Addx Corporation - New Jersey Legislature · Robert Fischer, Executive Director; George Rolon,...

State of New Jersey

Department of the Treasury

Integrity Oversight Monitoring Reporting Model

Firm Name: Addx CorporationEngagement: Integrity Oversight Monitor

For Quarter Ending: 09/30/2016

No.

Recipient Data Elements

Response Comments

A. General Info

1. Recipient of funding Bayshore Regional Sewage Authority (BRSA)

2. Federal Funding Agency? (e.g. HUD, FEMA) Federal Emergency Management Authority (FEMA)

3. State Funding (if applicable) N/A

4. Award Type Public Assistance - Category G

5. Award Amount Stone Hill Contracting inc., Doylestown, PA $17,185,821

6. Contract/Program Person/TitleBayshore Regional Sewage Authority (BRSA), Union Beach,NJ

Robert Fischer, Executive Director; George Rolon, Project Manager, New

Jersey Environmental Infrastructure Trust (NJEIT)

7. Brief Description, Purpose and Rationale of Project/ProgramDue to high winds, heavy rain, subsequent flooding and storm surge from SuperStorm Sandy,

the BRSA sustained major damage to two incinerators; the Dorr Oliver as well as the Niro

incinerator, in addition to its adjacent equipment. The Project Worksheet (PW) relates to the

demolition and reconstruction of these two incinerators and adjacent equipment.

8. Contract/Program Location BRSA, Union Beach, NJ

9. Amount Expended to Date $14,938,808.48 expended by Stone Hill Contracting

10. Amount Provided to other State or Local Entities None

11. Completion Status of Contract or Program Project is approximately 85% complete.

12. Expected Contract End Date/Time Period 12/31/2016

B. Monitoring Activities

Reports required under A-60 will be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by the

Disaster Relief Appropriations Act.

Page 1 of 3

State of New Jersey





No.


Response Comments



13. If FEMA funded, brief description of the status of the project worksheet

and its support.

IFCO has been conducting numerous classroom and hands on training for BRSA plant

personnel. SHC and Industrial Furnace Company (IFCO) requested rescheduling of the original

September 27-28, 2016 Stack Test with the New Jersey Department of Environmental

Protection-Bureau of Technical Services (NJDEP-BTS) to be pushed back to October 18-19,

2016. The primary cause of the slippage was attributed to electrical wiring and terminations

for the NIRO Incinerator. MBE Electric, the electrical subcontractor, and IFCO have been

efficiently working in tandem to pull, terminate, label, seal and test point to point and system

terminations. At two other sanitary sewage incinerator sites preparing to meet the new

federal stack tests emissions, the identical mercury removal equipment installed at those

sites as well as at BRSA, manufactured by the same company, essentially spontaneously

combusted. There was no loss of life. However, the fire suppression systems at the sites

were inadequate and the mercury scrubbers were destroyed. On September 30, 2016, there

was an emergency meeting of the mercury removal manufacturer, CPPE, with BRSA, IFCO,

Hazen and Sawyer, the engineer (Hazen), and Addx’s monitor. CPPE presented its

investigation into the likely causes for fires at the other two sites. IFCO and CPPE sought to

reassure BRSA with the following logic: BRSA purchased and installed a new suite of

equipment, primarily manufactured and warranted by IFCO unlike at the other two sites –

they did not contract with IFCO. Hence, BRSA has IFCO’s overly sufficient and redundant

installation of monitors and risk mitigation controls and operator training which were not

present at the other two sites. The IFCO engineer recommended that the plant hire a third

party facilitator to conduct a “hazard analysis,” or HAZOPS – hazard operations. It is a

controlled facilitation that allows the participants to walk through each part of the plant’s

process asking, ‘what if’ and assigning an acceptable and unacceptable level of risk and

mitigation for each factor. Upon completion, the group has achieved consensus upon what

hazard mitigation actions will take place at each stage of the plant’s operation. And

importantly, the group comes to consensus on what is and what isn’t an acceptable level of

risk and consequence at each stage and overall.

14. Quarterly Activities/Project Description (include number of visits to meet

with recipient and sub recipient, including who you met with, and any

site visits warranted to where work was completed)

The Addx Monitor attended weekly progress meetings with BRSA, SHC & Hazen on 7/5/16,

7/12/16, 7/19/16, 8/2/26, 8/9/16, 8/16/16, 9/13/16, 9/20/16, 9/27/16.

The Addx Monitor attended monthly scheduled update meeting on 8/2/16, 9/27/16.

The Addx Monitor conducted a site inspection on 7/19/16, 8/23/16,.

The Addx Monitor attended an emergency meeting with all parties 8/3/16.

The Addx Monitor attended an emergency meeting with all parties plus CPPE, the

mercury scrubber manufacturer on 9/30/16.

15. Brief Description to confirm appropriate data/information has been

provided by recipient and what activities have been taken to review in

relation to the project/contract/program.

As previously noted, the NJEIT and BRSA have been very cooperative as part of this

review. Addx compliance examiners have been able to review all project related

documents to include contract, drawings, bonds, invoices and supporting

documentation.

16. Description of quarterly auditing activities that have been conducted to

ensure procurement compliance with terms and conditions of the

contracts and agreements.In addition to continuing to analyze and review all invoices and materials as set

forth in the project and review of certified payroll rates and hours compared with

books and records, the Addx Monitor appears on site regularly to do monitoring,

attend meetings, site inspections, and help ensure compliance with requirements.

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State of New Jersey





No.


Response Comments



17. Have payment requisitions in connection with the contract/program been

reviewed? Please describeYes, payment requisitions are reviewed. Data analytics are performed during the

review to ensure all claims for payments are supported with adequate

documentation.

18. Description of quarterly activity to prevent and detect waste, fraud and

abuse.Appear on site nearly every week to do monitoring, site inspections, and help

ensure compliance with requirements.

19. Provide details of any integrity issues/findingsNone

20. Provide details of any work quality or safety/environmental/historical

preservation issue(s). At two other sanitary sewage incinerator sites preparing to meet the new federal

stack tests emissions, the identical mercury removal equipment installed at those

sites as well as at BRSA, manufactured by the same company, have essentially

spontaneously combusted. : BRSA purchased and installed a new suite of

equipment, primarily manufactured and warranted by IFCO unlike at the other two

sites – they did not contract with IFCO. Hence, BRSA has IFCO’s overly sufficient

and redundant installation of monitors and risk mitigation controls and operator

training which were not present at the other two sites.

21. Provide details on any other items of note that have occurred in the past

quarterAt two other sanitary sewage incinerator sites preparing to meet the new federal

stack tests emissions, the identical mercury removal equipment installed at those

sites as well as at BRSA, manufactured by the same company, have essentially

spontaneously combusted. BRSA purchased and installed a new suite of

equipment, primarily manufactured and warranted by IFCO unlike at the other two

sites – they did not contract with IFCO. Hence, BRSA has IFCO’s overly sufficient

and redundant installation of monitors and risk mitigation controls and operator

training which were not present at the other two sites.

22. Provide details of any actions taken to remediate waste, fraud and abuse

noted in past quarters

Addx has been monitoring the procurement process, to include providing due

diligence and a review of the solicitation documents. No irregularities were noted.

Addx representatives continue to attend regularly scheduled weekly or bi-weekly

meetings between BRSA and SHC representatives.

C. Miscellaneous

23. Attach a list of hours and expenses incurred to perform your quarterly

integrity monitoring review

Quarterly – 46 hours; $5,487.59 labor and $186.00 in the Other Director Costs

(ODCs). Totaling $5,673.59 for the quarter ending 9/30/16.

24 Add any item, issue or comment not covered in previous sections but

deemed pertinent to monitoring program. None

Name of Integrity Monitor: Jennifer Sirois

Name of Report Preparer: Allison Kennett

Signature:Date: 1/3/17

Page 3 of 3

1

Firm Name:

Brown & Company CPAs and Management Consultants, PLLC

Engagement: EQ2014‐009‐P1‐HMFA

For Quarter Ending: 9/30/16 Reports required under A‐60 will be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by the Disaster Relief Appropriations Act.

No. Recipient Data Elements Response Comments A.

General Info

1.

Recipient of funding

NJ Housing Mortgage and Finance Agency (NJHMFA)

2.

Federal Funding Agency? (e.g. HUD, FEMA)

HUD

3.

State Funding (if applicable) Not applicable

4.

Award Type HUD Community Development Block Grant (CDGB) - Disaster Recovery

5.

Award Amount $103,101,114

6. Contract/Program Person/Title Director, NJHMFA Division of Credit & Business Development

Quarterly Status Report Brown & Company CPAs and 2 Management Consultants, PLLC

No. Recipient Data Elements Response Comments

7. Brief Description, Purpose and Rationale of Project/Program

The Department of Treasury (Treasury), on behalf of the New Jersey Housing and Mortgage Finance Agency (NJHMFA) engaged Brown & Company CPAs and Management Consultants, PLLC (Brown & Company) pursuant to the “Prequalification Pools: Auditing and Other Related Services in Support of Disaster Recovery” contract (T2939) from prequalified contractors. The State retained the services of Brown & Company to provide a Program and Process Management Auditor to NJHMFA to audit the Fund for Restoration of Multi-Family Rental Housing (FRM) and associated contracts and the Sandy Special Needs Housing Fund (SSNHF) programs, for the purpose of minimizing risk and preventing or rectifying duplication of benefits, process and payment errors, waste, fraud, abuse, malfeasance and mismanagement of funds. The NJHMFA FRM program assists in the creation of rental projects in the nine most impacted New Jersey counties and provides the funding for forgivable subordinated mortgages. Those counties have been identified as Atlantic, Bergen, Cape May, Essex, Hudson, Middlesex, Monmouth, Ocean and Union. The program awards subsidies in the form of loans to both not-for-profit and for-profit developers; owners capable of managing large multifamily housing developments; and low- and moderate-income households.

As of this report, NJHMFA has approved 16 loan contracts (Attachment A).

8. Contract/Program Location Various counties in New Jersey

9. Amount Expended to Date $88,594,813

10. Amount Provided to other State or Local Entities

Not applicable

11. Completion Status of Contract or Program

85.9 % of funds have been expended

12. Expected Contract End Date/Time Period

Funds should be expended by December 31, 2017.


No. Recipient Data Elements Response Comments B. Monitoring Activities

13. If FEMA funded, brief description

of the status of the project worksheet and its support.

Not applicable

14. Quarterly Activities/Project

Description (include number of visits to meet with recipient and sub recipient, including who you met with, and any site visits warranted to where work was completed)

No site visits. Brown & Company received information from NJHMFA. We received an update on the contracts from NJHMFA. Brown & Company reviewed the status of funds for the 16 contracts. (See Attachment A).

15. Brief Description to confirm

appropriate data/information has been provided by recipient and what activities have been taken to review in relation to the project/contract/program.

Brown & Company’s integrity oversight monitoring activity for the quarter (July 1, 2016 – September 30, 2016) focused on Tasks D and Task E.

Brown & Company reviewed the status of funds for the sixteen contracts. We reviewed the status of the contracts with NJHMFA.

16. Description of quarterly auditing activities that have been conducted to ensure procurement compliance with terms and conditions of the contracts and agreements.

Under Task D, Integrity Oversight Monitoring, Brown & Company tracked, tested, and reviewed contractor invoices submitted to NJHMFA. We reviewed updated schedules that reported activities for Booker T Washington Apts. and Keyport Legion Apts.

17. Have payment requisitions in connection with the contract/program been reviewed? Please describe

Yes, payment requisitions were reviewed in previous quarters. There were no payment requisitions reviewed for the current quarter July 2016 thru September 2016, because there were very little expenditures during this period.



18. Description of quarterly activity to prevent and detect waste, fraud and abuse.

The first essential step in preventing and detecting waste, fraud, and abuse in government programs is to review and evaluate the comprehensiveness and effectiveness of existing policies, procedures, and controls in place to manage and mitigate the risks inherent in government loan programs. Brown & Company’s monitoring activities this quarter included reviewing updated FRM-PHA report

19. Provide details of any integrity

issues/findings There are no findings or integrity issues to report.

20. Provide details of any work quality

or safety/environmental/historical preservation issue(s).

None

21. Provide details on any other items

of note that have occurred in the past quarter

None

22. Provide details of any actions taken

to remediate waste, fraud and abuse noted in past quarters

Not applicable

C. Miscellaneous

23. Attach a list of hours and expenses

incurred to perform your quarterly integrity monitoring review

See Attachment B

24 Add any item, issue or comment

not covered in previous sections but deemed pertinent to monitoring program.

None


Name of Integrity Monitor: Brown & Company CPAs and Management Consultants, PLLC

Name of Report Preparer: Gail Jenifer, CPA

Signature:

Date: January 3, 2017

Brown & Company CPAs and 6 Management Consultants, PLLC

ATTACHMENT A – APPROVED LOAN CONTRACTS VALUED AT $5 MILLION OR MORE

The 16 loan contracts listed in the table below make up Brown & Company’s Task C Scope of Work.

FRM-PHA CDBG-DR Funding

HMFA ID #

Project Name Total Units

Type FRM FRM Expended to Date

CLOSED

00369 Keyport Legion Apts. 209 Rehab $4,567,315 $ 1,033,599.87

02927 Booker T. Washington Apts 319 Rehab $8,253,624 $4,084,961

PHA CLOSED SUBTOTAL 528 $12,820,939 $5,118,561

FRM Tranche 1 CDBG-DR Funding

CONSTRUCTION COMPLETE- TRANCHE 1

02704

Conifer Village at Rittenberg / Rittenberg Manor 100 New $5,412,163 $5,412,163

02861

Egg Harbor Hotel Conversion / Atrium Apartments at Egg Harbor 84 Rehab $5,549,899 $5,549,899

02859 Carolina Crescent and Connecticut Crescent 89 New $5,145,721 $5,145,721

02683 The Beachview Residence 58 New $5,642,518 $5,642,518

02772 The Meadows (Atlantic City HOPE VI) 90 New $5,783,923 $5,783,923

02869 Westmont Station 104 New $5,477,486 $5,477,486 02837 Meadow Lark Run 80 New $5,086,261 $5,086,261

02508 Green Heron Pointe 80 New $5,102,748 $5,102,748

02844 Heritage Village at Bloomfield 82 New $5,310,554 $5,310,554

02599 Willows at Waretown 76 New $9,097,970 $9,097,970

02878

The Residences at Willow Pond Village (formerly Delaney Homes) 70 New $5,840,000 $5,840,000

02885 Franklin Manor 86 New $10,118,157 $7,174,139

02853 Catherine Todd Senior Living Center 68 Rehab $5,692,775 $5,692,775

FRM COMPLETE SUBTOTAL 1,067 $79,260,175 $76,316,157

Brown & Company CPAs and 7 Management Consultants, PLLC

CLOSED- TRANCHE 1

02874 Heritage Village at Oakhurst 93 New $11,020,000 $7,160,095

FRM CLOSED SUBTOTAL 93 $11,020,000 $7,160,095

Total $103,101,114 $88,594,813

ATTACHMENT B – Level of Effort and Expenses

Quarter ending September 30, 2016.

Hours Incurred For Quarterly Activities

Member 10.0

Manager 0

Supervisor 0

Seniors (3) 3.0

Total Hours 13.0

Expenses Incurred For Quarterly Activities

Travel $ 0

Other Direct Costs $ 0

State of New JerseyDepartment of Treasury CliftonLarsonAllen ‐ DOT DEP Route 35Integrity Monitoring Reporting ModelEngagement: Task Order #: DOT 1‐1A‐E; Contract # 88364For Quarter Ending: 9/30/2016

No. Recipient Data Elements Response CommentsA. General Info

1. Recipient of funding New Jersey Department of Transportation and New Jersey Department of Environmental Protection

2. Federal Funding Agency? (e.g. HUD, FEMA) FHWA3. State Funding (if applicable) Yes4. Award Type FHWA 5. Award Amount Approximately $242 million excluding change orders6. Contract/Program Person/Title Ahmad Qureshi is the Project Manager for DOT projects and Erick Doyle is the Project Manager for

the DEP project7. Brief Description, Purpose and Rationale of Project/Program NJDOT and NJDEP received funding from the Federal Highway Administration (FHWA) and Federal

Emergency Management Agency (FEMA) for contracts in connection with damage caused by Superstorm Sandy. NJDOT procured the services to 3 contractors for 3 different projects for restoration repairs along Route 35. Those 3 contractors are Union Paving and Construction Company (DP 13130), George Harms Construction Company (DP 13120), and Agate Construction Company (DP 13114). NJDEP procured the services of EIC Associates to construct and install a four‐mile long steel seawall to help protect sections of Mantoloking, Brick and Route 35 from future natural disasters.

8. Contract/Program Location NJ Department of Transportation, Trenton NJ and NJ Department of Environmental Protection, Toms River, NJ

9. Amount Expended to Date All DOT projects as of 9/30/16 and including change orders: DP 13130 = approximately $85.8 million; DP 13120 = approximately $131 million; DP 13114 = approximately $44.1 million. NJDEP = approximately $24.5 million.

10. Amount Provided to other State or Local Entities $0 11. Completion Status of Contract or Program All the projects assigned (EIC Associates, DP 13130, DP 13120, and DP 13114) to CLA have been

substanitally completed as of 9/30/16. All projects are in the closeout phase.12. Expected Contract End Date/Time Period DP 13130 ‐ substantially complete ‐ awaiting closeout; DP 13120 ‐ substantially complete ‐ awaiting

closeout; DP 13114 ‐ substantially complete ‐ awaiting closeout; EIC substantially complete.B. Monitoring Activities

13. If FEMA funded, brief description of the status of the project worksheet and its support.

All the projects assigned (EIC Associates, DP 13130, DP 13120, and DP 13114) to CLA have been substanitally completed as of 9/30/16. All projects are in the closeout phase.

14. Quarterly Activities/Project Description (include number of visits to meet with recipient and sub recipient, including who you met with, and any site visits warranted to where work was completed)

Transactions and expenditure testing were performed this quarter for all four projects and ongoing review and testing of the expendituress as deemed necessary.

15. Brief Description to confirm appropriate data/information has been provided by recipient and what activities have been taken to review in relation to the project/contract/program.

Management has been cooperative in making themselves available to help move our monitoring of the contracts.


Testing of expenditures/payments for the 3 DOT projects have been conducted and continue to perform ongoing review activities. All onsite field visits were conducted during this quarter as well. No issues noted to date.

17. Have payment requisitions in connection with the contract/program been reviewed? Please describe Yes, see item #16.

18. Description of quarterly activity to prevent and detect waste, fraud and abuse. See #19 below

Reports required under A‐60 will be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by the Disaster Relief Appropriations Act.

Page 1 of 2

State of New JerseyDepartment of Treasury CliftonLarsonAllen ‐ DOT DEP Route 35Integrity Monitoring Reporting ModelEngagement: Task Order #: DOT 1‐1A‐E; Contract # 88364For Quarter Ending: 9/30/2016



19. Provide details of any integrity issues/findings No such findings were noted this quarter.20. Provide details of any work quality or safety/environmental/historical

preservation issue(s). See #19 above21. Provide details on any other items of note that have occurred in the past

quarter See #19 above22. Provide details of any actions taken to remediate waste, fraud and abuse

noted in past quarters None notedC. Miscellaneous

23. Attach a list of hours and expenses incurred to perform your quarterly integrity monitoring review SEE ATTACHMENT ‐ NEXT TAB IN SPREADSHEET

24. Add any item, issue or comment not covered in previous sections but deemed pertinent to monitoring program. N/A

Name of Integrity Monitor: CliftonLarsonAllen LLPName of Report Preparer: Gregory J. Bussink, III, Principal


Page 2 of 2

State of New JerseyDepartment of TreasuryIntegrity Monitoring Reporting ModelEngagement: Task Order #: DOT 1‐1A‐E; Contract # 88364For Quarter Ending: 9/30/2016

HOURS

Principal 26.25

Program manager 104.60

Project manager 270.50

Associate/staff 21.30

Total Hours 422.65

Expenses

Travel and other 1,061.45$

State of New Jersey CliftonLarsonAllen ‐ NJ Economic Development AuthorityDepartment of TreasuryIntegrity Monitoring Reporting ModelEngagement: EQ2014‐003‐P1Quarter ended 9/30/2016


1. Recipient of funding NJ Economic Development Authority (NJ EDA)2. Federal Funding Agency? (e.g. HUD, FEMA) HUD HUD award to State of NJ, State of NJ awarded to NJ DCA as a subrecipient.

3. State Funding (if applicable) n/a4. Award Type CDBG‐DR5. Award Amount $9 million6. Contract/Program Person/Title Fred Cole, Senior VP Operations for NJ EDA Mr. Cole acts as the State Contract Manager in relation to the

administration of the PFM contract.7. Brief Description, Purpose and Rationale of Project/Program EDA is a subrecipient of DCA and is responsible for the administration of $300 million in

funding for economic revitalization through grants or loans to small businesses. EDA procured the services of PFM to administer the grant/loan program.

8. Contract/Program Location Economic Development Authority, Trenton NJ9. Amount Expended to Date $6,929,523 10. Amount Provided to other State or Local Entities $0 11. Completion Status of Contract or Program Ongoing12. Expected Contract End Date/Time Period 1/31/2017 estimatedB. Monitoring Activities


N/A14. Quarterly Activities/Project Description (include number of visits to meet

with recipient and sub recipient, including who you met with, and any site visits warranted to where work was completed)

No invoices testing during quarter ended 9/30/16 as Program Manager was waiting for final invoices from PFM contractor. Time incurred includes updates with Program Manager and monthly reports.


Management has been cooperative in providing appropriate data/information to perform our monitoring of the contract.

16. Description of quarterly auditing activities that have been conducted to ensure procurement compliance with terms and conditions of the contracts and agreements. None noted.


Page 1 of 2

State of New Jersey CliftonLarsonAllen ‐ NJ Economic Development AuthorityDepartment of TreasuryIntegrity Monitoring Reporting ModelEngagement: EQ2014‐003‐P1Quarter ended 9/30/2016



17. Have payment requisitions in connection with the contract/program been reviewed? Please describe N/A

18. Description of quarterly activity to prevent and detect waste, fraud and abuse. N/A

19. Provide details of any integrity issues/findings No findings have been noted. 20. Provide details of any work quality or safety/environmental/historical

preservation issue(s). None noted.21. Provide details on any other items of note that have occurred in the past

quarter Nothing to note that has not already been stated elsewhere.22. Provide details of any actions taken to remediate waste, fraud and abuse

noted in past quarters not applicable ‐ no issues noted in previous quarters.C. Miscellaneous

23. Attach a list of hours and expenses incurred to perform your quarterly integrity monitoring review SEE ATTACHMENT ‐ NEXT TAB IN SPREADSHEET

24 Add any item, issue or comment not covered in previous sections but deemed pertinent to monitoring program. N/A

Name of Integrity Monitor: CliftonLarsonAllen LLPName of Report Preparer: Gregory J. Bussink, III, Principal


Page 2 of 2

State of New JerseyDepartment of TreasuryIntegrity Monitoring Reporting ModelEngagement: EQ2014‐003‐P1For Quarter Ending: 9/30/16

HOURS

Principal 1.75

Program manager 1.00

Project manager -

Associate/staff -

Total Hours 2.75

Submitted by CliftonLarsonAllen LLP - 1/3/17 along with our monthly status report

State of New Jersey



Firm Name: CohnReznick, LLPEngagement: New Jersey Transit Emergency Operations Center (EOC)



A. General Info

1. Recipient of funding New Jersey Transit Corporation2. Federal Funding Agency? (e.g. HUD, FEMA) Federal Transit Administration3. State Funding (if applicable) Not applicable4. Award Type Federal Transit Administration- Public Transportation Emergency Relief Program

5. Award Amount $8,682,000 6. Contract/Program Person/Title Amy B. Herbold, Deputy Executive Director (Interim Procurement Officer)7. Brief Description, Purpose and Rationale of Project/Program

The EOC will be a pre-identified location for designated NJ TRANSIT personnel and,

if required, emergency responders from outside agencies to meet and develop

strategies for coping with emergencies and major planned events. A major

objective of the EOC will be to support Incident Command (IC). The EOC shall be

staffed with the personnel necessary to make emergency management policy

decisions. NJ TRANSIT has determined that the EOC will be located at its existing

General Office Building (GOB).

8. Contract/Program Location NJ Transit General Office Building

Maplewood, New Jersey9. Amount Expended to Date $2,933,724.68

10. Amount Provided to other State or Local Entities None11. Completion Status of Contract or Program In Progress12. Expected Contract End Date/Time Period January 31, 2017B. Monitoring Activities


and its support.

Not applicable




7/14/16; 7/28/16; 8/11/16; 8/25/16; 9/22/16 - attended Construction Progress

Meetings with members of various NJ Transit departments and Alna Construction

at the NJ Transit Maplewood, NJ General Office Building..

7/6/16 conducted an unannounced Construction site visit with NJ Transit Internal

Audit department to the NJ Transit Maplewood, NJ General Office Building.

9/15/16 attended Construction Change order meeting with members of various NJ

Transit departments and Alna Construction at the NJ Transit Maplewood, NJ

General Office Building.

Preparation and submission of monthly Form E and provide status updates.

Reports required under A-60 will be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by the Disaster

Relief Appropriations Act.

Page 1 of 4

State of New Jersey











CR periodically requests information required as part of our monitoring procedures.

Information requested is applicable to the fraud risk areas under our review.

Documentation received during the quarter includes:

Progress meeting minutes

Daily site reports

Monthly workforce reports

Revised CPM schedule

2-week look ahead schedules

Site Photos

Notices of Proposed Changes

Contractor Limited Notice to Proceed

Contractor Form Es

Subcontractors' Form E2s

Contractor’s Payment Application Nos. 5, 6 & 7

Certified Payrolls for May, June and July 2016

During the quarter, we continued the review of the pay applications and conducted an

unannounced field visit. We also reviewed the Forms E and E-2 provided during the quarter

on the project by the Contractor and DBE Subcontractor and submitted to NJ Transit. We

continued a review of the NJT independent construction cost estimate and have requested a

meeting with the design firm. We began a review of certified payrolls (CPRs), and Notices of

Proposed Changes (NPCs). Additional documentation related to contractors' policies and

procedures, subcontracts, and insurance has been requested and is pending receipt.

NJ Transit is working with Alna Construction to obtain necessary documentation and to

assure that appropriate access is provided.



contracts and agreements.

CR has reviewed bid documents and continued the process of assessing the

independent cost estimate for electrical and telecommunication scopes of work.

Requested meeting with Jacobs Engineering to discuss their computation of the

independent cost estimate.


reviewed? Please describe

CR is in the process of reviewing the contractor's requisitions received to date. A

request for the complete requisition packages has been made.


abuse.

CR has attended several construction progress meetings, a change order meeting,

and conducted a site visit during the quarter. CR has also communicated with NJT

OBD with regards to DBE. Work progressing in the areas of Construction Contractor

payment application review and Change Orders.

19. Provide details of any integrity issues/findings None.

Page 2 of 4

State of New Jersey









preservation issue(s).

None.


quarter

During the 3rd quarter, Alna Construction continued to refuse to allow CR to

conduct prevailing wage interviews of its workers claiming that such interviews are

not authorized by its contract with NJT. Alna Construction has also continued to

refuse to allow CR to conduct confidential interviews of workers employed by its

DBE subcontractor, S&J Electrical Contractors, Inc. and would only permit such

interviews to be conducted in the presence of its representatives claiming that

confidential interviews are not required under the terms of its contract. NJ

TRANSIT continues to assess the status of, and facilitate the completion of, any

necessary prevailing wage interviews. as well as evaluate ALNA Construction’s

refusal to permit prevailing wage interviews for potential further action.

Additionally Alna Construction had denied CR requests to visit its offices for a

discussion of project policies and procedures and a review of project

documentation during the reporting period. As of the date of this report, however,

NJ TRANSIT representatives facilitated the requested Alna office visit. On

December 22, 2016, CR visited the Alna Construction Office in Secaucus, NJ and

obtained most of the previously requsested documentation and policies and

procedures. Also, on December 7, 2016, CR visited S&J’s office in Scotch Plains, NJ

to obtain previously requested documentation, policies and procedures.

On December 29, 2016, NJ TRANSIT sent a letter to Alna requesting it to allow the

Integrity Monitor to inspect and audit the remaining requested records and to

allow the Integrity Monitor to conduct prevailing wage interviews in accordance

with the NJ Prevailing Wage Statute (N.J.S.A. 34:11-56.25, et seq.) and contract

requirements. Alna has consented to allow prevailing wage interviews. Alna has yet

to produce or allow inspection and audit of the remaining document requested.



Not applicable

Page 3 of 4

State of New Jersey








C. Miscellaneous


integrity monitoring reviewFor the period July 1, 2016 through September 30, 2016, the following individuals

have expended a total of 131.4 hours:

Name

Gerard Frech

Carolyn Newcomb

Anna Fomina

Scott Millman

Jose Ortiz

Hosea Matic

No billable expenses were incurred.

24 Add any item, issue or comment not covered in previous sections but

deemed pertinent to monitoring program. None

Name of Integrity Monitor: CohnReznick, LLPName of Report Preparer:Frank BandaSignature:Date: January 3, 2017

Page 4 of 4

State of New Jersey



Firm Name: EisnerAmper LLP

Engagement:

Work Authorization No. 2 Hudson-Bergen Light Rail (HBLR) Repair

and Recovery and Locally Prioritized Resilience (NJ-44-X003)

Integrity Oversight Monitoring Contract 14-033B



A. General Info

1. Recipient of funding New Jersey Transit Corporation

2. Federal Funding Agency? (e.g. HUD, FEMA) Federal Transit Administration

3. State Funding (if applicable) Not applicable

4. Award Type FTA-Public Transportation Emergency Relief Program

5. Award Amount Total Project: $44,904,852

EisnerAmper: $692,325

6. Contract/Program Person/Title Amy B. Herbold - Deputy Executive Director (Interim Procurement

Officer)


The Hudson-Bergen Light Rail Repair and Recovery and Locally Prioritized

Resilience is comprised of the following scope of work:

- Sandy DMG. 05 HBLR 4 Track & Row: Repair/replacement of damaged

track components (rail resurfacing, lubricators, heaters, drainage swales,

inlets, culverts and ballast washout and related activities.

- Sandy DMG. 05 HBLR 4 Vehicle Base Facility: Replacement of damaged

yard switch machines, installation of storage container for critical parts,

auxiliary power repairs, and switch heater repairs, purchase of Wheel

Truing Machine and installation of VBF, and the purchase of off site

wheel truing services.

- Sandy DMG. 05 HBLR 4 Signals and Communications: Replacement of

mainline switches, impedance bond boxes, repairs at grade crossings,

replacement of communication components, installation of Mill Creek

CIH and testing and replacement of signal cable.

- Sandy DMG. 05 HBLR 4 Traction Power/Station Dist. Power: Testing

and replacement of Auxiliary Power Cable, repair Traction Power Cables

and associated costs for design, project administration, construction, the

purchase of necessary equipment and materials, and other related costs.

8. Contract/Program Location HBLR Line - Jersey City/Hudson County

9. Amount Expended to Date Total Project: $10,187,157

EisnerAmper: $23,525.75

10. Amount Provided to other State or Local Entities None

11. Completion Status of Contract or Program In progress

12. Expected Contract End Date/Time Period 12/31/2019


Reports required under A-60 will be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by

the Disaster Relief Appropriations Act.

Page 1 of 4

State of New Jersey




Engagement:









and its support.

Not applicable




Conducted safety training with TFC at HBLR HQ. Conducted site tour of

HBLR HQ including shop and yard and Mill Creek CIH with various

members of TFC and NJT representatives. Conducted initial introduction

meeting with TFC personnel at HBLR HQ with NJT representatives in

attendance. Conducted separate interviews with TFC personnel.




Obtained copies of various workpapers for NPC 8 (32 Mainline Switches)

and NPC 10A (Mill Creek CIH Rehabilitation and Installation) as

requested; March and April 2016 NJT Monthly Progress Report - Sandy

Projects; TFC organization chart



contracts and agreements.

Not applicable

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State of New Jersey




Engagement:










Not applicable


abuse.

Submitted additional document requests, reviewed documents provided,

conducted interviews with various TFC personnel.

19. Provide details of any integrity issues/findings None noted


preservation issue(s).

None noted


quarter

None noted

Page 3 of 4

State of New Jersey




Engagement:










None noted

C. Miscellaneous


integrity monitoring review

See attached hours summary.

24. Add any item, issue or comment not covered in previous sections but

deemed pertinent to monitoring program.

None noted

Name of Integrity Monitor: EisnerAmper LLP

Name of Report Preparer: Elliott Lee

Signature:

Date: 1/3/2017

Page 4 of 4

State of New Jersey

Department of Treasury


Attachment for Question #23

Professional Hours

David A. Cace 0.30

Robert Bright 1.00

Elliott Lee 15.95

Timothy Van Noy 26.00

Maureen Egan 4.75

Nicole Griffin 13.50

Adam Karasick 0.50

Tariq Boston 4.00

Marisol Gonzalez 3.25Stephanie Blue 1.00

70.25

State of New Jersey



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Firm Name: Grant Thornton LLPEngagement: PVSC Integrity Oversight Monitor EQ2015-001-PS



1. Recipient of funding Passaic Valley Sewerage Commission (PVSC)

2. Federal Funding Agency? (e.g. HUD, FEMA) FEMA

3. State Funding (if applicable) N/A

4. Award Type FEMA 406 Restoration and 406 Mitigation Funding

5. Award Amount $446.1 million

6. Contract/Program Person/Title E. David Barth, Grant Thornton Project Manager

7. Brief Description, Purpose and Rationale of Project/Program Passaic Valley Sewerage Commission has received federal FEMA funding in the amount $446.1 million through 47 different Project Worksheets (PW). The scope of Grant Thornton's work is limited to 12 specific contracts whose anticipated value will exceed $5 million. As of September 30, 2016 only four contracts exceeded the integrity monitoring threshold: 1) Temporary By-Pass Cabling - Travis A919 Contract; 2) Administration Controls Building - Fine Wall Contract; and 3) Program Management Services - AECOM/HDR Contract; and one contract is anticipated to exceed the threshold: 4) Additional By-Pass Cabling - Travis B036 Contract.

8. Contract/Program Location PVSC, 600 Wilson Avenue, Newark, NJ

9. Amount Expended to Date As of September 30, 2016 the following payments (associated with the four contracts) have been made: 1) Travis - $15,828,782; 2) Fine Wall - $4,246,416; 3) AECOM/HDR - $4,050,825; and 4) Travis - $659,067 .

10. Amount Provided to other State or Local Entities $0

11. Completion Status of Contract or Program The Completion Status for each of the four contracts, currently subject to our review, is as follows: 1) Travis - Temporary By-Pass Cabling. The work authorized under this contract has been completed. A replacment contract was awarded on March 22, 2016. 2) Fine Wall - Administration Controls Building - This construction project was advertised on March 4, 2015 and awarded on June 4, 2015. PVSC issued the Notice to Proceed on September 14, 2015. As of September 30, 2016 approximately 70% of the contract work had been completed. 3) AECOM/HDR - Program Management Services. The AECOM/HDR contract was awarded on February 13, 2015. The initial contract period is for two years. PVSC issued the Notice to Proceed on April 2, 2015. As of September 30, 2016 approximately 63% of the contract work had been completed. 4) Travis - Additional By-Pass Cabling. The contract award was authorized on March 10, 2016 as a two year term contract with individual Task Orders being issued for specific work. As of September 30, 2016, 58% of the authorized work has been completed.

Reports required under A-60 will be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by the Disaster Relief Appropriations Act.

State of New Jersey



Page 2 of 4





12. Expected Contract End Date/Time Period The contract end dates for the four contract currently subject to our review are as follows: 1) Travis - March 22, 2016; 2) Fine Wall - October 28, 2016; 3) AECOM/HDR - April 5, 2017 and 4) Travis - March 10, 2018



Grant Thornton is currently monitoring four projects. Funding is provided primarily through two Project Worksheets (PW): PW 4701 (Substations and Cables) supports the Travis Inc. (Temporary By-Pass Cabling and Additional By-Pass Cabling) and AECOM/HDR (Program Management Services) contracts . The authorized/eligible amount for PW 4701 is $406.9 million. PW 4803 (Administration Controls Building) supports the Fine Wall (Administration Controls Building) contract. PW 4803's authorized amount is $10.6 million. In addition to the specific work of these contracts, the PWs also funds other work not currently part of our review either because the contract values are less than the $5 million threshold or the proposed projects have not been initiated.


Grant Thornton's activities during this quarter included attendance at the Bi-Weekly FEMA Coordination Meetings and Monthly Construction Progress Meetings for the Administration Controls Building. During the quarter Grant Thornton communicated on a monthly basis the status of its' monitoring activities to the Treasury Integrity Monitor Liaison. During the quarter Grant Thornton met with PVSC on the following dates: July 13, 2016 - PVSC Purchasing Agent; July 13, 2016 - PVSC Engineering, AECOM-HDR, NJOEM and NJDEP; July 19, 2016 - Construction Progress Meeting; July 20, 2016 - PVSC Purchasing Agent; July 27, 2016 - PVSC Engineering, AECOM-HDR, NJOEM and NJDEP; July 27, 2016 - PVSC Chief Financial Officer; August 1, 2016 - AECOM-HDR; August 10, 2016 - PVSC Engineering, AECOM-HDR, NJOEM, and NJDEP; August 11, 2016 - PVSC Engineering and AECOM-HDR; August 16, 2016 - Construction Progress Meeting; August 17, 2016 - PVSC Engineering and AECOM-HDR; August 30, 2016 - PVSC Engineering and Hatch Mott and MacDonald; September 7, 2016 - PVSC Engineering, AECOM-HDR, NJOEM and NJDEP; September 7, 2016 - PVSC Chief Financial Office and Purchasing Agent; September 7, 2016 - PVSC Engineering; September 14, 2016 - PVSC Executive Director and PVSC Engineering; September 20, 2016 - Construction Progress Meeting.


PVSC has provided Grant Thornton copies of Travis, Fine Wall and AECOM/HDR invoices and supporting documentation With this information Grant Thornton was able to confirm PVSC's compliance with FEMA and/or State administrative grant requirements and processes; and identify any issues that represented potential loss of Federal reimbursements.

State of New Jersey



Page 3 of 4






During the Quarter Grant Thornton continued its in depth review of the Travis invoices paid under the Temporary By-Pass (A919) contract between March 2016 and May 2016 and began the review of Travis invoices paid under the Additional By-Pass Cabling (B036) contract . Grant Thornton continued its review of the AECOM-HDR and Fine Wall Construction invoices for the Program Management Services and Administration Controls Building contracts respectively to verify compliance with contract pricing.


During the Quarter Grant Thornton reviewed 1) 10 invoices submitted by Travis and paid by PVSC for the Temporary By-Pass Cabling; 2) 2 invoices submitted by Fine Wall and paid by PVSC for the Administration Controls Building; 3) 1 invoice submitted by AECOM/HDR for Program Management Services; and 4) 8 invoices submitted by Travis under the Additional By-Pass Cabling contract. In aggregate, as of September 30, 2016, Grant Thornton has reviewed 130 of 155 Travis (A919) invoices, 9 of 9 Fine Wall invoices and 15 of 16 AECOM/HDR invoices; and 8 of 12 Travis (B036) invoices. The total value of the 155 Travis invoices represents $15.83 million. The total value of the 9 Fine Wall invoices is $4.25 million. The total value of the 16 AECOM/HDR invoices represents $3.88 million. The total value of the 12 Travis invoices under the B036 contract is $659,067.


During the Quarter Grant Thornton worked with PVSC Engineering and Finance staff to review and reconcile the supporting documentation that may be questionable. PVSC has provided Grant Thronton the requested documentation. All questions have been answered.

19. Provide details of any integrity issues/findings None noted

20. Provide details of any work quality or safety/environmental/historical preservation issue(s).

During this quarterly period Grant Thornton's construction oversight was limited to the Administration Controls Building Construction. Based on our site visits we did not observe any work quality, health and safety, environmental or historical preservation issues.

21. Provide details on any other items of note that have occurred in the past quarter

PVSC has provided Grant Thornton access to its procurement, financial and administrative files necessary to perform our reviews.

22. Provide details of any actions taken to remediate waste, fraud and abuse noted in past quarters

No action has been taken or been necessary during the quarter. Issues noted in previous quarters have been addressed prior to this quarter.

C. Miscellaneous

23. Attach a list of hours and expenses incurred to perform your quarterly integrity monitoring review

See Attached Time and Expense Report. During the quarter Grant Thornton provided a total of 326.25 hours for a cost of $51,519.53

State of New Jersey



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24 Add any item, issue or comment not covered in previous sections but deemed pertinent to monitoring program.

Based on our review of PVSC’s financial and administrative processes, we concluded that PVSC’s processes are appropriate for complying with FEMA grant management requirements and NJOEM standards. PVSC’s financial and administrative processes provide the framework for ensuring that the functions adhere to grant program guidelines, procurement rules and reporting requirements. Proper controls appear to be in place to minimize the risk of deobligation of federal funds; duplication of benefits; process and payment errors; and waste, fraud and abuse.

PVSC’s financial and administrative processes provide the framework for ensuring that the functions adhere to grant program guidelines, procurement rules and re

Name of Integrity Monitor: Grant Thornton LLPName of Report Preparer: Jack Reagan

Signature:

Date: 3-Jan-17

PVSC Integrity Monitor - Time and Expense ReportHours Subtotal Hours Labor Travel Total

Project Name - ID: PVSC Kick-Off Mtg Task A / 100233.00.00A.00A 0.00 0.00 -$ -$ -$

Project Name - ID: PVSC Fin&AdminRevw Task B / 100233.00.00B.00B 0.00 0.00 -$ -$ -$

Project Name - ID: PVSC Travis Tsk C / 100233.00.001.01C 35.50Project Name - ID: PVSC Travis Tsk D / 100233.00.001.01D 0.00Project Name - ID: PVSC Travis Tsk E / 100233.00.001.01E 0.35Project Name - ID: PVSC Travis Tsk F / 100233.00.001.01F 2.55 38.40 5,450.06$ 8.13$ 5,458.19$

Project Name - ID: PVSC Fine Wall Tsk C / 100233.00.002.01C 0.00Project Name - ID: PVSC Fine Wall Tsk D / 100233.00.002.01D 38.00Project Name - ID: PVSC Fine Wall Tsk E / 100233.00.002.01E 3.95Project Name - ID: PVSC Fine Wall Tsk F / 100233.00.002.01F 2.55 44.50 5,671.72$ 190.88$ 5,862.60$

Project Name - ID: PVSC AECOM/HDR Tsk C / 100233.00.003.01C 36.75Project Name - ID: PVSC AECOM/HDR Tsk D / 100233.00.003.01D 1.00Project Name - ID: PVSC AECOM/HDR Tsk E / 100233.00.003.01E 46.70Project Name - ID: PVSC AECOM/HDR Tsk F / 100233.00.003.01F 2.55 87.00 14,573.20$ 281.68$ 14,854.88$

Project Name - ID: PVSC Floodwall Eng Tsk C / 100233.00.004.01C 5.50Project Name - ID: PVSC Floodwall Eng Tsk D / 100233.00.004.01D 0.00Project Name - ID: PVSC Floodwall Eng Tsk E / 100233.00.004.01E 1.95Project Name - ID: PVSC Floodwall Eng Tsk F / 100233.00.004.01F 2.55 10.00 1,875.93$ 31.97$ 1,907.90$

Project Name - ID: PVSC Floodwall Const TskC / 100233.00.005.01C 0.00Project Name - ID: PVSC Floodwall Const TskD / 100233.00.005.01D 0.00Project Name - ID: PVSC Floodwall Const TskE / 100233.00.005.01E 0.00Project Name - ID: PVSC Floodwall Const TskF / 100233.00.005.01F 0.00 0.00 -$ -$ -$

Project Name - ID: PVSC Power Gen Eng Tsk C / 100233.00.006.01C 30.00Project Name - ID: PVSC Power Gen Eng Tsk D / 100233.00.006.01D 0.00Project Name - ID: PVSC Power Gen Eng Tsk E / 100233.00.006.01E 2.20Project Name - ID: PVSC Power Gen Eng Tsk F / 100233.00.006.01F 2.55 34.75 6,705.56$ 31.97$ 6,737.53$

Project Name - ID: PVSC Power Gen Const TskC / 100233.00.007.01C 0.00Project Name - ID: PVSC Power Gen Const TskD / 100233.00.007.01D 0.00Project Name - ID: PVSC Power Gen Const TskE / 100233.00.007.01E 0.00Project Name - ID: PVSC Power Gen Const TskF / 100233.00.007.01F 0.00 0.00 -$ -$ -$

Project Name - ID: PVSC Phase 2 RepairsTsk C / 100233.00.008.01C 0.75Project Name - ID: PVSC Phase 2 RepairsTsk D / 100233.00.008.01D 0.00Project Name - ID: PVSC Phase 2 RepairsTsk E / 100233.00.008.01E 0.35Project Name - ID: PVSC Phase 2 RepairsTsk F / 100233.00.008.01F 2.55 3.65 650.28$ 13.37$ 663.65$

Project Name - ID: PVSC Motor Controls Tsk C / 100233.00.009.01C 0.00Project Name - ID: PVSC Motor Controls Tsk D / 100233.00.009.01D 0.00Project Name - ID: PVSC Motor Controls Tsk E / 100233.00.009.01E 1.60Project Name - ID: PVSC Motor Controls Tsk F / 100233.00.009.01F 2.55 4.15 739.36$ 7.40$ 746.76$

Project Name - ID: PVSC Mtr/PmpRepairs Tsk C / 100233.00.010.01C 0.75Project Name - ID: PVSC Mtr/PmpRepairs Tsk D / 100233.00.010.01D 0.00Project Name - ID: PVSC Mtr/PmpRepairs Tsk E / 100233.00.010.01E 1.60Project Name - ID: PVSC Mtr/PmpRepairs Tsk F / 100233.00.010.01F 2.55 4.90 872.98$ 13.38$ 886.36$

Project Name - ID: PVSC PAC Motors Elec TskC / 100233.00.011.01C 0.00Project Name - ID: PVSC PAC Motors Elec TskD / 100233.00.011.01D 0.00

PVSC Integrity Monitor - Legislative Quarterly Report

July 1, 2016 to September 30, 2016

Project Name - ID: PVSC PAC Motors Elec TskE / 100233.00.011.01E 1.35Project Name - ID: PVSC PAC Motors Elec TskF / 100233.00.011.01F 2.55 3.90 694.82$ 7.57$ 702.39$

Project Name - ID: PVSC AddByPassCablingTskC / 100233.00.012.01C 85.75Project Name - ID: PVSC AddByPassCablingTskD / 100233.00.012.01D 0.00Project Name - ID: PVSC AddByPassCablingTskE / 100233.00.012.01E 6.70Project Name - ID: PVSC AddByPassCablingTskF / 100233.00.012.01F 2.55 95.00 13,651.60$ 47.67$ 13,699.27$

Overall 326.25 326.25 50,885.51$ 634.02$ 51,519.53$

State of New JerseyDepartment of TreasuryIntegrity Monitor ReportMiddlesex County Utility Authority ‐ Pumping Stations Contract # T‐2939; EQ2014‐004‐P2&P3For Quarter Ending: 9/30/2016

The reporting period for this report is July 1, 2016 through September 30, 2016

No. Recipient Data Elements Response

A. General Info1. Recipient of funding Middlesex County Utility Authority (MCUA)

2. Federal Funding Agency? (e.g. HUD, FEMA)

FEMA

3. State Funding (if applicable) Not Applicable

4. Award Type Grant5. Award Amount Awarded Contractors and Award Amounts for Permanent Restoration and Mitigation work on Sayreville and Edison Pumping Stations is TBD.

6. Contract/Program Person/Title Permanent Restoration and Mitigation work on Sayreville and Edison Pumping Stations ‐ TBDProgram Person: Richard Fitamant, Executive Director

7. Brief Description, Purpose andRationale of Project/Program

During the ongoing incident period of Post Super Storm Sandy, beginning on October 26, 2012, the Middlesex County Utilities Authority (MCUA or Sub‐grantee) suffered substantial damage to its Pump Stations.

MCUA's Sayreville Pump Station (SPS) utilizes six (6)‐50 MGD (Million Gallons Daily) pumps and four (4)‐40 MGD pumps to pump approximately 70 MGD of dry weather sanitary flow to 300 MGD of wet weather sanitary flow from 30 municipalities in Middlesex and Somerset counties to the central treatment plant. The storm surge inundated and damaged its onsite electrical substation and controls. Also, due to salt water intrusion the pumps, pump fittings, and pump motors were compromised and rendered inoperable.

MCUA also owns and operates the Edison Pump Station (EPS), which is a regional raw sewage pumping facility that encompasses approximately 1.2 acres in Woodbridge, New Jersey. EPS pumps approximately 85 MGD of average daily dry weather sanitary flow from Carteret, Perth Amboy, Edison, and Woodbridge.

MCUA engaged emergency contractors immediately after Super Storm Sandy to perform emergency clean‐up, dewatering and restoration activities for both the original Sayreville Pumping Station and the Sayreville Relief Pumping Station resulting from storm damage.

The Sub‐grantee, through the New Jersey Office of Emergency Management (Grantee) has requested public assistance funding from the Federal Emergency Management Agency (FEMA) to fund permanent mitigation projects at Sayreville Pumping Station and Edison Pumping Station. This funding is in accordance with the Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1974 (42 U.S.C. 5172), as amended; the Sandy Recovery Improvement Act (SRIA) of2013; and the accompanying Disaster Relief Appropriations Act, 2013.

Thie Hazard Mitigation Project for SPS and EPS include improvements and the construction of a floodwall. These projects are intended to maintain continuous operation of the Sayreville and Edison Pumping Stations as required by regulations, thereby greatly reducing the potential for untreated sewage discharges from the SPS as a result of equipment failures, power outages, and flooding.

Under Section A‐60, this report must be submitted by Integrity Monitors on the first business day of each calendar quarter to the State Treasurer and will contain detailed information on the projects/contracts/programs funded by the Disaster Relief Appropriations

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KPMG - Middlesex County Utilities Authority





8. Contract/Program Location Middlesex County Utility Authority2571 Main Street Sayreville, NJ 08872

9. Amount Expended to Date Permanent Restoration and Mitigation work on Sayreville and Edison Pumping Stations ‐ $0.00


Not Applicable

11. Completion Status of Contract or Program

Emergency Work for Sayreville Pumping Station‐ 100% Complete.Sayreville and Edison Pumping Stations Permanent Restoration and Mitigation ‐ NTP in November 2016

12. Expected Contract End Date/Time Period

Sayreville and Edison Pumping Stations Permanent Restoration and Mitigation ‐ November 2016 ‐ November 2019



Funding for the approved Hazard Mitigation Proposals (HMP) was obligated under the respective FEMA PWs for Sayreville and Edison Pump Station.

• For Sayreville Pump Station PW 5061, the HMP represents $61,659,218.32 of the project worksheet’s total value of $73,877,840.25.• For Edison Pump Station PW 5075, the HMP represents $11,799,830.00 of the project worksheet’s total value of $15,760,971.59. Pursuant to the approved project worksheet, this HMP includes the construction of a floodwall surrounding the Edison Pump Station, the construction of an isolation vault with a bypass pumping system, and the construction of a riser ring to elevate the Northwest Access Shaft & Tunnel top slab above the design 500‐year flood elevation.

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This quarter, MCUA was in the process of finalizing and issuing the construction contractor solicitations for both pumping stations, resulting in minimal integrity monitoring work during the pre‐construction period.


This quarter, MCUA was in the process of finalizing and issuing the construction contractor solicitations for both pumping stations, resulting in minimal integrity monitoring work during the pre‐construction period.

14. July 21, 2016: Meeting with R3M Engineering to discuss current status of upcoming permanent repairs work for the SPS and EPS.

• MCUA received bids for both SPS and EPS on the 15th and 17th of June, respectively.• MCUA was set to award both contracts at the Commissioner’s Meeting on June 23rd,• On the morning of June 23rd, a “challenge” was posted for the SPS. • The apparent low bidder did not have all the required licenses. • The second low bidder was almost $7 million higher than the low bidder. • MCUA rejected all bids as they were concerned about justifying this difference to FEMA, and is currently in the process of re‐bidding the SPS project.• The EPS contract was awarded to Walsh Construction on June 23rd. MCUA is in the process of finalizing their contract and NJEIT funding documentation to commence with loan close out. • MCUA was contacted by Department of Community Affairs (DCA) that a contractor is contesting the EPS contract.

August 23, 2016: Discussed status of contractor bid and award process with R3M.• The EPS project was issued a Notice to Proceed the week of August 14th.• The SPS project is being rebid, and the bid opening has been rescheduled for September 1, 2016. MCUA plans a special meeting to award the contract on September 8, 2016.

September 8, 2016: Conversation with R3M Engineering to discuss the SPS flood mitigation and permanent restoration contract award. •The contract was awarded to the lowest qualified bidder, Northeast Remsco Construction, in the amount of $67,398,000. •This bid was 8.3 percent below the Engineer’s Opinion of Probable Construction Cost of $73,500,400.

• Northeast Remsco has previous experience working with MCUA performing the Replacement of Bar Screens Contract at SPS.• MCUA and Northeast Remsco are also currently working together on the following two projects: Contract 13‐9‐3: Dewatering Odor Control System Rehabilitation and Contract 13‐1‐1: Primary Tank Rehabilitation, Phase II.

September 20, 2016: As requested by KPMG, R3M Engineering provided the following documents related to the SPS recent bid and award:• Contract drawings and specifications• Bid packages from all five bidders• Proof of Advertisement• Bid tabulations• Recommendation to Award letter

Quarterly Activities/Project Description (include number of visits to meet with recipient and sub recipient, including who you met with, and any site visits warranted to where work was completed)

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Conducted periodic discussions with the owner's representative, R3M, to understand the status of procurement and contracting processes for both SPS and EPS. This quarter, MCUA was in the process of finalizing and issuing the construction contractor solicitations for both pumping stations, resulting in minimal integrity monitoring work during the pre‐construction period.

19. Provide details of any integrity issues/findings No noted issues this quarter.


No noted issues this quarter.


No other items to note this quarter.

C. Miscellaneous


Attached. See July ‐ September 2016 Time & Expense Summary Tab.

24. Add any item, issue or comment not covered in previous sections but deemed pertinent to monitoring program.

None.

Name of Integrity Monitor: KPMG

Name of Report Preparer: Kevin Max

Signature:

Date: 12/30/2016

No actions required.Provide details of any actions taken to remediate waste, fraud and abuse noted in past quarters

22.

No contractor payment requisitions were issued this period. Have payment requisitions in connection with the contract/program been reviewed? Please describe

17.

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Resource Hours Incurred (July ‐September)

Kevin Max 0.00Ryan Coco 2.00John Christensen 1.00Grand Total 3.00

Resource AmountKevin Max 0.00

Ryan Coco0.00

John Christensen 0.00

Grand Total 0.00

Time Summary

Expense Summary

Jul-Sept Time&Expense Summary

of 15

State of New JerseyDepartment of TreasuryIntegrity Oversight Monitoring Reporting Model

Firm Name: Navigant Consulting Inc.Engagement: EQ2014-002-P3-DCA Sandy Contracts


No.Recipient Data Elements

Response Comments

1. Recipient of Funding The New Jersey Department of Community Affairs ("DCA"), Sandy Recovery Division ("SRD"), is the direct recipient of funding from the United States Department of Housing and Urban Development ("HUD"), Community Development Block Grant, Disaster Recovery Program ("CDBG-DR") to address the massive property damage inflicted by Superstorm Sandy. DCA retained several contractors, who fall under the purview of the New Jersey Integrity Oversight Monitor Act ("A-60"), to assist it in managing various programs designed to distribute CDBG-DR funds to eligible New Jersey residents and businesses. These Contractors include the Gilbane Building Company ("Gilbane"), CB&I Shaw ("CB&I"), and the URS Group, which were retained to manage the Rehabilitation, Reconstruction, Elevation and Mitigation Program ("RREM"); Gilbane, which was retained to manage the Landlord Rental Repair Program ("LRRP"); CGI Federal ("CGI"), which was retained to create and manage the Sandy Integrated Recovery Operations and Management System ("SIROMS"), an information technology solution to assist DCA in managing its SRD programs; Hammerman & Gainer ("HGI"), which was retained to manage the housing application process for the SRD's various housing programs; ICF, Inc., which was retained to provide subject matter expertise and staffing augmentation services to DCA; and Cohn Reznick, which was retained to serve as DCA's internal integrity monitor.

2. Federal Funding Agency? (e.g. HUD, FEMA) HUD

3. State Funding (if applicable) None

4. Award Type HUD CDBG-DR Award

5. Award Amount Gilbane (RREM): $75,194,441; Gilbane (LRRP): $10,779,405CB&I/Shaw: $92,011,031CGI: $77,945,831ICF: $77,526,395


A. General Info

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Response Comments


6. Contract/Program Person/Title RREM and LRRP: David Mazzuca, Assistant Director, Housing Recovery Programs, DCA; Terrie Quintero, Senior Contracting Manager, DCASIROMS and Sandy Grant Manager Module ("SGM"): Joyce Paul, SIROMS Manager. ICF: Elizabeth Mackay, Assistant Director, Procurement & Legal


RREM provides CDBG-DR awards of up to $150,000 to eligible homeowners to restore homes damaged by Superstorm Sandy.LRRP provides CDBG-DR awards of up to $50,000 per unit to owners of rental properties with between 1 and 25 units that require rehabilitation as a result of Superstorm Sandy.SIROMS, developed and administered by CGI, manages all of DCA’s Superstorm Sandy funding requests from State agencies, local governments and school districts, as well as all HUD reporting obligations. SGM, a grant tracking system, was developed by CGI. It has replaced the eGrant system developed by HGI.ICF provides strategic advice, program implementation, subject matter expertise and staff augmentation services to DCA.Superstorm Sandy Housing Incentive Program ("SSHIP") covered the completion and processing of housing program applications, and the determination of eligibility and disbursement of funds under the Resettlement Incentive Program, and the RREM and LRRP Programs. HGI was the original contractor selected to manage SSHIP, but prior to the beginning of Navigant's monitorship, DCA and HGI, by mutual agreement, terminated HGI's role as the SSHIP contractor. In May 2015, DCA and HGI entered into a mutually agreed settlement to resolve HGI’s performance issues and the amounts billed by HGI and unpaid by DCA. DCA assumed responsibility over HGI's duties at the Superstorm Sandy Housing Recovery Centers, and CGI assumed responsibility for migrating applicant data from HGI's eGrants system to CGI's SGM system. CGI has completed the migration of data from eGrants to SGM, and is managing the data for the RREM and LRRP programs going forward.

8. Contract/Program Location Trenton, New Jersey

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Response Comments


9. Amount Expended to Date Amounts are based on current invoice totals as of September 30, 2016: Gilbane (RREM): $56,062,155; Gilbane (LRRP): $9,361,778CB&I/Shaw: $62,476,521CGI Federal: $58,322,160ICF: $67,575,857


N/A

11. Completion Status of Contract or Program Completion Status based on contract values and invoiced amounts as of September 30, 2016:RREM (Gilbane/CB&I Shaw): approximately 72%LRRP (Gilbane): approximately 87%SIROMS/SGM (CGI): approximately 75%*ICF: approximately 87%

12. Expected Contract End Date/Time Period RREM (Gilbane & CB&I Shaw): May 22, 2017 LRRP (Gilbane): June 30, 2017 CGI: May 24, 2017ICF: May 24, 2017


N/A


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Response Comments



Navigant's integrity oversight monitoring activity for the Third Quarter 2016 focused principally on three areas: (1) reviewing the invoices of the RREM Contractor Gilbane and their hazmat subcontractors; (2) commencing our Pathway B homeowner payment review and (3) continuing our comprehensive technical electronic analysis of RREM and LRRP application data to identify potentially problematic files for further review. During this quarter, we conducted six (6) meetings or teleconferences with State of NJ Department of the Treasury, DCA, Gilbane and CB&I.

A. Invoice Review:

Throughout the Quarter, we continued our review of Gilbane's hazmat subcontractor (“subcontractor”) invoices and related supporting documentation, and continued: (1) Follow up discussions with Gilbane to obtain clarification and supporting documentation to address the potential subcontractor invoice discrepancies that were reported in the prior Quarter’s report;(2) Updating our invoice database based on additional relevant supporting documentation provided by Gilbane; and (3) Our review of subcontractor invoices, hazmat reports and related supporting documentation to identify and track additional potential discrepancies in the subcontractor invoiced amounts.

Navigant reported in the prior Quarter’s report that we were performing an analysis of invoices submitted by two of Gilbane's subcontractors whichrevealed potential findings and that in this Quarter we would (1) continue to follow up with Gilbane during the next quarter to obtain the necessaryadditional supporting documentation and (2) quantify the invoice discrepancies that may result in a credit to the State. Navigant provides the followingupdates with regards to the potential findings that were reported in the prior Quarter’s report:

Potential Findings for Gilbane Subcontractor #1 – Shift Rate Contract Modifications Not Executed:According to our review, Subcontractor #1 submitted invoices totaling approximately $1.98 million. These invoices were also included with Gilbane’s invoice submissions to DCA.

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Response Comments


In our prior Quarter’s report, our review of the detailed invoice support provided for this subcontractor determined that they billed for certain hazmatrelated tasks and associated unit prices that were not authorized in their contract with Gilbane. There are three (3) separate issues we have identifiedin connection with the contract modifications. First, this subcontractor billed $150 per home for the preparation of abatement cost estimates for homesthat were determined to contain asbestos or lead risks. These billings totaled $174,600. Second, the subcontractor also utilized a higher daily shift rateof $2,200 for inspections conducted on the weekends for an incremental increase of $42,000. Finally, the subcontractor also billed at higher rates,ranging from $1-$6 per sample, for asbestos and lead samples collected during the field inspections and sent to the lab for the analysis of hazmat risks.These hazmat sample billings at the higher rates resulted in increased billings of $39,785.

Gilbane advised Navigant that expedited testing was necessary for the asbestos and lead samples collected from initial site inspections (“ISI’s”) ofapplicant homes in order to comply with DCA requirements and also to avoid any impact on subsequent dependent work flow processes. Gilbanefurther advised that due to challenges encountered at the onset of the RREM program (i.e. homeowner scheduling delays affecting the DCA turnaroundtime for ISI’s), Gilbane issued verbal authorizations to its subcontractors, and later followed up with an email authorizing the subcontractors to bill theshift rates and the lead/asbestos sample collections at the higher unit prices. Accordingly, Gilbane conceded that although the original agreements didnot reflect the higher unit prices for the shift rates and sample collections, and were not modified to reflect the amended unit prices, these prices wereknown and agreed to in advance between Gilbane and the subcontractor.

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Response Comments


Navigant’s review noted that the amended unit rates that were billed in this subcontractor’s invoices were referenced in contemporaneousdocumentation between Gilbane and the subcontractor by an email dated July 9, 2013, and Gilbane’s Modification #1 dated July 12, 2013.

Navigant therefore recommended that Gilbane formally update and modify this subcontractor’s agreement to properly incorporate the additional unititems and prices in order to properly reconcile the subcontractor’s contract with the subcontractors' and subsequently, Gilbane's billings. Gilbane hasagreed to modify the agreement to include the amended unit prices.

During the next quarter, Navigant will continue its review of this subcontractor’s invoices and the corresponding hazmat lab reports to identify anyadditional potential discrepancies, and Navigant will follow up with Gilbane for clarification and supporting documentation, as necessary.

Potential Findings for Gilbane Subcontractor #2:According to our review, Subcontractor #2 submitted invoices totaling approximately $1.1 million. These invoices were also included with Gilbane’s invoice submissions to DCA.

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Response Comments


Finding A: - Overbilling for Duplicate Shift Rates:In our prior Quarter’s report, we reported that this subcontractor’s invoices included potential discrepancies wherein the subcontractor billed more than one $1,700 daily shift rate when more than one field inspector visited and performed a single hazmat inspection on the same day. These billings for duplicate shift rates totaled $34,500 and were passed through by Gilbane to DCA for payment.

During the quarter, Navigant’s review also noted that Gilbane identified additional duplicate shift rate billings by this subcontractor. The additional duplicate shift rate billings totaled $93,500. Our review determined that Gilbane made the proper reductions to the subcontractor’s invoices for these overbillings and did not submit them to DCA for payment.

Navigant is continuing its analysis to validate and finalize our preliminary determination that this subcontractor overbilled an additional $34,500 related to duplicate daily shift rates and to identify any additional potential overbillings involving duplicative daily shift rates that this subcontractor billed before a final quantification can be made for the total potential overbilled amount, and the amount of credit that the State should expect from Gilbane.

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Response Comments


Finding B: - Revised Pricing Contract Modifications Not Executed:In our prior Quarter’s report, we reported that our analysis of a sample of hazmat reports and supporting lab results revealed some potential quantity and pricing discrepancies in the subcontractor’s billings.

During the quarter, Gilbane obtained clarification from the subcontractor for these potential discrepancies. Gilbane provided Navigant with a pricing table that included an additional set of asbestos and lead sample unit prices that Gilbane authorized this subcontractor to bill. This set included higher unit rates charged by the subcontractor to provide a shortened turnaround time for lab analyses and the subcontractor’s report. Similar to the circumstances and justification provided by Gilbane for amended unit rates authorized for Subcontractor #1, Gilbane did not modify their contract with the subcontractor to reflect the amended unit prices and pricing table. Navigant therefore recommended that Gilbane formally update and modify this subcontractor’s agreement to properly incorporate the additional hazmat unit prices referenced in the pricing table to properly reconcile the subcontractor’s contract with the subcontractor's and subsequently, Gilbane's billings. Gilbane has agreed to modify the agreement to include the amended unit prices.

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Response Comments


Additionally, Gilbane provided clarification on asbestos and lead samples that were collected during ISI’s that were not analyzed by the lab due to “stop positive” or “insufficient materials.” Gilbane explained that although the lab did not analyze these samples, the subcontractor should have billed a $10 prep fee per sample in lieu of billing the analysis unit prices for the appropriate hazmat sample type.

During the next quarter, Navigant will continue its review of this subcontractor’s invoices and the corresponding hazmat lab reports to identify any additional potential pricing and quantity discrepancies, and Navigant will follow up with Gilbane for clarification and supporting documentation, as necessary.

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Response Comments


B. Meetings and Inspections:During the quarter, Navigant participated in meetings with each of Gilbane and CB&I in order to understand their internal procedures for receiving, reviewing, recommending approval, and then maintenance of documentation for draw requests submitted by either applicants in the RREM program (Pathway A and B), or homebuilders hired as part of the RREM program (Pathway C). The draw requests pertain to Advance Payments, Design Draw Requests, 'standard' Draw Requests, and Final Release of Funds from an applicant's grant award.

The review with Gilbane was performed in person in which Gilbane walked Navigant through the steps and documentation that they review for each draw request received from applicants in the RREM program. Gilbane's process is multi-stepped in which internal teams each perform reviews based on the required documentation to ensure each draw request is complete, accurate and includes the appropriate support as required in the form of photos or invoices.

All documentation received is maintained in both hard copy and electronically. The hard-copy files are maintained by Gilbane in secure file cabinets in a room accessible only to Gilbane employees. The electronic files are maintained both on SIROMS, and on an internal Gilbane server. At closeout, each applicant's files on SIROMS will be fully checked and verified to ensure completeness, providing the ability for the duplicative data on the Gilbane server to be subsequently deleted and destroyed.

The review with CB&I was performed via teleconference. CB&I personnel walked us manually through the steps and documentation that they review for each draw request received from applicants in the RREM program. A more detailed review of the CB&I process has been scheduled to be performed in person in the next quarter. A similar set of checks and balances for draw request reviews was communicated by CB&I, and both electronic and hard copy files are maintained as required by DCA until applicant closeout.

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Response Comments


The current processes employed by both contractors appears to be sufficient to ensure draw requests are properly documented, supported, and maintained as required. In the following quarter, a more detailed review of sample draw requests will be performed, initially with personnel from each of the contractors, and then electronically via Navigant personnel performing reviews of documentation as available on SIROMS, and as required by the program.

In the next quarter Navigant will continue our review of the draw request process and Gilbane and CB&I's procedures and processes for reviewing draw requests to ensure accuracy and that they are in accordance with the RREM program and the approved scope of work outlined in the ECR and Grant Award.

C. Technical Electronic Analyses:

During the Quarter, Navigant continued our comprehensive review of SIROMS application data to identify potentially problematic applications for further review.

This Quarter, the Navigant team received a listing of known twin applicants from DCA as part of an independent review of applications with the same, or substantially similar, damaged property addresses between RREM and LRRP applications. During the Quarter, Navigant ingested the listing received from DCA and began comparison of the contents of the DCA report to the results of our initial analysis. This comparison will continue into the next Quarter.

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Response Comments



Navigant obtained (1) from DCA, invoice-related documentation (2) from DCA, supplemental applicant related data (3) from the Contractors, regular schedules of their planned RREM applicant meetings and inspections, and some, but not all, of the invoice-related documentation requested; and (4) from CGI, data extracts containing the historical RREM and LRRP application structured data available at the time of the data migration, the current RREM and LRRP application structured data available when the extract was prepared, and the current audit trail of changes made to the RREM and LRRP application data available when the extract was prepared. This data and information was utilized in the analyses described in paragraph 14 above.


As described in paragraph 14 above, during this Quarter, Navigant reviewed the invoices of the RREM and LRRP Contractor and their subcontractors for potential billing irregularities, commenced our Pathway B homeowner payment review, and continued our comprehensive technical electronic analyses of RREM and LRRP application data to identify potentially problematic files for further review.


As described in paragraph 14 above, during this Quarter, Navigant continued reviewing the RREM and LRRP Contractor invoices and their subcontractor invoices, and updated our invoice database to compile relevant invoice details for further analysis. This database enables us to verify the mathematical accuracy of invoiced amounts, validate the invoiced unit rates, identify any second-tier subcontractors, track the amount of the subcontractors’ billings to date, track total amounts billed by subcontractors to the terms of their subcontractor agreements or purchase orders, and conduct additional invoice analytics based on the RREM and LRRP application numbers and other key information and underlying source documents. Although many of the previously reported subcontractor billing issues have been resolved there are a few issues that continue to be reviewed and a comprehensive set of findings is expected to be completed during the next Quarter pursuant to our review and analysis of additional data and documents to be provided by the contractors.

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Response Comments



As described in paragraph 14 above, all of Navigant’s work this Quarter was designed to prevent and detect waste, fraud and abuse. Our review of the invoices of the RREM and LRRP Contractors and their subcontractors sought to identify any potential irregularities with billings submitted by the Contractors and their subcontractors; our review of Pathway B homeowner payments was commenced to develop the methodology we will execute duting subsequent quarters to identify any potential irregularities in connection with these payments ; and our technical electronic analyses of the universe of RREM and LRRP applications sought to identify potentially problematic applications for further review using data extracts from SIROMS.

19. Provide details of any integrity issues/findings

As explained in paragraphs 14 and 18 above, our review of the invoices of the RREM and LRRP Contractor and their subcontractors identified potential billing issues. Although many of the previously reported subcontractor billing issues have been resolved there are a few issues that continue to be reviewed and a comprehensive set of findings is expected to be completed during the next Quarter pursuant to our review and analysis of additional data and documents to be provided by the contractors; our technical analysis of RREM and LRRP applications, similar to our previously completed RREM technical analyses, using data extracts from SIROMS to identify and analyze potential applicant eligibility issues. This analysis will continue through the next Quarter.


N/A


N/A

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Response Comments


22. Provide details of any actions taken to remediate waste, fraud and abuse noted in past quarters

N/A


For the Quarter Ending September 30, 2016: Total hours incurred: 232.45 hours Total fees incurred: $ 63,924.00 Total expenses incurred: $0

24 Add any item, issue or comment not covered in previous sections but deemed pertinent to monitoring program.

N/A

Name of Integrity Monitor: Navigant Consulting Inc.Name of Report Preparer: Daniel F. Gill

Signature:Date: December 31, 2016

C. Miscellaneous

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A. Samuel Viavattine Deputy Commissioner

B. Robert Bartolone Director, Office of Auditing

C. David Mazzuca Assistant Director Housing Recovery

D. Terri Quintero

Sr. Contracting Officer-Procurement/Legal- Sandy Recovery Division

E. Laura SheaAssistant Commissioner, Sandy Recovery Division

F Elizabeth MackayAssistant Director of Procurement and Legal

G Michael Simon Compliance

Roseann KovalDeputy Chief of Staff - Division of Purchase & Property

A. Deborah Perriera VP, Program CEO, LEED BD+C

B. Thomas Nieder Senior Project Executive

C. Samir Patel Senior Project Executive

D. Kevin Kennedy Project Manager

E. Ed Savoth Payment Team

A. Jo Carroll Program Manager

B. Mary Shapiro Marketing Specialist

C. Roger Clifford Project Manager

D. Darren Hurley Project Manager

E. Joanna Kennedy Senior Manager

IV. CB&I Shaw

III. Gilbane Building Company

Appendix AMeetings Conducted

For Quarter Ending 9/30/2016

I. New Jersey Department of Community Affairs

II. New Jersey Department of the Treasury

State of New JerseyDepartment of the Treasurylntegrity Oversight Mon¡toring Report¡ng Model

Firm Name:

Engagement:

For Quarter Ending:

Thacher Associates

DEP Rebuild byosl30l20L6

the Disaster Relief Act.

18.

T7

16.

15.

14.

No.

Description of quarterly activ¡ty to prevent and detect waste, fraud and

abuse.

Have payment requ¡sitions in connection with the contract/program been


Description of quarterly aud¡ting activities that have been conducted toensure procurement compl¡ance with terms and conditions of thecontracts and agreements.

Brief Description to confirm appropriate data/informat¡on has beenprovided by recipient and what activities have been taken to rev¡ew inrelat¡on to the project/contract/program.

Quarterly Activities/Project Description (include number of v¡s¡ts to meetw¡th recipient and sub recipient, includ¡ng who you met with, and anys¡te visits warranted to where work was completed)

Recip¡ent Data Elements

During the quarter, Thacher Associates cont¡nued to ¡dentlfy the r¡sl<5

fac¡ng the project and the pol¡c¡es, procedures and controls ¡n place toguard against them. Thacher Associates also init¡ated reviews of CMF

invoices.

Yes. Thacher Assoc¡ates has been reviewing monthly ¡nvoices from theCMF

With the exception of the review of CMF invoices described below,fhacherAssociates' activities were related to interviews and documentreview and analysis for the purpose of identifying risl(s facing the projects

and assess¡ng the policies, procedures and controls ¡n place to guard

against those r¡sks.

ïhacher Associates provided an in¡tial document request for documentsrequired forThacher's review of DEP's f¡nancial, administrat¡ve andprocurement processes. During the course of the quarter, ThacherAssociates reviewed and analyzed those documents to assess the r¡slsfacing the Projects and the policies, procedures and controls in place toguard asa¡nst the risks.

Following the initial kick-off meeting in June 2016, Thacher Associates

began to conduct r¡sk ând controls analyses for the Projects. Workincluded review of Crosscut Policies as against CDBG laws rules and

regulations. Thacher Associates also attended a CDBG training session ¡n

Trenton.

Response Comments

Pâge 2 of 4

State of New JerseyDepartment of the Treasurylntegr¡ty Oversight Mon¡toring Reporting Model

F¡rm Name:

Engagement:

For Quarter End¡ng:

Thacher Associates

D_EP Rebuild by Design Program09l30l2OL6

the D¡saster Rel¡ef Act.

CommentsResponse

None.

None.

N/A

Rich Vermeulen - 14

Melissa Liebermann - 71

Kev¡n Mullins - 95

Edison Montalvo - 33.75

Joshua Wiesenfeld - 68.5

Justin Rattino - 68.25

Michael Bernste¡n - 53.5

Chris Ward - 33

None.

Recip¡ent Data Elements

Provide details of any integrity issues/findings

Provide details of any work quality or safety/environmental/histor¡calpreservation issue(s).

Provide deta¡ls on any other items of note that have occurred ¡n the pastquarter

Prov¡de details of any actions taken to remediate waste, fraud and abuse


Attach a list of hours and expenses incurred to perform your quarterly¡ntegrity monitoring review

Add any item, issue or comment not covered ¡n prev¡ous sections butdeemed pertinent to monitorinA program.

No.

19.

zo.

2t

22

I23.

24

Page 3 of 4

State of New JerseyDepartment of the Treasurylntegrity Overs¡ght Monitoring Report¡ng Model

Firm Name: Thacher AssociatesEngagement: DEP Rebuild by Design Program

For Quarter Ênding: 09130120t6

the Disaster Rel¡ef

Wre:

Assoc¡atesName of lntegrity Mon¡tor:Name of Report Preparer:

Page 4 ol 4

State of New JerseyDepartment of the TreasuryIntegrity Oversight Monitoring Reporting Model

Firm Name: Thacher Associates LLCEngagement: NJ Transit ‐ Gladstone Line Poles & Foundations Replacement Project



1. Recipient of funding New Jersey Transit Corporation2. Federal Funding Agency? (e.g. HUD, FEMA) Federal Transit Administration3. State Funding (if applicable) N/A4. Award Type Emergency Relief Program5. Award Amount $13,308,080.00 Represents the contract value of the single contract in Thacher Associates

current scope of work.6. Contract/Program Person/Title Amy Herbold, Deputy Executive Director (Interim Procurement Officer)

7. Brief Description, Purpose and Rationale of Project/Program This project consists of installing new concrete foundations and steel poles on the Gladstone Branch of New Jersey Transit's (NJT) Morris & Essex Line.

8. Contract/Program Location Gladstone Branch (New Providence to Gladstone Rail Yard)9. Amount Expended to Date $11,866,280.08 through September 30, 2016; approved by New Jersey

Transit and paid to Case Foundation Company (CFC).10. Amount Provided to other State or Local Entities None11. Completion Status of Contract or Program In Progress12. Expected Contract End Date/Time Period January 2017 (Est.)B. Monitoring Activities


N/A


Thacher performed business office visits in August during which it met with the owner and president of L&R Construction (L&R), Judith Volmer. Thacher also met with NJT's office of business development and internal audit during July 1 and September 30 to discuss project status and plans for additional business office visits to CFC and/or L&R. Additionally, Thacher reviewed various documents obtained from NJT and performed related procedures in accordance with its work plan.


Thacher reviewed documents received from NJT including electronic copies of payment requisitions, certified payroll reports, Forms E and E2 filings, and procurement files. Thacher began its look‐back review of Procurement compliance during the third quarter of 2016 noting no issues. In addition, Thacher performed a business office visit to L&R's offices to assess DBE compliance with respect to its performance of a commercially useful function on the project as well as review for pass‐through activities. Thacher requested a business office visit to CFC's offices to be performed during the fourth quarter.


Page 1 of 3






16. Description of quarterly auditing activities that have been conducted toensure procurement compliance with terms and conditions of the contracts and agreements.

Thacher continues its review of monthly payment requisitions and certified payroll reports to assess CFC's and L&R's compliance with contractual and legal requirements in the areas of procurement, prevailing wage rules, and payment to contractor and subcontractor. Crescent Consulting ‐ DBE sub‐consultant to Thacher ‐ (Crescent) reviewed additional documentation obtained from L&R during the business office visit and continues its performance of DBE Compliance related portions of the workplan.


Thacher reviewed payment requisitions submitted by CFC for periods during the second quarter of 2016. Construction work was completed during the third quarter of 2016 and additional reviews of payment requisitions will be limited to closeout items.

18. Description of quarterly activity to prevent and detect waste, fraud andabuse.

Thacher is reviewing various filings and supporting documentation pertinent to certified payroll reports submitted by L&R, prevailing wage requirements, and monthly Form E and Form E2 DBE utilization reports submitted by CFC and L&R through June 30, 2016.

19. Provide details of any integrity issues/findings None.20. Provide details of any work quality or safety/environmental/historical

preservation issue(s).None.

21. Provide details on any other items of note that have occurred in the pastquarter

Thacher performed a business office visit to L&R and inquired about L&R's procurement of steel used for the construction project from non‐DBE steel suppliers. Thacher also learned that CFC claimed DBE participation credit for the steel procured by L&R. Thacher requested a separate meeting with CFC (which occurred in the 4th quarter of 2016). Thacher also requested supporting documents from CFC and L&R to determine whether L&R was performing a commercially useful function and to also assess whether L&R's procurements could be considered pass‐through items.

Note: following the meeting with CFC and the receipt of documents requested during the 4th quarter of 2016, Thacher determined that L&R's involvement in the procurement of steel from the non‐DBE suppliers satisified the performance of a commercially useful function, and eligible for DBE participation credit to CFC.

22. Provide details of any actions taken to remediate waste, fraud and abusenoted in past quarters

None.

C. Miscellaneous

Page 2 of 3







For the period July 1, 2016 through September 30, 2016 Thacher expended 197 hours (see Comments for breakdown) and no expenses. This includes site and office visits, document reviews, and preliminary follow‐up discussions with NJT. Additionally, Thacher filed prior quarterly reports with the Department of the Treasury for the quarters ended June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015, and June 30, 2015.

Angela Della Universita, Senior Consultant ‐ 27.25 Chris Ward, Senior Consultant ‐ 12.75Jose L. Velazquez, Project Manager ‐ 118.75Justin Rattino, Consultant ‐ 8.75Richard Vermeulen, Program Manager ‐ 0.5Hector Calderon, Principal (DBE) ‐ 29.00

24. Add any item, issue or comment not covered in previous sections but deemed pertinent to monitoring program.

None.

Name of Integrity Monitor: Thacher Associates LLCName of Report Preparer: Jose L. Velazquez, Jr.Signature:Date: January 3, 2017

Page 3 of 3

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