The Office of Inspector General (OIG) conducted an audit of the Chicago Department of Transportation’s (CDOT) process for loading zone signs and the Department of Finance’s (DOF) process for residential disabled parking signs.
The objectives of the audit were to determine if,
- CDOT accurately recorded, calculated, and collected fees related to loading zone sign installations and renewals
- DOF accurately recorded and collected fees related to disabled parking signs
- Significant delays occurred during the application for and installation of loading zone and disabled parking signs.
Loading Zone Signs
We concluded that CDOT did not collect $3.9 million, or 59.9%, of the $6.4 million of annual loading zone fees invoiced in 2013, including amounts due from previous years. We also determined, however, that CDOT inaccurately calculated the installation fees for each of 95 loading zones we reviewed. CDOT charged per sign instead of per zone, causing business owners in the sample to overpay by a total of $10,550. Based on discussion with CDOT and this sample we find it reasonable to assume that all business owners with loading zone sign installations were inaccurately charged.
OIG also found that the City does not have a standardized process to maintain loading zone applications and that 88.4% of installations recorded within CDOT’s system lack complete data. Therefore, OIG was unable to review the entire population of installations to determine the average length of time from initial application to completion of the installation request. However, for the 95 loading zone installations reviewed, OIG determined that installation took an average of 337 days.
Finally, OIG identified a lack of segregation between the billing and collecting functions for loading zone application fees. At the time of the audit, CDOT had assigned a single administrative employee the responsibility of billing, receiving payment, transmitting payments and deposit tickets to DOF, and updating payment status in the program database.
Prior to the arrival of the current CDOT management team, the department had internally identified similar weaknesses in its collection processes and data reliability in a 2013 proposal entitled Loading Zone Restructuring. The proposal was presented to the Mayor’s staff in July of 2013 but has not been implemented. More information on this proposal is available in the background section of this report.
Residential Disabled Parking Signs
OIG determined that DOF collected all installation fees for disabled parking signs, but failed to collect 10% of annual renewal fees resulting in $3,250 of uncollected fees for the period we audited.
DOF did maintain complete data for residential disabled parking signs, and OIG therefore was able to determine that the City installed those signs in an average of 207 days from application to installation.
Recommendations
OIG recommends that CDOT seriously consider restructuring the loading zone process by actively pursuing changes such as those described in its 2013 Loading Zone Restructuring proposal, or that it engage with DOF and City Council to correct problems in the current billing and installation processes. CDOT should also determine all overpayments by business owners and develop the necessary corrective action to issue reimbursements. We recommend that DOF work with City Council to improve the residential disabled parking sign installation process. CDOT and DOF agreed with the OIG’s recommendations and responded with corrective actions the departments have taken or will take. The specific recommendations related to each finding, and CDOT’s and DOF’s responses, are described in the “Audit Findings and Recommendations” section of this report.
Management Response
CDOT and DOF responded to our audit findings and recommendations by describing corrective actions they have already taken and actions that they plan to take in order to address the issues identified in the audit. Both departments agreed with OIG that the sign processes can and should be improved, and both departments committed to work with City Council to address those aspects of each process that involve aldermanic approval or potential changes to the Municipal Code.