Bigger Story Now Than Ever Thought
(But as many predicted)
Puerto Rico: Entire Power Grid Down After Hurricane Maria
4th Update (and I suspect this is not the last we
have heard about this mess or shall we call it for what it is: One huge “con”):
This update is
from the NY Times with this headlines:
Lineman Got $63 an Hour. PR Utility Billed $319 an
Hour
Extract from
this very extensive and detailed article (my emphasis added):
SAN JUAN, PR — The small energy outfit from
Montana that won a $300 million contract to help rebuild Puerto Rico’s tattered
power grid had
few employees of its own, so it did what the Puerto Rican authorities could
have done: It turned to Florida for workers.
For their
trouble, the six electrical workers from Kissimmee are earning $42 an hour,
plus overtime. The senior power linemen from Lakeland are earning $63 an hour
working in PR the FL utility said. Their 40 co-workers from
Jacksonville, also linemen, are making up to $100 earning double time, public
records show.
But the
Montana company that hired the workers, Whitefish Energy Holdings, had a
contract that allowed it to bill the Puerto Rican public power company, known
as Prepa, $319 an hour for linemen, a rate that industry experts said was far above the norm even
for emergency work — and almost 17 times the average salary of their counterparts in Puerto
Rico.
A spokesman for Whitefish, Chris
Chiames, defended
the costs, saying that “simply looking at the rate differential does not take
into account Whitefish’s overhead costs,” which were built into the rate and he
continued: “We have to pay a premium to entice the labor to come to Puerto Rico
to work.”
Many workers
are paid overtime for all the time they work. Overtime pay varies by type of
worker, union membership, mainland utility company, and many other factors.
As I said, this story is probably not over yet – stay tuned.
And. as usual, thanks for stopping by.
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3rd Update (today): Highlights from here (Boing-Boing.net):
Whitefish Energy's had quite a week:
Last week the two-person company from Whitefish, Montana (FYI: Hometown of Trump Interior Secretary Ryan Zinke) was awarded a $300 million contract to help rebuild the power-grid in Puerto Rico.
That contract has some very favorable terms including: (1) $462 / hour for subcontracted supervisors, (2) no penalties for nonperformance, and (3) a guarantee that the government wouldn't audit its expenditures, plus it was a “no-bid” contract.
Now, Whitefish has lost that contract after the governor of Puerto Rico demanded that it be canceled. The cancellation came with an announcement that all of Whitefish Energy's government contracts would be audited, and the FBI is involved now.
As they say: Something has stunk since day one on this “deal.”
So, stay tuned – expect W/H (via Tweeter storm at 3 am) to follow.
======================================================
2nd Update (October 27, 2017): This story just keeps growing each passing now it seems – the latest from The Hill here (in part) with this headline:
“FEMA has ‘Significant Concerns’ with Puerto Rico’s
$300M Power Deal”
Highlights and Intro:
The Federal Emergency Management Agency (FEMA) is sounding an alarm over Puerto Rico’s $300 million contract with a small Montana company to restore power infrastructure, amid concerns over the firm's tiny staff and lack of competitive bidding.
FEMA will be responsible for paying for the work by Whitefish Energy Holdings, but the Puerto Rico Electric Power Authority (PREPA), the island’s utility, entered into the contract.
(NOTE: The Company is named after the small town (Pop. 6,300) of Whitefish, MT which also happens to be the hometown of Interior Secretary Ryan Zinke – what a deal, um?).
From a FEMA statement: “Based on initial review and information from PREPA, FEMA has significant concerns with how PREPA procured this contract and has not confirmed whether the contract prices are reasonable. FEMA is presently engaged with PREPA and its legal counsel to obtain information about the contract and contracting process, including how the contract was procured and how PREPA determined the contract prices were reasonable.”
I note: As the old saying goes or a cliché of sorts: “I smell a rat.” Stay tuned.
======================================================
“Whitefish Energy Apologizes to Puerto Rico, San Juan Mayor
for Twitter Comments”
In part:
Whitefish Energy issued an apology to San Juan Mayor Carmen Yulin Cruz and “everyone in Puerto Rico” for comments posted in a public Twitter spat today.
The small Montana-based company is at the center of a controversial $300 million contract to restore electricity to the storm-battered U.S. island territory.
After Cruz questioned the transparency of the “alarming” contract — the largest awarded for relief efforts after Hurricane Maria — and demanded it be voided, Whitefish Energy’s Twitter account called her comments “disappointing and demoralizing” and appeared to threaten to stop working altogether, tweeting:
“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?”
More questions have arisen about how the company, which had only two full-time employees up until recently, managed to beat out other utility companies and secure the contract.
Interior Secretary Ryan Zinke and Whitefish CEO Andy Techmanski have admitted knowing each other but said that played no role in Whitefish getting the contract. The company’s investors also include HBC Investments, a Texas-based firm whose founder donated generously to President Trump.
Puerto Rico Gov. Ricardo Rossello echoed Cruz’s concerns on Wednesday, announcing that he’s asked the OIG to review the contracting process.
Wow – stay tuned.
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ORIGINAL POST: Whew boy – can we now add contract corruption in the Puerto Rico power grid recovery process by a well-connected small electric company tied to Trump campaign donor? Seems like it…
Introduction and Highlights from The Daily Beast:
Puerto Rico has agreed to pay a reported $300 million for the restoration of its power grid to a tiny utility company that is primarily financed by a private-equity firm founded and run by a man who contributed large sums of money to President Trump, an investigation conducted by The Daily Beast has found.
Whitefish Energy Holdings, which had a reported staff of only two full-time employees when Hurricane Maria touched down, appears ill-equipped to handle the daunting task of restoring electricity to Puerto Rico’s more than 3 million residents. Much larger utilities are more commonly used following natural disasters on the scale of Hurricane Maria, which devastated the island last month.
The private-equity firm that finances Whitefish, HBC Investments, was founded by Joe Colonnetta, who serves as its general partner. FEC 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 (maximum amount permitted), $2,700 to Trump’s general election campaign (the maximum), and a total of $30,700 to the RNC 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 RNC (maximum permitted) for party committees in 2016.
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 (R-MT).
Moreover, Whitefish is located in Zinke’s hometown of Whitefish, MT (Hence: The Company’s name: Whitefish).
My summary: I’m not saying (wink/wink) there is “corruption brewing there, there,” but corruption seems to be brewing there, there. How to solve it – how to get to the bottom of this apparent insider dealing and if so, it is totally unfair and certainly possibly illegal. A look-see is definitely called for this $300 million pending deal. That’s a lot of money.
The question is who will initiate a look-see.
Thanks for stopping by.
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