Report No. 2011-13
March 2011
Complete Report
Findings in the audit of the Transportation Development Districts as of December 31, 2008
Background
As of December 31, 2008, 154 Transportation Development Districts (TDDs) had been established, with reported total estimated transportation project costs of over $1.5 billion and reported total anticipated revenues of over $1.8 billion. The 2008 TDD audit report provides information regarding the 154 TDDs and presents audit results for 16 specific TDDs: Lee's Summit Missouri New Longview; Branson Regional Airport; BaratHaven; College Station; Briarcliff Parkway and Highway 9; Fulton South Business 54; Crackerneck Creek; Arnold Triangle; Broadway Hotel; University Place; U.S. Highway 50/63 and City View; Cornerstone Pointe; Town and Country Crossing; Belton/Raymore Interchange; 1200 Main/South Loop; and Gans Road and U.S. 63.
Construction Contracts and Expenditures
TDDs need to improve their procurement practices. Some TDDs did not solicit proposals for construction management, choosing instead a related party of the developer or a service provider the owner/developer used before. State law requires competitive bidding for certain TDD construction contracts, and competitive bidding helps ensure the district is getting the best value and gives all parties an equal chance to participate in district business.
Engineering Services
Four TDDs failed to document the evaluation and selection of engineering services.
Budgetary Matters
Several TDDs exhibited problems with their budgets, including mathematical errors, deficits, or overspending. One TDD did not prepare a budget at all, while other budgets were incomplete or untimely.
Financial Reporting
The following 11 TDDs failed to file the required financial report for 2008: Truman Road; Country Club Plaza of Kansas City, Missouri; CenterState; 71 Highway & 150 Highway; Southtown; St. Charles Riverfront; Northwoods; 1717 Market Place; Tuscany Village; Harrisonville Market Place A; and Harrisonville Market Place B. Another five filed their 2008 financial reports after the deadline, and an additional five failed to file their 2007 financial reports.
Related Party Transactions
One TDD selected a subsidiary of the developer as its construction manager. Such related party transactions can create conflicts of interest and lead to questions regarding whether the TDD is receiving the best value for its dollars.
Financial Condition
One TDD may not be able to meet its financial obligations and fully reimburse the developer for transportation-related costs unless it improves its revenue streams.
Compliance with Prevailing Wage Laws
One TDD was unable to document that contractors complied with prevailing wage laws because it did not retain the affidavits of compliance it received from the contractors.
Additional Comments
The Crackerneck Creek TDD did not maintain and was unable to obtain documentation to verify project costs, bidding of contracts, or debt service obligations, which impaired the audit staff's ability to conduct a thorough audit.
On a positive note, audits of the following TDDs noted no matters which required reporting: Branson Regional Airport; College Station; University Place; U.S. Highway 50/63 and City View; and 1200 Main/South Loop.
Because of the compound nature of this audit report, no overall rating is provided.
American Recovery and Reinvestment Act (Federal Stimulus)
The TDDs did not receive any federal stimulus monies during the audited time period.
*The rating(s) cover only audited areas and do not reflect an opinion on the overall operation of the entity. Within that context, the rating scale indicates the following:
Excellent:
The audit results indicate this entity is very well managed. The report contains no findings. In addition, if applicable, prior recommendations have been implemented.
Good:
The audit results indicate this entity is well managed. The report contains few findings, and the entity has indicated most or all recommendations have already been, or will be, implemented. In addition, if applicable, many of the prior recommendations have been implemented.
Fair:
The audit results indicate this entity needs to improve operations in several areas. The report contains several findings, or one or more findings that require management's immediate attention, and/or the entity has indicated several recommendations will not be implemented. In addition, if applicable, several prior recommendations have not been implemented.
Poor:
The audit results indicate this entity needs to significantly improve operations. The report contains numerous findings that require management's immediate attention, and/or the entity has indicated most recommendations will not be implemented. In addition, if applicable, most prior recommendations have not been implemented.
Complete Audit Report
Missouri State Auditor's Office
moaudit@auditor.mo.gov
