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USDOT to Meet CARES Act Responsibilities

Tuesday, April 28, 2020

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In a memorandum issued last Monday (April 20), Acting Inspector General Mitchell L. Behm wrote to the Secretary on supporting efforts made by the United States Department of Transportation that aim to meet provisions outlined in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

“We are ready to support these efforts and work together to expedite our Nation’s economic recovery while maximizing efficiencies, ensuring compliance, and promoting fraud awareness,” stated the memorandum.

About the CARES Act

At the beginning of the month, the USDOT announced $25 billion in federal funding allocations for the nation’s transportation systems and $1 billion in funding for the National Railroad Passenger Corporation (Amtrak) in response to the COVID-19 pandemic.

Tanaonte / Getty Images

In a memorandum issued last Monday (April 20), Acting Inspector General Mitchell L. Behm wrote to the Secretary on supporting efforts made by the United States Department of Transportation that aim to meet provisions outlined in the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Both allocations were made available through the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed by President Donald J. Trump on March 27.

The CARES Act is reported to provided fast and direct economic assistance for American workers and families, small businesses, state and local governments and helps to preserve industry occupations.

According to the USDOT’s announcement, the Federal Transit Administration (FTA) plans to use the $25 billion in allocated funding by giving $22.7 billion to projects in large and small urban areas, while $2.2 billion is slated to be used for rural infrastructure.

The FTA adds that operating expenses incurred beginning on January 20, for all rural and urban recipients are also eligible for maintaining transit services and administrative leave due to reduced operations.

Other steps the FTA has taken to provide relief include expanding its eligibility for federal assistance under its Emergency Relief Program, establishing an Emergency Relief docket and the announcement of a 30-day extension for deadlines regarding current competitive grant program funding opportunities, including: FTA’s Grants for Buses and Bus Facilities Program; Passenger Ferry Grant Program; Accelerating Innovative Mobility (AIM) Challenge Grants; and Helping Obtain Prosperity for Everyone (HOPE) Program.

In regard to the $1 billion in funding for Amtrak, the Federal Railroad Administration (FRA) is slated to make or amend existing grants to Amtrak in order to provide approximately $1.02 billion; $492,000,000 for the Northeast Corridor and $526,000,000 for National Network Grants, as authorized by sections 11101(a) and 11101(b) of the Fixing America’s Surface Transportation Act.

At least $239,000,000 of funds are also slated to be used to help mitigate the cost impact on America’s 28 State-supported intercity passenger rail routes.

USDOT Supporting Efforts

According to the memorandum, the Office of Inspector General (OIG) intends to provide an initial product in the coming months which will crosscut oversight risks and suggestions for mitigation regarding the Department’s efforts.

The product plans to leverage key insight for bolstering the Department’s oversight of CARES Act grantees and contractors.

Additionally, Behm points out that because of the volume and speed required to make CARES Act funds available to the public, transactions are at higher risk for fraud, waste, and abuse. To mediate these possible threats, the USDOT and OIG plan to work together and look for any early indicators that might suggest potential misuse.

“We encourage submitting any suspicions of fraud, waste, or abuse to OIG as soon as possible via the DOT-OIG Hotline or direct communication with previously established OIG points of contact. Through our shared efforts to communicate fraud awareness and implement other proactive best practices, DOT and OIG can help maximize the efficacy of these vital CARES Act funds,” stated the memorandum.

Since writing to the Secretary, the USDOT has been reported to grant exemptions to Delta, Alaska Airlines and Hawaiian Airlines under obligations made by the CARES Act.

Specifically, the USDOT has ruled that Hawaiian Airlines and Alaska Airlines could significantly reduce capacity into the islands and remain in compliance with their service obligations under the Act. However, flights are slated to remain limited for the foreseeable future while the state’s Governor is still implementing mandatory 14-day quarantines for all arrivals on to the islands.

Although the USDOT recently ruled against seasonal services provide by JetBlue and Spirit Airlines, the recent precedent suggests that similar requests from American Airlines and United Airlines could be granted in the weeks to come. Southwest is also likely to be successful if it requests similar exceptions.

While seasonal services will still be treated differently based on destination, USDOT also highlights staffing issues for several locations.

All exemptions follow the USDOT’s final order establishing parameters for implementing the authority granted to the Secretary of Transportation by Sections 4005 and 4114(b) of the CARES Act, which was made on April 7.

The order requires that air carriers receiving financial assistance under the CARES Act maintain minimum air services on a nationwide basis, with some exceptions.

View all of PaintSquare Daily News' coverage on COVID-19, here.


Tagged categories: COVID-19; Department of Transportation (DOT); Funding; Government; Health & Safety; Health and safety; NA; North America; President Trump; Program/Project Management; Project Management; Transportation

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