An Overland Park contractor under fire for cost overruns and delays in the construction of a major power plant in Afghanistan now faces fresh criticism on another, much smaller project.
That engineering firm, Black & Veatch, had blamed subcontractor Symbion Power for holdups in construction of the electrical plant, a $300 million project so troubled critics dubbed it "the White Elephant of Kabul."
Symbion denied it was responsible for delays. The subcontractor was cleared of fraud or deliberate misrepresentation last year through arbitration, which awarded Symbion $7.3 million plus interest in damages and fees from Black & Veatch.
Asked about the arbitration, Black & Veatch said only that its "paramount concern was to protect its U.S. government client's interests" and that the company is proud of its work to increase electrical power in Afghanistan.
Now Black & Veatch faces new criticism in a federal audit, released in December, on a different project.
Auditors concluded the company failed to provide an installation plan for millions of dollars in electrical equipment that sat unused for months last year in a warehouse near the southern Afghan city of Kandahar.
In that case, the U.S. Agency for International Development had awarded a $3.4 million contract to Black & Veatch in 2009 to provide technical assistance, training and support to the country's national power utility. Afghanistan ranks among the countries with the lowest energy production in the world.
Over time, Black & Veatch's contract with USAID was modified to focus on commercialization of the national utility, and the original contract's value nearly doubled, according to the audit by the State Department's special inspector general for Afghanistan reconstruction.
Neither Black & Veatch nor USAID could provide evidence to auditors that the contractor completed most of the required work, including an installation plan for the meters. But the U.S. government paid the company in full anyway, the audit said.
Without the plan, the auditors said almost $12.8 million worth of transformers, poles, wires and other equipment had been sitting in storage since at least last March.
Auditors fretted that the manufacturer's two-year warranty on 50,000 electrical meters might expire before they were installed.
"This would leave the U.S. government with no recourse for the manufacturer to replace defective equipment," the audit reads.
Asked why a copy of the installation plan wasn't provided to auditors, Black & Veatch quoted USAID's official comments attached to the audit. That response says that the contractor did complete a plan in the form of a technical schematic for the equipment. USAID said in its comments that the contract with Black & Veatch didn't include installation.
Auditors still hadn't seen a copy of the installation plan by the time the audit was published. USAID said it is continuing to work with auditors and will give them the plan this month.
"Our focus remains to work in close cooperation with USAID to complete closeout of the deliverables and the project," Black & Veatch said in a statement.
USAID paid the company the maximum fee of $5.76 million for the project last July, the report says. The audit recommends that USAID seek reimbursement from Black & Veatch "to hold the contractor accountable."
Founded in Kansas City in 1915, Black & Veatch is one of the largest private companies in the United States. It has more then 110 offices worldwide and employs 8,000 people. In 2011, the company had revenue of more than $2 billion.