New Castle News

January 12, 2013

Outgoing auditor general questions ‘culture’ of turnpike commission

John Finnerty

HARRISBURG — Pennsylvania’s auditor general devoted his final press conference to one last plea that someone pay attention to the debt crisis at the turnpike commission.

Jack Wagner leaves office this week and Eugene DePasquale, the newly elected auditor general, will replace him.

Wagner’s newest revelation: Turnpike staff ran up $60,000 in meals and lodging bills during the four years studied by auditors, costs the commission attributed to meetings and travel associated with lobbying for the failed bid to toll Interstate 80.

Auditors reviewed 183 travel expense vouchers, which contained incomplete or vague descriptions of the business purpose and generally did not include receipts, the auditor’s report found.

Wagner’s staff pointed to three specific instances — a July 2009 meal at a restaurant close to the turnpike headquarters that cost $174; a June 2009 meal in Hershey that cost $135 and a February 2010 meal at a restaurant in Harrisburg that cost $494.

“As Harrisburg-based auditors, we know the above examples to be relatively expensive meal charges,” the report states. “For example, for a restaurant tab to total nearly $500, we would hope it represented a meal for a large group of people conducting turnpike business and involving no alcohol. However, because the expense voucher included no mention as to the number of attendees or the purpose of the meal, we could not determine that.”

At the press conference, Wagner said the spending found in the audit “defines the culture of the turnpike system.”

Carl DeFebo, turnpike spokesman, said the spending found by the auditors related to travel and meetings by turnpike officials during the period when the commission was trying to convince the public and the federal government to go along with the bid to toll Interstate 80.

Wagner has repeatedly criticized the financial management of the turnpike commission, as well as the state’s bungled Act 44 plan that required the turnpike commission to begin paying the Pennsylvania Department of Transportation millions of dollars in exchange for the right to add tolls to I-80.

The federal government forbid Pennsylvania from tolling I-80, but the turnpike commission has been making its payments, running up a debt that has exceeded $8 billion, Wagner said.

But the turnpike commission has contributed to its problems by employing risky financial practices. Among them is an interest rate swap that ended up costing the commission $108.9 million, which the auditor general said will end up being passed along to taxpayers and toll-paying motorists.

The turnpike commission also has been lax about requiring that its employees only use commission-issued EZ passes for work purposes.

Wagner’s audit revealed the turnpike commission allowed employees to use the turnpike for free, even for personal use.

In addition, the turnpike commission provided free travel to 5,000 consultants, contractors and other state officials. Those freebies amounted to $4.1 million in lost toll revenue.

Combined with the liberal policy regarding employee travel on the turnpike, the auditors estimated the turnpike missed out on $7.7 million in toll revenue it otherwise would have collected between January 2007 and August 2011.

In a response issued after Wagner’s comments, Craig Shuey, acting chief executive officer of the turnpike, said that most of what the auditors had found, the commission has taken steps to correct, adding the turnpike is a “well-run operation.”

“While we disagree necessarily upon the weight of each of your recommendations, it is clear to me that when system safety and provision of services are considered, the Pennsylvania Turnpike Commission is performing as should be expected.”

Shuey said that in response to the auditors’ concerns about accountability for employee travel, turnpike commission staff agree that improvements need to be made.