Auditors uncover $193,138 in improperly assessed charges due back to airport tenants
Controller Chelsa Wagner today released the findings of a contract compliance review of Browning-Ferris Industries of PA, LLC (d/b/a Allied Waste Service of Pittsburgh), the entity that provides waste disposal services at the Pittsburgh International Airport. The Airport Authority contracts with Allied Waste to provide refuse removal services for all tenants, occupants, and users of the Airport. Wagner's audit team reviewed all of the invoices Allied Waste issued to Airport tenants for service periods from December 2007 through August 2012 as part of this extensive review.
With so many public tax dollars invested in the Airport and the Airport continuing to struggle through difficult economic times and obstacles to its optimal use, it is extremely important that those tenants and users of the Airport who have stuck by the Airport, including many small businesses, receive fair and proper billing for all services rendered under this and any other contract. Businesses that make a commitment to the Airport need to be assured that the Airport and County government are reciprocating that commitment and doing all that can be done to make the Airport an attractive location in which to do business. However, Wagner's review revealed considerable problems with the oversight and execution of the waste disposal contract by Allied Waste, in addition to the innacurate charges assessed upon tenants.
"Overcharging tenants under this type of contract is simply inexcusable," said Wagner. "While the amount of money at issue may not be substantial to a nationwide refuse disposal company (Allied Waste is a subsidiary of Republic Services, Inc.), for businesses out at the Airport, this could be the difference between operating in the black versus the red."
A significant finding in Wagner's investigation was that Allied Wate incorrectly billed tenants for shared refuse containers. The costs of these shared containers are supposed to be allocated among the tenants on a pro rata basis. After conducting their own calculations based upon the square footage used, Wagner's audit team found that shared container tenants were overbilled by 84,799 USD, and once the 2% service charge is added, the total overbilling amounts to 147,395 USD. Wagner was pleased of her Audit Team's work in this area, stating "it is gratifying that we are able to identify overbilling to those small Airport tenants, as such inflated costs can dramatically afect the bottom line of these tenants."
Another financial finding of Wagner's analysis was the Allied Waste charged Airport tenants fuel/environmental recover fees and administrative fees that were simply not allowed under the contract, thereby resulting in improper fees of 38,454 USD. Wagner also identified that tenants with individual containers had been invoiced incorrectly, resulting in overcharges of 7,289.00 USD
Commenting upon these findings, Wagner, stated "Companies that do business with Allegheny County and its authorities, such as the Airport, should be aware that the Controller's Office is there to protect the public and taxpayers and to hold everyone to account under the terms of the contract."
Wagner's report identifies a number of rercommendations to prevent such problems from recurring. Currently, the Allied Waste contract is effective thorugh October 13, 2013. Wagner noted approvingly that the Airport Authority management had reviewed her analysis and report and concurred with the findings and recommendations made by she and her Audit Team. "I have every confidence in the Airpoert that it will take appropriate and necessary actions to ensure that this situation is not repeated and, most important, to make certain that Allied Waste returns to the tenants all of the money it should not ahve received in the first place."
Wagner indicated that she intends to continue to review similar vendor contracts and relationships throughout the County to guarantee to the taxpayers that those who are doing businesses in the public domain are doing so efficiently, transparently and according to the letter of their agreement.
Since taking office in 2012, Controller Wagner and her Audit Team have identified more than 4,440,000 USD in monies and cost savings through their various audits, reports and analyses. With this review now completed, she is pleased to add more than 193,000 USD to this tally.