MIAMI (CBS4) - Some Miami-Dade Commissioners expressed outrage Tuesday at having been "left in the dark" about a growing accounting scandal at the county's transit agency that has led to the suspension of federal funding.
"There apparently are much deeper problems than were let on by the manager," said Commissioner Carlos Gimenez, referring to County Manager George Burgess. Jimenez and Commissioners Joe Martinez and Rebeca Sosa said they felt misled by the administration as to the depth of the crisis.
CBS4 News first reported on Thanksgiving eve that the Federal Transit Agency (FTA) had suspended funding to the Miami-Dade Transit Agency amid concerns that the county was unable to demonstrate how federal money and fare box revenues were being spent. The $182 million in suspended federal grant money represents nearly half the agency's budget.
At the time, Burgess downplayed the issue. In a memo to commissioners Burgess wrote that, "Contrary to erroneous media reports...the FTA has not suspended payments to Miami-Dade Transit."
The FTA issued a strongly-worded statement contradicting Burgess. FTA associate administrator Brian Farber said that due to "serious accounting deficiencies involving federal funds and fare box collections...the FTA will not be considering any (funding) requests until extensive corrective measures are taken."
In a December 3rd memo, Burgess conceded that federal funding had in fact been suspended.
"I'm very upset that the manager did not rectify the information that he gave us just before Thanksgiving, until more than a week later," Gimenez said.
"I found out when I saw it on the news," said Commissioner Joe Martinez. "Why wasn't I told? Why wasn't anybody told?"
Commissioner Sally Heyman echoed Martinez's concern.
"The first I ever heard of this was from a news reporter," Heyman said.
Burgess told CBS4 News Tuesday that he did not deliberately mislead anyone, that he initially thought the government had suspended "automatic" access to federal grant money but believed that it could still be obtained through a manual process.
Assistant County Manager Ysela Llort revealed Tuesday that a transit agency employee made an unauthorized withdrawal of approximately $14 million dollars from the federal grant fund about two hours after the feds had pulled the plug on the funding. Llort said word of the funding suspension had apparently not "worked its way down the agency" when the withdrawal was made. She said the money has since been repaid, but the gaffe apparently served to add to the FTA's displeasure with the county.
Burgess said the "executive offices" at county hall have become actively involved in addressing the "deficient financial controls" at the transit agency.
"We have made personnel changes," Burgess said, noting that two high level accounting officials at the transit agency have been removed. "We are taking corrective measures." Burgess said the county should conduct a national search for a qualified person to oversee finances and bookkeeping at the transit agency.
Burgess called the questions raised by the federal government "technical accounting issues," adding that he's confident they can be resolved.
"It doesn't look like this is going to be something that is even remotely unsolvable," Burgess said. "We should be okay once we clean things up and move forward."
Commissioner Gimenez wondered, though, if the irregularities in the transit books "could go to something criminal in nature."
Burgess said he doesn't think there is anything "sinister" in the "poor accounting" at the transit agency and doesn't believe anything "fraudulent" had occurred.
Commissioner Martinez said that, given the county's history of scandal, he worries that restoration of federal funds will be difficult.
"They are going to believe the worst in us," Martinez said. He pointed out that the federal government took over the county's housing agency in 2007 amid rampant mismanagement and fraud.
Gimenez said transit services are "obviously going to be impacted" if the suspension of federal funding continues for any length of time. "Without a doubt, the services of Miami-Dade Transit are going to decline."
Commissioner Rebeca Sosa said the transit funding crisis underscores systemic management problems at county hall.
"Where was everyone in the middle of this mess, when everything was happening?" Sosa said. "Why didn't they identify these problems before the federal government stopped the money from coming?"
A spokesperson for Mayor Carlos Alvarez said the mayor was not available to be interviewed Tuesday regarding the transit story.
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