Firms Awarded Iraq Pacts Tied to D.C. - (D-CA) Frankenstein Profits Off War at $27M

AP: Firms Awarded Iraq Pacts Tied to D.C.
1 hour, 4 minutes ago
By MATT KELLEY, Associated Press Writer

WASHINGTON - Many of the firms that were awarded $130 million in Iraq reconstruction business this week have strong Washington connections: Several are generous Republican donors, one company is partly owned by a California senator's husband and another is tied to a Pentagon official involved in the contracts.

The Parsons Brinkerhoff construction company was one of two firms picked to share a $43.4 million contract to help manage reconstruction of Iraq's electricity grid. Retired Navy Rear Adm. David Nash, director of the program management office for the Pentagon in Baghdad, is a former president of a Parsons Brinkerhoff subsidiary.

The company also has Republican connections. It gave $90,000 to various Republican Party committees in the past five years, $8,500 to similar Democratic groups.

"It's hard to find a major company in America anymore that doesn't have political connections," said Danielle Brian, the head of the independent watchdog group Project on Government Oversight. "Federal contracting has become political. Just about every company that can compete does have political connections."

Defense Department officials say neither Nash's connections nor politics had anything to do with the contract award, and that all eight awards were chosen through open competition. Nash does not have any authority to award contracts, said Army Lt. Col. Joe Yoswa, a Pentagon spokesman.

"His only involvement is to set priorities for tasks requested in the (contract) proposals," Yoswa said.

Parsons Brinkerhoff spokesman Bruce Ross declined comment.

The new contracts were awarded Wednesday in the shadow of previous controversy over Iraq reconstruction work given to Vice President Dick Cheney (news - web sites)'s former firm, Halliburton Co. Some of that work is now under criminal investigation.

Halliburton has refunded some money for alleged overcharges, and is running a series of television ads contending the criticism of its work is politically motivated.

The Pentagon says it chooses contractors based on which have the best management, are most likely to succeed and offer the best price. But a general acknowledged at a House hearing Thursday that the military has made mistakes.

"We aren't perfect. It is a war zone, and we are correcting mistakes as we find them," said Gen. Paul Kern, head of the Army Materiel Command.

One such mistake was a $327 million contract to outfit the new Iraqi military. The U.S. Army canceled that contract after two losing bidders complained that the decision-making process was confusing and contradictory.

The contract had been awarded to Nour USA of suburban Washington, whose president is A. Houda Farouki. He's a friend of Ahmed Chalabi, a member of the Iraqi Governing Council who was close to several top Pentagon officials before the U.S. invasion.

Nour and the Pentagon have said Farouki's ties to Chalabi had nothing to do with the award. The Army hopes to have a new bidding process for that contract ready within three months, said Maj. Gary Tallman, a spokesman.

Republicans aren't the only ones with ties to Iraq contractors. URS Group Inc., which is partly owned by Richard C. Blum, the husband of Democratic Sen. Dianne Feinstein of California, was part of a two-company team that won $27.7 million in Iraq business Wednesday.

Blum is vice chairman of URS Group, which in partnership with New Jersey's Louis Berger Group will help manage reconstruction of Iraq's transportation, communications, security, education and health infrastructure.

Asked if Blum's connections had anything to do with the Iraq contracts, Feinstein spokesman Howard Gantman replied, "In a word, no."

URS Group spokeswoman Judith Lillard did not return a telephone message.

Another contract, worth $28.5 million, went to a partnership of the engineering firm CH2M Hill of suburban Denver and the California construction firm Parsons Corp., which is not related to Parsons Brinkerhoff.

CH2M Hill gave $69,000 to Republican committees over the past five years and $34,000 to Democratic committees. The head of the company, Ralph R. Peterson gave $6,000 each to Republican and Democratic candidates during the same time frame.

Karen Steeper, a CH2M Hill spokeswoman, said federal rules forbid the consideration of politics in awarding contracts. She declined further comment.

Parsons Corp. is not a major political donor, but it has hired several former government officials to help it land contracts, including a retired Air Force major general and two former Energy Department officials.