Billion-Dollar Start Falls Short in Iraq
U.S. Officials Worry About Leaving Baghdad Without Basic Services

By John Ward Anderson and Bassam Sebti
Washington Post Foreign Service
Sunday, April 16, 2006

BAGHDAD -- On the southern outskirts of Baghdad, a sewage treatment plant that was repaired with $13.5 million in U.S. funds sits idle while all of the raw waste from the western half of Baghdad is dumped into the Tigris River, where many of the capital's 7 million residents get their drinking water.

Adjacent to the Karkh sewage plant is Iraq's most advanced sanitary landfill, a new, 20-acre, $32 million dump -- also paid for by the United States -- with a liner to prevent groundwater contamination. It has not had a load of garbage dropped off since the manager of the sewer plant was killed four months ago. Iraqis consider the access roads too dangerous, and Iraqi police rarely venture into the area, a haven for insurgents who regularly lob mortar shells across the city into the Green Zone less than six miles away.

The mothballed projects highlight a growing concern among U.S. officials here: whether Iraqis have the capacity to maintain, operate and protect the more than 8,000 reconstruction projects, costing $18.4 billion, that the United States has completed or plans to finish in the next few years, which include digging roadside drainage ditches, refurbishing hospitals and schools, and constructing electric power plants.

"The United States must ensure that the billions of dollars it has already invested in Iraq's infrastructure are not wasted," said an October report by the Government Accountability Office, the investigative arm of Congress, citing what it said were "limitations in the Iraqis' capacity to maintain and operate reconstructed facilities."

For example, the report said, "as of June 2005, approximately $52 million of the $200 million in completed large-scale water and sanitation projects either were not operating or were operating at lower capacity due to looting of key equipment and shortages of reliable power, trained Iraqi staff, and required chemicals and supplies."

The Karkh facilities -- not included in the GAO report -- also illustrate the security problems that plague reconstruction efforts and have forced U.S. officials to redirect as much as $3.5 billion from building projects and into security to protect them, raising the cost of infrastructure improvements by between 16 percent and 22 percent, officials say.

"It's a nightmare -- you can't ask the 4th ID [Infantry Division] to go out and put their lives on the line for a sewer repair," said Charles Thomas, 59, a water contracting specialist with the Army Corps of Engineers who lives in Potomac. "We've given the Iraqis enough to go out and fix the systems themselves. It's time for the Iraqis to step up, and they can and they want to."

These days, as money begins to run out, U.S. officials say they spend much of their time teaching modern democratic practices and personal responsibility to Iraqis raised in a system of favoritism, nepotism and pervasive corruption built during 24 years of deposed president Saddam Hussein's rule.

Efforts to improve Iraq's water system have exposed some reconstruction challenges and what the GAO report called "sustainability problems" after U.S. forces pull out.

At a recent board meeting of the Baghdad Water Authority, an Iraqi who had won a contract to build a small water treatment plant offered his plan. The water authority's chief engineer looked at it and said in disgust: "This is the Spanish design."

When the contractor protested, the engineer stormed out of the room and returned two minutes later with a large schematic showing that the Iraqi contractor had copied the design of a Spanish firm and replaced the firm's name with his company's logo.

The contractor apologized. That was an old plan, he explained, opening another large roll of paper and spreading it on the table. The chief engineer looked at it.

"This is the Chinese plan!" he said with a roar, leaving to retrieve another drawing showing that the contractor had swiped the second design, too. "Are you working for your country or someone else?"

From the side of the table, Lt. Col. Otto Albert Busher III, a reservist in the Army Corps of Engineers and the U.S. government's point man on water issues in Baghdad, watched with amusement. "This is a huge leap forward," he said.

"Two years ago the Army and the U.S. government sat at the head of the table, and now the Iraqis run the meeting and take the minutes and set the agenda," he said. But not without some help. Among the skills that Busher, a former director of public works in Hopkins, Mass., is teaching the Iraqis are master planning, budgeting, procurement, contract and accounting -- and even how to run a public meeting.

Plenty of problems remain, he said, the most critical being the poor state of Baghdad's water network and the lack of money to repair it. Busher estimated that between 40 percent and 60 percent of the purified water that leaves Baghdad's treatment plants never makes it to city taps because of leaks in the system.

"You're looking at a couple of million dollars of lost water per day," he said. And because the water network was built 25 years ago with brittle cement pipes that have a 20-year life, every time a bomb explodes in Baghdad, the water system is damaged.

Even tanks rumbling on the streets crack the pipes -- and not just water pipes, but sewer pipes that run alongside. Contamination of fresh water by sewage "happens on a daily basis," Busher said.

"You could easily sink $3 billion into infrastructure in Baghdad" to fix water and sewer problems, he said. "But we're still shooting at five-meter targets. We don't have the resources for 500-meter targets."

The United States and United Nations initially budgeted about $34.4 billion for short-term relief and reconstruction, about $21 billion of which is to be paid by the United States. A recent report by the U.S. Department of Energy estimated long-term reconstruction costs in Iraq at "$100 billion or higher."

In the water and sanitation sector, the World Bank estimated that $6.8 billion was needed through 2007. Congress initially allocated $4.6 billion for the sector, and that was cut to $2.6 billion by the State Department; the savings were shifted to other priorities, particularly security, according to a September GAO report. Along the way, the original target of delivering potable water to 90 percent of Iraqis was lowered to 50 percent to 60 percent, the report said.

In testimony before Congress in February, Stuart W. Bowen Jr., the special inspector general for Iraq reconstruction, said that only 49 of the planned 136 large water projects would be completed because of what he called a reconstruction funding gap. "Most of the projects planned in sewerage, irrigation and drainage, major irrigation and dams have been canceled." But officials here say they are not getting credit for what they have accomplished.

Dawn Liberi, director in Iraq of the U.S. Agency for International Development, said her agency has restored water-treatment service to 3.5 million Iraqis and sewer service to 3.2 million, By the end of the year, she said, those numbers will more than double.

"The United States was never meant to do this whole job by itself. There's about a $40 billion difference in what was needed for the entire job to be done," she said, based on what the United States is spending and what the World Bank calculated was needed.

The United States is making major investments in Sadr City, a teeming Shiite slum with about 2 million residents in northeast Baghdad that is a stronghold of militia leader and cleric Moqtada al-Sadr.

A $15 million repair of a water-distribution system was finished in January. Work continues on a $47.5 million project to build a water-treatment plant and lay new pipes in the area. A $106.5 million rehabilitation of the neighborhood's power grid is also underway.

Talib Hussein Hailoon, a member of the Sadr City Council, said the projects were the most important infrastructure improvements in the neighborhood in decades. Council President Jawad Kadhum said the water improvements would mean that leaking water would no longer swamp the streets and clean water, not raw sewage, would come from taps.

U.S. officials hope that this and similar projects will ease anti-U.S. sentiment and perhaps reduce support for Iraq's insurgent groups and violent militias.

"If I can sit in a La-Z-Boy and if the TV and AC work, why am I going to go out and lay an IED?" said Col. Peter J. Rowan, a commander in the Gulf Region Division of the Army Corps of Engineers who lives in Fairfax County.

Despite the massive U.S. investment, there is a huge funding shortfall, and how Iraq will make it up is anybody's guess.

The country has no real tax base, and the government projects that about 90 percent of its annual operating revenue will come from oil. The oil sector is not producing or exporting as expected. Last year 186 attacks on oil facilities kept production and exports about 800,000 barrels below prewar levels and cost the country $6.25 billion, the Oil Ministry reported in February.

The needs are glaring. At the Wehda water-treatment plant on the Tigris River, eight water pumps built in 1945 and 1958 sit alongside massive new electric generators from USAID, which were purchased to ensure reliable electricity to pump water even during the capital's long power failures. But the generators have not been connected, and only half the pumps are working. Water seems to drip from every joint.

Lt. Col. Joe Gandara, a special troops battalion commander with the 4th Infantry Division from Fort Hood, Tex., walks around the facility with pride and consternation. The United States has spent $6 million to get the facility to this semi-respectable state, and another $6 million has been approved to finish the job. In the meantime, he has given the Iraqis $18,000 worth of tools to keep everything operating, although with two different generations of pumps -- both of them old -- finding spare parts is difficult.

"This is a big challenge because there's no standardization, and it's tough keeping up," said Gandara, 42, a father of six with a master's degree in civil engineering from Texas A&M. "We're not trying to fix an entire network, we're trying to take someone on life support and get them to live on their own."

The Karkh sewage plant and landfill have different problems.

Eight months ago, the governor of Baghdad province sent a group of armed men to the mayor's office and ran him out, then installed a new one. The circumstances did not allow for the new mayor and his staff to be fully briefed, according to Busher, a lanky, professorial civil engineer prone to understatement. "Initially, the new mayor didn't even know he had a new landfill," he said.

The sewage treatment plant was opened in September; the landfill in October; and in December, the manager of the treatment plant was killed, Busher said. No one has been back to operate either facility since, he said.

The new mayor has sent letters to the prime minister and the ministers of defense and interior requesting protection for the facilities, Busher said, but has gotten no response.

An official in the office of the Interior Minister said the projects were enmeshed in bureaucratic disputes over how to protect the facilities and who was responsible for doing so.

The new mayor, Saber al-Esawey, said it was unclear when the facilities would reopen. He blamed the United States for not coordinating the projects with local authorities and for picking a poor location. Even though they are "good projects," he said, "they did them without the advice of the Baghdad municipality, and we got no benefit at all."

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