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Air Force Erred With No-Bid Iraq Contract, GAO Says

By Renae Merle
Washington Post Staff Writer
Tuesday, November 29, 2005

The Air Force, under pressure from the Pentagon, committed a "gross error" last year when it rushed to sign a no-bid contract for advisers to help plan and implement Iraq's national elections and draft its constitution, the Government Accountability Office has ruled.

New York-based REEP Inc., a private translation company also known as Operational Support Services, was awarded two contracts worth more than $45 million. The firm was tasked with finding bilingual speakers "committed to a democratic Iraq" as part of a program a Pentagon official hoped would create "a nudge toward democracy," the report said.

The dispute offers insight into the Pentagon's continued use of Iraqi exiles and its strategy for bringing democracy to Iraq.

"Our Defense Department has continued to pay, through pliant contractors, for a flock of Iraqi political exiles as our paid political agents in Iraq," said Charles Tiefer, a government contracting professor at the University of Baltimore School of Law.

Two competing firms -- WorldWide Language Resources Inc. of Andover, Maine, and SOS International Ltd. of New York -- filed protests, arguing that they should have been able to bid for the work. In a 17-page decision issued last week, the GAO agreed.

"This obvious error constituted lack of advance planning, which compromised the agency's ability to obtain any meaningful competition and directly resulted in the sole-source award," the decision said. The Air Force should hold a competition for the second contract, which is ongoing, or justify why it should not, the report said. The Air Force did not respond to requests for comments.

The program, according to the report, grew out of the Iraqi Reconstruction and Development Council, which the Pentagon created in 2003 to help the Coalition Provisional Authority establish an Iraqi government. The council contained about 150 Iraqi exiles -- including lawyers, physicians, and others with links to ethnic or tribal groups.

That group dissolved along with the CPA in June 2004. But shortly thereafter, Paul D. Wolfowitz, then deputy defense secretary, "determined that the success of the United States war effort" required experts in "reconstruction and governance," the report said. Wolfowitz sought to enable 50 to 75 council members to operate independently throughout the country, according to the report. The program originally called for "Western oriented individuals of Iraqi background" but was later changed to Iraqis with U.S. citizenship.

The duties of the advisers include "advising government ministers, planning for and implementation of elections, drafting of constitutional documents, advising neighborhood, municipal and national councils and public services, training of security forced and details," according to the report.

The Pentagon asked the Air Force to issue the contract. The service initially attempted to use an environmental contracting mechanism to hire the advisers but dropped the plan. An Air Force contracting director determined the failed effort was the result of overzealous personnel, who were "leaning way forward in the saddle" and were "not in the habit of saying no to anyone."

With only a few months remaining before the January 2005 elections and "experiencing what it perceived to be significant pressure" from the Pentagon to deliver the bilingual advisers, the Air Force decided there was no time for a competition.

"OSS is the only known contractor who is in the position to provide [the advisers] to Iraq in time to support the Iraqi national elections in January 2005," the Air Force said in a December 2004 document. About six months later, it issued another sole-source contract to OSS, increasing the number of advisers to about 200 and extending their term until July 2006.

Both contracts, the GAO determined, were flawed.

"GAO has put its foot down: The [Pentagon] can't take shortcuts in competition that violate the law, even in a time of war," said Christopher R. Yukins, associate professor of government contract law at George Washington University.

OSS declined to comment. Officials from WorldWide and SOS both said they were prepared to compete if the Air Force chose to open the contract.

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