$48M 'No-Bid' State Department Grant for ISIS Bomb Removal Faces Scrutiny Under Pompeo

Sources: State Department officials rushed to lock-in grant in final days of Obama administration

Barack Obama
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May 29, 2018

A $48 million State Department grant to a for-profit company for IED and other bomb removal in Syria was rushed in the final days of the Obama administration to lock it in before President Trump was inaugurated, according to two sources with detailed knowledge about the process, as well as State Department grant records.

The grant is receiving new internal State Department scrutiny just a few weeks into Secretary of State Mike Pompeo's tenure, as U.S. government officials try to flag key areas of concern that the new secretary can address, the sources said.

The bombing and ordnance removal is extremely dangerous work but critically important for the safety of returning communities displaced by the Islamic State in Iraq and Syria, which left IED booby traps intended to maim or kill returning families or government workers.

By the late summer of 2016, a joint effort by foreign non-governmental organizations, NGOs, from Western Europe, local Iraqi groups, and Janus Global Operations, worked under State Department funding to clear bombs in Iraq.

Janus, a for-profit company which claims to be the largest munitions management and demining company in the world, at the time was the only U.S. commercial company under State Department contract for this type of work.

In 2016, the company cleared thousands of IEDs and explosives planted by ISIS in Ramadi alone.

Optima, a British company that bills itself as "leaders in explosive threat mitigation," in mid-2016 was in the middle of surveying an area in Fallujah littered with IEDs and planning a major clearing operation, according to its website.

Despite the expertise and experience of these companies and others operating in the region, by the end of December 2016, as the Obama administration was coming to a close, State Department officials in the Office of Near East Asia, Office of Assistance Coordination facilitated funding for a non-competitive grant to Tetra Tech. 

The State Department's Political-Military, Weapons Removal Abatement, or PMWRA, Office ultimately approved and authorized the grant.

Tetra Tech is an engineering services company that specializes in construction management and has much more limited experience in munitions and ordnance clearance than Janus and other foreign NGOs such as HALO Trust and for-profit companies such as Optima, FSD/Crosstech, Mechem, and others, sources said.

The State Department's PMWRA office had never worked with Tetra Tech before the $48 million grant for large-scale IED removal in Syria, spurring more questions in the contracting community about why it was selected, the sources said.

Tetra Tech, according to its website, had experience in supporting the U.S. Army Engineering and Support Center in the disposal of unexploded ordnance and munitions removal in Iraq. The website does not cite a date for that project.

Munitions handling, however, is different than IED clearance work, which requires more sophisticated experience and skill sets. IEDs set by ISIS are hidden boobytraps, difficult to detect and even more difficult to safely disable.

Officials in the U.S. State Department's PMWRA office worked to expedite a start date for Tetra Tech's IED removal grant before Jan. 19, 2017, the day before President Trump was inaugurated, the sources said.

"There was a mad dash in the PMWRA and NEA bureaus to get this done by Jan. 19," said one source familiar with the internal State Department effort. "They got the grant funded by Dec. 29, 2016, and then got the internal paperwork finished by Jan.19, working in theater with the NEA regional bureau to lock this in."

According to the website, the State Department's PMWRA Office provided the grant money for "Syrian Conventional Weapons Destruction" with the funds doled out in tranches for work performed over the course of two years and two months.

The first award of $8 million was provided Dec. 29, 2016, with another $8 million coming March 29, 2017. The State Department doled out another $30 million May 5, 2017, and provided the final $2.4 million Sept. 21, 2017.

While the publicly available grant award information is currently listed for $48 million, it was eventually worth more than $150 million as Germany and other countries directed funds to Tetra Tech for Syria's IED clean-up efforts, sources said.

A Defense One report in August 2016 noted that the State Department had just secured $86 million from 26 countries for demining efforts over the next three years.

The awarding of a "no-bid" grant, instead of allowing several companies to compete for a government contract through the paper-intensive and time-consuming government bidding process, raised immediate questions about the project's selection process in the government contracting community, the sources said.

Patrick Kernan, a government contracting attorney who previously served as the chief of contract fiscal law for the Multinational Force in Iraq as a U.S. Army Judge Advocate General, said a U.S. government agency providing a grant to a large, for-profit company is unusual and raises legal red flags.

Whether it broke any laws or State Department procedures and rules, he said, would depend on internal paperwork and whether the officials involved precisely followed all the agency's grant rules.

"[It] sounds like a way to circumvent the strict sole-source contracting rules by pushing money into a grant process," which provides far less oversight than the regular contracts, he said in an email. "It sounds like a pretty broad problem that needs some legislation to fix."

Usually grants are awarded instead of contracts to NGOs and other entities for projects aimed at benefitting the public good, instead of simply providing a service to the U.S. government. However, critics say federal agencies are increasingly doling out grants as a way to streamline the process and provide lucrative contracts to a select contractor and avoid subjecting the contractor to the competitive bidding process.

The practice has drawn scrutiny from government inspectors general. In one case in 2007, the Labor Department's inspector general found that 90 percent of non-competitive grants examined in detail (35 out of 39) were processed in a way that did not conform with proper procedure.

If the PMWRA truly believed a grant was warranted, critics question why it didn’t ask other private commercial companies with more experience in IED clearance to set up special NGOs to bid on the project.

Critics of the Tetra Tech IED removal grant also question a subsidiary of Tetra Tech's hiring of a low-level program coordinator who worked at PMWRA, as the administrative assistant to PMWRA Office Director Stanley Brown until the end of 2017.

Late last year or early this year, the PMWRA coordinator was hired by Tetra Tech subsidiary PRO-telligent to serve as a "grants management specialist" for the State Department's Bureau of Near Eastern Affairs Office of Assistance Coordination, according to the employee's LinkedIn profile.

That NEA office initiated plans to award the $48 million grant to Tetra Tech, before PMWRA signed off on it.

The grants management specialist position helps with "internal and external oversight" of U.S. foreign assistance programs in the Middle East.

U.S. laws bar a former government employee involved in the procurement of a government contract worth $10 million or more from going to work for the company who received the contract for one year.

Those laws, however, specifically apply to contracts, not grants, according to Kernan.

Most contract workers—even those that help staff State Department offices—are largely exempt from the revolving-door laws, he said.

The U.S. Office of Government Ethics, which provides ethics guidance to all federal employees, points out that there is a criminal conflict of interest statute prohibiting a government employee from "participating personally and substantially, in an official capacity, in any 'particular matter' that would have a direct and predictable effect on the employee's own financial interests."

"Even in the government contract context, there are ways to get around those rules, so it is a real fact-specific inquiry," Kernan told the Washington Free Beacon.

Questions on Tetra Tech's safety record arose after the high-profile death of one of its employees while he was clearing bombs ISIS left in Raqqa, Syria, in October last year.

The employee was a 41-year-old British bomb disposal expert who had spent 20 years in the British Army's bomb disposal units in Kosovo, Iraq, and Afghanistan.

Tetra Tech's spokeswoman Charlie MacPherson referred all of the  Free Beacon's questions to the State Department.

The Free Beacon specifically requested the company's safety record on the Syria grant and asked whether it followed all U.S. government rules in applying for the State Department grant.

Asked for details about why the State Department's Political-Military Affairs' Office of Weapons Removal and Abatement, or PMWRA, grant to Tetra Tech, a State Department official said only: "As a matter of policy, we do not comment on contracting details."

The official referred to a State Department fact sheet on the Syria IED clearance project, which said the PMWRA office had provided a total of $54 million since fiscal year 2015 to support the clean-up efforts "with additional financial contributions coming from our international partners."

The IED and mine clearance project, resulted in the removal of 20,000 landmines, pieces of unexploded ordnance and IEDs from more than 15.5 square meters of land, "facilitating the refurbishment of critical infrastructure and return of agricultural land previously denied to Syrians by ISIS-placed explosive hazards," according to the fact sheet.

Pressed further to provide an explanation about why the $48 million for IED bomb removal was provided through a grant, not a contract, and rushed through in the final days of the Obama administration, the State Department asked for more time and responded two days later.

A State Department official said the PMWRA office "generally works with for-profit companies in cases where humanitarian needs exceed the capabilities of demining NGOs."

"Syria is arguably the most difficult country in the world to conduct these operations in," the official said. "This project was awarded in full compliance with all applicable laws, regulations, and administrative procedures governing grants and cooperative agreements."

The State Department official did not say why PMWRA did not give other companies with extensive de-mining experience, such as Janus Global Operations, Optima, FSD/Crosstech, Mechem, UXB, DynCorps, or NGOs a chance to bid on the Syria project.

"Following the liberation of Manbij [in Northern Syria] from ISIS control in August 2016, we had an urgent need for an implementing partner who could work in the exceptionally difficult security environment and who had the resources, technical capacity, and willingness to implement a program quickly and effectively," the official said.

However, with other companies and NGOs already providing IED removal in the region, Tetra Tech was not uniquely situated to take on and execute the grant, sources say.

There is no evidence, for instance, that Tetra Tech was already working in Syria on IED projects prior to their no-bid grant award.

The State Department official said the company's safety record is "comparable to other organizations clearing explosive hazards in areas liberated from ISIS control."

Tetra Tech's spokeswoman declined to discuss the company’s history or expertise in IED-mine removal work or their safety record for the Syria project.

The official also said neither Tetra Tech, nor any of its subsidiaries has hired a "direct-hire" State Department employee.

However, the official didn't deny that Tetra Tech's subsidiary, PRO-telligent, hired a contractor who had worked in State's PMWRA office that awarded the $48 million grant.

Asked whether other official State Department employees in PMWRA office were offered positions with Tetra Tech or a subsidiary, the State Department official said the agency doesn't track the private job search activities of its employees.

"To our knowledge, no PM/WRA direct hire employees have been hired by Tetra Tech or its subsidiaries," the official said. "The Department has contracted with PRO-telligent, a Tetra Tech subsidiary, to fill a number of positions in different bureaus and offices."

"Because the Department does not track the private job-search activities of its employees, we are unable to say with whom PRO-telligent may have spoken."

The State Department official said "PMWRA program management staff are familiar with the laws and regulations prohibiting 'revolving door' employee arrangements."

"Indeed, department employees must complete mandatory ethics training upon appointment and additional ethics training and information – including clear guidance on these very employment issues – is readily available for department employees."

Published under: Obama Administration