Non-Competitive Subsidy Grants Enabling Potential Abuse by Incumbents

$100K-$300K annually (underinvestment in safety when subsidies misdirected; potential liability exposure if unreported safety deficiencies emerge) • $10M-$18M annually through inflated service hour claims and phantom route reporting (estimated 1-2% of $800M program) • $15M-$25M annually across non-bidding states (estimated 30-40% of $800M program) through inflated route justifications and suppression of lower-cost operator alternatives

Charter revenue deliberately misclassified as regular fare revenue or hidden in separate ledgers; commission splits manipulated; phantom charter bookings recorded then cancelled to inflate revenue baseline for subsidy calculations • Compliance records selectively audited or not audited; weak or missing procurement documentation; compliance officer overlooks non-competitive subsidy allocations due to political pressure or informal relationships with incumbents; compliance reports submitted without supporting audit trail verification • Fuel consumption inflated in records through manual log manipulation; phantom fuel purchases recorded; gallons misallocated to subsidized routes vs. charter services; duplicate fuel cost claims across multiple reports