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Money pit MTA kept paying contractors despite bad reviews: audit

The cash-strapped MTA allowed subpar contractors to continue working on its dime despite bad reviews, a new audit has found — the latest red flag for the agency as it advances controversial congestion tolls and seeks a bailout from Albany.

New York State Comptroller Tom DiNapoli’s office audited MTA internal reviews of 10 unnamed, “repeated less-than-satisfactory” contractors — and found officials “missed opportunities” to flag the troublesome ones, allowing at least two bad apples to slip through the cracks.

“Despite receiving at least three successive less-than-satisfactory ratings, three contractors were awarded a new contract,” the comptroller’s office wrote in its released on Wednesday.

Comptroller Tom DiNapoli speaks at a podium at a campaign event.
Comptroller Tom DiNapoli campaigning for re-election last week.
Stephen Yang

“For one, we found a waiver signed by the agency’s President. For the others, there was no documented rationale and required approvals supporting this decision.”

Auditors analyzed the MTA’s use of a now-defunct system called “All-Agency Contractor Evaluation,” or ACE, meant to flag construction contractors who go over budget, blow past their deadlines or make other costly mistakes.

Of the 10 contractors whose reviews auditors studied, seven lacked documentation showing the companies’ ACE ratings had been reviewed, the report said.

MTA CEO Janno Leiber
MTA CEO Janno Lieber led the MTA’s construction division from 2017 to 2021.
Paul Martinka

The MTA’s $55 billion five-year capital construction plan is set for more than $10 billion from the bipartisan infrastructure bill signed into law by President Biden last year.

But the authority faces lingering questions about its spending — the first phase of the Second Avenue subway was the most expensive per-mile transit line ever. While officials insist they have taken steps to cut costs, the second phase is slated to cost even more.

The MTA’s controversial congestion pricing program would fund the authority’s capital budget, which aims to deliver long-awaited subway signal upgrades.

Separately, MTA CEO Janno Lieber has warned the agency will need an infusion of state cash to keep its operation budget running past 2024.

The audit covered contracts dated January 2016 to March 2020, and an MTA spokesman argued in a statement that DiNapoli’s findings are irrelevant and out-of-date since the agency no longer uses the ACE system.

“The audit is old news covering portions of the last decade, and since then the MTA has consolidated its capital program into a single agency that has allowed for improved oversight with a new contract evaluation system,” MTA spokesman Michael Cortez said.

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