U.S.’s $51 Billion Iraq Projects at Risk, Inspector Says

Billions of dollars in Iraq reconstruction projects may be wasted as the U.S. transfers them to the Iraqi government, according to a U.S. watchdog.

“There remains a vulnerability that thousands of projects” completed with $51 billion in American reconstruction funds “will not be sustained and thus fail to meet their intended purposes,” Special Inspector for Iraq Reconstruction Stuart Bowen said yesterday.

“The record of what the U.S. built in Iraq and what we transferred to Iraqi control is full of holes,” Bowen told a House oversight panel during a hearing on the transition to State Department management after the U.S. military withdrawal in December.

Bowen first warned of a “sustainment gap” in 2007, saying the Iraqi government wasn’t capable of performing long-term operation and maintenance of projects funded by U.S. taxpayers. Today “it remains unclear whether” the State Department “will engage in any further follow-up,” Bowen said in prepared testimony.

One reason is that the withdrawal of U.S. forces combined with violence outside Baghdad makes visits to check on projects risky and costly, he said.

“To make a movement outside the embassy grounds requires 48 hours of notice, three hardened vehicles and a couple of shooters in each vehicle, and limited time on site to carry out your mission,” Bowen said.

Guarding Employees

Bowen and other witnesses described as uncertain both the security situation and the Iraqi goverment’s commitment to helping maintain a State Department presence. After violence fell in March to the lowest level since the March 2003 U.S. invasion, deaths have again increased in Baghdad, Bowen said.

The State Department has about 16,000 personnel in Iraq at 14 sites, including about 14,000 contractors primarily responsible for providing logistics and protection for the other employees. The department has said it will reduce that presence to a total of 11,500 by September 30, 2013. The State Department and Pentagon are planning to spend $4 billion this year in Iraq to support the diplomatic presence.

The Iraq government’s commitment to the continued U.S. presence “has remained unclear,” said Michael Courts, acting director for international affairs for the U.S. Government Accountability Office.

The foreign minister’s office “questioned the size, location and security requirements of U.S. sites” and as of May hadn’t signed all land-use or operations agreements, he said.

Parked Vehicles

To transport State Department personnel in high-risk areas, the U.S. Army left behind 60 fortified Mine-Resistant Ambush- Protected vehicles that protected U.S. and Iraqi troops from improvised roadside bombs, Courts said.

“The Iraqi government will not allow their use and so they’re essentially sitting right now,” Courts said.

Patrick Kennedy, under secretary of state for management, told the panel the vehicles weren’t being used because after consultation with the Iraqi government the State Department determined that they “were not ideally suited” to operations in heavily populated areas.

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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