FEMA'S Disturbing 30 Million Meal Fiasco in Puerto Rico
After Hurricane Maria hit, most houses, roads, electricity and telecommunications services were destroyed in Puerto Rico. Most important to deal with immediately after the disaster struck was providing food and water for those who lived there. FEMA took action on that by quickly issuing solicitation HSFE70-17-R-MARIAMEALS for 30 million self-heating meals.
But, FEMA did not engage in sound procurement practices from the start. Responses were due merely hours after the solicitation was first issued on Sep 18, 2017 at 12:59 PM. Then it was amended at 4 PM and quotes were due at 7 PM the same day "and every 6 hours thereafter until all requirements are fulfilled and/or this post is cancelled."
So, not enough time was allowed for responses from professional companies, unless they were notified in advance or were already anticipating FEMA'S needs and were ready to respond quickly.
The only real requirements for a contract award was that the company be listed in the System for Award Management (SAM), had supplied their DUNS# when registering, furnished a photo of the proposed meals and made a claim to be able to perform.
There was no requirement for actual production capacity, an ability to finance the production of so many meals or a licensed food preparation facility capable of producing massive amounts of safe food quickly.
A contract for 30 million meals was awarded to Tribute Contracting LLC for approx. $156 million because it was the lowest and first responsive proposal. Additional contracts for lower amounts were awarded to seven other companies.
Producing 30 million self-heating meals is an enormous project, and one might think FEMA would have picked one of the many experienced large-scale disaster-relief food suppliers in the region or tapped existing supplies. Given the urgency, FEMA should have selected a company that actually had food in stock and could deliver it quickly to the hungry people. FEMA did not do these things. Instead, it selected Tiffany Brown, an entrepreneur based in Atlanta who not only had zero experience in this sort of thing but also had five previously canceled government contracts as part of her background. Brown’s company, Tribute Contracting LLC, for which she was both the owner and its only employee, yet she was given a $156 million contract to produce the meals.
The contract, awarded on October 3, was one of the biggest food contracts FEMA awarded. The terms were for the company to provide 30 million ready-to-eat meals, at an equivalent price of $5.10 each, by October 23. That was less than three weeks after the contract award. It would have been obvious to anyone that the chances that Brown’s company could deliver on time were slim at best.
Clearly, Brown needed help. One might think that without having direct applicable experience in doing this sort of thing, she would turn to someone else who did to assist her in the primary job of producing the meals. She did not. Instead, she hired as her primary partner a wedding caterer, also in Atlanta, who had a staff of 11. However, she did find a Texas non-profit with experience in delivering food aid both in the United States and overseas to help once the food was prepared.
As one might expect, the scale of production the wedding caterer’s staff of 11 might be able to produce was limited. They were asked by Tribute to produce something simple: freeze-dried wild mushrooms and rice, chicken and rice and a vegetable soup. They did, but it was still a slow undertaking.
When the due date to deliver the 30 million meals contracted for arrived, there were two problems discovered by FEMA inspectors. The first was that the meals that had been produced were being packed separately from the pouches used to heat them. This was despite the contract requirement that the food be delivered as “self-heating meals.” The second was that Tribute had only produced 50,000 meals. That was only 0.3% of the total the company was supposed to have delivered. Still, it was remarkable that it had been able to provide 50,000 meals in that short period of time.
When what had happened was discovered, Carolyn Ward, the FEMA contracting officer who was responsible for managing Tribute’s agreement, shut Tribute down. “Do not ship another meal. Your contract is terminated,” she wrote to Brown by email on October 19.
This is not the only such mess FEMA has found itself in regarding bad contracts associated with help related to Hurricane Maria. There was also a total of $30 million in contracts released for emergency tarps and plastic sheeting, but the company that was awarded the contracts never delivered the goods.
As congressional investigators are now discovering, findings going back to the many support delivery problems associated with 2005’s Hurricane Katrina suggest that the current-day events are very similar to what happened then. Even though natural disasters such as hurricanes and tornadoes are regular and somewhat predictable events, FEMA is often painfully unprepared – or deliberately negligent.
Part of the preparations for disasters is the lining up of suppliers for all sorts of emergency aid to be delivered on short notice when such disasters occur. First, there is the requirement of stockpiling certain types of supplies (such as water, generators and their associated fuel, temporary shelters and medical supplies) so they are ready for deployment the moment it is safe to do so after a disaster hits. Second, there is the need for the identification of, prequalification for and regular requalification of companies that can produce emergency food supplies on demand. Post-Katrina, the Bush administration worked to correct not having such contractors available. The Obama administration also invested to make sure that such companies were ready to respond.
According to those close to the situation, the lack of staffing by key personnel within the Trump administration has created a void of knowledge, support and planning in the emergency services area, which is big and inexcusable.
Tribute Contracting and CEO Tiffany Brown are not taking the contract termination lightly. For one thing, Brown cannot just simply sit by, since both of her major subcontractors for the work (Cooking With a Star LLC and Breedlove Foods, Inc.) have threatened to sue her for breach of contract. Cooking With a Star also reportedly has 75,000 meals prepared for delivery but no customer ready to receive or pay for them.
Though FEMA had cited Tribute for not preparing self-heating meals, the ultimate reason the organization gave for terminating the contract was Tribute’s late delivery of the approved meals. Brown appealed the contract termination on December 22, saying the reason FEMA cut off her contract was because the meals were packed separately and that the agency had never specified that the meals and the heaters had to be packed together. She also said she could have finished all 30 million meals by November 7, a date that seems doubtful to everyone else. Brown is looking to settle the dispute for at least $70 million.
With Tribute’s past track record, however, it is unclear if Brown is in a strong position to win her case. Her company had four previous government contracts canceled for failure to deliver the required food products to institutions within the federal prison system. The company also had a contract terminated with the Government Publishing Office (GPO) for delivering 3,000 tote bags that were supposed to have the U.S. Marine Corps logo printed on both sides but were only printed on one side each. According to a 2015 report provided to Congress, the GPO’S inspector general also determined that Tribute had “altered and submitted a false shipping document and subcontracted the predominant production function on two contracts without proper authorization.”
Based on the poor delivery results and the document falsification, the GPO banned Tribute from receiving any contracts worth more than $35,000 until January 2019. Unfortunately, that ban only applies to the GPO and not to the government in general.
What is odd is that despite the ban for GPO contracts and the other four contract cancellations for food deliveries for the federal prison system, Tribute was still eligible for what was, in the end, a real “life or death” contract.
Though the Tribute meal deliveries were missed, FEMA agency spokesman William Booher claims that Puerto Ricans still had “ample” food and water for distribution from other suppliers at the time.
A broader congressional investigation into why Tribute was awarded the contract in the first place – as well as into FEMA’S entire handling of disaster relief support for Hurricane Maria victims in Puerto Rico – will likely happen sometime in the near future. However, it may not expose what could really be going on.
FEMA’S gross incompetence when it comes to contracting may be deliberate. There are many elements within federal contracting who want to do away with competitive and transparent bidding and make all federal contracting opaque and more like in the military, where trillions of dollars vanish without any accountability. By deliberately sabotaging the public procurement process, FEMA supports the agenda of the criminal elements who seek to loot even more from taxpayers.
This latest FEMA fiasco comes at a time when Congress is considering making massive changes to federal procurement law, none of which are for the better.