Report 2013-130 Recommendation 12 Responses

Report 2013-130: California Public Utilities Commission: It Fails to Adequately Ensure Consumers' Transportation Safety and Does Not Appropriately Collect and Spend Fees From Passenger Carriers (Release Date: June 2014)

Recommendation #12 To: Public Utilities Commission

To detect and deter carriers from operating illegally at airports, the branch should use as intended the five positions added for passenger carrier enforcement at airports. If the branch chooses not to designate five positions solely for this purpose, then it must be prepared to demonstrate regularly that an equivalent number of full-time positions are working on this activity.

Annual Follow-Up Agency Response From November 2020

In the Oct 2019 Agency Response, CPED committed to evaluating the demand for transportation enforcement activity at California airports. In Jan 2020, CPED provided the Auditor with an initial report (attached), that justified an increase of 1 PY to enhance airport enforcement.

Since Jan 2020, CPED has completed a comprehensive evaluation of its enforcement priorities, reorganized its Transportation Enforcement team, and has increased its contact with airport authorities and enforcement coverage of the major airports. Six enforcement staff are now dedicating a portion of their time to monitoring carrier activity at major airports across California on a weekly basis, including ground surveillance and coordination with airport police. Due to COVID-19, direct engagement with carriers remains limited, however, the enforcement team is actively monitoring conditions, remains in contact with the airport authorities, and prepares to change its enforcement approach as conditions warrant.

California State Auditor's Assessment of Annual Follow-Up Status: Partially Implemented

The California Public Utilities Commission (Commission) did not use as intended the five positions added for passenger carrier enforcement at airports, and it did demonstrate that an equivalent number of full-time positions are working on this activity. The Commission provided some documents to demonstrate that it has about three full-time equivalent positions working on this activity and estimates that it will have more than five full-time equivalent positions performing this work after COVID-19 restrictions subside.

Annual Follow-Up Agency Response From October 2019

In progress. As of October, 2019, TEB has 1 full time investigator at LAX and a part-time presence in Northern California at SFO and San Jose airports. The San Jose Airport agreement referenced previously was not finalized, although TEB staff continue to train LAX and SFO airport police and carriers on a regular basis, and will continue to pursue such training opportunities at other California airports.

Recognizing the importance of addressing this audit recommendation, the new CPED Director has directed an evaluation of the demand for transportation enforcement activity in California, with a specific assessment of the enforcement demand at airports, in order to prioritize the location of enforcement resources. TEB will produce an initial report by the end of 2019 that identifies the highest priority needs for transportation enforcement in California that will inform the immediate assessment of whether shifting resources within TEB to focus on the airports is warranted relative to other priority locations and activities.

To address enforcement demands, CPED will consider re-prioritizing existing enforcement resources to the airports, and/or using contract funding to enter into enforcement agreements with airport and local law enforcement agencies to increase enforcement coverage at the airports

California State Auditor's Assessment of Annual Follow-Up Status: Pending

Annual Follow-Up Agency Response From October 2018

The CPUC and SFO signed an agreement. San Jose Airport is still reviewing the CPUC's draft proposal. The CPUC also backfilled the Northern California Airport Investigator position. The investigator works at SFO at least three days each week, and routinely visits the San Jose and Oakland airports. The CPUC still maintains a full-time presence at LAX, and conducted xx airport inspections or enforcement projects in 2018.

California State Auditor's Assessment of Annual Follow-Up Status: Pending

The California Public Utilities Commission (Commission) did not provide evidence to support its claims of full implementation.

Annual Follow-Up Agency Response From November 2017

The CPUC has composed draft agreements with both San Jose Airport and San Francisco Airport. TEB will be hiring a Northern California Aiport investigator to backfill the vacancy for this position within the next two weeks, after which the agreements will be finalized and airport enforcement will continue under the agreed terms and at greater frequency.

California State Auditor's Assessment of Annual Follow-Up Status: Pending

Annual Follow-Up Agency Response From November 2017

The CPUC has composed draft agreements with both San Jose Airport and San Francisco Airport. TEB will be hiring a Northern California Aiport investigator to backfill the vacancy for this position within the next two weeks, after which the agreements will be finalized and airport enforcement will continue under the agreed terms and at greater frequency.

California State Auditor's Assessment of Annual Follow-Up Status: Pending

Annual Follow-Up Agency Response From October 2016

In August 2016, TEB completed the process to return all five of the identified airport enforcement positions to their appropriate enforcement sections. One of these positions is currently filled. TEB posted the remaining four for interested applicants, and expects to conclude the review and selection process in November 2016. To ensure availability of airport enforcement work, TEB is drafting airport partnership plans, which it expects to circulate to the airports in late 2016.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

Annual Follow-Up Agency Response From October 2016

On March 23, 2016, the CPUC Executive Director communicated to State Auditor Elaine Howle that the CPUC intends to comply fully with Recommendation 12. The CPUC identified the specific positions intended to conduct airport enforcement. Of the five, three positions were located in the transportation enforcement section, one in the transportation license section, and one outside of TEB. The CPUC returned all positions to airport enforcement, posted the vacancies and expects to fill the vacancies by November 15, 2016. As stated in TEB's 2016 Annual Plan, TEB is drafting a formal airport partnership plan to locate the equivalent of those five positions among California's major airports. Right now, only LAX authorizes the CPUC to locate enforcement staff onsite; TEB consistently maintains one full-time inspector at LAX. While TEB maintains a close relationship with all airports and coordinates joint inspections, there is not enough airport work to occupy five inspectors unless the CPUC obtains agreements with the major airports.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

Annual Follow-Up Agency Response From October 2015

See one-year response.

California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement

1-Year Agency Response

CPUC began the transition of five positions to new passenger carrier enforcement activity at California airports beginning August 2014. CPUC also refined its Work Tracking System (WTS) to better define and track work associated with airport enforcement. TEB Management reviews WTS monthly, and adjusts workload as appropriate. Historically, TEB's annual investigatory workload is approximately 60% passenger carriers and 40% household goods carriers. Investigators are cross-trained to work on both types of cases. Five investigators dedicated to airports results in a loss equivalent to two full time investigators to the household goods program. The CPUC must retain the flexibility to investigate the highest priority cases, regardless of carrier classification.

California State Auditor's Assessment of 1-Year Status: Will Not Implement

It is troubling that the California Public Utilities Commission (commission) does not plan to implement our recommendation. As we describe in pages 34 through 37 of our report, because the transportation enforcement branch (branch) does not use the five positions the Legislature authorized to conduct passenger carrier enforcement at major airports, it may not be catching and deterring unlicensed passenger carriers operating at major California airports as the Legislature intended. We found that the commission transferred one of these five staff to work in a completely different branch unrelated to transportation enforcement, and the remaining four staff spent more time working on household good carrier investigations and licensing activities than passenger carrier enforcement. Consequently, the branch inappropriately uses funds from the transportation account, which benefited from a fee increase tied to what was supposed to be five new positions working on passenger carrier enforcement at major airports, to compensate for work associated with other activities. Therefore, we concluded that the commission should either reduce revenues by lowering fees on passenger carriers or it should increase its enforcement activities by using the positions as authorized by the Legislature. However, the commission is doing neither.

6-Month Agency Response

TEB dedicated the equivalent of five positions to passenger carrier enforcement at California airports. TEB also refined its Work Tracking System to better define and track work associated with airport enforcement, which enables management to rebalance workload as necessary to maintain the five-person allocation. Currently, such reviews take place quarterly.

Status: Ongoing. The first two reviews indicate the need for continued monitoring and supervision over staff entries into the work tracking system.

California State Auditor's Assessment of 6-Month Status: Pending

All Recommendations in 2013-130

Agency responses received are posted verbatim.