Airports authority board, under fire, struggles to right itself

August 12, 2012

The board in charge of Washington’s most expensive transportation project in decades — the Metrorail line to Dulles International Airport — is dysfunctional, out of control and secretive, federal officials contend.

They criticize the Metropolitan Washington Airports Authority board for spending lavishly on its own entertainment and handing out jobs and contracts that may benefit friends and family.

U.S. Transportation Secretary Ray LaHood, one of the board’s most prominent critics, stepped in to smooth out the political bickering and last month assigned someone to keep tabs on the largely autonomous body that is building the $6 billion rail line to Dulles.

“I have serious questions about how the board has operated,” LaHood said Friday. “I want the people of the D.C. area to know that we don’t agree with what they’ve been doing.”

LaHood said he met Aug. 2 with three elected officials who appoint board members — D.C. Mayor Vincent C. Gray (D), Virginia Gov. Robert F. McDonnell (R) and Maryland Gov. Martin O’Malley (D) — to discuss changing the membership of the board. He said they also will ask the board to terminate contracts given to former board members and former employees.

The authority says it is addressing a long list of potential improprieties identified by a federal inspector general, LaHood, members of Congress and local elected officials. Hanging in the balance is its stewardship of the region’s most costly transportation project and whether taxpayers will be left holding the bag.

To understand how a board that runs two airports — Dulles and Reagan National — got into the business of building a rail line that will carry Metro passengers 23 miles through Northern Virginia, one needs to follow the money trail.

For decades after Washington’s outer airport opened 50 years ago, people have talked of building a rail connection, which has come to be known as the Silver Line. But gathering the money to pay for it proved to be a problem.

Then came a landmark deal six years ago in which Virginia gave the airports authority control of the Dulles Toll Road. Under a deal signed by then-Gov. Timothy M. Kaine (D), the authority would use toll revenue to finance bonds to pay for the Silver Line.

And almost from that moment, the workings of a board that had been overshadowed by virtually every other elected and appointed body in Washington, from Congress to zoning boards, suddenly found its actions under intense scrutiny and withering criticism.

“You had a system that went off the tracks,” said Rep. Frank R. Wolf (R-Va.), whose district is home to Dulles and who has condemned the board as dysfunctional. “I want to see the board returned to honesty and integrity.”

Wolf sent the Transportation Department’s inspector general a list of issues that worried him. The 18-page report he got in response three months ago was a litany of concerns about the way the MWAA board did business.

Some were the kind that most concern lawmakers: weak oversight, lax ethics, conflicts of interest, no-bid contracts, a lack of transparency.

Others were the kind that infuriate taxpayers and drivers who worry about rising tolls in their daily commute. Some members of the unsalaried board were living large on expense accounts: two bottles of wine for $238, three dinners for $4,800, a $9,200 airline ticket to a conference in Prague, a $4,800 first-class ticket to Hawaii and Florida.

“There is a public perception problem,” said board member Michael L. O’Reilly. “It’s not as bad as the first travel stories that came out [in The Washington Post] in 2008. We’ve gotten better, but we haven’t gotten to the point where people are going to praise us for our frugality.”

Board Chairman Michael A. Curto said he suspended all international board travel after reading the inspector general’s report and wants the board to give him authority to approve all trips. He said the board also will upgrade policies on ethics, conflicts of interest and hiring former board members.

“We hear you, IG. We hear you, Secretary LaHood. We understand the concerns,” Curto said.

The board’s problems arose because the four people who appoint its members — the president, the two governors and the mayor — gave seats to too many political cronies, said Leo J. Schefer, president of the Washington Airports Task Force, a non-profit group that promotes the two airports.

“Up until about 10 years ago the board didn’t need to be scrutinized,” Schefer said. “It may have had a couple of less-desirable people on it, but they were a tiny fraction of the total.”

Now, he says, the 13-member board divides into three distinct groups: “The really sensible people; the group that . . . steer[s] things in a direction they passionately believe in, even if it’s wrong; and the third group that is sort of undecided, and they sway between the two.”

He fears that will drive away key people in the authority’s 1,400-member staff.

“The authority staff is excellent,” Schefer said. “The danger is that the fish rots from the head, and if we don’t get the authority board restored to harmony and effectiveness it will be extremely difficult to sustain that excellence in the staff.”

That staff is led by John E. “Jack” Potter, president and chief executive of the authority, who took the helm a year ago. He is a former postmaster general.

“I personally think that things are getting better [and] issues that are being raised are being addressed,” Potter said. “Our goal is to get ahead of the IG report and put this in our rearview mirror as quickly as possible.”

Potter said he has eliminated the use of an exemption that allowed certain contracts to be awarded without competitive bidding. The inspector general’s report found that the MWAA awarded more than $220 million in contracts citing the exemption.

“We’re looking at all of our contracts to ensure that we’re maximizing competitive bidding wherever it can be done,” he said.

The divisions on the board gained public attention with a fight over whether the Silver Line station at Dulles should be built underground, which would have added $600 million to the cost.

Board members Mame Reiley and Dennis L. Martire led a successful effort to win approval for an underground station, but the board later acquiesced to public pressure and reversed itself. Then there was a battle over a union-friendly provision included in the contract for Phase 2 of the project, which will extend the line from Wiehle Avenue in Reston to the airport and eastern Loudoun County.

“Those two decisions really set off a firestorm,” Schefer said.

Another public flap arose when Reiley resigned from the board, citing health reasons, and was given a $180,000 job with benefits, the Washington Examiner reported.

“The thing that really pushed me over the top with the board is when I read in the Examiner that they gave a former board member a contract,” LaHood said. “I don’t think that’s right. I don’t think that’s the way to operate. I think it’s too much inside politics.”

Other former board members also received contracts, as did the law firm that employed the wife of the board chairman, Curto.

In June, McDonnell removed Martire, who spent $9,200 on the ticket to Prague, from the board. That effort led to lawsuits in state and federal courts.

“The board’s just become dysfunctional,” Schefer said.

Wolf drew up a pair of as-yet unsuccessful legislative efforts to tip the board’s balance of power in Virginia’s favor: one that would have expanded the board to 17 members, and a second to contract it to nine seats, with Virginians holding six of them.

The congressman in a neighboring district, Rep. Gerald E. Connolly (D-Va.), said Wolf’s proposals may not hold the answer but may provide a starting point for discussion.

“It’s an unelected body from multiple jurisdictions,” Connolly said of the board. “I just think its a mishmash.”

That said, he added: “I am confident that MWAA can manage the Silver Line to completion. They have the technical and managerial expertise, certainly at the staff level, to help manage the projects.”

Curto agrees.

“I wish people could pull back and really see the full landscape,” he said. “Dulles rail is not anything people thought would get across the finish line. In a year’s time those rail cars are going to be running on that line.”

LaHood said he expects that too, but he said his confidence resides in Potter and not with the board.

“I have a great deal of confidence in the executive director of MWAA,” LaHood said. “Jack Potter is doing a very, very professional job. He’s trying to clean up a mess and I have confidence that he can carry off Phase 2 of the Line.”

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