The Capital Area Transit System in 2014 corrected all but a handful of 33 problem areas identified by state, federal and external auditors in 2013, according to the draft of a new audit presented this afternoon to a CATS board committee.
The draft report, prepared by the bus system’s auditor, Laporte CPAs, reviewed prior audit findings for the year ended Dec. 31, 2013—one of the most tumultuous in CATS’ history. That year, auditors in a series of reviews found the agency had misappropriated funds, failed to deposit nearly $80,000 in bus fares, improperly paid employees for hours not work and overbilled the company that provides paratransit services, among other things. Those problems and more have been corrected, auditors told CATS committee members today.
“It’s great news,” says CATS CEO Bob Mirabito, who took over the agency on an interim basis in mid-2013 amid board and staff turmoil and since has become permanent CEO. “We have made significant progress in closing all the holes that were identified by the state Legislative Auditor, the federal government and by our own external auditors and we’ve closed out all but four or five of 33 findings.”
One potentially significant issue that has yet to be resolved is the agency’s lack of insurance on its capital assets, namely its bus fleet. The shortcoming was noted in a federal audit last year. The federal government, which provides grant money for the acquisition of the buses, requires the property be adequately insured in the event of a disaster. However, CATS has not been able to afford such a policy because the annual premiums average between $1.5 million and $2 million. Mirabito says the board will need to decide how it wants to handle the issue.
“We will bring it to the board and they’ll have to decide what their options are,” he says.
The draft audit presented today will be completed later this month and presented to the full CATS board in early June. No major changes are expected to the findings between now and then.
—Stephanie Riegel
