Jackson Free Press

The New York Times reports today:

BAY ST. LOUIS, Miss., Nov. 10 - From their new metal-encased classroom, the third graders who returned to school this week can look straight into the carcass of the old North Bay Elementary. To the Federal Emergency Management Agency, the modular classrooms lined up next to the soon-to-be demolished former school show, as the billboard out front boasts, "Katrina Recovery in Progress." But to critics, the 450 portable classrooms being installed across Mississippi are prime examples in their case against FEMA and its federal partner, the Army Corps of Engineers, for wasteful spending and favoritism in the $62 billion hurricane relief effort.

Provided by a politically connected Alaskan-owned business under a $40 million no-bid contract, the classrooms cost FEMA nearly $90,000 each, including transportation, according to contracting documents. That is double the wholesale price and nearly 60 percent higher than the price offered by two small Mississippi businesses dropped from the deal.

In addition, the portable buildings were not secured in a concrete foundation, as usually required by state regulations because of safety concerns in a region prone to hurricanes and tornados.

The classroom contract has already prompted a lawsuit from one of the Mississippi companies and a government investigation.

"The fact that natural disasters are not precisely predictable must not be an excuse for careless contracting practices," David E. Cooper from the Government Accountability Office, told Congress recently. In testimony submitted this week, Mr. Cooper said, "We found information in the corps' contract files and from other sources that suggest the negotiated prices were inflated."

Officials at Akima Management Services, the contractor that got the job, say they that while the cost was high, this was not a case of price gouging. The speed demanded in installing the classrooms required charging a premium, said John D. Wood, the company's president.

"What we provided to the government was a fair and reasonable cost given the emergency conditions and the risks," Mr. Wood said. "If it had been done the other way, the kids would not have been in school yet."

Akima's majority owner is the NANA Regional Corporation. It is represented in Washington by Blank Rome Government Relations, a lobbying firm with close ties to the Bush administration and particularly Tom Ridge, the former head of the Department of Homeland Security, FEMA's parent agency. NANA's federal contracts have grown rapidly in recent years, according to the Center for Public Integrity.

Representative Bennie Thompson, a Mississippi Democrat, argues that the Akima deal made no sense. Instead of paying a middleman like Akima or the Mississippi companies, he told the Department of Homeland Security, the federal government should have purchased the classrooms directly. And he complained that FEMA had ignored a requirement to give preference to local businesses. [...]

The school construction job is just one of several Hurricane Katrina deals under scrutiny by auditors and Congressional investigators. In awarding those contracts - for roof tarps, debris removal and mobile homes - the federal government said it had to move quickly and often turned to proven contractors accustomed to large-scale work.

The classrooms would have been by far the largest project ever undertaken by the Mississippi company seeking the contract, its owners acknowledge. The business, Adams Hardware and Home Center, has been selling modular classrooms statewide for decades and operates a local mobile home park.

Adams is based in Yazoo City, Miss., about 200 miles north of Bay St. Louis ...