Purpose

To determine the extent of implementation of the seven recommendations included in our initial audit report, Infrastructure Inspection and Maintenance (2014-S-45).

Background

Our initial audit report, issued on May 26, 2015, examined whether the New York State Canal Corporation’s (Corporation) inspection scheduling procedures ensure that all high- and intermediate-importance structures were periodically inspected and whether inspection results were considered when maintenance activities were prioritized. The audit report concluded that, while the Corporation performs routine operational and reliability checks of the Canal System’s critical structures, it had not performed biannual inspections of a significant number of them – some over many years, some not at all. In addition, the report concluded a risk existed that critical structures most in need of repair were not given priority, as the Corporation's process for determining inspection and maintenance priorities lacked clarity and funding shortages have greatly inhibited the Corporation’s ability to address its priority maintenance needs.

On April 1, 2016, legislation authorizing the transfer of the Corporation from the Thruway Authority to the New York Power Authority (Power Authority) was passed by the New York State legislature. The legislation authorized the Power Authority to transfer moneys, property, and personnel to the Corporation, and also authorized the Power Authority to issue debt for the purposes of financing the construction, reconstruction, development, and improvement of the Canal system. At the time our follow-up fieldwork was completed, the Power Authority was in the process of transitioning the Corporation’s operations, effective January 1, 2017. With the merger of the Corporation to the Power Authority, significant organizational and operational changes are underway. Given the time period of our review, our follow-up primarily focused on actions taken by the Corporation and the Thruway Authority since our last audit.

Key Findings

• We found the Corporation has made progress addressing the issues identified in our initial audit. Of the seven recommendations contained in our audit report, two have been implemented and five have been partially implemented.
• Moving forward, additional actions should be taken to ensure all high- and intermediate-importance structures are inspected timely. In addition, a documented and sound system should be established for supporting capital spending decisions.

Key Recommendation

Officials are given 30 days after the issuance of the follow-up review to provide information on any actions that are planned to address the unresolved issues discussed in this review.

Other Related Audits/Reports of Interest

Niagara Frontier Transportation Authority: Capital Planning (2015-S-37)
Ogdensburg Bridge and Port Authority: Capital Planning and Maintenance (2015-S-70)