Like Countable?

Install the App
TRY NOW

Whitefish Energy Contract in Puerto Rico Canceled Amid Investigations

by Countable | 10.30.17

What’s the story?

On Sunday, Puerto Rican Governor Ricardo Rosselló (R) announced that he was voiding the $300 million contract awarded to a small Montana power company, Whitefish Energy, to rebuild the island's devastated power grid. News of the contract raised many questions about the company’s ability to fulfill the contract, as well as the contract’s terms and the company’s ties to GOP figures.

Since news of the contract exploded in the media, multiple investigations have been initiated into the deal. An emergency supervisor has been put in place by the federal control board that is monitoring the island’s finances, and prominent local officials have called for the resignation of the head of Puerto Rico’s power company.

Why does it matter?

As reported previously by Countable, Whitefish Energy, a company that specializes in power grid repairs in extremely hazardous conditions, was in contact with the Puerto Rico Electric Power Authority (PREPA) after Hurricane Irma damaged the island. When the severity of Hurricane Maria’s impending impact was realized, PREPA reached out to a variety of companies about the repairs that were likely to be needed. Whitefish was the only company that would agree to do the work without requiring a hefty down payment. PREPA, which is currently $9 billion in debt, did not have millions on hand for a down payment.

However, on the day the storm hit the company only had two full-time employees. The company historically relies on temporary contract labor to do the vast majority of their work, though they had never embarked on a project of the scale of what they'd face in Puerto Rico. Also, CEO Andrew Techmanski has personal ties to Interior Secretary Ryan Zinke, and Texas GOP heavy-hitter and Trump campaign donor Joe Colonetta is a primary financier for the company.

Finally, the contract involves very high reimbursement rates for labor and equipment and contained a clause that limited the government’s right to audit Whitefish’s work.

It is "allowable under [Federal Emergency Management Agency] FEMA regulations in emergencies" for the usual bid process for federal contracts to be circumvented, reports The Hill, and both PREPA representatives as well as Whitefish have defended the contract and the work being done. But with 70% of the island still without power over a month after Hurricane Maria hit, and the other details emerging about the company and the contract, many concerns have been raised.

Investigations are being launched into the deal by the FBI, both the House Energy and Commerce and Natural Resources Committees, as well as the Inspector General for the Department of Homeland Security, which oversees FEMA. According to the Associated Press, the "federal control board that oversees Puerto Rico’s finances announced this week that retired Air Force Col. Noel Zamot will be in charge of power reconstruction efforts" as opposed to the heads of PREPA. Governor Rosselló, however, has rejected that appointment, swearing that if any officials engaged in inappropriate dealing that he would “take administrative actions.”

San Juan Mayor Carmen Yulin Cruz, in an interview with Joy Reid of MSNBC’s AM Joy, called for PREPA head Ricardo Ramos to resign over the deal.

What do you think?

Were Puerto Rican officials right to void the contract? Should the investigations continue?

Tell us in the comments what you think, then use the Take Action button to tell your reps!

— Asha Sanaker

(Photo Credit: Department of Defense / Creative Commons)

RELATED READING:

Countable

Written by Countable

Leave a comment
(17)
  • Brenda
    10/30/2017
    ···

    I would like to know who the Trump administration thinks the people of Port a Rico are. Obviously he could care less what goes on there especially since the Republican Party put there own electric company there. This administration is so corrupt I just can’t believe it.

    Like (5)
    Follow
    Share
  • BeStrong
    10/30/2017
    ···

    “No bid” awards are generally not permissible in government contract offerings. With a rush to get the ball rolling, there seems to have been no vetting or award oversight. Government contracts often include a Cancellation clause, there may well be no penalty for cancellation. Get the bid out, fast track it with the necessary specs, and vet your vendors with FEMA input and oversight. A limited bid offered only to a FEMA recommended vendor list, will ensure a more valuable vendor response. You’ve already wasted 5 weeks, 15-20 more days after rebid issuance is in line.

    Like (4)
    Follow
    Share
  • Gail
    10/31/2017
    ···

    Ripping off the most needy and vulnerable to stuff it your buddies' pockets is the epitome of Trump's grand promise: Drain the Swamp, Trumpspeak for we're going to rip you off.

    Like (4)
    Follow
    Share
  • Gary
    10/30/2017
    ···

    It was a mistake to cancel the contract. It would have been better to follow the Trump business model, have them do the work and then refuse to pay.

    Like (3)
    Follow
    Share
  • Kathy
    10/31/2017
    ···

    CEO Andrew Techmanski has personal ties to Interior Secretary Ryan Zinke, and Texas GOP heavy-hitter and Trump campaign donor Joe Colonetta is a primary financier for the company. I think this says volumes as zinke is one of trump's cronies that is doing everything he can to destroy national parks and monuments and have his buddies drill, mine and completely destroy America and sell it for parts.

    Like (3)
    Follow
    Share
  • Christine
    10/31/2017
    ···

    Definitely something fishy here. The company has 2 employees & had to outsource the work. The American people are being conned at every step under djt.

    Like (3)
    Follow
    Share
  • M
    10/31/2017
    ···

    Just canceling the contract is not enough. The fact that it happened at all is a slap in the face of all of struggling Puerto Rican citizens. If it is not investigated would be a wink at a blatant money grab based on cronyism and conflict of interests!!

    Like (2)
    Follow
    Share
  • Vanessa
    10/31/2017
    ···

    Yikes! This is what happens when a president would rather watch tv and tweet instead of dealing with crisis.

    Like (2)
    Follow
    Share
  • Eileen
    10/31/2017
    ···

    Good for Puerto Rico! I wish we could cancel contracts that have been handed out here for reasons not in concert with the majority of Americans!

    Like (1)
    Follow
    Share
  • Cliff
    11/01/2017
    ···

    It seems it wasn’t a no bid contract but that nobody bid except this company and they were doing a good job? It didn’t require a down payment from a bankrupt island and power company - seems like it was doing a good deed?

    Like
    Follow
    Share
  • Jaxmirox
    10/30/2017
    ···

    I thought that the news media said that the island wouldn’t get the power grid completely fixed for at least 6mo-1yr. Why are they so upset that 30% has been done in 1 month?! Seems to me, according to opinions offered by experts after it occurred, they’re ahead of schedule.

    Like
    Follow
    Share
  • Azrael
    10/31/2017
    ···

    Thank New York They’ve Been there and continue to be there for Puerto Rico and aren’t leaving until our fellow citizens have electricity and all the other needed services I hope someone is investigating this fiasco

    Like
    Follow
    Share
  • Ticktock
    10/30/2017
    ···

    Corruption? Business as usual? No, with this Administration and Congress with events that have already occurred with the EPA and other government agencies that have been immaculated there will be other business deals that will arise just as questionable.

    Like
    Follow
    Share
  • Norm
    10/30/2017
    ···

    I’m annoyed with this pettiness. After all no one else apparently wanted the contract on any financial level and without a deposit from a country that’s bankrupt?Did any volunteers come forward to help with the electrical issues. These are hard times for these folks so now they longer to see the light.

    Like
    Follow
    Share
  • Deirdre
    10/31/2017
    ···

    Good decision! This just shows how all of trump’s goons are benefitting from trump.

    Like
    Follow
    Share
  • KansasTamale
    10/30/2017
    ···

    Zinnci thought he could use the old crony system to get a company from his home town with only 4 employees a huge contract in Puerto Rico which is already devastated because of the Trump administration. Contracts should have been let over a month ago right after the Island was devastated. Can’t wait for this horrible administration to be in jail.

    Like
    Follow
    Share
  • Dean
    11/02/2017
    ···

    Stupid! Based on PC crap!

    Like
    Follow
    Share