Failed Louis Berger Projects

Failed Louis Berger Projects and Interesting Tidbits

Note: This list is not complete.

Since 2002 - American Tax Payers have poured 51 Billion Dollars into the war in Afghanistan. The Louis Berger Group has been one of the top recipients of American reconstruction contracts in Afghanistan. (This means that taxpayer money is going to Louis Berger for them to do projects in Afghanistan). So THIS is why everyone, including the federal government, (especially Defense Secretary Robert Gates with his recent goal to find 100 billion dollars worth of savings in the military and contracting realms in the next 5 years) should be interested in exactly what projects The Louis Berger Group is working on and which ones there have been problems with. To read more about this, view the full citations, and read the full articles CLICK HERE and HERE.

Of particular interest, is a project that has to due with electricity in Afghanistan. Now, remember - Allegheny Energy and Americal Electric have teamed up to run a high voltage transmission line through 280 miles of WV land - leaving a scar anwhere from 200-1000 feet wide and 280 miles long - forever and permanently altering/destroying the landscape. Louis Berger was contracted to "route" this power line through the states of WV, MD and VA. The poorly planned out project is called the Potomach Appalachian Transmission Highline (PATH) and if approved, will give the power companies the right to forcibly take the land from private landowners (eminent domain). Not only is this line not needed, but there have been multiple delays because the involved power companies do not have the numbers (proof) to back up the claim of "need." Oddly enough - Louis Berger Group was in charge of an electricity related project in Afghanistan (and this one doesn't work right either). The next paragraph gives more details.

Louis Berger FAILURE - Loss Of Electricity in Afghanistan

The Louis Berger Group was in charge of the Kajakai Dam, outside the city of Kandahar in Afghanistan. According to the article (sited at the end of this paragraph) it sits unfinished, underutilized. The Washington Post later reported that "The dam produces about 33 megawatts of electricity with the two rehabilitated turbines, of which about 30 percent reaches Kandahar. As much as 40 percent of the electricity is lost to theft and transmission inefficiencies." Is this a good use of American Taxpayer Money? CLICK HERE to read full article and full article citation.

Louis Berger FAILURE - Diesel Run Power Plant (part of the 1.4-billion-dollar project awarded to Louis Berger Group, Inc. and Black & Veatch Joint Venture through 2011 to improve road, power generation capacity and power transmission networks across Afghanistan. )

Quote from article: " US government hired Louis Berger to build - at a cost of $300 million dollars - a diesel-run power plant. But Afghanistan doesn't have diesel, they have to import it. And the cost to the Afghan government of running the plant is projected to be $280 million a year." CLICK HERE to read full article and full article citation. In addition to this, there are allegations that the conract was awarded improperly (CLICK HERE).

The article on McClatchy further quotes "Two earlier U.S. government inquiries concluded that that unnecessary construction delays led to $40 million in cost overruns by the plant's two contractors, U.S.-based Black & Veatch and Louis Berger."

Interestingly enough - McClatchy futher quotes " Scott "Max" Anthony Walker, who worked for Louis Berger and Black and Veatch as a security coordinator until he was fired in June, recently pleaded guilty in connection with charges that he solicited at least $250,000 in kickbacks in exchange for steering a contract.

Another article quotes: "A Louis Berger committee member, who is a former member of the Australian army, was jailed in the United States for his involvement in a 900,000-dollar Afghanistan security contract kickback case this month, the Sydney Morning Herald reported on Feb. 6. Scott Anthony Walker was a coordinator for the 1.4-billion-dollar infrastructure project". CLICK HERE for full story.

Another quote on McClatchy: "In a separate case, former Louis Berger security subcontractor Delmar Dwayne Spier and his wife, Barbara, pleaded guilty in September to federal conspiracy and fraud charges related to their scheme to inflate expenses claimed by his company, United States Protection and Investigations. Prosecutors estimate the couple brought in at least $3 million from the scheme."

Last Quote from McClatchy article: "A separate government audit recently found that the U.S. has spent more than $732 million to improve Afghanistan's electrical grid since 2002, but delays and rising costs have plagued many of the projects, including the plant, in part because of poor oversight by Washington."
Read the McClatchy article in entirety at: http://www.mcclatchydc.com/2010/02/11/84334/afghan-power-plant-hit-by-new.html#ixzz0wKycyTr3.

Now..the ironic thing about this Diesel Power Plant? The 100 million dollar cost of the project increased to 305 million dollars because "construction lagged a year behind schedule, and now it often sits idle because the Afghans were able to import cheaper power from a neighboring country before the plant came online." The result? "And a U.S. contractor benefited from a development program that essentially gives vendors a blank check, allowing them to reap millions of dollars in additional profits with no consequences for mistakes." (Fox News)

"U.S. contractor Black & Veatch oversaw the project for USAID as part of a joint $1.4 billion contract with The Louis Berger Group, another American contractor" (Fox News)

Conclusion: "But the number of Afghans with access to electricity has only inched up from 6 percent in 2001 to an estimated 10 percent now, well short of the development goal to provide power to 65 percent of urban and 25 percent of rural households by the end of this year." (Fox News)

To read the full articlde and article citation containing the above 3 quotes from Fox News: CLICK HERE.

What Louis Berger says in the BERGER MISSION STATEMENT

Given the above information - I find it Ironic that the Berger Mission Statement (page 4..my comments in red) says that their goals are to:

•Develop infrastructure that improves peoples’lives - I'm sorry..the infrastructure failed..so how did you improve lives?
•Preserve and enhance the environment - The PATH route does NOT preserve and enhance the environment.
•Reduce poverty and spur sustainable economic development- the projects certainly do not reduce poverty and spur sustainable economic development if the Afghanis are still imorting diesel.

Louis Berger "Principles of Berger Development Practices" (Page 26).
They tout the following as their goals (my comments in red):

Empower people directly - and how exactly did you empower the people without electricity who are still forced to import diesel?
Rely on Local, Indigenous Resources - again...Afghanis still have to import diesel.
Adapt to Local Cultural Conditions - The Afganis do not feel you have done this. Neither do the WV landowners affected by PATH.
Focus on Results - the results are that you wasted tax payer money and failed...yet you still profited while the rest of us have to suffer.