- Associated Press - Tuesday, September 7, 2010

KHAN BANI SAAD, Iraq | A $40 million prison sits in the desert north of Baghdad, empty. A $165 million children’s hospital goes unused in the south. A $100 million wastewater treatment system in Fallujah has cost three times more than projected, yet sewage still runs through the streets.

As the U.S. draws down in Iraq, it is leaving behind hundreds of abandoned or incomplete projects. More than $5 billion in U.S. taxpayer money has been wasted on these projects — more than 10 percent of the $53.7 billion that the U.S. has spent on reconstruction in Iraq, according to audits from a U.S. watchdog agency.

That amount is likely an underestimate, based on an analysis of more than 300 reports by auditors with the special inspector general for Iraq reconstruction. It also does not take into account security costs, which have run almost 17 percent for some projects.

There are success stories. Hundreds of police stations, border forts and government buildings have been built; Iraqi security forces have improved after years of training; and a deepwater port at the southern oil hub of Umm Qasr has been restored.

But even completed projects for the most part fell far short of original goals, according to an Associated Press review of hundreds of audits and investigations and visits to several sites. Also, the verdict is still out on whether the program reached its goal of generating Iraqi good will toward the United States instead of the insurgents.

Col. Jon Christensen, who took over as head of the U.S. Army Corps of Engineers in Iraq this summer, said it has completed more than 4,800 projects and is rushing to finish 233 more. Almost 600 projects have been terminated, mostly for security reasons.

Col. Christensen acknowledged that mistakes have been made but said steps have been taken to fix them. The success of the program will depend ultimately on the Iraqis — who have complained that they were not consulted on projects, he said.

“There’s only so much we could do,” Col. Christensen said. “A lot of it comes down to them taking ownership of it.”

The reconstruction program in Iraq has been troubled since its birth, shortly after the U.S.-led invasion in 2003. The U.S. was forced to scale back many projects even as they spiked in cost, sometimes to more than double or triple initial projections.

As part of the so-called surge strategy, the military in 2007 shifted its focus to protecting Iraqis and winning their trust. American soldiers hired contractors to paint schools, refurbish pools and oversee neighborhood water distribution centers. The $3.6 billion Commander’s Emergency Response Program provided military units with ready cash for projects and paid for Sunni fighters who agreed to turn against al Qaeda in Iraq for a monthly salary.

But civilian and military reconstruction efforts sometimes were poorly coordinated and overlapped.

Iraqis can see one of the most egregious examples of waste as they drive north from Baghdad to Khan Bani Saad. A prison rises from the desert, complete with more than two dozen guard towers and surrounded by high concrete walls. But the only signs of life during a recent visit were a guard shack on the entry road and two farmers tending a nearby field.

In March 2004, the Corps of Engineers awarded a $40 million contract to global construction and engineering firm Parsons Corp. to design and build a prison for 3,600 inmates, along with educational and vocational facilities. Work was set to finish in November 2005.

But violence was escalating in the area, home to a volatile mix of Sunni and Shiite extremists. The project started six months late and continued to fall behind schedule, according to a report by the inspector general.

The U.S. government pulled the plug on Parsons in June 2006, citing “continued schedule slips and … massive cost overruns,” but later awarded three more contracts to other companies. Parsons, based in Pasadena, Calif., said it did its best under difficult and violent circumstances.

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