Chair West, Vice Chair Wright, Immediate Past Chair Woodbury, Members of the Commission, Mr.

Harrell, Recently I was surprised to discover a peer review presentation which listed some issues HRT had already addressed or are addressing in a very negative way. I was also surprised that the presentation totally ignored the extraordinary efforts and achievements the HRT staffs have done under the Commission's leadership since 2010. As an immediate past CFO and Commission Treasurer & Secretary, I feel compelled to share a brief history with you below how HRT has significantly strengthened its financial and operational management over the last couples of years, and I believe, as a governing body, you should be proud of your leadership and acknowledge staff's achievements. 1. In 2010, It was discovered that there were a cost overrun by $100M and construction delay by one and half year of the light rail project, serious financial oversight flaws, excessive violations of federal procurement rules, and serious internal control deficiencies. Later 2010, two federal criminal inquiries were launched, one State DOT Inspector General investigation was conducted, and two comprehensive FTA audits/reviews (financial management oversight - FMO review and procurement review) were conducted. Under the strong leadership of Chairman Wood then, a series of corrective actions were launched. 3. By March 2011, 70 significant deficiencies were cited by FTA, and FTA posted strict deadlines for the corrections, or it might suspend its annual federal assistance to HRT which accounts for 34% of HRT's operating budget and 70% of capital budget. 4. By April 2011, after almost a year long national search, I was hired as the CFO and Board Treasurer to lead agency wide effort and work with other executive team members such as Jim Price, Sibyl Pappas to address all 70 significant deficiencies cited by FTA, establish best practice processes and policies and procedures, and review and correct over 20,000 light rail related transactions traced back to 2006, among other tasks. 5. By middle of 2012, all 20,000 light rail related transactions were reviewed and/or corrected and the total cost was reduced from $338M to $316M, and over 80 best practices policies or procedures were preliminarily developed. HRT's financial house was in order and public confidence was restored. All 170 corrective actions aiming to address 70 significant deficiencies were developed and successfully implemented with over 5,500 pages of supporting documents. FTA reviewed all supporting documents thoroughly, closed all these findings and issued close out letters to HRT in September 2012. FTA auditors and officials highly appraised the massive efforts and extraordinary successes of HRT. This significant success was a result of Commission's strong leadership under past Chair Wood and Woodbury and current Chair West, as well as the entire HRT team's endless and relentless efforts. As an opposite, FTA suspended over $182M ederal funding for Miami Dade Transit due to its failure to addressing FTA

FMO findings (see attachments). 6. Throughout 2012, the issue of lacking dedicated funding was repeatedly raised to the Commission and regional key stakeholders. In September 2012, with the team work between Ray Amoruso, myself and the entire team, the first HRT long term transit and financial plan was developed and in-depth analyses were done to show how serious HRT was lacking the future funding and to recommend seeking dedicated funding in state and local level and revising GOPASS 365 program. 7. In May 2012, I was asked to take more responsibilities as the Chief Financial & Administrative Officer/Board Treasurer & Secretary. The Board chair and the immediate past chair sincerely asked me to help Mr. Harrell with my in-depth transit expertise to ensure HRT's further success. I pledged my commitment to Chair West. 8. In February 6, 2013, Mr. Harrell further added two more functions (Legal Services and Risk Management) under my leadership. 9. In February 14, 2013, I accepted a position with another transit agency and submitted the resignation to Mr. Harrell after successfully and honorably helping him for nearly a year. 10. In March 19, 2013, one day after I left HRT, peer review team was invited to conduct a three-day review including document reviews, interviews and presentation writing. Without spending any time reviewing documents before site-visit (which is an industry norm) and without interviewing some key stakeholders (such as HRT CFO Adviser/previous Controller, internal auditor - Mr. Taylor, other executive members and myself), a peer review presentation was released in March 22, 2013. 11. The presentation completely ignored the all successes HRT has achieved in last couple of years. Instead, based on HRT's Internal Auditor's investigation report and Mr. Harrell's explanation as shown in the Commission's Meeting Minutes, the peer review team presented a list of issues which HRT has either already addressed a while ago (for a majority of the issues listed) or in the process of being addressed (for a small portion of them). Also it presented these issues either already addressed or being addressed in a way which appeared much more serious than it actually were or not accurately. While the facts finally have been verified and clarified by internal auditor's investigation report, a a citizen who cares about HRT deeply, I would like to advise Commission that three significant challenges are still ahead of HRT: 1. HRT needs a dedicated funding source and current funding structure is not sustainable. If this continues, six jurisdiction counties likely will leave HRT one by one to either join other nearby transit entities such as Williamsburg Transit or operate their own transit

systems like Suffolk. Unfortunately, early this year, HRT failed in getting this dedicated fund from the Hampton Roads Transportation Bill while the transit agencies in the other regions within the Commonwealth have gotten a share from their respective transportation bills. 2. HRT leadership needs to be keenly aware of continuing to monitor the implementation and performance of all 170 FTA FMO corrective actions and Mr. Taylor needs to take a leading role to check on it. As I often shared with the colleagues in HRT that we have successfully been climbing a mountain and we need to continue to do so, otherwise, we will slide down quickly. If we fail on this, we will be in trouble again when FTA comes back to conduct a follow-up FMO Review later. The peer review report actually is an wake-up call even though it is not accurate. 3. Run HRT as a private entity and improve its efficiency and effectiveness relentlessly and consistently. It was a great pleasure serving you in the past two years! If I can be of any assistance, please feel free to call me. Best Regards, Henry Li