DEPARTMENT OF TRANSPORTATION Public Transportation Grants Management Accountability [31 Pa.B. 1005] I. Introduction Act 3 of 1997, Section 1315, requires the periodic completion of management performance audits by all transit entities receiving financial assistance under public transportation grant programs administered by the Pennsylvania Department of Transportation (Department). The Act further stipulates that the Department shall establish criteria to be followed by transit entities in the completion of these audits. The following guidance is intended to fulfill this requirement. These guidelines are applicable to Class 1, 2 and 3 transit entities.
While the legislation specifically references ''audits'', the following guidance will use the term ''management performance review'' or ''review'' to establish a clear distinction between the annual independent financial audits which transit entities are required to complete, and the management reviews described herein.
II. Schedule for Completion Class 1 transit entities shall initiate the next management performance review following the publication of this guidance, not later than 5 years after completion of the SEPTA Business Audit performed by Phoenix Management Services, Inc., and dated May 1998. Thereafter, Class 1 transit entities shall initiate and complete a management performance review at least once every five years.
Class 2 transit entities shall initiate the next management performance review following the publication of this guidance, not later than 5 years after completion of the Business and Organizational Review of Port Authority of Allegheny County performed by Booz-Allen & Hamilton, Inc. and dated July 1998. Thereafter, Class 2 transit entities shall initiate and complete a management performance review at least once every 5 years. The management performance reviews described herein may be conducted as part of audits/reviews completed by Class 2 transit entities pursuant to the Second Class Port Authorities Act, 55 P. S. § 551 et seq, as amended. To the extent that the audit/review is substantially in conformance with the requirements specified in this guidance, the department will accept the combined audit/review as satisfying the requirements of Section 1315 of Act 3 of 1997.
Class 3 transit entities shall begin the initial management performance review based on the following schedule:
1. Class 3 entities in urbanized areas with a population of more than 200,000, shall begin their first management performance review no later than July 1, 2001.
2. Class 3 entities in urbanized areas with a population of under 200,000, shall begin their first performance review not later than July 1, 2002.
Thereafter, all Class 3 transit entities shall initiate and complete a management performance review at least once every seven (7) years.
Class 3 transit systems which operate in the Philadelphia and Pittsburgh urbanized areas (at the time of publication of this guidance these systems are the Beaver County Transit Authority, Westmoreland County Transit Authority, and the City of Washington) will be defined as urbanized areas with a population of under 200,000 for purposes of scheduling reviews, and therefore are required to begin their initial in accordance with the schedule in item 2 above.
All Class 1, 2 and 3 transit entities are required to complete their respective management performance reviews within ten months of the scheduled date of initiation of the review. Class 1, 2 and 3 transit entities shall bear all costs of performing the management performance reviews. The management performance reviews shall be conducted by a qualified independent auditor, and/or an independent firm or agency with appropriate experience and qualifications to conduct management performance reviews of public transportation entities. The services of the party contracted to perform the review (hereafter referred to as the ''consultant'') must be obtained through a competitive procurement process. Procurement documents must specify the required scope for the review, which shall be in compliance with this guidance, and must be submitted to the Department for written approval prior to advertisement. Transit entities that provide both urban transit service (as a Class 1, 2 or 3 transit entity), and rural service (as a class 4 transit entity) may elect to conduct one management performance review, in accordance with this guidance, encompassing both urban service and rural services.
III. Organization Functional Review The selected consultant shall conduct a system performance review to determine the operating efficiency and service effectiveness for both the transit system as a whole, and for selected organization functions and activities of the agency. The analysis of the efficiency and effectiveness of the forenamed organization shall, at a minimum, include the functions and activities listed below. The transit entity is encouraged to include additional functions and activities in their evaluation as it finds appropriate.
Organization Functions to be Reviewed:
1. Board of Directors
2. Management/Administration
3. Finance
4. Human Resources
5. Transit Operations
6. Vehicle/Facility Maintenance
7. Marketing/Promotion
8. Planning/Government Relations
9. Capital Planning
IV. Systemwide Performance Evaluation The analysis of systemwide performance shall, at a minimum, include the following transit industry performance measures:
Transit Performance Measures to be Included:
1. Operating cost per vehicle mile and/or per vehicle hour
2. Operating cost per originating passenger
3. Originating passengers per vehicle mile and/or per vehicle hour
4. Total employees per vehicle mile and/or per vehicle hour
5. Total vehicle miles and/or total vehicle hours per peak vehicle
6. Average age of the active vehicle fleet
7. Ratio of operating revenue to operating expenses (required for fixed route services only)
8. Average trip length (required for demand response services only)
Transit entities are encouraged to supplement these measures with additional performance factors which would be helpful in determining the agency's overall operating efficiency and service effectiveness.
The review shall include a time-series trend analysis of the above performance measures for the agency for the five most recently completed fiscal years. Based on this trend analysis, the consultant shall identify the areas of relative improvement and relative decline. To the maximum extent possible, the consultant shall identify the probable causes of these relative changes and make recommendations intended to strengthen the performance of the transit system.
In addition to this systemwide trend analysis, the review shall include a comparison of the above perfor-mance measures for the agency, for the most recently available fiscal year, with the same measures for approximately five ''peer'' transit systems. The peer transit systems, to the maximum extent possible, should have similar operating characteristics including service area, number of vehicles, types of services offered, etc. The selected peer transit systems may be either systems within, or outside of Pennsylvania.
Based on this peer-group analysis, the review shall identify the transit entity's areas of relative strength and relative weakness when compared to the peer group. To the maximum extent possible, the consultant shall identify the probable causes of these comparative strengths and weaknesses, and make recommendations intended to strengthen the performance of the transit system.
Finally, the review must include an evaluation of the results of the customer satisfaction surveys completed by the transit agency in accordance with Section 1315(c) of Act 3 of 1997. At a minimum this analysis must address the following six state-mandated subject areas:
a. On-Time Arrival & Departure
b. Vehicle Cleanliness
c. Fares
d. Driver Courtesy
e. Safety
f. Overall Customer Satisfaction
The transit entity is encouraged to evaluate additional areas of customer satisfaction that were included in the agency's customer satisfaction survey. This analysis shall include a time-series trend analysis of this information for the five most recently completed fiscal years. Based on this trend analysis, the consultant shall identify the areas of relative improvement and relative decline. To the maximum extent possible, the consultant shall identify the probable causes of these relative changes and make recommendations intended to improve customer satisfaction.
V. Transit System Response and Submission of Independent Review Upon receipt of the final report, each transit entity shall prepare an action plan addressing the findings and the recommendations contained in the independent review. The action plan must be approved by the transit entity's governing body within two months of receipt of the final report. Upon, approval of the action plan by the transit entity's governing body, a copy of the independent review report and the agency's action plan must be submitted to the Department. In addition, Class 1 and Class 2 transit entities must submit a copy of the independent review report and the agency's action plan to the Legislative Budget and Finance Committee, the chairman and minority chairman of the Transportation Committee of the Senate, and the chairman and minority chairman of the Transportation Committee of the House of Representatives.
The transit entity shall implement its action plan in accordance with the time frames specified in the plan.
BRADLEY MALLORY,
Secretary[Pa.B. Doc. No. 01-292. Filed for public inspection February 16, 2001, 9:00 a.m.]
