Ethics

Fill The Swamp

JM Ashby
Written by JM Ashby

The electrical grid of Puerto Rico was virtually obliterated by Hurricane Maria and, to that end, the government is handing out contracts to rebuild it. But who are these contracts being awarded to?

Ordinarily, utilities from other cities and states are contracted to help rebuild, but in this case a small, private, two-person company called Whitefish Energy that's based in the home town of Interior Department Secretary Ryan Zinke has been handed a $300 million contract to rebuild the island's grid.

But how can two people rebuild the grid? They can't. They've hired a small army of private subcontractors to do the work at wildly inflated prices.

With the entire Puerto Rican commonwealth in bankruptcy, and the utility itself in default on $9 billion in debt, spending for the recovery is drawing scrutiny from the Trump administration and Congress. Gov. Ricardo Rosselló and José Carrión, chairman of the federal oversight board created to resolve the island’s long-running financial crisis, were summoned to Washington last week for a meeting with the Office of Management and Budget.

The House Committee on Natural Resources is examining Whitefish’s role in Puerto Rico, said Parish Braden, a spokesman for the committee. The hiring of the little-known company has been noted by the trade publications Utility Dive and E&E News.

Under the contract, the hourly rate was set at $330 for a site supervisor, and at $227.88 for a “journeyman lineman.” The cost for subcontractors, which make up the bulk of Whitefish’s workforce, is $462 per hour for a supervisor and $319.04 for a lineman. Whitefish also charges nightly accommodation fees of $332 per worker and almost $80 per day for food.

One of my uncles was a lineman for a telecommunications company before he passed away and I can tell you he didn't make anywhere near this much money. And he wasn't a young journeyman. He also worked in very dangerous conditions.

And, you know, I'm not suggesting these contractors should be forced to eat gruel, but $80 per day for food is ridiculous. That's my budget for nearly two weeks.

Ryan Zinke's office has denied that he had any role in securing the contract for Whitefish Energy, but you'll have to excuse me if I don't immediately take his word for it. Just his proximity to the company's owners may have benefited them.

According to the Washington Post, the largest contract Whitefish has ever handled prior to Puerto Rico was a $1.3 million contract to replace a 4.8 mile transmission line in Arizona. The company is now responsible for a $300 million contract to rebuild the lion's share of the island's grid.

  • muselet

    Okay, so a newish, two-man shop with a minimal track record and which just happens to be based in the hometown of Ryan Zinke was awarded a $300 million contract by the Department of the Interior, and that raised not a single red flag among, well, anybody?

    Sounds to me like another round of “Loot The Treasury!”—the favorite game of the Trump administration, it seems—is underway.

    –alopecia

  • ninjaf

    According to the Washington Post, the largest contract Whitefish has ever handled prior to Puerto Rico was a $1.3 million contract to replace a 4.8 mile transmission line in Arizona. The company is now responsible for a $300 million contract to rebuild the lion’s share of the island’s grid.

    And they have only been in business for 2 years.

  • Draxiar

    I work in construction and a company whose biggest contract was $1.3 Million would NEVER FRIGGIN EVER be given a contract as large as $300 Million…at least not by a decent GC. There’s something else happening there. Also, expect cost overruns, change orders, extras, and contract disputes.

    • The company chosen has to be able to do the damn job and hiring subcontractors is the least cost effective solution. The only thing that makes sense is corruption.

  • Dread_Pirate_Mathius

    I would be quite happy to fly to PR and “supervise” for $462 / hr. Can I get overtime at time-and-a-half?

    By the way, $462 / hr plus that food budget works out suspiciously close to $1mm / yr.