|
By Greg Miller
The Los Angeles Times
The report says expenses in projects that exceeded budgets were concealed in unrelated accounts.
Washington - The U.S. agency responsible for administering $1.4 billion in reconstruction funds in Iraq has sought to hide major cost overruns on high-profile projects from Congress by engaging in questionable accounting maneuvers, according to a federal audit released late Friday.
The agency has masked budget spillovers on a children's hospital in the southern city of Basra and other facilities by hiding the expenditures in seemingly unrelated accounts, the report from the Special Inspector General for Iraq Reconstruction says.
Overall, the report found a "lack of effective program management" by the State Department and the U.S. Agency for International Development, which oversees U.S. reconstruction spending in Iraq and other countries.
The accounting issues are the latest in a series of problems, including fraud allegations and the soaring costs of protecting work sites and crews from attacks, that have beset the massive rebuilding effort in Iraq.
The report focuses on cost overruns and construction delays at the children's hospital, whose advocates include First Lady Laura Bush and Secretary of State Condoleezza Rice. But the document also points to similar accounting irregularities on other projects, including a power station in Musayyib and an electricity project in Baghdad.
USAID has continued to list the hospital project's cost at $50 million in reports to Congress, even as its actual budget has ballooned to more than $149 million, the audit found. The discrepancy was disguised by spreading indirect costs associated with the project - such as security and transportation expenditures - to other accounts, according to the report.
As a result, "millions of dollars in indirect costs that should have been applied to the hospital project were applied to other USAID projects, resulting in a serious misstatement of hospital project costs," the report says. At the same time, a facility that was supposed to be finished in December is now scheduled for completion in July 2007.
A spokeswoman for USAID, an independent agency that receives overall foreign policy guidance from the State Department, could not be reached for comment.
State Department spokesman Justin Higgins said he could not comment on the contents of the report. "We have not yet had a chance to fully review this report but certainly will consider it carefully as we do all the findings of the inspector general," Higgins said.
"Despite the challenges, we are committed to completing this project so that sick children in Basra can receive the medical help they need," he said.
The lead contractor on the hospital had been Bechtel National, based in Frederick, Md. But the company was reportedly dropped from the project last week - a development first reported in the New York Times - after long-
|
|
