Big changes appear to be coming for contractors working with the New York City Metropolitan Transit Authority (MTA). A report by departing MTA Inspector General Carolyn Pokorny claims that the MTA’s system for filing construction project documents is too complex, leading many contractors working for the agency to ignore it — which is a big problem for MTA officials and contractors alike that may now be leading to changes in the system.
According to the report, “MTA Construction Managers allow the contractors to determine what documents were uploaded, and where…No one is held accountable for failing to comply with document retention requirements in part because no one is checking.”
This has had some significant ramifications for the agency and the contractors that work with them: The report included a review of nine construction projects which found that 48% of required documents were missing from Asite, MTA’s project database software.
The report led Pokorny to recommend that officials create a more simple system, as well to more stringently enforce standards on contractors who work with MTA.
“MTA Construction & Development was formed to innovate and standardize capital project delivery across the MTA. One of the many initiatives is to enhance legacy construction management systems such as Asite,” said MTA Construction and Development President Jamie Torres-Springer.
“Work is well underway to improve Asite, including the recommendations contained in the report, with a target of full implementation by the end of 2022.”
Proper documentation is a crucial part of the payment process in the construction industry, making this a major concern for contractors who are doing work with MTA or might do so in the future. After all, contractors need to be able to prove that they did the work they were contractually obligated to do.
Payment problems are common in every aspect of the construction industry, but especially so when it comes to the issue of proper paperwork: According to Levelset’s 2021 Construction Cash Flow & Payment Report, a large chunk of contractors deal with paperwork problems in the payment process.
27% of survey respondents found it difficult to figure out what payment paperwork customers require, and 29% of respondents noted that they had had a document rejected over incorrect project information — issues that very likely could come up with the MTA’s current paperwork practices.
Beyond this, 39% of contractors noted that it was somewhat difficult to find project information when it was needed, with 9% saying that it was very difficult for them.
A huge matter of the importance of document retention is liability protection.
“Your construction company needs to be sure it can defend itself against claims, or be able to enforce claims against others,” says construction lawyer Alex Benarroche. “The ultimate issue is that claims can arise long after the project is completed. If a dispute reaches the court, well-organized records are not only your best line of defense, but also, your best ammo to prove your side of the story.”
Keeping proper documentation adds an element of protection within the legal process as well. “On top of [protecting from liability], the other party [in a legal dispute] may request certain documents through discovery,” Benarroche adds. “If you’re unable to produce these documents, you may find yourself with claims barred, or being charged with evidence tampering.”
The implementation of the agency’s new system should have a big impact. We’ve seen contractors take on big projects for MTA recently, as well, and more spending should be on the way for the agency. Its 2020-2024 capital plan reportedly invests a total of $51.5 billion into MTA subways, buses, and railroads.