The Lineman Got $63 an Hour. The Utility Was Billed $319 an Hour.

[deminks]

https://www.nytimes.com/2017/11/12/us/whitefish-energy-holdings-prepa-hurricane-recovery-corruption-hurricane-recovery-in-puerto-rico.html?smid=tw-nytimes&smtyp=cur

SAN JUAN — 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 Puerto Rico, the Florida 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.

(snip)

Questions are already being raised about a second contract that Prepa signed, this one with an Oklahoma company, Cobra, which was the highest bidder, required a $15 million down payment and — like the doomed Whitefish agreement — included a clause that said the deal could not be audited.

(end snip)

Gouging in Donnie's America. Who could have imagined?

[BigmanPigman]

1. Meanwhile 44% the citizens in PR are still without power

after the repaired lines failed.

[ghostsinthemachine]

2. Lock em up, lock em up!

[Hortensis]

20. :) No doubt overbilled. HOWEVER, let's first subtract some

little costs, like just those of materials alone.

Someone recently stole the wires connecting our little vacation mobile home in Florida to the power pole standing right by it. (Mostly surrounded by marsh, it's an easy target.) My husband's not here to remind me of what the new line cost us, but I do remember that it both shocked me and completely explained why someone bothered to steal it. And Florida's not an island 1000 miles out to sea.

[msongs]

3. one wonders why government managers sign such stupid deals. kickbacks? nt

[justhanginon]

5. It certainly doesn't happen by accident. But seems to happen a lot from

what we see. I wonder what happens that we don't see. It would probably scare the hell out of anybody to see how our tax money is abused for scurrilous corporations benfit.

[ms liberty]

4. K&R. n/t

[jimmil]

6. It is not unusual....

For a company to make scads more money off of workers than the workers are paid. My old company made approx $1.2m per engineer per year while paying them around $100K a year and total company expense per engineer was $250K leaving $950K per year profit for the company.

[Bernardo de La Paz]

7. Exactly as I predicted in several posts about the criminal Whitefish scheme.

Thanks for posting how it turned out to be the case.

https://www.democraticunderground.com/?com=view_post&forum=1014&pid=1899914

October 29:

Whitefish would get paid $300 + per hour for some subcontractor positions (supervisors, e.g.) but you can be sure the subs would not see more than about $60 per hour, max.

[Ilsa]

8. I was on Twitter and someone tweeted a pic of their FEMA food.

Potted meat (protein) Cheez-its (starch/carb), AirHeads (fruit), and Baby Ruths (desserts). In other words, FRAUD by a contractor.

Link to tweet

Might need to contact Congress and FEMA about this shit.

[BREMPRO]

9. "included a clause that said the deal could not be audited." wonder why they wanted that included??

unbelievable this shit takes place without more public airing and outrage. I thought no bid sweetheart contracts with unqualified insiders died off with the Browney/FEMA, Cheney/Haliburton era scandals... but i guess not. Thanks for making America great again Dotard Rump.

[shadowmayor]

10. Telephone call for Mr. Sessions

Hey Attorney General - gotta job for you! Or are you the guy who doesn't do his fucking job? Que Mr. Wahlberg to punch Mr. Sessions right in the pie-hole!

[residentcynic]

11. Yeah, $319 may be high, but...

Is the $63/hr straight time? If so, then OT costs for this employee would be 1.5x to 2x that. Does the employer pay SS and FICA on these employees? Add another 10%. Is the employer paying for their room and board while on the job? Is that covered by the $319? The employer has to advertise for employees in trade mags and pay for whatever vetting process they use. More employer cost. The employer has administrative cost (payroll, records, etc.) that are covered in the $319/hr they bill. It's not like the is making pure profit on every dollar over $319. We Dems need to focus on real issues (and there is no shortage) rather than try to make something that isn't that different than what outside firms who supply consultants, contractors or any temporary skilled workers charge, even in the USA. Flame away.

[GP6971]

13. Lodging and meals

are covered by another Contract Line Item Number. If I remember correctly, lodging and meals are billed separately at over $300 a day.

[Massacure]

15. I can only speak from an IT contracting perspective, but...

An average worker will take home 45-55% of what the staffing firm bills the client, and the rest is devoted to paying for benefits and overhead. Travel, lodging, and meal costs can either be itemized and passed through, or sometimes a per diem amount is specified.

I find it hard to believe that a worker is earning $140-$175 an hour or that Whitefish is paying anywhere near the $412 that they are billing Puerto Rico for daily lodging and meal cost.

[madville]

17. What are the workers' employers billing Whitefish to use their workers?

That's what I would like to see. I don't really care what the worker's hourly rate is, that means nothing. When my company used to loan me out to other corporations for projects they would typically bill them $175 an hour for the service and $150 a day for per diem.

Eventually all this outrage will just run off all these companies that are capable of orchestrating such projects, the people really losing are the ones without power who probably don't care what the costs are right now.

[Tom Rinaldo]

19. Every dollar Whitefish charged subcontracting above industry norms for similar scenarios was gauging

Sure they didn't make pure profit on the $256 per hour they billed Puerto Rico above the pay they gave the linemen. But are you trying to claim that the cost of actual labor is less than a third of the cost of hiring that labor and administering their records etc? For each and every hour that each and every worker worked? Week in and week out? That is laughable on its face. Especially at this reimbursement level. It essentially costs no more to do record keeping for electrical linemen than it does for burger flippers. Other companies hired and trained the workers that Whitefish profited from in Puerto Rico. Whitefish brought nothing to the table except political connections. They had no expertise in managing this type project - they had no workers of their own. They are leaches pure and simple, profiting greatly from other's grief. And that goes to the core of the corruption inherent in the current Republican control of Washington

[residentcynic]

21. Nope

If you read my post you can easily see I'm not trying to claim what you're saying. I do, however, believe that there are many things to be hysterically outraged about and this one is low on the scale. As for your point that they had no workers - well, no company sits around with hundreds of workers on its payroll waiting to get a bid to do repair work after a natural disaster. Sure, there's probably a political connection aspect to the contract and I'm fine with outrage directed at that. In fact, I would think that competitors, if there's really that much money to be made, would be up in arms fighting Whitefish.

[OxQQme]

12. The Shock Doctrine in play

>"Central to the book's thesis is the contention that those who wish to implement unpopular free market policies now routinely do so by taking advantage of certain features of the aftermath of major disasters, be they economic, political, military or natural. The suggestion is that when a society experiences a major 'shock' there is a widespread desire for a rapid and decisive response to correct the situation; this desire for bold and immediate action provides an opportunity for unscrupulous actors to implement policies which go far beyond a legitimate response to disaster. The book suggests that when the rush to act means the specifics of a response will go unscrutinized, that is the moment when unpopular and unrelated policies will intentionally be rushed into effect. The book appears to claim that these shocks are in some cases intentionally encouraged or even manufactured."<

https://en.wikipedia.org/wiki/Naomi_Klein#The_Shock_Doctrine

[BadgerMom]

14. You know who is from Oklahoma?

Pruitt at the EPA is an Oklahoman. More pay to play? Certainly it’s not a sure thing, but with this band of bandits, it’s difficult to avoid such thoughts.

[FarCenter]

16. Prepa is owned by Puerto Rico and controlled by a board mostly appointed by the Governor

Why would they agree to such an outrageous contract?

[oasis]

18. Drain the swamp, eh?