Overseas Civilian Contractors

News and issues relating to Civilian Contractors working Overseas

PROMISES, PROMISES: US opts for no-bid contract

WASHINGTON (AP) — The U.S. government awarded a no-bid, $266 million contract for a lucrative electricity project in southern Afghanistan despite promising last year to seek competitive bids from other companies, The Associated Press has learned.

The U.S. Agency for International Development quietly made the change despite criticism over how it has managed billions of dollars spent on reconstruction contracts.

In January 2010, USAID said companies would compete for the electricity project, awarded to Black & Veatch Corp. of Overland Park, Kan., a company that the agency earlier had chastised for big cost overruns and busted deadlines on a diesel-fueled power plant in Kabul. But the government let 10 months pass before deciding to award a contract without competitive bids, saying that it couldn’t spend more time seeking offers.

A rival company that was interested in bidding, Symbion Power LLC of Washington, D.C., said USAID broke its promise and spent more than it should to expand electricity into war-ravaged Helmand and Kandahar provinces in southern Afghanistan.

“I was stunned because of the cost of it,” Symbion chief executive Paul Hinks said.

The no-bid contract comes as the independent Commission on Wartime Contracting is examining how wisely billions of U.S. tax dollars are being spent and how well contractors are being supervised in Afghanistan. USAID and Black & Veatch executives are scheduled to testify Monday at a commission hearing.

USAID opted against seeking competitive proposals “to meet the tight timelines required to have an urgent impact,” the agency said in a statement to the AP.

Black & Veatch defended its selection for the work without competition. “The cost of this contract is entirely reasonable” and includes multiple projects in a large area subjected to intense conflict, the company said in a statement.

During the 2008 presidential campaign, Barack Obama criticized the Bush administration for awarding contracts without competition, a practice he said cost U.S. taxpayers billions of dollars each year. But once in office, Obama didn’t prohibit sole-source contracts, saying agencies needed the flexibility to tailor contracts to meet their needs.

Hinks, who has previously fought against Black & Veatch over contract issues on the troubled power plant in Kabul, said his company successfully completed more energy projects for less money at the height of fighting in Iraq. Symbion handled about $250 million in Defense Department projects in that country, including building 11 power substations and nearly 300 miles of transmission lines.

Hinks said USAID could have received a better deal. The agency had to discuss the project for months with Black & Veatch to craft a no-bid agreement and should have sought proposals at that time from other companies working in the region, he said.

Agency officials told Hinks in several e-mails last year that Symbion and other companies would have the chance to bid on the work.

“USAID intends to procure services through a full and open competitive procurement process and Symbion is invited to submit a proposal,” William Frej, then the agency’s Afghanistan director, wrote to Symbion in February 2010. In November, USAID changed course, saying Black & Veatch would receive the no-bid contract because the company already was working on USAID energy projects.

Under the latest contract for work in southern Afghanistan, Black & Veatch will upgrade electrical distribution in Kandahar city, install diesel generators, rebuild power substations and install a third hydro-electric turbine generator to the Kajaki Dam in Helmand province.  Please see the original here

January 22, 2011 Posted by | Afghanistan, Contractor Oversight, Department of Defense, State Department, USAID | , , , , | Leave a comment

Firm with checkered record,Black & Veatch Corp.,hired for Afghan work

Richard Lardner and Brett Blackledge at Associated Press

WASHINGTON — The U.S. government is counting on an American contractor with a record of cost overruns and missed deadlines to handle a critical component of Gen. David Petraeus’ plan to stabilize volatile southern Afghanistan: quickly deliver more electricity to the power-starved region.

The U.S. Agency for International Development last month awarded Black & Veatch Corp. of Overland Park, Kan., a no-bid contract worth $266 million to push more power into Kandahar and Helmand provinces. Officials say expanding electrical access will improve the quality of life for Afghans, undercutting the influence of the Taliban-led insurgency.

USAID called Black & Veatch a “proven partner” in a statement Monday. The agency also said it has changed its contracting operations and won’t hesitate to penalize or terminate arrangements with vendors that fail to deliver.  Please see the original here

January 10, 2011 Posted by | Afghanistan, Civilian Contractors, Contract Awards, Contracts Awarded, State Department, USAID | , , , , , , | Leave a comment

Army Secretary says KBR contract still classified

“Who is it precisely we’re keeping information from?” he asked. “It appears the only reason to invoke this classification at this point is to keep information from the American public.”

Julie Sullivan The Oregonian

The Army’s combat mission in Iraq has ended, but details of the no-bid contract it signed with Kellogg, Brown and Root before the war started remain classified.

On Tuesday, Sec. of the Army John McHugh said he would not release the contract’s specifics that holds taxpayers — and not KBR — responsible for any harm to a soldier or civilian as it worked restoring Iraqi oil flows in 2003.

But in a two-page response to U. S. Rep. Earl Blumenauer‘s demand for details, McHugh reveals how unusual the Army’s arrangement with the former Halliburton subsidiary was.

“Apart from the Restore Iraqi Oil contract with KBR, no other Army contracts awarded since 2001….contain indemnification provisions,” McHugh wrote. “The Army has made no payments as a result of indemnification provisions with contractors supporting contingency operations in Iraq. Afghanistan or anywhere else.”

In July, Blumenauer demanded the Army produce the contract after KBR’s claims of immunity emerged in a U.S. District Court case in Portland. Chris Heinrich, a KBR attorney, said in a sworn deposition that after KBR signed its Restore Iraqi Oil contract and as the March 2003 invasion was taking place, he went to the Pentagon himself to demand immunity for KBR.

He told Army officials that KBR refused to do the restoration without “broad coverage.” KBR required that taxpayers — not the war contractor — pay for any property damage, injury or death at any KBR site. That applies even if the harm resulted from KBR negligence. KBR eventually billed the government $2.5 billion for the work.

But it could cost taxpayers millions more. Dozens of National Guard soldiers from four states have sued KBR since 2008 claiming the contractor knowingly or negligently exposed them to a cancer-causing chemical at the Qarmat Ali water treatment plant. Among them: 26 Oregon Army National Guard soldiers who arrived at the Iraq plant in late May 2003. They claim breathing, stomach and skin issues result from their exposure to hexavalent chromium.

Blumenauer expressed disbelief that the specifics would remain classified — even after combat operations ceased.

“Who is it precisely we’re keeping information from?” he asked. “It appears the only reason to invoke this classification at this point is to keep information from the American public.”

Blumenauer said he is drafting a bill requiring such an arrangement be reported to Congress in the future. “There ought to be someone looking over their shoulders.”

Meanwhile, the National Guard soldiers’ case is moving forward in Portland. Monday, U.S. District Magistrate Judge Paul Papak denied a KBR motion to dismiss.

Spokeswoman Heather Browne said KRB disagrees with the judge and may appeal. She restated KBR’s stand that the Army was responsible for safety at the plant.  Original Story here

September 1, 2010 Posted by | Civilian Contractors, Contractor Oversight, Iraq, KBR | , , , , | Leave a comment

KBR to Get $568 Million Army Order as US Joins Lawsuit

By Tony Capaccio at Bloomberg

May 5 (Bloomberg) — KBR Inc., the Army’s largest contractor in Iraq, was picked for a no-bid contract worth as much as $568 million through 2011 for military support services in Iraq, according to Army officials.

The Army announced the new work order only hours after the Justice Department said it will pursue a lawsuit accusing the Houston-based company of taking kickbacks from two subcontractors on Iraq-related work. The Army also awarded the work to KBR over objections from members of Congress, who have pushed the Pentagon to seek bids for further logistics contracts.

The Justice Department said the government will join a lawsuit filed by whistleblowers alleging that two freight- forwarding firms gave KBR transportation department employees kickbacks in the form of meals, drinks, sports tickets and golf outings.

“Defense contractors cannot take advantage of the ongoing war effort by accepting unlawful kickbacks,” said Assistant Attorney General Tony West, in a statement.

KBR will review the litigation when it is received and “will continue to cooperate with the government,” company spokeswoman Heather Browne said in an e-mail. “Gifts of dinners, baseball tickets and similar items would violate KBR policies and KBR was not aware of these violations.”

KBR will continue to provide services such as housing, meals, laundry, showers, water purification and bathroom cleaning under the new order, which was placed under a military contract KBR won in late 2001, shortly after the U.S. invaded Afghanistan.

‘Appropriate Safeguards’

The Army has “reviewed the government’s notice to intervene” in the whistleblower lawsuit, Army spokesman Dan Carlson said. “We feel we have appropriate safeguards in place” to protect the government’s interests.

The no-bid work order is unusual because the Army, at the insistence of Congress, has since April 2008 put all logistics orders to bid, pitting KBR against Falls Church, Virginia-based DynCorp International Inc. and Irving, Texas-based Fluor Corp.

The Army didn’t put the work out for bids because U.S. commanders in Iraq advised against it, saying that enlisting a new company would be too disruptive, Army program director Lee Thompson said in an interview before the Justice Department action was announced. The U.S. force in Iraq is scheduled to shrink from 94,000 troops today to 50,000 by August, with a complete withdrawal by December 2011.

Transition Costs

The Army, in a statement, said putting to bid an order for 18 months’ work, and making the transition to a new contractor, would cost at least $77 million. The KBR work order will be awarded by Aug. 31, said Mike Hutchison, deputy director of Army logistics contracting.

The lawsuit is the second government action this year against KBR. The U.S. sued the company on April 1, alleging that it used private armed security guards in Iraq between 2003 and 2006 in violation of its Army contract and then improperly billed for their services.

Before today’s Justice Department announcement, the Army had said in an e-mailed statement that it was aware of the April lawsuit and would use “additional oversight measures to ensure only reasonable, allowable costs are paid” under the new work order.

The new lawsuit, filed in a Texas federal court, was based on information from two whistleblowers who work in the air cargo industry, the Justice Department statement said. The whistleblowers can get a portion of any money the Justice Department obtains in the case.

Senate Objections

KBR’s no-bid work order drew criticism from Congress even before it was announced.

Senator Claire McCaskill, the Missouri Democrat who heads a subcommittee that oversees military contracting, and the panel’s ranking Republican, Susan Collins of Maine, wrote to Defense Secretary Robert Gates on April 30 urging the Army against “continued reliance” on KBR in light of the Justice Department’s April lawsuit.

Under the new competitive-bid approach, KBR on March 2 won a one-year, $571 million contract with four option years that, if exercised, could be worth as much as $2.77 billion.

That contract calls for KBR to provide services including transportation and postal operations. DynCorp initially protested the award and then dropped its objections.  Original Here

May 5, 2010 Posted by | Contractor Corruption, Contracts Awarded, KBR | , , , , , | Leave a comment