Federal audit scrutinized Overland Park company over payments for Afghanistan work
More than $1.3 million that Overland Park-based Black & Veatch received in reimbursements from a U.S. government contract was scrutinized by federal auditors last year.
The company says it paid back $2,700 after a review of the audit by the U.S. Agency for International Development, which had a contract with Black & Veatch.
USAID awarded Black & Veatch a contract in 2010 to work on the Kandahar Power Initiative, later renamed the Kandahar Helmand Power Project. The project was part of a national initiative to improve the South East Power System and connect it to other electrical grids and “ a critical component of the U.S. government’s counterinsurgency strategy in southern Afghanistan,” according to the audit commissioned by the Office of the Special Inspector General for Afghanistan Reconstruction, or SIGAR.
The audit, which was obtained through an open records request by The Star, initially found Black & Veatch received $1,313,191 in “ineligible costs” prohibited by the contract, which it deemed a “significant deficiency and noncompliance.” Auditors recommended that Black & Veatch return the money.
Black & Veatch called the audit’s conclusion “erroneous” in a response published in the audit.
In a statement, Black & Veatch spokesman Patrick MacElroy said that the company finished its work in Afghanistan at the end of 2014 and that USAID has found “the vast majority” of the charges questioned by SIGAR to be appropriate in a subsequent review.
“Black & Veatch is proud of our accomplishments in having successfully delivered numerous projects across Afghanistan that have helped more than double the amount of reliable power available to the country’s hospitals, schools, businesses and homes,” MacElroy said. “Under the terms of our contracts with USAID we provided engineering, construction and program management services related to power infrastructure development in one of the world’s most challenging operating environments.”
Auditors questioned several other smaller amounts of money, including a $34,473 charge for a mobile phone service for which Black & Veatch allegedly did not complete a cost or price analysis. In all, the audit questioned $1,350,382 that Black & Veatch received, mostly consisting of the $1.31 million reimbursement the audit thought improper.
Asked about the audit in October, a USAID spokesperson said the agency took the findings seriously and was “still completing a lengthy review and investigation of any improper charges.” Asked about the review Monday after The Star obtained a copy of the audit, the agency referred questions to SIGAR and the USAID Office of the Inspector General.
According to a USAID spokesperson, the Afghan government assumed full operations of the Kajaki Power Plant in 2017, “providing access to cheaper and more reliable electricity in Helmand and Kandahar.”
Struggles to rebuild the Kajaki Dam drew wide criticism as a “waste.”
U.S. Sen. Claire McCaskill, D-Missouri, has previously pushed for information regarding taxpayer resources “wasted in Afghanistan.”
“As a former auditor, I know just how important oversight and investigations are to ensure taxpayer dollars aren’t being wasted,” McCaskill said in a statement. “I look forward to reviewing this audit to ensure we’re doing everything possible to cut down on waste, fraud and abuse in federal contracting.”
This story was originally published July 31, 2018 at 11:30 AM.