12/23/10: Bring on the disinfectant

This op-ed appeared in The Virginian-Pilot on the date shown.

OVER THE PAST year or so, information has come to light that all was not well at Hampton Roads Transit. But that information paled in comparison to what was really going on over there, as the state Inspector General’s report disclosed.

We knew, for example, that the original cost of light rail was low-balled in order to obtain federal funds. What we didn’t know was that HRT knew the costs were higher than that at the time Norfolk agreed to be responsible for overruns.

We knew that there had been a theft from the fare boxes. What we didn’t know was that HRT hadn’t reconciled receipts to the reports in two years.

And we certainly didn’t know that we might be on the hook to repay $192 million to the federal government.

I’m bothered by the light rail mess at HRT but equally so by the non-light rail-related disclosures. What it demonstrates is that this agency operated virtually without any oversight while spending millions, the bulk of it taxpayer dollars: According to the report, only 23 percent of HRT’s revenues come from passengers. The light rail project is completely taxpayer-funded.

The report mentions some issues that have been corrected since Philip Shucet took the helm, including controls over credit card spending, elimination of personal use of HRT vehicles and the end of inconsistent application of paid health insurance for certain members of management. Shucet is to be applauded for his actions, including the requesting of the IG review, but that doesn’t explain how we got here in the first place.

It appears that, because no one was watching, the agency — which had a budget in excess of $84 million in fiscal year 2009 and which employs nearly 900 people — was run like a mom-and-pop operation, with the attending loyalty to the “owner,” in this case, the former CEO, Michael Townes.

The investigation was stymied by these people: The report shows that “employees did not always provide complete and timely responses” to the reviewer’s requests. “Obtaining that data,” the report says, “was time consuming and challenging because we often had to submit multiple requests before being provided with necessary information.” That reflects the culture of the organization, something that changing a few people is not going to fix.

When the culture of an organization is secretive, it should come as no surprise that wrongdoing is not exposed. But the lack of transparency lies not just with those who work for the organization but also with those charged with its oversight, in this case the Board of Commissioners and, for the light rail project, the city of Norfolk.

One of the more interesting things in the report was the comment that the reviewer could not determine when Norfolk City Council received the earliest notice that there might be cost overruns because there were no minutes from the June 2007 closed door session where the project was scheduled to be discussed.

Had any of the stakeholders in HRT exerted a culture of transparency over the organization, much of what occurred would likely not have happened. The most credible and respected organizations operate in the open. According to Louis Brandeis, “Sunlight is the best disinfectant.” If there is any hope that HRT will ever regain the public trust, the organization and all of its stakeholders must open the shades.