- The Washington Times - Thursday, April 17, 2003

Iraqi reconstruction presents multimillion-dollar business opportunities for mostly, but not exclusively, American companies.

President Bush yesterday signed a bill providing $2.48 billion for a new Iraq Relief and Reconstruction Fund, part of the intensive, multiagency effort to rebuild the country.

Congress limited the White House's freedom to spend the money, but gave the Pentagon a role in rebuilding the country.

The White House is working with the Pentagon and the U.S. Agency for International Development to determine how much to spend on individual rebuilding projects.

"The White House has the budget and is working with USAID in terms of establishing what the different needs are. There's no way we could know how much money we will need until we get in the country," said a USAID spokesman, who asked not to be named.

USAID is awarding about $1.7 billion in reconstruction contracts to private companies. Those will go to U.S. businesses or U.S. subsidiaries of foreign companies.

About $43.8 million has been committed so far.

RTI International, a North Carolina nonprofit group, won a $7.9 million contract to help local governments provide basic services in Iraq's cities and towns.

"We're not naive in thinking this is going to be an easy project. But it is in the scope of our experience and we feel very good about it," said Ron Johnson, vice president for international development at RTI.

RTI is sending in a team of five persons next week and will follow with as many as 200 U.S. personnel and 350 Iraqi hires, Mr. Johnson estimated.

Subcontracts in RTI's original proposal are with U.S. companies, but Iraqi companies will be considered for local projects, he said.

Subcontracts on all awards are open to all foreign companies that meet government requirements, including companies not located in coalition partner countries, according to USAID.

Seattle-based Stevedoring Services of America won a $4.8 million award to assess and manage the Umm Qasr port; Washington-based Creative Associates International won a $2 million pact for education; and Washington-based International Resources Group (IRG) won a $7.1 million contract for personnel support.

The biggest contract, $600 million for construction, has not been awarded.

USAID and the Pentagon's Office of Reconstruction and Humanitarian Assistance are taking leading roles in the reconstruction efforts.

The Office of Reconstruction and Humanitarian Assistance has teams in Iraq and is working through the military's Central Command and forces on the ground, according to Army Brig. Gen. Vincent Brooks, deputy director of operations at Central Command in Doha, Qatar.

The Pentagon already has played a role handing out contracts to fight oil well fires.

Additional money that filters down from the Pentagon to the U.S. Army Corps of Engineers for oil field work in southern Iraq probably will be bid out internationally, said Scott Saunders, an Army Corps of Engineers spokesman.

"We're doing planning. We don't know yet what it will be or what it will cost," Mr. Saunders said.

The corps awarded a subsidiary of Halliburton a no-bid contract to put out oil well fires, a move that led to cries of cronyism because Vice President Dick Cheney was the company's chief executive until 2000.

That contract is valued at about $600 million, Mr. Saunders said, less than originally estimated because there were relatively few fires.

Future contracts depend on instructions and allocations from the Pentagon.

"There's probably not enough money in place to pay for everything that will be needed," Mr. Saunders said.

Total cost estimates for reconstruction vary, with multiyear investments ranging from $25 billion to $100 billion, according to a published report.

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