House panels investigating $300M Puerto Rico power grid contract

Two House committees and a federal watchdog have started investigating a $300 million repair contract that Puerto Rico’s electricity utility signed with a Montana company..

The probes come amid growing questions in Puerto Rico and the mainland about how Whitefish Energy Holdings, which had only two employees before Hurricane Maria decimated the island, got the contract, and how it is managing the task of restoring electricity to millions of residents who have been without power for more than a month.

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Whitefish had little experience in repairing electricity infrastructure. Its CEO, Andrew Techmanski, is from the same town as Interior Secretary Ryan Zinke and the two know each other, but they have denied that Zinke played any role in Whitefish getting the no-bid contract.

Whitefish and the Puerto Rico Electric Power Authority (PREPA) have defended the contract, saying that Whitefish was the first company to offer help without requiring significant payment in advance.

Republican and Democratic leaders on the House Energy and Commerce Committee sent a letter Thursday to Techmanski asking for various documents regarding its activities in Puerto Rico and for a staff briefing by Nov. 9.

Leaders of the House Natural Resources Committee, meanwhile, directed their probe at PREPA President Ricardo Ramos, asking for documents related to how the agency contracts with companies like Whitefish.

“The size and terms of the contract, as well as the circumstances surrounding the contract’s formation, raise questions regarding PREPA’s standard contract awarding procedures,” Rep. Rob Bishop (R-Utah), the panel’s chairman, wrote along with Rep. Bruce Westerman (R-Ark.).

“The committee is also examining PREPA’s decision to forego the activation of the mutual assistance program,” they wrote, referring to the American Public Power Association’s program allowing utilities to call upon other utilities to help with disaster recovery.

The Natural Resources Committee oversees U.S. territories, as well as implementation of Puerto Rico’s debt recovery process.

Separately, the Department of Homeland Security’s Office of Inspector General has started an audit of the contract, spokesman Arlen Morales said.

“They will review the contract and as part of their standard procedure, they will conduct vetting to look for the presence of any inappropriate relationships,” Morales said.

The Federal Emergency Management Agency, which is part of Homeland Security, is providing Puerto Rico with the money for its recovery operations and has rules about recovery contracting.

In a statement, Whitefish welcomed the investigations.

“Whitefish Energy appreciates the efforts of the committees to gather information so that they have confidence in the overall process to support the people of Puerto Rico as well Whitefish Energy’s capabilities and commitment to deliver on the contract to help restore power and a sense of normalcy for the people of Puerto Rico,” it said.

Numerous officials have called for different investigations into Whitefish’s contract, including congressional Democrats, Puerto Rico Gov. Ricardo Rosselló and San Juan Mayor Carmen Yulín Cruz. Rosselló’s own government is also examining the arrangement.

The Interior Department inspector general is also deciding whether to investigate after receiving a letter from eight House Democrats, spokeswoman Nancy DePaolo said Thursday.

The Democrats had asked specifically that Interior’s watchdog examine whether Zinke played any improper role in Whitefish’s activities, a charge that Interior has denied.