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Study: Donors get contracts

Executives, employees and political action committees from the 70 companies that received government contracts for work in either Iraq or Afghanistan contributed slightly more than $500,000 to President Bush's 2000 election campaign, according to a comprehensive study of the contracts released Tuesday.

The overwhelming majority of government contracts for billions of dollars of reconstruction work in Iraq and Afghanistan went to companies run by executives who were heavy political contributors to both political parties.

Though the employees contributed to both parties, their giving favored Republicans by a 2-1 ratio. And they gave more money to Bush than any other politician over the past 12 years.

Among the biggest contributions to Bush's election and re-election efforts were executives and employees from Dell Computer at $113,000; from Bearing Point, a business consulting firm, at $119,000; from General Electric at $72,000; and from Halliburton at $28,000, according to the report.

Nine of the 10 biggest contractors, the biggest of which are Bechtel Corp. and Halliburton Inc., either employed former senior government officials or had close ties to government agencies and the Congress.

Prepared by the Center for Public Integrity, a nonprofit research group, the report said that the contractors' executives and employees have contributed $49-million to political candidates and parties since 1990.

The new report is the first comprehensive independent study of companies involved in Iraqi reconstruction, and it provides evidence that the process for handing out big contracts has often been secretive, chaotic and favorable to companies with good political contacts.

The report is the result of a six-month investigation, which included obtaining information on 70 contracts through the Freedom of Information Act.

The report confirms that many if not most of the contracts handed out for work in Iraq were awarded through a process that was inscrutable to outsiders and often without competitive bidding.

One consultant, given a four-month contract to advise Iraqi government agencies, was the husband of Carol Haave, the deputy assistant secretary of defense for security and information operations. A Pentagon spokesman said that Haave did not see this as a conflict of interest, according to Bloomberg News.

One of the report's most basic conclusions is that neither the Pentagon nor the State Department or the U.S. Agency for International Development were eager to provide comprehensive or accurate information about contracts that total about $8-billion over the past two years.

Ellen Yount, the spokeswoman for USAID, disputed that claim and said her office had cooperated with the center and that requests for proposals for Iraq contracts had been publicly available on the agency's Web site for more than six months. "I found the report sloppy and inaccurate in many instances," she said.

Political questions have dogged the administration over the awarding of lucrative contracts since the war began. Initially, administration officials restricted bidding to a select group of firms and expedited the awarding of the contracts, saying they needed to be prepared to rebuild the country as soon as the war ended.

Congress is set to approve $20-billion for reconstruction in Iraq and Afghanistan this week, much of it going to these firms.

Although the size of the initial contracts were relatively small, the winning companies gained a huge advantage over competitors with an early presence in Iraq.

One case examined by Congress was the Army Corps of Engineers award of a contract without competition to Kellogg Brown & Root, a Halliburton subsidiary, to fight oil well fires in Iraq.

Vice President Dick Cheney was Halliburton's chief executive from 1995 until 2000. The White House said it had no involvement in that or any other of the contracts awarded for reconstruction.

Following the money

The following is a list of companies whose post-war government contracts exceed $100-million and the total contributions they have made to political campaigns from 1990 through mid-year 2003. The two biggest contributors during that time had contracts worth less than $100-million: General Electric with $8.8-million in donations ($5.9-million contract) and Vinnel Corp. with $8.5-million ($48.1-million contract).

CONTRACTOR CONTRACT TOTAL DONATION TOTAL

Kellogg, Brown & Root (Halliburton) $2.33-billion $2.38-million

Under its existing contract, the company was asked to repair damage to Iraq's oil industry and to provide logistical support to the U.S. military. New contract will focus on longer-term repairs to the oil industry. In Afghanistan, logistical support to the Army and constructing a new U.S. Embassy in Kabul.

Bechtel Group Inc. $1.03-billion $3.31-million

Company plans to subcontract 90 percent of the work. Contract includes work on rehabilitation of electricity, water and sewage, airport facilities, the Umm Qasr seaport as well as reconstructing hospitals, schools and government buildings, among others.

International American Products Inc. $526.8-million $2,500

Electrical supplies and services worldwide for the Army. Contract increased to rebuild Iraq's electrical infrastructure and train the Iraqi Ministry of Electricity. Also delivered electrical supplies and services in Afghanistan.

Perini Corporation $525-million $119,000

One of three companies hired to provide field support for Central Command (CENTCOM) in Iraq, Afghanistan and 23 other countries. Each contract has a $500,000 minimum and could earn each company up to $500-million. The company also said it would earn up to $25-million for a contract to design/build facilities to support the First Brigade of the Afghan National Army.

Contrack International Inc. $500-million $2,000

Design and construct military facilities and other infrastructure projects.

Fluor Corp. $500-million $3.62-million

One of three companies hired to provide field support for Central Command in Iraq, Afghanistan and 23 other countries. Each contract has a $500,000 minimum and could earn each company up to $500-million.

Washington Group International $500-million $1.19-million

One of three companies hired to provide field support for Central Command in Iraq, Afghanistan and 23 other countries. Each contract has a $500,000 minimum and could earn each company up to $500-million.

Research Triangle Institute $466.1-million $1,950

Help increase management skills of local government and improve delivery of public services, as well as provide training in communications, conflict resolution, leadership skills and political analysis. RTI is also a subcontractor to Creative Associates on its education project.

Louis Berger Group $300-million $212,456

Assess Afghanistan's infrastructure and provide a "vulnerability assessment map" and "rehabilitate economic facilities" in Afghanistan. Media reports say the company has a $300-million contract to oversee postwar reconstruction in Afghanistan, but that contract was not include in materials provided under the Freedom of Information Act.

Creative Associates International Inc. $217.2-million $10,300

In Afghanistan, rebuild schools, train teachers and provide textbooks. In Iraq, provide school kits, including pencils, pens, erasers, rulers, etc., as well as teacher training and to award grants for Iraqis to launch local parent-teacher associations.

Chemonics International Inc. $167.8-million $24,350

Three contracts in Afghanistan: improve food security in the Shomali Plain north of Kabul and rehabilitate 250 miles of irrigation canals to support farmers; rebuild Afghanistan's agricultural sector, including improving food security; reduce poverty and strengthen food security in Afghanistan.

BearingPoint Inc. $143.7-million $4.95-million

Facilitate Iraq's economic recovery. In Afghanistan, rebuild economic infrastructures.

For a complete list of contractors, contract amounts and descriptions and political donations, go to www.publicintegrity.org/wow/

SOURCE: Center for Public Integrity

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