for all MARTA employees and
as such there wasn’t a 100% attendance from all interdependent departments.
Recommendations:
• The Office of Capital Programming & Development should consider making the
CIP training a web-based or online training course (e.g. using the I-learning tool
44
in Oracle). A web based/online training would allow for the training course to be
readily available to all employees and would easily track the progress and status
of each employees understanding of the CIP material.
• If the Office of Capital Programming & Development chooses to continue with the
current method of training, then the following steps should be taken:
o Project Managers, Project Sponsors and/or designated Departmental
representatives should be required to take the SharePoint Training course
prior to been assigned a CIP Project.
o The Office of Capital Programming & Development (CDP) should consider
offering the Capital Improvement Program (CIP) training course and
SharePoint training course more frequently during the fiscal year and
require a mandatory attendance of members of all departments affected
by the CIP Process in MARTA.
o Allow for remote access to MARTA sever for employees and/or
contractors with company laptops – so that they can have access to the
SharePoint site.
Management Action Plan: Agree: Extensive outreach by CPD was conducted to
maximize training for all CIP participants. To-date this has not been a mandatory
training class, however, we support the recommendation to make it mandatory.
We are also working with Training to develop online certification via MARTA iLearning.
Responsible Party: Office of Capital Programming
V. Project Closing
1. Timing of closing out CIP Projects

Project # 31662 (Rehabilitation of at-grade track slab on the NE, South and Proctor
Creek Rail Lines) was completed in FY 15 and is still in a 'close out' phase half way
through FY 17.
Details of Project #31662

• Project Start Date (i.e. date project was entered into Oracle): 9/15/2006, Project
End Date in Oracle: 6/30/2017
• Project Manager: Jayant Patel, Project Sponsor: Joseph Erves
• Purpose of Project: To amend existing project for the inclusion of the
rehabilitation of at-grade track slab on the NE, South and Proctor Creek Rail
45
Lines. The work consisted of removing lead-based paint from steel plate girders
and framing members at aerial structures (Bridges) CS115 and CS310, cleaning,
preparing and recoating the same.
• CIP Budget: FY 15 ($3M), FY 16 ($300k), FY 17 ($100k)
• Explanation for Decrease in CIP Budget: The budget decreased in FY17 from
FY15 because most of the work was already done in FY15 and paid for in FY15.
The FY16 and FY17 budgets were to cover closeout cost and documentation (i.e.
the hard and soft costs). To date, the project has been completed but is still
waiting to be closed out. Per the Project Manager the delay in closing out the
project is primarily coming from the Contracts & Procurement Department and
Engineering Department. The project spanned over 10 years and was executed
on CPM contract # CPB24418.
Risk:
Potential for unrelated project costs to be booked to project 31662 in Oracle as a
way to 'hide' unauthorized project expenditures.
Recommendation:
A policy and/or procedure should be put in place to ensure that substantially
completed projects are closed out in a timely manner (e.g. within a year). The
Project close-out policy and/or procedure should cover all types of projects (e.g.
A&E, MATCC, IT projects etc.)
Management Action Plan: Agree: Closeout is contingent upon receipt of all

contractual items, approval by the PM and CPM and subsequent submission from CPM
to Audit. Once the audit is completed, it can be scheduled for closeout through
Committee and MARTA Board.
A closeout procedure with timelines should be documented and utilized Agency-wide as

part of the centralized PMO.
Responsible Party: Project Management & Construction
46
Appendix I
OVERVIEW OF MARTA’S CAPITAL IMPROVEMENT PROGRAM
I. Organizational Structure
The Department of Capital Programs & Development is responsible for providing
a centralized and comprehensive management of MARTA’s Capital Program.
The Department is comprised of the following:
• The Office of Capital Programming – is responsible for developing the Authority’s

long range Capital Program which includes capital project origination, scope,
schedule and budget development, oversight & analyses, project and program
performance, and scheduling & estimating. This office also manages the
Authority's Strategic Transit Asset Management Plan (STAMP) and State of
Good Repair (SGR) initiatives ensuring Moving Ahead for Progress in the 21st
Century (MAP-21) compliance.
o The Office of Capital Programming consists of the following departments:

▪ CIP Scoping & Screening
▪ CIP Monitoring & Reporting
▪ Asset Management
▪ Architecture & Engineering (A&E) Contracts, General Engineering
Consultant (GEC) Contracts
• Architecture & Design – provides the Authority with complete architectural design
services in support of operating and capital programs for rehabilitation of existing
facilities as well as for new capital projects. The office is responsible for designs,
design coordination and review, design services during construction, and
ensures architectural code compliance.
• Engineering & Development (E&D) – includes infrastructure Engineering &

Systems Engineering. The office is responsible for providing design and
engineering services in support of maintenance, rehabilitation and expansion of
MARTA’s infrastructure, rolling-stock and related systems and assets that are
critical to the safe and reliable operation of the MARTA system. Other
responsibilities include configuration management and document control,
preparation of contract documents, technical specifications and drawings,
updating of engineering design criteria, and fire protection and corrosion
engineering. The office also directs and manages the technical activities of the
General Engineering Consultant (GEC), General Consultant Professional
47
Services (GCPS), Vehicle Consultants (VCs) and other specialty engineering
consultants. Furthermore, the office is responsible for defining technical
requirements and scope of services for consultant’s annual work programs in
support of the Authority’s long range Capital Improvement Program (CIP).
• Project Management & Construction – The office provides project management,

construction management, and capital program support services. Project
Managers are responsible for managing and directing resources and activities to
ensure that project goals and objectives and successfully completed within
scope, schedule and budget. This office is also responsible for managing the
Job Order Contracting (JOC) services for small scale, unique or urgent
construction activities.
II. Asset Structure

MARTA launched its capital improvement projects as means for the Authority to
preserve its capability for high-quality service delivery over a ten-year range. The
long-range CIP consists of a portfolio of programs and projects organized by the
major asset categories of a transit authority. The CIP also includes a category for
non-asset projects. These categories, which were adapted from the Federal
Transit Administration’s (FTA) asset management guidelines are:
FTA Term Lite Asset Categories

Vehicles Stations Guideway Systems Facilities
Elements
Revenue Complete Bus Utilities Central Control
Station Guideway
Non-Revenue Electrification Major Shops
Building Special
Equipment/Parts Structures ITS Equipment
Access
Track work Revenue Buildings
Platform
Guideway Security Storage Yard
Signage
Communications
Ferry
Train Control
MARTA’s Asset and Sub Asset Categories

Asset Categories
Vehicles Facilities & Maintenance Systems Non-Asset
Stations of Way
48
Sub-Asset Sub-Asset Sub-Asset Sub-Asset Sub-Asset
Bus Bus Facilities & Track Electrical Power Asset
Procurement Equipment Maintenance Management
& & & Equipment
Enhancement Replacement
Rail Rail Facilities & Work Automatic Transit
Procurement Equipment Equipment Planning
& Train Control
Enhancement
Paratransit Buildings/Offices Track Lighting Environmental
& Equipment Structures Sustainability
Non-Revenue Parking Lots & Tunnel Performance
Paving Measurement
Ventilation System
Non-Revenue System-Wide Fire Protection Customer
Equipment Service
Fuel Facilities Structure & Elevators & Escalation Safety
& Equipment Drainage
Roofing Radio/Communications CIP Support
&Skylights
Underground Revenue Collection Design
Storage Tanks Criteria/
IT Hardware
IT Software
III. Fiscal Budget

The Capital Improvement Program (CIP) is a 10 year plan that serves as a
means for the Executive Management Team (EMT) to manage the
implementation of programs, projects and procurements. The Board approval of
the CIP 10 year plan authorizes funding of the annual Capital Budget. MARTA
for fiscal year 2017 adopted a CIP Budget of $255M to spend on 151 projects.
Below is a comparative analysis of the CIP budget from FY 15 through FY 17.
The Capital Budget is based upon the amount of funding available from the
following sources:
49
Local Sources Federal, State and Other Sources
General Fund (prior year Federal Capital Assistance
balance)
- US Department of Transportation (US
Sales Tax DOT)
Financing - Federal Transit Administration (FTA)
Debt Issue - Department of Homeland Security (DHS)
Investment, Lease & Other

Income
State Grants
50

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Audit: #17-04-O-1

DATE: June 28, 2017

TO: David Springstead – AGM Office of Capital Programming & Development

FROM: Charles Middlebrooks – Manager Operational Audit

SUBJECT: Review of the Capital Improvement Program_____________________

Phase 1: Understand the CIP Budget Process

Phase 2: Perform substantive test of ‘Approved’ CIP 10 YR Projects

NOTE 1: Refer to Appendix 1 for an Overview of the Capital Improvement

• There is no documented evidence to show that every Project Manager is

➢ Disagree that there is “no” evidence – as many of the milestones and

➢ Agree - a Standard Operating Procedure (SOP) to assist the PMO in

• There is no validation of Project Forecasts and Project Costs by the CIP

cc: Keith T. Parker, General Manager/CEO

3. CIP Budget on Project Schedule vs. CIP Budget on Project Origination

5. Timely resolution of Change Requests in SharePoint - As of November

• Initiation of a ‘New’ CIP Project

• CIP Change Control Subcommittee (CCSC)

The Department of Capital Programming and Development should develop and

o The purpose, role and function of the Department of Capital

Target Date(s): 12-01-2017

Responsible Party: Office of Capital Programming & Development.

2. Succession Plan for MARTA Employees and/or Contractors

Management Action Plan: Disagree: Although it would be ideal to have succession

Target Date(s): 02-01-2018

Target Date(s): 08/01/2017

Responsible Party: Office of Capital Programming and Treasury

B). PROJECT MANAGEMENT

1. Scoping of CIP Projects

Target Date(s): 07/08/2017

Responsible Party: MARTA Executive Management and the Office of Capital

2. Project versus Program Definitions within the Capital Improvement Program

Responsible Party: Office of Capital Programming & Development and Finance

3. CIP Budget on Project Schedule vs. CIP Budget on Project Origination

Target Date(s): 08/01/2017

Responsible Party: CIP Scoping & Screening Department

4. Insufficient Completion of Project Origination Document (POD)

Target Date(s): 02-08-2018

Responsible Party: CIP Scoping & Screening Department

5. Timely resolution of Change Requests in SharePoint

Below is a breakdown of the change requests:

Status of Change Request Number of Change Requests

Target Date(s): 12-15-2017

Responsible Party: CIP Monitoring & Reporting Department

II. Project Planning

1. Insufficient communication between the Office of Capital Programming and

There appears to be an inadequate communication from the Department of Capital

• Approvals or rejections to a Project Change Request – some Project Managers

• Defunding of an existing project - The Project Champion/Project Manager, for

• Establish workflow in SharePoint to notify respective individuals on status of a

Management Action Plan: Disagree: We are working to improve transparency and

Target Date(s): 08-01-2017

Responsible Party: CIP Scoping & Screening, Office of Capital Programming

Target Date(s): 08-01-2017

Responsible Party: CIP Scoping & Screening Department

3. Project setup forms are not consistently approved by Treasury/Accounting