The Department of Transportation’s investigation revealed weaknesses in the procurement guidance given to the CRRC MA.
The Department of Transportation’s Office of Inspector General said there were numerous problems with the Federal Transit Administration’s oversight of SEPTA’s railcars’ compliance with Buy America. this week.
The announcement was, ReportsThe investigation, requested by members of the U.S. House of Representatives Committee on Transportation and Infrastructure in 2022, will look into a $138 million contract between the Philadelphia-area transit agency and CRRC MA, a Massachusetts-based subsidiary of a Chinese state-owned enterprise.
This is exactly the kind of company that would come under scrutiny from regulators and lawmakers if it were to receive large amounts of federal funding to buy railcars, and Congress had CRRC specifically in mind when it passed this bill. Bipartisan The Transportation Infrastructure Vehicle Safety Act went into effect in 2019, barring Chinese state-owned enterprises from bidding on future federally funded rail car and bus contracts, but a CRRC subsidiary had accepted a very low SEPTA bid two years earlier, after photos of a nearly completed SEPTA car in the Philadelphia Inquirer went viral. In ChinaNot in Massachusetts, Request from the Committee For research purposes.
And although that is now a moot point, SEPTA canceled CRRC MA contractThis OIG report is enlightening, coming months after millions of dollars were spent and not a single rail car was delivered. It offers a glimpse into just how haphazard the enforcement of these domestic procurement laws has been.
Without defining how manufacturers’ railcar documentation would be reviewed or the requirements for retaining supporting documentation to verify the results of pre-contract audits, FTA and SEPTA had no assurances about the quality and thoroughness of the work performed to determine Buy America compliance. For example, (a) a pre-contract audit conducted six years ago (by a third-party consultant) stated that “the description of the workspace to be performed at the Springfield facility meets final assembly requirements. Estimated cost data for final assembly activities was also provided during the audit, as required. Labor hours and costs appeared to be consistent with the described scope of work for this type of car.” However, in conducting an ongoing enhanced Buy America compliance review, FTA found that as of February 23, 2024, CRRC MA had not provided SEPTA with supporting documentation that described final assembly activities in sufficient detail to determine compliance.
“Buy America” is a smart and popular public policy, but to work properly it must be enforced.
Read the OIG report here.
