News Archive
Groundhog Day at the ‘K-Town Mall’
Released on 27/06/2008
Millions over budget, riddled with defects and two years late and counting, a US Air Force community centre in Germany shows the ‘pervasive dysfunction’ in federal contracting, says procurement watchdog Henry Waxman.
More than two years after the originally scheduled completion date, the US Air Force community centre at Kaiserlautern in West Germany continues to experience construction quality problems and ongoing criminal investigations.
According to evidence given to the House of Representatives Oversight Committee, the project known as ‘K-Town Mall’ is US$110m over budget, has no validated cost estimate and no working completion date.
A report released by the US Government Accounting Office on June 25 gives the facts on the shopping mall’s defective and continuously leaking roof which will cost millions of dollars to repair.
There are also serious construction mistakes such as kitchen exhaust ducts sealed with flammable insulation.
In a statement opening the Oversight Committee’s second inquiry into the Kaiserlautern project, chairman Henry Waxman said:
“We also obtained a report from the Air Force Audit Agency detailing 35 different deficiencies in the Air Force’s management of this project.
“And we were informed of several ongoing criminal investigations of US officials involved with this project, including one official who fled to Dubai instead of agreeing to testify before this committee.”
Mr. Waxman described the Kaiserlautern story as more evidence of ‘pervasive dysfunction’ in Federal contracting. The present hearing, he said, is particularly frustrating because glaring problems identified a year ago have not been fixed.
He described he evidence from the audit team as something out of the popular film “Groundhog Day”.
In addition to the faulty roof and dangerous kitchen exhaust ducts, the government auditors have identified long cracks in the concrete foundations of the building. Nobody yet knows the full extent of this damage, how long it will take to repair or how much these repairs will cost.
To date the cost estimates are running at $230 million and rising compared with the forecast of $120 million for completion in 2006.
It is now believed the community centre will not be open for business until some time in 2009.
Marc E. Rogers, USAF vice commander in Europe, described the Kaiserlautern project as a top priority for the USAF.
The construction contracts are in the hands of German agencies, he explained, and the Air Force has no authority over contractors.
The local German agency had failed in fundamental areas: the project suffered from absence of a general contractor, inadequate quality control and ineffective contract management.
Since last year these management failures have been validated by German and US authorities and additional failures identified, such as inadequate accounting, schedule deficiencies and non-compliance with NATO rules.
Meanwhile several US officials are being investigated for ‘dereliction of duty and bribery’.
Mr. Waxman said there has been a complete breakdown in the US procurement process over the last eight years, adding that those responsible ought to face appropriate consequences.
“We urgently need a new approach that welcomes oversight and demonstrates a commitment to fixing problems and protecting taxpayers from waste, fraud and abuse,” he said.
