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Internal Audit Report: Noise Insulation Program, January 2013 – March 2019

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A 2019 Port of Seattle internal audit of the Noise Insulation Program — which has invested over $400 million since 1985 to reduce aircraft noise in homes and schools near Sea-Tac Airport — found two key problems: a contractor called Burton Construction overbilled the Port by an average markup of 51% above subcontractor costs, and the Highline School District failed to consistently meet federal grant requirements for disadvantaged business enterprises and Buy American standards. The audit covered January 2013 through March 2019 and assessed compliance with FAA federal grant rules.

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Port Of Seattle Internal Audit Report No. 2019-04 covering the Noise Insulation Program (NIP) for January 2013 through March 2019. Audits controls and FAA Airport Improvement Program (AIP) grant compliance. Identifies two findings: (1) High risk — Burton Construction Inc. Job Order Contract (JOC) controls ineffective, resulting in unreasonably high billings with an average 51% markup over subcontractor costs; unbalanced bid characteristics; JOC awarded at not-to-exceed $3.8 million under RCW 36.10.440. (2) Medium risk — Highline School District non-compliance with FAA disadvantaged business enterprise (DBE) requirements under Title 49 USC § 26, Buy American requirements under Title 49 USC § 50101, and Memorandum of Agreement (MOA) with the Port. Responsible management includes Ralph Graves, Dwight Rives, Nora Huey, Elizabeth Leavitt, and Arlyn Purcell.

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