Puerto Rico Governor Calls For Termination Of Whitefish Contract

by Joy Montgomery October 30, 2017, 1:51
Puerto Rico Governor Calls For Termination Of Whitefish Contract

Puerto Rico is scrapping a deal with a tiny American firm that fell under intense scrutiny after it nabbed a lucrative contract to restore electricity to the storm-ravaged island, the head of its power authority said Sunday.

Whitefish Energy Holdings was awarded the no-bid contract by the beleaguered Puerto Rico Electric Power Authority on September 26, and the deal has drawn loud criticism since its specifics have trickled out.

"There can not be any distraction that alters the commitment of raising electric system as soon as possible", Rossello said of the contract, which came under scrutiny last week.

Many people in the utility business had said that the authority, known as PREPA, would have been better off tapping into the well-established networks of utilities that have formed mutual aid groups expressly for the objective of emergency relief. Zinke has said he had nothing to do with the contract. The government already paid Whitefish $8 million and does not expect the U.S. Federal Emergency Management Agency to reimburse that sum, the sources said.

"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", it said.

The latest updates from the Puerto Rican government show that nearly 70 percent of the island remains without power; the storm made landfall on the island on September 20. "This was a state and local decision made by the Puerto Rican authorities and not the federal government", Sanders said. It is located in the same small Montana town that Interior Secretary Ryan Zinke is from, leading to some questioning if he had any involvement. When it was hired, 2-year-old Whitefish had just two workers.

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The Trump administration denied Friday (Oct. 27) that political connections had anything to do with restoring electrical connections in Puerto Rico, and Zinke said Friday he had nothing to do with the contract. Rosselló added that the contract "appeared to comply 100% with FEMA regulations".

Whitefish has said that its expertise working in mountainous terrain qualifies it for the job and that its business model calls for rapidly expanding using subcontractors.

Whitefish and PREPA did not immediately respond to a request for comment.

Though Zinke and Techmanski acknowledge knowing one another, the Interior Department and Techmanski both told the Washington Post the secretary played no role in Whitefish securing the contract.

But the industry plan may conflict with the goals of the federal control board that oversees Puerto Rico's troubled finances.

But last week Rosselló asked the Department of Homeland Security's inspector general to review the contracting process, even while seeming to defend Whitefish for "providing important recovery services to PREPA in the aftermath of Hurricane Maria, which completely destroyed the Island's electrical grid system".


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