The Federal Emergency Management Agency is going to look into the details behind how a controversial $300 million contract was awarded to a tiny energy firm with financial connections to President Donald Trump's administration.
"Based on initial review and information from PREPA, FEMA has significant concerns with how PREPA procured this contract and has not confirmed whether the contract prices are reasonable," FEMA explained in a statement. "FEMA is presently engaged with PREPA and its legal counsel to obtain information about the contract and contracting process, including how the contract was procured and how PREPA determined the contract prices were reasonable."
FEMA also claimed that PREPA, or the Puerto Rico Electric Power Authority, was exclusively responsible for approving the contract.
"FEMA has not provided any reimbursement to Puerto Rico to date for the PREPA contract with Whitefish Energy," FEMA wrote in its statement. "Regardless, FEMA will verify that the applicant (in this case PREPA) has, in fact, followed applicable regulations to ensure that federal money is properly spent."
Puerto Rico Gov. Ricardo Rosselló echoed FEMA's concerns about the contract in a letter to Inspector General John Roth.
"The FEMA team concluded that they will want to follow up with additional questions and information requests on the procurement process, but that they had no comments on the the Whitefish contract at this point since it appeared to comply 100 percent with FEMA regulations," Rosselló wrote.
The House Oversight Committee seems to share the same view as FEMA and Rosselló, requesting earlier this month that the Department of Homeland Security and FEMA provide all documents or communications "relating to any steps taken to prepare Puerto Rico and the U.S. Virgin Islands for Hurricanes Irma and Maria, as well as logistical challenges, distribution of commodities, or power restoration following the storm."
The so-called "Whitefish contract" was procured for $300 million in order to rebuild Puerto Rico's infrastructure, according to USA Today. The company that received the contract, Whitefish Energy, was founded in 2015 and only had two full-time employees at the time when Hurricane Maria hit Puerto Rico. It is located in Whitefish, Mont, the hometown of Secretary of the Interior Ryan Zinke, whose son worked a summer job at one of the construction sites owned by Whitefish Energy Chief Executive Andy Techmanski.
It has also been cited as troubling that HBC Investments, a private equity backing Whitefish Energy, is led by Joe Colonnetta, who has donated significantly to Trump's election campaign and political action committee.