CONTRACT REVIEW HALTS GUAM PORT PROJECT

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Federal funding threatened over nonbid award

By Therese Hart HAGATNA, Guam (Marianas Variety, August 13, 2009) – A shocking new development at the Port Authority of Guam threatens to sink efforts to modernize the region’s largest deep-water port and threatens a loss of millions of dollars in federal funding.

Patrick O’Brien, director of the Office of Economic Adjustment in Arlington, Virginia, notified the governor’s chief of staff George Bamba that PAG must put a hold on all work by Parsons Brinkerhoff International, the primary contractor for port modernization plan.

The OEA is the Department of Defense’s primary source for assisting communities that are adversely impacted by defense program changes, including base closures or realignments, base expansions, and contract or program cancellations.

In a letter to Bamba, O’Brien said his office will not release the US$350,000 authorized through the government of Guam procurement action for the port modernization community outreach and communications plan.

Until OEA has concluded a review of the government’s contract award to Parsons, all funding has been placed on hold.

Bamba, in turn, wrote to PAG general manager Glenn Leon Guerrero yesterday asking him to suspend further work to be performed by Parsons on port modernization projects and all other OEA-funded projects assigned to the contractor "unless the Port can identify an alternative source of funding."

After port board members and officials learned that the money was placed on hold and that all of PB’s work was suspended PAG board chairman, Monte Mesa issued a statement.

"I am convinced after extensive discussions with the management of the port that there has been nothing inappropriate in either the contractual relationship with any contractor or procurement procedures. Everything that should have been done was done."

Mesa continued, "Let is be clearly understood, contrary to "unnamed" sources and unsubstantiated allegations, the Port Authority is completely satisfied with the work that has been completed by its contractor and the work that will continue," stated Mesa.The communications and community outreach contract has been the subject of controversy for several weeks as speculation continues to grow over how a project that size managed to circumvent local procurement regulations meant to ensure a fair playing field for all local businesses.

Bamba, the single point of contact for all OEA contractual activities on Guam, facilitated the award as a sole source contract, in apparent violation of local law.

O’Brien has requested that the governor’s legal counsel provide a complete list of procurement action, as well as an opinion on how the procurement actions comply with local and contracting policies and procedures.

OEA is also seeking explanation as to how the contract award to Parsons is in keeping with the GovGuam’s 2007 grant application, which states all government of Guam procurement must meet and remain in accordance with local laws.

The OEA director finally asked Bamba to ensure the counsel provides his office with documentation of standards of conduct that exist for local government officials engaged in procurement, including any system of internal controls to ensure compliance.

PAG has identified more than US$200 million in funding potential for the port improvement initiative. Integral to the authority’s plans however is more than US$156 million in federal dollars, one-third of which will come from American Recovery and Reinvestment Act funds.

PAG general manager Glenn Leon Guerrero and port board chairman Monte Mesa have recently presented around town their modernization plan saying that they have until Sep. 15 to apply for more than US$100 million from the federal government.

However, the legislature must review the master plan sometime at the end of the month.

With all work by the primary contractor now on hold, it remains to be seen if the legislature will even take up the review of the master plan and if PAG can meet the deadline for applying for two separate grants valued at over US$50 million each.

The funding is critical to having the port ready in time for the impending military buildup.

PAG has already received and is spending US$4.5 million from the USDA for buying equipment that is to be in place before the kickoff of major projects. Much of the work being performed at the port is being managed by Parsons.

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