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Archive for Sunday, October 31, 2004

Army extended Halliburton contracts despite warnings of contracts officer

October 31, 2004

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— The Army extended a Halliburton Co. troop support contract over the objections of a top contracting officer, even contending -- and then withdrawing -- a claim that U.S. forces faced an emergency if the company didn't get the extra work.

"I wrote directly on the document the weaknesses ... so that all could clearly see," contracting official Bunnatine Greenhouse wrote a top general this month in questioning the extended troop support contract in the Balkans.

Greenhouse has had problems with the $2 billion contract at least since January 2002, when she wrote, "There is little or no incentive for the contractor to reduce or keep cost down."

Greenhouse complained, in writing, Oct. 5 to Lt. Gen. Carl Strock, commander of the Army Corps of Engineers, that the corps should not have halted plans to let companies compete for a successor Balkans contract. She is the corps' top contracting officer.

Corps officials initially justified stopping the bidding by concluding that a "compelling emergency" would exist if Halliburton's work were to be interrupted.

When Greenhouse challenged the justification and sought an explanation of the emergency, however, corps officials changed their reasoning. The new explanation was that Halliburton subsidiary KBR was the "one and only" company that could do the job.

Greenhouse wrote Strock that "the truth should be clearly explained" about the reason for halting competition.

She not only complained there was no explanation of what drove officials to cite an emergency, but, referring to the second justification, added: "It is not reasonable to believe that only one source responded to the solicitation."

Greenhouse, who has said she was frozen out of decisions on Halliburton, went public last weekend with allegations that Army officials showed favoritism to the company.

The FBI has asked Greenhouse's lawyers for an interview with her. The bureau has launched a criminal investigation of Halliburton's no-bid work.

The Associated Press has obtained dozens of documents that Greenhouse intends to provide to investigators.

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