R. Reese Fuller

An "infuriating" $156 million increase to ICF for the Road Home

by R. Reese Fuller

On Thursday, The Times-Picayune revealed that former Gov. Kathleen Blanco's administration increased the payment to ICF International for administering the Road Home project in December by $156 million — from $756 million to $912 million, an increase of 25 percent — unbeknownst to the general public. On Friday, Blanco defended the action :
"It was my understanding and belief that any contract change would be publicly noticed," Blanco said in an e-mail message sent from France, where she's giving a speech to a flood-response conference. "I encourage Steve Theriot, the legislative auditor, whose office was consulted during negotiations, to continue to audit ICF and to hold them accountable for every dollar of their contract."

Theriot said he would begin dissecting the amendment costs immediately.
The Associated Press reports that ICF is boasting strong profits after going public and getting "a potentially big raise recently from the state of Louisiana":
Yet, 56,000 applicants — nearly 40 percent of the qualified total — had yet to receive a cent as of last month. Plagued by cost overruns and delays, Road Home is expected to cost the taxpayers $10 billion in federal money and has become another glaring symbol of frustration and red tape in post-Katrina New Orleans. ...

ICF spokeswoman Gentry Brann blamed the state's ever-changing rules and political meddling by officials and community groups for many of Road Home's difficulties.

She complained that Road Home has come to be regarded as an entitlement program, and said the company must carefully evaluate 157,000 applications to guard against fraud.

"The state essentially redefined the goal of the program from rebuilding to relief in midstream," Brann said.

She said the $912 million that the company could earn is to cover the costs of the program and was approved by public officials.

"It's very important to note this is not a `pay increase.' It's not actually even `pay' to ICF. Rather it is an increase in the contract ceiling to cover the additional unit price costs incurred by our subcontractors," Brann said. ...
On Sunday, The Times-Pic called on Gov. Bobby Jindal to fire the Office of Community Development's director Suzie Elkins, whose department is supposed to oversee ICF, saying that the department is "either incompetent or too cozy with the contractor — or both." The paper also called on the Jindal administration to withhold the increase to ICF until Theriot's office can investigate the deal but saved its most pointed barbs for ICF:
The company's disdain for the tens of thousands of Louisianians who lost their homes to hurricanes and flooding in 2005 is infuriating.
ICF spokeswoman Gentry Brann complained in an Associated Press story last week that the Road Home has come to be viewed as an entitlement program and blamed meddling community groups for some of the program's problems.

That is outrageous. This grant money is a small measure of repayment for the massive devastation wrought when the federal government's levees fell apart during Katrina.

The air of entitlement comes from Ms. Brann and others at ICF, which went public after getting the Road Home contract and has profited handsomely on rising stock prices.

Ms. Brann pointed out in the AP story that ICF will only make a 3 to 5 percent profit on the Road Home contract. She makes it sound like a sacrifice. But 5 percent on $912 million is $45.7 million.

That would be a fortune to the thousands of South Louisianians who have had to beg for the grants they need to rebuild their shattered homes.
Read more about the controversial ICF in The Independent Weekly's May 29, 2007 cover story, "Road Blown."