What lesson can governments and businesses overseeing billion-dollar Infrastructure Funding and Jobs Act (IIJA) infrastructure tasks be taught from an $8.5 billion greenback growth of an airport in a serious Midwestern metropolis, the refurbishment and growth of a New York Metropolis landmark conference heart, and the development of a municipal wastewater therapy plant? The appointment of an unbiased integrity monitor helped the businesses overseeing these tasks proactively assess danger, forestall fraud, and guarantee compliance with stringent funding necessities—and save tens of millions of {dollars} within the course of.
With $550 billion in federal spending for roads and bridges, rail and transit, ports and airports, water infrastructure, resilience, broadband and the electrical grid, the IIJA is enabling many states to embark on wanted infrastructure tasks. For instance, greater than $2.5 billion was made out there for airport enchancment tasks for fiscal 12 months 2023.1 Nevertheless, as with every firm receiving federal funding, recipients of IIJA funds should guarantee they spend these {dollars} appropriately. Failure to grasp the obligations and adjust to relevant legal guidelines and IIJA rules may end up in funding clawbacks, reputational danger, and elevated scrutiny by oversight organizations, together with state and federal inspectors basic. Mitigating these dangers requires cautious planning and execution, together with efficient oversight controls all through the venture life cycle.
Skilled in authorities rules and audit procedures, integrity screens may also help officers perceive venture eligibility necessities, carry out danger assessments, handle federal funding, and put greatest practices in place to protect in opposition to fraud, waste, and abuse. They will additionally assist businesses adjust to relevant procurement and documentation necessities, reporting necessities, and related safety and security rules.
Assessing and Mitigating Danger
Integrity screens may also help state businesses establish and handle potential points early within the course of—earlier than they turn into systemic. By conducting danger assessments and creating danger administration plans, integrity screens may also help businesses proactively handle potential dangers and cut back the probability of noncompliance, fraud, or different issues.
Case Research: Worldwide Airport Enlargement
K2 Integrity is at the moment conducting a multiyear integrity monitoring task as a part of a world airport growth, a $8.5 billion venture. As a part of this engagement, our building and actual property staff was appointed as one of many integrity screens to reduce noncompliance with guidelines and rules and reduce fraud, waste, and abuse points.
Our position as an integrity monitor for the venture entails reviewing venture insurance policies, procedures, and practices to establish gaps and supply suggestions for enhancements to venture controls. Evaluations of venture procedures, controls, and monitoring of controls as they relate to building procedures, well being and security necessities, website safety expectations for airside and landside work on the airport; and audit and monitoring of workforce website entry gear and associated insurance policies and procedures.
Whereas this venture is ongoing, K2 Integrity’s findings and proposals have resulted in enhancements to venture processes to reinforce compliance, by creating efficient controls to reduce residual danger in areas akin to well being and security, and website safety.
Making certain Compliance
Integrity screens may present ongoing monitoring and oversight all through the venture life cycle, guaranteeing that contractors and different events adjust to related rules and contractual obligations. This may embody monitoring venture prices, monitoring progress in opposition to milestones, and guaranteeing that work is carried out in a protected and safe method.
Case Research: Municipal Wastewater Remedy Plant
K2 Integrity was chosen as an integrity and security compliance monitor for the development of a US $3 billion water filtration plant. We had been tasked with unbiased oversight of integrity and website security of the complete building venture.
K2 Integrity performed danger assessments of the safety, security, and financials controls surrounding this venture. We famous vulnerabilities, made suggestions to shut gaps, and monitored the venture from the procurement part via the ultimate building closeout.
K2 Integrity staffed this venture with auditors, engineers, investigators, and building specialists that monitored the positioning for well being and security, safety vulnerabilities, regulatory compliance, and indicators of fraud, waste, and abuse. Moreover, K2 Integrity reviewed procurement practices, invoices, change orders, and carried out due diligence on contractors, subcontractors, distributors, and suppliers.
Our findings and proposals resulted in enhancements to venture processes and integrity controls, improved bodily safety procedures, and price financial savings of tens of millions of {dollars} that had been recognized by our audits, engineers, and investigators on account of compliance audits and investigations.
Assembly Stringent Documentation Necessities
State businesses disbursing IIJA funds have to be ready to adjust to related procurement and documentation necessities, together with funding program reporting necessities. As well as, they face audits by state and native oversight businesses. Integrity screens can help businesses in sustaining correct and full documentation; designing and implementing subcontractor vetting and approval procedures; and managing funding appropriately.
Case Research: Conference Middle Enlargement Challenge
K2 Integrity performed a multiyear building integrity monitoring task as a part of a $1.5 billion New York Metropolis conference heart growth venture. The growth venture comprised the addition of 1.2 million sq. ft of event-related house, and the addition of a working rooftop farm.
As a part of this engagement, our staff of building and actual property professionals created, carried out, and monitored insurance policies and procedures to make sure that entities on the venture complied with related legal guidelines and rules, together with documentation necessities.
Our tasks additionally included the efficiency of an integrity danger evaluation of the venture, to establish insurance policies and procedures with residual danger that could possibly be susceptible to fraud, waste, and abuse. We designed and carried out a corruption prevention program to mitigate these dangers.
As well as, we carried out a subcontractor vetting and approval process and assisted the consumer in devising particular monitoring procedures, the place warranted, for sure subcontractors; carried out an enhanced monitoring program for the onsite crane operations; monitored compliance with well being and security and website safety necessities; performed QA/QC building integrity evaluations of key constructing components; and tracked progress of building work in opposition to key milestones.
In conclusion, state businesses face quite a few challenges in disbursing IIJA funds, together with guaranteeing regulatory compliance, stopping fraud and abuse, avoiding clawbacks, monitoring security and safety, and being ready for single audits. By working with building integrity screens, state businesses can handle these challenges proactively, handle potential dangers, and make sure that funding is spent in accordance with relevant legal guidelines and rules—and save time and money within the course of.
- Federal Aviation Administration. “Bipartisan Infrastructure Legislation – Airport Infrastructure.” U.S. Division of Transportation. Obtainable at https://www.faa.gov/bil/airport-infrastructure ; accessed on February 22, 2023.
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