House Democratic Leader Nancy Pelosi on Wednesday demanded an investigation into how a small Montana-based firm with ties to Interior Secretary Ryan Zinke struck a $300 million deal to repair Puerto Rico’s shattered electricity grid.
Whitefish Energy signed a $300 million contract with the Puerto Rico Electric Power Authority, or PREPA, to rebuild 100 miles of power infrastructure across the island.
Instead of activating “mutual aid” arrangements with other utilities, PREPA decided to hire Whitefish, even though other mutual aid agreements in Florida, Texas, and many other states have helped U.S. utilities rebuild following natural disasters.
Those agreements allow out-of-state utility workers to quickly arrive on the scene after a disaster. But the American Public Power Association, the trade organization that coordinates mutual aid for municipally owned utilities, said they never got a request for aid from Puerto Rico.
“All Americans should be concerned about the highly suspect Whitefish contract and the circumstances under which it was negotiated,” Pelosi said in a statement. “We are deeply concerned both about why and how a small, inexperienced firm was tasked with the massive job of rebuilding Puerto Rico’s devastated electrical grid and why PREPA failed to activate the mutual aid network, which effectively came to the aid of Texas and Florida after the devastation of Hurricanes Harvey and Irma.”
“Democrats demand Congress and the appropriate Inspectors General exercise their oversight role to get to the bottom of this suspicious agreement and hold this administration accountable for its dangerous lack of transparency in spending taxpayer money,” Pelosi added.
Pelosi is the latest lawmaker to express concern about the size of the contract and scale of the job awarded to Whitefish, a company that had two full-time employees the day Hurricane Maria hit Puerto Rico.
Sen. Maria Cantwell of Washington, the top Democrat on the Senate Energy and Natural Resources Committee, asked the Government Accountability Office on Tuesday to investigate the circumstances surrounding Whitefish’s contract.
Natural Resources Committee Chairman Rob Bishop, R-Utah, also will be looking into the contract, his office said, and the lawmaker is visiting Puerto Rico this week to learn more about it.
In addition to questioning Whitefish’s qualifications, some lawmakers suspect Zinke played a role in picking the company because it is based in his hometown.
“We also need to better understand whether FEMA and the Army Corp of Engineers were involved before the award of this contract, whether they are conducting appropriate oversight, and what if any role Secretary Zinke had in the award and management of the contract,” Pelosi said.
Zinke and Whitefish both say he had nothing to do with the contact.
Whitefish says it now has 300 contract utility workers on the ground in Puerto Rico and about 15 or 20 more are arriving each day.
PREPA Executive Director Ricardo Ramos defended the contract, saying Whitefish was the first “available to arrive and they were the ones that first accepted terms and conditions for PREPA.”
“The doubts that have been raised about Whitefish, from my point of view, are completely unfounded,” Ramos said.
Seventy-five percent of Puerto Rico remains without power.
