Construction, Engineering Industry Denounces Iraq Reconstruction Study

A coalition of construction and engineering organizations condemned a study released by the minority staff of the House Government Reform Committee and the Senate Democratic Policy Committee, which criticized the Iraq reconstruction effort. The coalition said the study's findings and conclusions failed to understand the long, established processes used in carrying out complex, taxpayer-funded construction projects.

The “Contractors Overseeing Contractors” study examines two contracts for oversight of the Iraq reconstruction: 1) a $28.5 million contract awarded to a joint venture of Parsons and CH2M Hill to oversee $1.7 billion in public works and water projects by four other contractors (Fluor, Washington Group International, AMEC, and Black & Veatch); and 2) a $43 million contract awarded to a joint venture of Parsons and a separate company, Parsons-Brinckerhoff, to oversee $1.6 billion in power generation, transmission and distribution projects by four other contractors (Fluor, Washington Group International, AMEC, and Perini.)

The study concludes that neither Parsons nor CH2M Hill is an “independent watchdog,” and each has significant conflicts of interest with the contractors there are to oversee.

“Contractors use a time-honored and transparent practice, favored by many government agencies, of tailoring joint ventures and construction management practices to suit specific project execution and financial requirements,” the coalition countered. “The study ignores or fails to understand the substantial, time-tested safeguards that provide an auditable trail used to measure the performance and costing of engineering, construction and project management contracts.”

The coalition added that many government audit agencies already are looking over these contracts, and that there are “ample safeguards” to protect the interests of the taxpayer.