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U.S. Embassy in Baghdad Declared Ready, With Nudge by Rockets

By Glenn Kessler
Washington Post Staff Writer
Friday, April 18, 2008

The troubled effort to build the giant U.S. Embassy in Baghdad seemed to be months away from completion when a team of top State Department officials flew to Iraq on March 20 to meet with senior staff from the prime contractor, First Kuwaiti General Trading & Contracting. But as insurgent rockets began to rain down on the flimsy trailers housing diplomats inside the Green Zone, the two sides suddenly found ways to settle many of the major issues dividing them.

"The only way to do this was for us to get in the room, nail the door shut and get this resolved," said Robert S. Nichols, a partner with the Crowell & Moring law firm who attended the meeting and provides legal advice to First Kuwaiti. "It started out as the 'Gunfight at the O.K. Corral' the first day or so, but then we got past it."

Construction of the embassy in Baghdad had been greatly complicated by several factors, including a fast-track building plan that had kept key State Department inspectors out of the loop until the building was largely done, changes made on the spot by the project manager without complete documentation, and cultural differences between State and a Middle Eastern company working on its first embassy project.

Yet on Monday, the State Department issued certificates of acceptance and completion, officially taking possession of the embassy. Already, during the recent barrage of insurgent rocket attacks, some diplomats had moved from their unprotected trailers into bedrooms in the sprawling facility, which is built on acreage almost four times the size of the Pentagon.

Originally expected to be completed by last July 1 at a cost of $592 million, the largest U.S. diplomatic mission in the world has been plagued by disputes over workmanship and design changes that have increased costs by at least $144 million. But after months of bad news about the facility, U.S. officials and congressional investigators said they no longer have concerns about whether the embassy is a firetrap or poses other safety problems that would endanger embassy employees.

"We are pleased" with the work done by First Kuwaiti, said Patrick F. Kennedy, the undersecretary of state for management. Though the State Department project manager had issued a notice in December saying the work was "substantially complete," Kennedy said that it turned out "there was a significant amount of work that needed to be done -- and that the contractor did. The contractor has not shirked any of their responsibilities."

Under a plan developed by retired Gen. Charles Williams, then head of State's Overseas Building Operations, the embassy project was managed by a tight-knit team with little of the usual input by State Department specialists. The arrangement was made to save time, sources said, but in the end it led to months of delays because the State Department experts who needed to approve the building had to start from scratch -- and then uncovered what they viewed as troubling departures from the contract or State guidelines.

Terry Looper, whose company, TL Services Inc., was hired by First Kuwaiti to evaluate whether key systems were operational, said he took the job late last year with some trepidation. "There was so much adverse publicity about this embassy that I was very concerned what the actual situation on the ground was," he said in a telephone interview from Baghdad. "I was really expecting a disaster."

Over time, relations between the builder and State began to break down amid mutual suspicions, particularly as much of the communications occurred by e-mail and phone. But once senior representatives gathered in Baghdad, they focused on crucial life-safety issues, such as nonworking elevators, while deferring less essential issues, such as a hot water shortage.

State, for instance, was concerned that each of the 2,600 ceiling lights had two centimeters of uncovered wiring, believing it might take five months to fix. First Kuwaiti came up with a solution acceptable to State that took 116 electricians just a week and a half to fix, at a cost of about $350,000.

One State Department official said the rocket attacks helped focus attention. "People were very motivated to hurry up and get out of there," he said.

Questions remain about whether project manager Mary French had been too quick to sign the document in December asserting the work was substantially complete. Kennedy said that anyone walking through the facility at the time would think "it looked finished." But then State inspectors raised questions about the electrical, mechanical and fire safety systems. "Was it enough to issue a certificate of substantial completion? That is a debatable question," Kennedy said. French declined to comment.

Congressional investigators said that the seemingly hasty signing leaves the government open to substantial claims by First Kuwaiti for any work done after December, potentially leaving taxpayers with a higher than expected bill.

First Kuwaiti is still reviewing its reimbursement options. "First Kuwaiti completed the original contract scope within the fixed price budget and on time. As in almost any construction project, the customer made changes," Nichols said. "The State Department and FKTC will resolve these matters under the standard claims process."

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