Pentagon releases new round of Iraq reconstruction projects
The Defense Department on Wednesday formally issued a new set of reconstruction projects for Iraq's war-torn roads, utilities and buildings, kicking off a three-month period in which engineering and infrastructure companies will vie for the rights to oversee thousands of repair projects worth billions of dollars.
On Wednesday, agencies from the Army and Navy, as well as the Defense Department, issued several requests for proposals to repair the most vital pieces of Iraq's infrastructure. The total value of the contracts is expected to be more than $18 billion. Military officials and members of the Coalition Provisional Authority, the outfit governing Iraq, spent months crafting the RFPs, to which only U.S. and Iraqi companies, as well as firms from nations that supported the U.S.-led invasion of Iraq, may reply.
The RFPs are divided into several categories that cover a range of nation-building activities, including repairs to electrical and communications facilities, public buildings, transportation, public works and water resources and the repair or reconstruction of justice and military facilities.
There are 17 major construction contracts. The prime contractors that win those awards will then parcel out work to subcontractors. There are no restrictions on which approved countries' firms can compete for subcontracts, and there are about 2,000 projects covered by the 17 sector contracts.
In addition to the sector contracts, seven support contracts will be awarded. One company will provide "top-level" services to oversee broad aspects of the reconstruction, according to the Coalition Provisional Authority. Those tasks would include interfacing with the CPA as well as the Iraq Governing Council and coalition governments. The top-level company also will oversee the separate contractors that will craft requirements and oversee the day-to-day work of each of the reconstruction sectors. Companies that win those sector management contracts are not eligible to win construction contracts within the same sector. And the company that wins the overall management contract cannot win any of the sector management awards.
The RFPs were released more than a month after initially expected. That will likely delay the point at which senior coalition officials select the winning contractors. William Loiry, the president of Equity International Inc., a Washington business development firm that has hosted numerous reconstruction conferences, said award announcements are expected in early March. That would be about a month later than the coalition authority had first anticipated.
The sector construction awards contain many broad work requirements. For example, in the electrical sector, the contractor must build new power generators, rehabilitate existing facilities, and perform various "transmission," "distribution," and "communications/controls" work in the northern and southern regions of Iraq.
The coalition authority anticipates that all the sector awards will be indefinite delivery, indefinite quantity contracts awarded for two-year periods with three one-year renewal options. The contracts are open-ended so that companies can devise their own solutions for completing the work.
Contractors also will be paid on a cost-plus basis. That means they'll be compensated for whatever they spend and given an additional fee. The base award fee is 3 percent of the total amount spent, but contractors can receive higher percentage awards if the government deems their work exceptional.
The Coalition Provisional Authority's Program Management Office, the division responsible for managing reconstruction contracts, formally released the RFPs on its Web site. However, the Army Corps of Engineers also released some RFPs through the government's FedBizOpps Web site, which is the official register of all government procurements.
The dual release initially caused some confusion about which agency would be officially managing the contracts. On Wednesday, the Program Management Office's contracting division began moving its facilities out of a location in Rosslyn, Va., and into offices at the Pentagon. The Army will now be the executive agency managing the contracts, and the division's temporary head, Defense Department procurement chief Deidre Lee, will leave her post and resume her Pentagon duties.
There was speculation that the head of the Program Management Office, David Nash, also would leave his post. But Nash told reporters at a Pentagon briefing Tuesday that he would stay in his job and return to Baghdad this week. Nash said that he had returned to the United States for Christmas.