US lawmakers investigate firm's contract to help restore Puerto Rico's power

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The Guardian  /  October 26, 2017

Multiple congressional committees seek information on $300m deal awarded to Whitefish Energy Holdings, tiny company in interior secretary’s hometown

Multiple congressional committees are investigating a $300m contract awarded to a small Montana company in the hometown of the interior secretary, Ryan Zinke, that was tapped to help restore Puerto Rico’s damaged power grid.

The Puerto Rico Electric Power Authority awarded the contract to tiny Whitefish Energy Holdings to restore transmission and distribution lines damaged or destroyed during Hurricane Maria.

The two-year-old company had just two full-time employees when the storm hit last month.

In the House of Representatives, leaders of the natural resources and energy and commerce committees sent letters Thursday seeking documents about the contract, saying circumstances surrounding the award raised troubling questions.

Meanwhile, the Senate energy and natural resources committee chairman, Lisa Murkowski, an Alaska Republican, vowed to hold a hearing on the issue. Two Democrats, senators Maria Cantwell of Washington state and Ron Wyden of Oregon, formally requested an investigation by the Government Accountability Office.

Cantwell and Wyden questioned whether the contract cost was inflated, especially since work crews provided under mutual-aid agreements from other public utilities were available but not used.

The lawmakers also complained about the “opaque and limited nature” of the bidding process conducted by the Puerto Rico authority and “contemporaneous communications” between Whitefish officials and senior members of the Trump administration, including Zinke. Cantwell is senior Democrat on the Senate energy panel, while Wyden is top Democrat on the Senate finance committee.

The interior department has denied that Zinke, a former Montana congressman, played any role in the contract award.

Zinke knows the Whitefish CEO, Andy Techmanski, “because they both live in a small town where everyone knows everyone”, a spokeswoman said. Zinke’s son had a summer job at a Whitefish construction site.

On Wednesday, the mayor of San Juan accused the company of threatening to withdraw its services after she had demanded greater transparency about its contract. Whitefish hit back at Carmen Yulín Cruz in a tweet: “We’ve got 44 linemen rebuilding power lines in your city & 40 more men just arrived. Do you want us to send them back or keep working?”

Bipartisan leaders of the House energy and commerce panel said questions raised about Whitefish’s involvement in recovery efforts make it “important to develop a clear understanding of the facts.”

The committee requested a series of documents from Whitefish and asked for a briefing for committee staff by 9 November. The letter is signed by the committee chairman, Greg Walden, an Oregon Republican; the senior Democrat, Frank Pallone of New Jersey; and three other committee members.

Separately, the House natural resources chairman, Rob Bishop of Utah, and the Arkansas representative Bruce Westerman, chairman of an oversight and investigations subcommittee, asked the Puerto Rican power authority for all documents related to the Whitefish contract.

While speed is necessary in an emergency such as Hurricane Maria, “transparency and accountability in government contracting” must never be compromised, they wrote in a letter to Ricardo Ramos, the power authority’s executive director.

Ramos said in a radio interview Thursday that Whitefish was doing an “excellent job”, adding that he has no intention of canceling the contract. “There’s been nothing illegal here,” Ramos said.

Nicole Daigle, a spokeswoman for Murkowski, said the Whitefish deal “is a very large contract for a relatively new and small company, and Senator Murkowski intends to find out more about it”.

Her committee expected to explore the contract at a hearing next month on hurricane recovery efforts and reconstruction of the electric grids in Puerto Rico and the US Virgin Islands, Daigle said.

Senator Steve Daines, a Montana Republican, said he did not know Whitefish or its CEO, Techmanski.

“The first I heard of the Whitefish Energy contract was through the news. I was surprised that such a small company from Montana got the contract,” Daines said.

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