MARTA owes Atlanta taxpayers as much as $70 million after overcharging the Atlanta expansion program for bus and other operational services, according to an audit of the program.
The total figure is contested by MARTA, but it backs up the fears of Atlanta City Council members who began calling for the independent audit two years ago amid concern the transit agency was spending too much of the expansion sales tax revenue on operating costs at the expense of capital projects.
Mauldin & Jenkins, the auditing firm hired by the city, found that MARTA charged for more service than it provided in the first six years of More MARTA, as the expansion program is dubbed. The additional half-penny sales tax was approved in 2016 by voters who sought new heavy and light rail lines, bus rapid transit and other improvements like expanded bus service hours and increased bus frequency. Bus service has increased, just not at the level MARTA charged, the auditors said.
The audit was shared Monday with City Council members and MARTA’s board of directors. In a statement, Mayor Andre Dickens’ office said city officials agree with all 10 of the auditor’s recommendations.
“Mayor Dickens and MARTA’s CEO, as well as both organization’s respective CFO’s and attorneys have been in discussions about the findings and a path forward,” the statement reads.
MARTA officials have pushed back on the audit’s findings.
“Mauldin & Jenkins’ calculations are wrong,” spokeswoman Stephany Fisher said in a statement. “MARTA informed the City and Mauldin & Jenkins of their flawed methodology and is disappointed that our responses to the audit which were provided to both parties were not included or referenced.”
Of the $70 million, MARTA has previously acknowledged unspecified “errors” that led to a $9.9 million overcharge in 2022 and agreed to repayment. There’s disagreement over the rest, however.
MARTA said it has already adjusted two years of additional overstatements totaling $10.6 million, but the auditors could not find documentation proving the money was paid back. There is even less documentation surrounding the remaining $44.1 million auditors believe MARTA overcharged from 2017 through 2019.
The transit agency wasn’t able to tell auditors how it calculated the costs those years, so auditors did their own calculations using MARTA’s current funding formula to arrive at the $44.1 million overcharge estimate.
In a letter to the auditors and city officials, MARTA General Manager and CEO Collie Greenwood said those calculations “arbitrarily” reduced the cost calculation from 2017 to 2019 by applying a post-pandemic standard to pre-pandemic times.
In an interview, Dickens said he expects MARTA to repay the full $70 million.
“I want to make sure that we get everything that the City of Atlanta taxpayers deserve,” Dickens said.
The auditors said better record keeping is needed, one of 10 recommendations in all. They recommended discussions between the city and MARTA to resolve the differences in charges and determine what MARTA must repay.
The auditors also said the city and MARTA need to get on the same page as to which capital projects will proceed, and in what order. Since the initial list was approved by voters, many of the original plans have been scaled back, with rapid bus transit planned in place of rail. The list of projects was revised in 2023 and split into two phases, but that was never officially approved.
The auditors did not find evidence that money was spent on non-approved transit projects. The agency increased bus services by lengthening hours of service, particularly on the weekends, and increasing bus frequency until concerns were raised about the amount of money being spent on operational services. MARTA scaled back service when the pandemic began before restoring it in 2021.
MARTA service levels for the year ending June 2022, the most recent year of available data, are on par with the service offered at the time the sales tax was approved, the auditors reported.
The audit also noted that before 2020, MARTA was limited by how it could pursue capital projects. The agency was only authorized to use money to develop plans. This limitation could account for some of why operational spending outpaced capital spending in the early days of More MARTA.
Council members who led the call for the audit said Monday they felt validated, and concerned by the findings.
Council member Amir Farokhi reacted with a post on X, formerly Twitter, and said: “Well, we were right.” Council President Doug Shipman said the results align with what he suspected.
“To have no documentation and no institutional knowledge, it’s extremely troubling,” Shipman said. “In the short-term, this raises a lot of questions, and it’s not what anyone wants to see from a transit agency that we desperately need to work well.”
Shipman said there’s the potential the audit’s recommendations leads to greater trust in MARTA’s operations, by increased transparency.
Shipman said he was concerned to learn there’s not an up-to-date approved project list.
Voters initially approved a list of 17 potential projects, but all were subject to available funding. Starting in 2022, it became clear there wouldn’t be enough money to fund all 17. That led to a resequencing, and the projects were split into two tiers, with the first group of projects scheduled for completion by 2028.
The auditors couldn’t determine who decided to split the project list or how projects were prioritized. The revised list also hasn’t been formally adopted, which prohibits MARTA from prioritizing any projects. And four additional infill stations announced by Dickens earlier this year aren’t on the most recent list. The auditors said it’s not clear how they fit into the schedule.
Auditors said it’s also unclear how two other big projects fit into the schedule: the Atlanta streetcar east extension, which would add light rail to the Beltline, and the Five Points station remodel, which was put on hold at Dickens’ request pending the audit results.
Neither MARTA nor a Dickens spokesman responded to a request asking what changes, if any, they want to see made to the project list.
Shipman said there’s an opportunity now to re-evaluate projects. If $70 million more is available for capital expenses, that changes what could be pursued, he said. If other projects like Five Points are scaled back, as he has sought, that also opens up money for other projects.
Earlier this month, Dickens expressed hesitance at the idea of light rail on the Beltline. Over the weekend, supporters urged him to press forward.
“Some people say there’s not enough money for this,” Beltline Rail Now Chairman Matthew Rao said. “I’d say we can’t afford not to do this.”
Staff writer Riley Bunch contributed to this report.
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