| SUMMARY OF: | A Special Report on the Department of Transportation and Public Facilities (DOTPF), Ted Stevens Anchorage International Airport (AIA), Capital Projects Review, September 4, 2009 |
Purpose of the Report
In accordance with Title 24 of the Alaska Statutes and a special request by the Legislative Budget and Audit Committee, we conducted an audit of various capital project related issues at the Ted Stevens Anchorage International Airport (AIA). Our primary objective was to determine AIA’s process for approving the scope and funding for capital projects, to review capital projects approved over the last ten years for verification of the approval process, and to summarize capital projects in excess of $500,000 by expenditure amount, funding source, and timeframe for completion. Additionally, we assessed the operational effect of projects exceeding budget and completion timeframes.
We reviewed two specific projects in detail – the airport director’s office renovation and airport hold room construction. For the director’s office project, our objective was to evaluate the office layout and determine if the layout exceeds professional office space standards. For the hold room project, our objective was to provide a layout of the room, determine the budget and source of funds to operate the room, and identify who is eligible to, and who has used the room over the last year.
Report Conclusions
AIA generally followed its process for approving projects. This includes the director’s office and hold room construction projects. However, we found AIA inadequately documents certain aspects of the capital project planning and approval process and project management avoids project control practices. Information inadequately documented includes the original budget and expected completion dates for projects. Furthermore, prior to 2009, airlines did not approve individual projects, and information concerning airline approval for projects was unavailable prior to 2002. There is no indication of significant negative impacts on airport operations due to budget or timeframe overruns.
We found that the director’s office configuration and many other private offices exceed space allocation standards. Overall, AIA’s management allocated an unreasonable amount of space for administrative non-revenue generating purposes. In addition, AIA has no formal procedures for use of the airport hold room and does not keep a record of hold room use. Over the last six months, the room was used on four occasions – three times by the Governor’s office and once by foreign dignitaries. We also found that DOTPF is not meeting statutory requirements for annual reporting of International Airport Construction Fund activity, and the DOTPF commissioner, appointed in 2007, did not satisfy Alaska Executive Branch Ethics Act requirements until July 2009.
Findings and Recommendations
1. AIA’s airport director should improve the project planning and management process.
2. The commissioner of DOTPF should ensure submittal of an annual International Airport Construction Fund spending plan to the legislature in accordance with state law.
3. AIA’s airport director should consider reducing the amount of space allocated for administrative purposes to maximize the amount of space available for generating rental income.