- A $US300 million government contract awarded to Whitefish Energy was revealed Friday.
- It had some eyebrow-raising terms and conditions.
- The company is tasked with rebuilding some of Puerto Rico’s power grid. It is located in the same small Montana town that Interior Secretary Ryan Zinke is from, leading to some questioning if he had any involvement.
The $US300 million contract that was awarded to a tiny electrical firm in Interior Secretary Ryan Zinke’s small Montana hometown to help rebuild Puerto Rico’s power grid was revealed on Friday.
And it contained some startling terms.
First reported by Daily Beast contributor Ken Klippenstein, the contract awarded to Whitefish Energy seems to heavily favour the company.
As Klippenstein noted, the contract includes:
- $US79.82 per person for food each day
- $US332.41 per person for accommodations each day
- More than $US40,000 for helicopter-related services
- It states that, “In no event shall [government bodies] have the right to audit or review the cost and profit elements.”
- And that the Puerto Rican government “waives any claim against contractor related to delayed completion of work.”
The contract was causing alarm for some in the days that preceded its release. Whitefish Energy, a two-year-old energy company from Zinke’s hometown, had just two employees prior to being awarded the contract last month by Puerto Rico’s quasi-public utility, PREPA, to fix part of the island’s power grid that was destroyed by Hurricane Maria. The contract was awarded without a competitive bidding process, Reuters reported, which drew criticism from lawmakers who are now looking into the deal.
Senate Energy and Natural Resources Committee Chair Lisa Murkowski, an Alaska Republican, has vowed to hold a hearing on the contract. Of note is that Zinke happened to call Murkowski earlier this year and threaten to withhold funding for Alaska if she did not vote in favour of the Republican healthcare bill, which she did not.
“I obviously want to find out more about it because this is quite a substantial contract and one that is really important for the people of Puerto Rico right now,” Murkowski told reporters.
Meanwhile, top Democrats on both the Energy and Finance committees requested that the Government Accountability Office investigate the matter.
Those senators, Sens. Maria Cantwell of Washington and Ron Wyden of Oregon, noted the “opaque and limited nature” of the bidding process and “contemporaneous communications” between Whitefish and Trump administration officials such as Zinke.
The House is also looking into the ordeal. In a bipartisan letter signed by leaders of the House Energy and Commerce Committee, congressmen are seeking documents from Whitefish and asked for a briefing before committee staff by early November. In addition, leading Republicans on the House Natural Resources Committee asked the Puerto Rican power authority for its documents related to the contract, the Associated Press reported.
Republican Sen. Steve Daines of Montana told the AP that he did not know Whitefish or its CEO, Andy Techmanski, and said he was surprised it was able to secure the contract.
“The first I heard of the Whitefish Energy contract was through the news,” he said. “I was surprised that such a small company from Montana got the contract.”
Zinke’s department has denied any involvement in the deal, as has the company. Zinke met with President Donald Trump on Friday morning — White House press secretary Sarah Huckabee Sanders said Trump did ask Zinke about the contract, and Zinke denied involvement with it. She also noted that there is an ongoing audit being conducted about the deal.
Zinke’s office said the secretary knows Techmanski but only because both are from a small town where “everybody knows everybody,” Politico reported, adding that one of Zinke’s sons “joined a friend who worked a summer job’ at one of Techmanski’s construction sites.
Speaking to MSNBC on Friday, a Whitefish spokesperson said “the contract speaks for itself as the ability to get work done.” The spokesperson said the contract was not to rebuild all of Puerto Rico’s power grid, but just “100 miles of transmission line.”
“We can’t be responsible for what the others might do,” the spokesperson said when asked about the line in the contract that said government agencies may not audit or review cost and profit elements. “That’s very simple.”
“There is nothing there,” they added. “… everyone wants to say that there is a conspiracy theory.”
Puerto Rican Gov. Ricardo Rossello defended the deal in a statement, though he said his administration would review PREPA’s contracting practices.
“Of those who met the requirements and aggressive schedules to bring brigades, one was asking for a substantial amount of money — which PREPA had no liquidity for — and another did not require it,” Rossello said. “That other one is Whitefish.”
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