Contract to Tiny Firm to Restore Puerto Rico’s Electricity Raises Concern
With the total restoration of electricity in Puerto Rico expected to be several months out, the recent $300 million federal contract awarded to Whitefish Energy to restore power there has raised eyebrows. The small Montana company, which has been in operation for only two years—and before the hurricane consisted of only two employees—has never taken on a project remotely close to the size of this one. The contract also reveals that the government will not be allowed to “audit or review the cost and profit elements,” meaning the company will essentially have secrecy for how it will spend the $300 million.
Whitefish contract states, “In no event shall [government bodies] have the right to audit or review the cost and profit elements.” Wow. pic.twitter.com/dIyQXb6AK0
— Ken Klippenstein (@kenklippenstein) October 27, 2017
The contract also prohibits the Puerto Rico Electric Power Authority from making “any claim against Contractor related to delayed completion of work.”
Incredible: Whitefish contract states Puerto Rican govt “waives any claim against Contractor related to delayed completion of work.” pic.twitter.com/k4wWxrLFq2
— Ken Klippenstein (@kenklippenstein) October 27, 2017
Whitefish has been the target of heavy criticism over questions as to why the small company, which only had two full-time employees when the storm struck, was selected for such a lucrative government contract to help clean up the island.
Two House committees and a federal watchdog have all opened investigations into the deal. San Juan Mayor Carmen Yulín Cruz has called for the deal to be voided and investigated after representatives for the company feuded with her on Twitter and asked her if she wanted them to stop working.
Cruz called the deal “alarming” in an interview with Yahoo News on Wednesday. Whitefish fired back on Twitter: “We share the mayor’s frustration with the situation on Puerto Rico, but her comments are misplaced. … We find her comments to be very disappointing and demoralizing to the hundreds of people on our team that have left their homes and families and have come here to help the people of Puerto Rico.”
Cruz, who has been lauded for her steadfastness in advocating for the people of Puerto Rico, said, “I’ve seen people drinking from creeks, mothers just holding their babies saying, ‘Please help me.’ … The federal response has been inadequate. Frankly, it’s an embarrassment.” She added her gratitude to the citizens of the mainland who have come to volunteer: “I want to make sure that people understand that we know the difference between President Trump and the good-hearted people and the good-natured people of the United States. We know they’re not one and the same.”
Rep. Luis Gutiérrez, D-Ill., a son of Puerto Rican immigrants who has also been outspoken about the Trump administration’s response to the hurricane, shared his thoughts on the Whitefish deal on Wednesday, saying, “We learned that the company is two years old and as of about six weeks ago, it had just two employees. It does not have a track record of working on massive projects—certainly not one as massive as rebuilding the power grid in Puerto Rico after a once-in-a-century storm like Hurricane Maria … Whitefish Energy is based in Whitefish, Montana. That’s the hometown of Interior Secretary Ryan Zinke, who used to represent Montana in this body. His son even worked for them briefly at one point. The Chief Executive of Whitefish, Andy Techmanski, knows Secretary Zinke, but as a spokesman for the Interior Department said to the Washington Post, in Whitefish [quote] “everyone knows everybody.” That does not make me feel better.”
Gutiérrez also raised concern over Whitefish’s financing by HBC Investments, a private equity firm founded by Joe Colonnetta, who holds the title of general partner. The Daily Beast reports:
Federal Elections Commission data compiled by The Daily Beast shows Colonnetta contributed $20,000 to the Trump Victory PAC during the general election, $2,700 to Trump’s primary election campaign (then the maximum amount permitted), $2,700 to Trump’s general election campaign (also the maximum), and a total of $30,700 to the Republican National Committee in 2016 alone.
Colonnetta’s wife, Kimberly, is no stranger to Republican politics either; shortly after Trump’s victory, she gave $33,400 to the Republican National Committee, the maximum contribution permitted for party committees in 2016.
Joe Colonnetta is not the only Republican connection to the controversial Whitefish contract. On Monday, The Washington Post reported that Whitefish Chief Executive Officer Andy Techmanski is friends with Trump administration Interior Secretary Ryan Zinke. Moreover, Whitefish is located in Zinke’s hometown of Whitefish, Monatana.
An energy company in Oklahoma (home state of EPA Administrator Scott Pruitt, who has well-documented ties to the state’s oil and gas industry) was awarded a $200 million contract, similar to that given to Whitefish. According to a release, “Oklahoma City-based Mammoth Energy Services announced its wholly owned subsidiary, Cobra Acquisitions LLC has won a nearly $200 million contract to restore power to Puerto Rico following the hurricane.”
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