January 04, 2012
In March 2010, the New Orleans inspector general found that a major contractor for the city’s recovery efforts, MWH Americas, had been overcharging the city. The Times-Picayune reported at the time:
The controversial engineering firm hired to manage New Orleans’ massive rebuilding effort has been operating for more than two years under a dubiously awarded contract that has allowed it to overbill the city repeatedly even as the bricks-and-mortar recovery work it oversees has lagged, according to a draft report by the city’s inspector general.
Now this same company accused of wrongdoing in New Orleans has landed a USAID contract for work in Haiti. And it’s not the first time this has happened. MWH announced on December 21 that it had received a $2.8 million contract to conduct a feasibility study for port infrastructure in northern Haiti (the contract was signed on September 23). The company’s release goes on:
The $2.8 million contract will include a market demand and project finance structure study, economic feasibility analysis, and the preparation of a detailed technical study including geotechnical, environmental assessment, operational performance, water supply system, emergency response, access roads and institutional and regulatory assessment. The project is expected to be complete in May 2012.
The awarding of the contract to Colorado-based MWH, despite a record of waste and abuse, is consistent with other contracts awarded by USAID in the aftermath of the January 2010 earthquake. Overall, USAID has awarded over $300 million in contracts, with only 0.02 percent going directly to Haitian firms. The largest contractor is Chemonics, a company with a long record of waste and abuse in Afghanistan and which was criticized by the USAID inspector general last year for its work in Haiti. MWH Global, the parent company of MWH Americas, spent over $675,000 dollars on lobbying expenses in 2011, according to OpenSecrets.org, although it was below the $1.2 million spent in 2010.
And it’s not just the contractors who are profiting. The person tasked with coordinating USAID’s relief efforts in the aftermath of the earthquake has personally benefited from the “gold rush” for contracts. Bill Quigley and Amber Ramanauskas, in their article, “Seven Places Where Earthquake Money Did and Did Not Go” write:
Capitalizing on the disaster, Lewis Lucke, a high ranking USAID relief coordinator, met twice in his USAID capacity with the Haitian Prime Minister immediately after the quake. He then quit the agency and was hired for $30,000 a month by a Florida corporation Ashbritt (known already for its big no bid Katrina grants) and a prosperous Haitian partner to lobby for disaster contracts. Locke said “it became clear to us that if it was handled correctly the earthquake represented as much an opportunity as it did a calamity…” Ashbritt and its Haitian partner were soon granted a $10 million no bid contract. Lucke said he was instrumental in securing another $10 million contract from the World Bank and another smaller one from CHF International before their relationship ended.
UPDATE 1/05: The article has been edited slightly for accuracy.