The Montana company that received a massive contract to fix Puerto Rico’s energy grid paid power linemen $63 per hour for their work but charged the island hundreds of dollars for the repairs, according to a report Sunday from The New York Times.
Whitefish Energy paid six electrical workers from Kissimmee, Fla., $42 an hour on work rehabbing Puerto Rico’s bedraggled grid, while others in the state earned $63 per hour for their work. Whitefish stiffed Puerto Rico with a $319 bill for linemen, which is far above the going rate.
Whitefish, for its part, maintains that the price was appropriate and needed to attract the workers for such a risky operation – Hurricanes Irma and Maria from September ravaged the entire island and downed Puerto Rico’s power lines.
“We have to pay a premium to entice the labor to come to Puerto Rico to work,” the company’s spokesman, Chris Chiames, told reporters Monday about the reason for the inflated bill. The pay was dependent on several factors, including the type of worker and the union involved, among other factors.
Representatives at FEMA, which is responsible for overseeing disaster rebuilds, questioned how the Puerto Rico Electric Power Authority (PREPA) granted the contract. They have more questions about the contract, but they initially believed it complied with regulations.
The contract was awarded shortly after Hurricane Maria slammed into Puerto Rico. An employee with PREPA, who had a satellite phone and phone number called Whitefish following the hurricane, according to a report in September from E&E News..
PREPA apparently had access to the phone number because the company issued a request for proposals when Hurricane Irma caused minor damage to the island two weeks earlier. Whitefish was one of the few companies to respond to the request.
Officials have also scrutinized an Oklahoma company that forged a similar contract with PREPA for repairs on the island. Cobra required a $15 million down payment before the company would begin work – a provision was also included in the Cobra contract prohibiting FEMA and others from auditing the deal.
President Donald Trump agreed to increase billions in aid to the American territory, but stipulated the money would only be allocated if Puerto Rico can revamp the measurements it uses to estimate emergency costs.
“We have a lot of work to do when it comes to grant-monitoring at all levels of government,” Brock Long, a FEMA director, said at a congressional testimony earlier this year.
Costs associated with housing and feeding linemen have also exploded.
“They are paying $3 million for hotels and $80 a day each for food,” Johnny Rodriguez Ortiz, who represents retired electrical workers in Puerto Rico, told reporters. “I just had lunch with my wife, and it cost me $14.”
Former Puerto Rico utility crewmen argue the deal is unusual, both in terms of the contract’s bloated prices and PREPA’s decision to go with a company like Whitefish.
“Linemen cost $60, $70, maybe $100 an hour,” Luis Aviles, a former chairman at PREPA, said in a statement. “Let’s say you put an overage on it, because it’s a special emergency circumstance. But $300 an hour? No way.”
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