1. Assuring Financial Transparency and Accountability for the Proposed Montgomery County Independent Transit Authority JIM ZEPP TRANSIT TASK FORCE ROCKVILLE, MD JULY 15, 2015

2. Transportation is one of the few issues that hit everybody. It’s where the work of government is visible to everybody. - JOHN WEINGART, ASSOCIATE DIRECTOR, EAGLETON INSTITUTE OF POLITICS, RUTGERS UNIVERSITY

3. *Government should be transparent. Transparency promotes accountability and provides information for citizens about what their Government is doing. *Government should be participatory. Public engagement enhances the Government's effectiveness and improves the quality of its decisions. Knowledge is widely dispersed in society, and public officials benefit from having access to that dispersed knowledge. *Government should be collaborative. Collaboration actively engages Americans in the work of their Government. Executive departments and agencies should use innovative tools, methods, and systems to cooperate among themselves, across all levels of Government, and with nonprofit organizations, businesses, and individuals in the private sector. - President Barack Obama, Jan. 21, 2009

4. After hearing from parents whose kids attend schools feeding into Walter Johnson and Walt Whitman high schools, who described overcrowded schools, Leggett criticized Montgomery County Public Schools for its “opaque” budget. He noted that the county’s budget website allows visitors to access spending records, budget documents and vendor contracts.  What we don’t see, and what citizens say constantly we don’t see, is the same thing from the school system. - County Executive Isiah Leggett, Bethesda Magazine, Feb. 3, 2015

10. Source: Montgomery County Website

17. Financial Transparency for the ITA In the spirit of County Executive Leggett’s Open Government Initiative, the financial information currently available for the transportation functions under consideration for transfer to the ITA should not be lost. Consequently, if the ITA is created, then this should be an opportunity to make a commitment to counter the paucity of financial information being provided by the other independent agencies. Therefore the ITA should be mandated to continue providing financial data to the County’s Open Government Websites in detail comparable or greater to what is done now and in the future as these Websites evolve.

18. A History of Financial Scandals and Mismanagement among Independent Agencies

19. Financial Accountability for the ITA In order to prevent the financial accounting, procurement, and ethical problems experienced with other independent agencies, if the ITA is created, it should be required to meet the following provisions: Before beginning operations and incurring debt, the ITA should be required to demonstrate to an external reviewer who will provide a public report that it has: Implemented reasonable and sufficient capabilities for accounting for all financial transactions to both investors and Federal and state agencies, Adopted suitable procurement mechanisms to assure that all contracts and purchases are done with competitive bid procedures in an open and fair manner based on vendor price and performance considerations, and

20. Financial Accountability for the ITA Established ethical conduct standards which are widely disseminated and enforced that prohibit the ITA board members and staff from both the appearance and actual conflicts of interest and exercising undue influence over the ITA’s policies and decisions, and Developed a performance-based compensation system for the ITA’s senior management that is linked to the agency’s performance and quality of operational and financial management. Conduct annual financial audits. At key milestones such as before incurring major debt, these capabilities should be reassessed for adequacy and level of performance by external auditors.

21. Performance Accountability for the ITA Because the creation of the ITA is an extraordinary action by the County to significantly increase transit usage, achieve a substantial modal shift from private motor vehicles, significantly reduce traffic congestion, and generate economic development, there should be regular performance measures that assess whether these goals are being achieved and whether its services are meeting the transportation needs of County residents and businesses.

22. Performance Accountability for the ITA 1.There should be a sunset provision in the enabling legislation that if these goals are not met in ten years, then the ITA would be subject to dissolution and its services be returned to County government. 2.A baseline performance audit of the existing services before transferal to the ITA to document the current levels of services and related conditions for subsequent assessments. 3.Invest in predictive analytics capabilities in order to have reliable forecasts for service and financial planning and strategic decision making.

23. Performance Accountability for the ITA 4.Every two years, the ITA will produce reports on these performance measures using the most recent data from external sources such as the US Census Bureau’s Transportation Planning Products, INRIX traffic congestion reports, Washington Metropolitan Council of Governments, the MD Departments of Labor, Licensing, and Regulation (DLLR) and the MD Department of Assessments and Taxation as well as rider and citizen surveys.  County transit usage shall significantly exceed equivalent regional and national statistics  Modal shift from private motor vehicles reported by ITA users will be 30% or more.  Traffic congestion reductions will be substantially more than that reported for the region and nation.  County economic development will be measured by increases in jobs, household income, commercial sales, and assessed property values as compared to the region and nation

24. So what? The need for compliance assurance and enforcement provisions