FBI Is Probing Puerto Rico’s $300 Million Power Contract With Whitefish Energy
Just a day after Puerto Rico’s cash-strapped power authority on Sunday canceled its controversial $300 million contract with Whitefish Energy, a small Montana company tasked with rebuilding the island’s power grid after it was completely destroyed by Hurricanes Maria and Irma, the WSJ is reporting that the FBI is looking into the circumstances surrounding the contract.
The contract was canceled on orders from Puerto Rico Gov. Ricardo Rossello, who pointed to the burgeoning controversy surrounding the company – including its relationship with Secretary of the Interior Ryan Zinke, who is from the same small Montana town where Whitefish is based.
Zinke issued a statement last week denying any involvement in the deal. Zinke is reportedly friends with Whitefish CEO Andy Techmanski.
The company has been criticized for moving too slowly in its efforts to restore power to the island. To date, only 30% of power customers on the island have had electricity restored, more than a month after Maria first made landfall along the island’s southeastern coast.
As WSJ explains, the firm had more than 350 workers and 2,500 tons of heavy equipment on the ground for rebuilding electrical lines destroyed in Hurricane Maria. But the firm’s small size and limited track record, as well as the terms of the contract, ignited concerns around Puerto Rico’s management of the flow of federal disaster-relief dollars to the island.
The Federal Emergency Management Agency, multiple congressional committees and local auditors also have raised concerns and begun requesting documents about the deal. Ricardo Ramos, the executive director of Prepa, had defended the selection of Whitefish and said the contracting process was done according to the utility’s regulations for handling emergency situations.