MTA OIG finds MTA assessment of contractors create ‘evaluation inflation’ for subpar performers

The Metropolitan Transportation Authority (MTA) Office of the Inspector General (OIG) released a report last week recommending a complete overhaul of the authority’s evaluation system for contractors and consultants following an audit that found current practices create “evaluation inflation” for those performing at subpar levels.  

The MTA OIG’s report found the authority’s contractor evaluation (ACE) system, which records and tracks contractor and consultant performance for contracts more than $250,000, continues to underperform. The report says capital project managers have a history of rating subpar vendors “satisfactory” in evaluations, creating “evaluation inflation” in the system. Accordingly, the system does not provide the basic, necessary performance information that the MTA needs when making critical contracting decisions.

MTA agreed to revamp its evaluation system as part of its ongoing transformation, a move OIG commended.

“There is no use in a pass/fail test where everyone passes,” said MTA Inspector General Carolyn Pokorny. “The MTA’s contractor evaluation system has been ineffective for a long time. Kudos to the MTA for agreeing to reform this system to serve the best interests of our riders and taxpayers.”  

OIG auditors found that fewer than one percent of contractors have been given unsatisfactory scores. This evaluation inflation is a persistent and worsening problem the OIG addressed previously in 2009 and 2015, which, among other findings, found companies clearly performing unacceptably, but still received satisfactory scores. This means that problematic vendors who might be stopped from receiving additional MTA contracts could undeservedly score satisfactory ACE reviews, ultimately costing the MTA, its riders and taxpayers precious time and money. The OIG office says this also presents a missed opportunity for the MTA to address problems with vendors early in the process and perhaps avoid poor contractor performances altogether.

In light of these findings and the MTA’s ongoing Transformation Plan, the OIG recommended that the MTA take this opportunity to devise a system that prizes accuracy and provides the vital information its agencies need to ensure their contractors are responsible and perform well. The MTA, to its credit, agreed to the recommendation and advised it plans to implement a new contractor evaluation system in the 3rd quarter of 2021.

The audit was conducted by Audit Manager Navon Hirshaut, Senior Investigative Attorney Jonathan Estreich and members of the Audit Unit.