WASHINGTON – The Pentagon's use of no-bid contracts meant to field urgently needed war goods like counter-IED devices has tripled since 9/11, despite promises to reform the controversial practice once justified by military planners at the outbreak of war ten years ago, a new watchdog report finds.
After repeated pledges and orders from President Barack Obama and Defense Department leaders to clean up the no-bid trough, “Campaign pledges and memos have made little headway in combating the problem,” writes Sarah Whitmire, in the Center for Public Integrity's first installment of a five-day investigative report on war contracting, released Monday. What was a $50 billion worry in 2003 has ballooned to $140 billion in 2011.
The report is the latest dispatch in the Center’s “Windfalls of War” series, which in 2003 accounted for the explosion of war spending in the buildup and aftermath of the Iraq invasion and early Afghanistan fighting. (Full disclosure: I was a writer on the original project.) At the time, when U.S. officials refused or could not say how much money the wars were costing taxpayers, through Freedom of Information Act requests the Center discovered billions of dollars were being doled out to huge defense firms, like Halliburton. The Pentagon, in some cases, simply modified previously existing contracts for unrelated goods and services instead of opening up a new bidding process to competition, sometimes adding tens of millions to the potential value of the original contract.
The Pentagon and other contracting agencies said the practice was justified because the need to troops was too urgent. Some of the contractors, DOD said, were the only ones capable of providing unique and uniquely large services, like rebuilding Iraq’s electrical system. The Center found that was untrue in many cases.
“There have been many instances, because of wartime needs, where a long, lengthy, competitive-bid contract process does not serve the needs of the war fighters. There are instances when non-competitive bidding is absolutely necessary,” said Pentagon spokesman Col. David Lapan. “We’ve tried to…[make] sure that no-bid contracts don’t lead to higher costs, but again, it many instances it’s a matter of saving lives, doing things more quickly because of the nature of conflict.”
The independent Commission on Wartime Contracting in Iraq and Afghanistan also is about to report that one in every six contracting and grant dollars spent in Iraq and Afghanistan has been wasted, according to published accounts.
“We are well aware of some of the deficiencies over the years in how we’ve worked contracts,” Lapan said, listing several steps taken since 2003, including the creation of special inspector general’s offices and task forces in the war zones, to audit contracting.
On Monday, the Center highlights one recent example: DOD awarded $50 million in sole-sourced contracts to Applied Energetics, an Arizona firm developing a device that shoots a lightning bolt from the front of a vehicle to detonate improvised explosive devices. The Marines recently canceled the contract. Another company, it turns out, developed their own lightning rod for just $1.5 million and is now testing it on military ranges.
“The bomb fighting contract is a small example of a problem that’s been exacerbated by 10 years of war: awarding contracts without competition,” the Center writes. “And despite repeated pledges to reform the process, non-competitive contracts are a hard habit to break.”
So far this year, just 55 percent of DOD contracts have been awarded after competition – the lowest rate among total contracts since 9/11.
The lightning bolt experiment has been, well, struck down by many critics over the years. Wired.com’s military tech blog, Danger Room, has derisively tracked the weapon, finally writing, “The Pentagon and Its Bogus Bomb-Zapper: A Love Story.”
The Center for Public Integrity deemed it, and the larger counter-IED mission, “The Manhattan Project that failed.”
The rest of the series:
Tuesday: After a decade of war, KBR’s “concierge” contract tops $37 billion
Wednesday: Pentagon spends millions of US tax dollars on Russian-made helicopters to outfit Iraqi and Afghan militaries
Thursday: Pentagon caught abusing its sole-source authority on weapons from tankers to choppers
Friday: Other departments, from Energy to State, have far better records on competition for big contracts