Idle Contractors Add Millions to Iraq Rebuilding (NYT)

[spindrifter]

By JAMES GLANZ
Published: October 25, 2006

Overhead costs have consumed more than half the budget of some reconstruction projects in Iraq, according to a government estimate released yesterday, leaving far less money than expected to provide the oil, water and electricity needed to improve the lives of Iraqis.

The report provided the first official estimate that, in some cases, more money was being spent on housing and feeding employees, completing paperwork and providing security than on actual construction.

Those overhead costs have ranged from under 20 percent to as much as 55 percent of the budgets, according to the report, by the Special Inspector General for Iraq Reconstruction. On similar projects in the United States, those costs generally run to a few percent.

The highest proportion of overhead was incurred in oil-facility contracts won by KBR Inc., the Halliburton subsidiary formerly known as Kellogg Brown & Root, which has frequently been challenged by critics in Congress and elsewhere.

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http://www.nytimes.com/2006/10/25/world/middleeast/25reconstruct.html?hp&ex=1161748800&en=10920cf59eaeb386&ei=5094&partner=homepage

[WCGreen]

1. I am shocked, shocked I tell you...

[judaspriestess]

2. sick n/t

[OneBlueSky]

3. someone should initiate a class action suit on behalf of . . .

the American taxpayers for return of the millions (if not billions) of dollars that companies like Halliburton have stolen from our government -- even though it was stolen with the government's knowledge and consent . . .

and where the hell is the Congressional oversight? . . .

[DeepModem Mom]

4. WP: Halliburton Cited For Iraq Overhead: Costs in Oil Contract Extreme

Halliburton Cited For Iraq Overhead
Costs in Oil Contract Called Extreme
By Griff Witte
Washington Post Staff Writer
Wednesday, October 25, 2006; Page D01

Administrative overhead accounted for more than half the costs that a Halliburton Co. subsidiary passed on to the government under a key contract to restore Iraq's oil industry, a figure that critics said was unusually high.

A report released yesterday by the inspector general's office overseeing Iraq spending found that at least 55 percent, or $163 million, of $296 million in total costs rung up by Halliburton unit KBR went to expenses such as back-office support, transportation and security. That percentage was significantly higher than it was on work by other firms in Iraq, and experts said it is far above what is typically found on a government contract.

The findings are the latest that call into question KBR's work under the deal, which required the company to rehabilitate oil facilities in southern Iraq. Under the contract's terms, KBR is reimbursed for its costs and then receives a percentage for profit on top, an arrangement that critics contend has given the firm an incentive to run up its bills.

According to internal government documents released in March, auditors found that the company had repeatedly overcharged the government by, among other things, billing for work it didn't actually do and paying suppliers more than they were owed. Meanwhile, work schedules slid and company officials balked at requests for accurate cost estimates. At one point, officials threatened to terminate the deal. Instead, KBR -- which has received more money from the Iraq war effort than any other firm -- was allowed to keep the contract and is now winding up work....

***

The United States has devoted more than $20 billion to rehabilitate Iraq, but critics contend that much of the money has been wasted as contractors used the government's checkbook to spend lavishly on hotels, food and employee salaries. Halliburton has come under particularly intense scrutiny because of the volume of work it has done in Iraq and because Vice President Cheney was once the firm's chief executive....

http://www.washingtonpost.com/wp-dyn/content/article/2006/10/24/AR2006102401237.html

[saigon68]

5. It's called "Milking the Golden Cash Cow"

Bring up the stool boys, and sit down with your pail and bucket.

LOL

[DoYouEverWonder]

6. Get the damn contractors out of Iraq

and give the money and oil back to the Iraqis so they can rebuild their own country.