The tally for Hurricane Katrina waste could top $2 billion next year because half of the lucrative government contracts valued at $500,000 or more for cleanup work are being awarded with little competition.
Federal investigators already have determined the Bush administration squandered $1 billion on fraudulent disaster aid to individuals after the 2005 storm. Now they are shifting their attention to the multimillion dollar contracts to politically connected firms that critics long have said are a prime area for abuse.
In January, investigators will release the first of several audits examining more than $12 billion in Katrina contracts. The charges range from political favoritism to limited opportunities for small and minority-owned firms, which initially got only 1.5 percent of the work.
“It wouldn’t surprise me if we saw another billion more in waste,” said Clark Kent Ervin, the Homeland Security Department’s inspector general from 2003-04. “I don’t think sufficient progress has been made.”
He called it inexcusable that the Bush administration would still have so many no-bid contracts. Under pressure last year, Federal Emergency Management Agency Director David Paulison pledged to rebid many of the agreements, only to backtrack months later and reopen only a portion.