Wall contracts awarded before land owned
LA GRULLA — The federal government said it needed Ociel Mendoza’s land on the outskirts of this tiny Texas town — and it couldn’t wait any longer.
Each additional day of delay was costing the government $15,000 as contractors waited to begin construction on the border fence slated to go through Mendoza’s ranch, the Department of Justice argued in court filings. By Nov. 24, the tab for the delay had reached nearly $1.6 million, the land acquisition manager for U.S. Customs and Border Protection said in an affidavit.
More than a year earlier, CBP had awarded a contract then worth $33 million to a New Mexico-based company to build 4 miles of fencing in Starr County. The county is one of the top targets of President Donald Trump’s administration for a border wall and a place agents have called the most volatile stretch in the nation. Construction was slated to begin in November 2019, the agency announced.
There was one problem: The government had awarded the contract before obtaining the land, including Mendoza’s. This September, after more than a year without getting that land, CBP had to suspend the contract to Southwest Valley Constructors, accruing “substantial” charges along the way, according to court documents.
An investigation has found that the government’s strategy of awarding contracts before acquiring titles to the land in Texas has led to millions of dollars in costs for delays, according to calculations based on statements made by CBP officials in court filings. On at least two dozen occasions, the agency has used the argument, often successfully, to convince federal judges to immediately seize land from property owners fighting their eminent domain cases.
The situation could become even more complicated if President-elect Joe Biden makes good on his promise to stop border wall construction.
Mendoza, an entrepreneur, said the government’s latest offer, which he said was about $136,000, fell short of the $200,000 he was seeking. The ranch is especially personal. It’s a piece of land he vowed to own after he crossed the
border illegally over the property as a teen more than 40 years ago.
“It represents a dream to me,” said Mendoza, who became a permanent resident in the 1980s. “The American dream.”
Since 2017, the federal government has awarded at least a dozen contracts in South Texas worth more than $2 billion prior to obtaining all the land it needed for the projects. The agreements are to build 146 miles of border wall and install three dozen gates.
But very little construction has been completed. Out of the 110 miles the administration planned to build in the Rio Grande Valley, where most of the land is privately owned, 15 miles had been finished as of mid-December.
The Army Corps of Engineers generally requires land to be acquired prior to awarding contracts, but the policy allows exceptions if approved by high-level officials, said Grace Geiger, an agency spokeswoman.
While posing greater risks for the government, she said the practice doesn’t have to lead to greater costs as, depending on the situation, the government may still be able to acquire the land before the contractor needs to enter the site.
Contract experts say the practice violates principles of sound procurement.
“It sounds like a formula for waste, or worse, to make the construction contract first and only acquire the land months or years later,” said Charles Tiefer, a Uni
versity of Baltimore contracting expert.
Austin Evers, the executive director of American Oversight and a senior counsel for the State Department during President Barack Obama’s second term, said the practice should be investigated by federal watchdogs.
“The government is arguing that it has to seize these lands right now because it is being penalized under the contract it already signed,” Evers said. “In plain English, what that means is that American taxpayers are seeing their money thrown away for no purpose because the government signed the contract before it could execute the project.”
Federal judges hearing CBP’s eminent domain cases in South Texas also have expressed frustration with the government’s legal argument for immediate possession in Starr County. In recent weeks, a segment of border fencing has quietly gone up in a remote area near Mendoza’s ranch.
While the government gets the title to the property as soon as it files what’s called a “declaration of taking” and deposits the amount it deems reasonable with the court, it can’t begin construction until a judge approves an order to possess the land. U.S. District Judge Micaela Alvarez, a George W. Bush appointee, blasted government attorneys’ request to take immediate possession of Mendoza’s ranch, arguing that the agency has had the funds to acquire private
land in Starr County for nearly two years.
“The United States’ delay until November 2020 to file its motion for possession is not within the court’s control … and (does) not create an emergency for this court,” she wrote Dec. 17. “The court has repeatedly expressed its dissatisfaction with the United States’ requests for expedited relief. The United States is not entitled to expedited relief, and should cease requesting such relief without good cause.”
However, Alvarez said that under the Declaration of Taking Act, she had little option but to grant the government’s request to take possession of Mendoza’s land, noting that Mendoza had not responded in time and that the government had filed the correct documentation and deposited what it estimated it would pay for the land seizure.
Even as government attorneys continue to cite the growing costs of delays to judges, the agency has downplayed the issue outside the courtroom.
“CBP will not know if there are any associated delay costs due to real estate until the end of the contract, as the contractor may be able to make up any potential delays incurred,” CBP spokesman Matthew Dyman said Friday. Dyman declined to clarify the statement, citing the ongoing litigation.
CBP also insists that awarding contracts without first obtaining land is efficient.
“Once the border wall system design is approved by the Government, and sufficient real estate is acquired by the Government, construction activities can begin,” wrote Roger Maier, a spokesman for CBP.
The government has been here before. A decade ago, CBP learned that building in this part of the border would be especially challenging, between acquiring the land — which in some cases took more than two years — and flooding concerns. Under the Bush and Obama administrations, several border wall fence projects, also awarded before the government obtained the land, died because the agency couldn’t get them built before funding dried up.
The Trump administration’s legal efforts have only intensified with nearly 40 new eminent domain lawsuits filed in the Southern District of Texas since Election Day.
All of which leaves the incoming Biden administration and hundreds of Texas landowners in a web of title and compensation disputes, multimillion-dollar contracts and a string of unfinished — and disconnected — projects all along the Rio Grande.
Biden has said he will cease wall construction and drop all the lawsuits on Day 1. Biden could save up to $2.6 billion if he halts construction, according to Army Corps of Engineers documents reviewed by the Washington Post.
One of CBP’s toughest fights over eminent domain centers on Starr County, a poor, mostly rural county where family properties date back to original Spanish land grants issued 250 years ago, well before the Rio Grande served as an international boundary.
For more than a decade, residents and county officials have resisted the agency’s push to build a border wall, which the government has said in court filings is the No. 1 county for narcotics seizures across the entire southern border of the United States.
Column resumes Jan. 6.