Construction Woes Plague U.S. Embassies

By Glenn Kessler
Washington Post Staff Writer
Friday, August 17, 2007

The new air-conditioning system in the $66 million U.S. Embassy in Mali broke down in June, sending office temperatures soaring to 100 degrees. An electrical fire erupted in the rehabilitated annex to the embassy in Rome. And the U.S. ambassador in Belize had to personally help workers sand the floors for new housing.

As the United States seeks to rapidly modernize and fortify its diplomatic missions around the world because of terrorism and other security concerns, the State Department's $5 billion construction efforts abroad have come under increasing strain. In a series of cables sent to Washington this summer, U.S. diplomats complained of building delays and shoddy workmanship, underscoring problems with State's one-size-fits-all approach to building that results in the same air-conditioning system being shipped to embassies in Africa and in Europe.

Concerns have focused in particular on the ongoing construction of the largest U.S. Embassy in the world -- the $592 million complex in Baghdad. The State Department inspector general is probing the awarding of sole-source contracts in the sprawling project, including whether they are unjustifiably expensive and whether top officials in State's Bureau of Overseas Buildings Operations (OBO) short-circuited the process to favor particular contractors, according to sources familiar with the probe.

At the center of the controversy is the man who has run the OBO since the start of the Bush administration -- Charles E. Williams, a retired major general in the Army Corps of Engineers, who quit under fire as chief operating officer of the D.C. public schools in 1998 when a botched roof repair project delayed the opening of District schools by three weeks. State Department officials who have worked with Williams assert that the serious construction problems now coming to light flow directly from Williams's mercurial management style.

Some department officials have questioned Williams's decision in 2005 to award the construction contract for the Baghdad embassy to First Kuwaiti General Trade and Contracting Co., a Middle Eastern firm currently under Justice Department scrutiny for alleged labor abuses. Inspector General Howard J. Krongard, as a matter of policy, declined to confirm or deny any probe.

Williams, who declined several requests for an interview, was hired by then-Secretary of State Colin L. Powell; the two have known each other since they were Army captains in the 1960s. Williams is described by people who have worked with him as a complicated personality who demands absolute loyalty, insists that his staff and outsiders call him "General" and prefers to ride elevators alone.

He has won praise for speeding up construction by insisting on a few basic designs for all embassy projects, but he has also run the buildings office as a virtual fiefdom. He travels around the world with a large, close-knit staff when he breaks ground and cuts ribbons for new embassies.

Pat Kennedy, director of the State Department's Office of Management Policy, was assigned to answer queries about the OBO. "General Williams has a process," Kennedy said. "He is retired military, and he has a way of doing things."

Williams oversaw the building of the Dulles Greenway, completed in 1995, but he abruptly resigned from two other high-profile jobs -- head of the $4 billion New York City School Construction Authority and then the D.C. schools post -- after being heavily criticized for poor management. He left the New York job after an audit found that he had given misleading information on the progress of projects he was overseeing. He left the D.C. job after an audit said he authorized shoddy contracting procedures and left the school system vulnerable to waste and fraud.

At the State Department, one of Williams's first actions was to rename the office, formerly known as the Foreign Buildings Operations -- a move that cost more than $1 million in computer-programming changes, according to OBO sources. He engineered an expensive redesign of the OBO executive suites in Virginia, including installing brass lettering that announced "The War Room" over the entrance.

He also invested $3.5 million in an off-the-shelf software program for managing leases and properties, the Building Management Integrated System, which some OBO officials say is largely unusable. (Kennedy said the software had not been fully implemented and the jury is still out on whether it is effective.) For the Baghdad embassy project, Williams personally rejected a bid from New York-based Framaco International that appeared to be $50 million lower in favor of First Kuwaiti, three OBO officials said. Framaco, which declined to comment, had completed other embassy projects successfully, OBO officials said, including a guard camp in Afghanistan that has experienced none of the problems plaguing a $22 million guard camp being built by First Kuwaiti as part of the Baghdad project. A cascade of safety and building blunders -- including the use of possible counterfeit electrical wiring and toxic formaldehyde fumes in 252 prefabricated residential trailers -- have kept the camp unopened.

Kennedy said a technical review of the bidding determined that First Kuwaiti offered the "best overall package" for the project. "Price is not the sole determinant of a contract," he added.

The inspector general's probe is said to focus on a $6.9 million contract awarded to an Indonesian company via a Lanham-based firm called Milvets Systems Technology. The Indonesian company, North Java Sea, is tasked under the contract to help certify the Baghdad embassy as ready for use, but sources said that in reality the workers were helping with construction. The bid was set using U.S. wage rates, sources said, but the Indonesian engineers apparently would be paid at much lower rates, a gap that one official estimated could reach $3 million.

"The rates were determined to be reasonable," Kennedy said, and Milvets was permitted to subcontract to a foreign company. Milvets did not respond to e-mails and phone calls requesting comment.

Williams testified last month before the House Oversight and Government Reform Committee after construction problems with the Baghdad guard camp were revealed. He said that before he took charge of the OBO, only one new embassy a year was built, while 14 new facilities were completed in 2006. "Since 2001, OBO has completed 47 new facilities, budgeted at $2.7 billion, and we are currently working on either designing or constructing 34 additional new facilities," he said.

But in interviews in recent weeks, officials in the OBO and other parts of the State Department said the building binge has led to numerous problems in many of the embassies. Several officials blamed Williams's refusal to consider alternatives. "The circle around the general makes the decisions," said a source who spoke on the condition of anonymity for fear of retaliation. "There is no input from the field, and he does not accept changes because of local conditions."

The problems were detailed in several cables sent by embassies in Africa, Latin America and Europe, and obtained by The Washington Post.

In June, the U.S. Embassy in Bamako, Mali, reported that the "total failure" of the air conditioning had left "temperatures in most work spaces . . . between 93 and 95 degrees at 8 am, with a few desks as high as 98 degrees at [t]hat time; temperatures on the second floor cross the 100 degree mark before 10 am. . . . unclassified servers must be shut down by 11 am in order to avoid hardware failure." One of two central air-conditioning units had been inoperative since March, the cable said.

Darryll L. Fortune, a spokesman for Johnson Controls Inc., which installed the air-conditioning systems, said they have failed in at least a dozen new embassies because the specifications from the OBO were incorrect. The units were "strained from extreme heat from weather conditions, questionable installation and improper maintenance," he said, adding that the problems have since been fixed. Kennedy attributed the problems to a single part and said the units had been replaced under warranty.

Meanwhile, Ronald P. Spogli, the U.S. ambassador to Italy, sent a blistering cable to Williams, reporting in June that the rehabilitated annex known as the Sembler Building had suffered a "very troubling" electrical fire, which Spogli attributed to improper wiring. "I find the overall electrical work done by Gilford [the contractor] to be of such a shoddy nature that it calls into question their competence," he said. Spogli said his staff had uncovered 97 code violations and yet the OBO had failed to act, even though he urged that the contract be terminated.

"Neither of us can afford to have another life-safety incident as a result of the Gilford contract," Spogli added.

Larry Schor, an attorney for Gilford Corp., based in Beltsville, said the OBO was at fault. "They are having enormous problems with shoddy and incomplete designs," he said.

Robert J. Dieter, the ambassador to Belize, also sent an outraged cable to Williams in June. He said that since fall 2005, he had tried to get the OBO to supervise a project to build new housing units for embassy staff members, adding that he was forced into "personally having to assist workmen with floor-sanding and refinishing" because of the lack of OBO personnel. Under the contract, the 17 homes are being leased from the builder at a cost of $3 million a year. The embassy "reasonably expects contract performance and oversight in line with these expenditures," Dieter said.

None of the embassies would elaborate on the cables. Kennedy said the embassies were appropriately asking for better performance from the vendors involved. "I don't see anything wrong with them pushing," he said.


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