Working with the government: Easy come … Easy go

Easy come, easy go.
   That expression just doesn’t quite provide solace when you lose a large contract.
   But, when a small company is dealing with the U.S. government, and said government is purchasing equipment from said small company for use in the middle of a very hot war – well, anything can happen. But there are lessons to be learned.
   The whole thing began with a simple e-mail, one of probably a dozen I received September 28th, 2004. An Army Corp of Engineers design engineer working in the Sunni triangle of Iraq had a problem – how to provide safe drinking water to 45 villages along the Euphrates River in Iraq with a limited amount of money. He was surfing the Internet and found us. A little two-plus-two on his part and he fired off an e-mail to me.
   Over the next month and several dozen e-mails, we came up with solid designs to accomplish the task, within budget, and in a way that was sustainable for the villagers. The idea was that we would sell the water filters to the U.S. Army Corps of Engineers, and the installation of the systems would go to a contractor working in Iraq.
   So far it had been just the design engineer and myself working out the details. But then in came the bureaucracy. The engineer had to sell the concept to the Corps contract people, various military commanders, and officials from the Iraqi Ministry of Water. Over the next couple of months, the numbers of villages went down to 36, then down to 8, then to 12, then back to 36. By October 31st, a scope of work was completed and submitted.

  • November 11th. Some anonymous person in the contracting office, not an engineer, wanted to know if we could use garbage cans as tanks for the water filters. He had read an article somewhere. It was pointed out that we were supplying water for up to a million people. No, garbage cans would not work.

  • Thanksgiving. The design engineer informs me that they would be eating hot dogs for Thanksgiving at his base near Fallujah because the truck carrying the camp’s Thanksgiving dinner also happened to be loaded with explosives and had to be blown up outside the camp. Another indication of the environment in which we were trying to implement this large project.

  • December 9th. Everything is put on hold. Contractors bidding the construction and installations in Iraq  were 800 percent over budget. I suggested maybe my company should bid all materials to keep costs within bounds. Besides this current snag, key unanswered questions included how to get all this stuff to Iraq, would we send someone there to supervise, and if so, how would his/her security be handled – an especially unsettling question in light of frequent reports of contract workers getting killed while working in Iraq.

  • December 28th. Another contract officer wants to put the whole thing to bid again.

  • January 14th. I receive another request for quotation, my fourth or fifth to date.

  • January 26th. We are informed we have the best proposal.

  • February 7th. We are asked for expedited delivery, and then asked not to expedite delivery. Then we are awarded the contract.

  • February 12th. We are given a request for delivery to Baghdad instead of the original destination of a military base near Fallujah. Later we are asked to deliver to the seaport of Aqaba, Jordan, instead of the base or Baghdad.

  • February 25th. The contract officers meet with the Iraqi Ministry of Water to discuss the project. I’m wondering why this didn’t happen at the beginning.

  • March 14th. A list of the first 12 high-priority villages is issued.

  • March 16th – 22nd. We negotiate initial payments, and FOB points, both critical issues in terms of how to finance this project and who is responsible for what when.

  • April 2nd. We are requested to remove 7 villages from the list for unknown reasons.

  • April 5th. We are requested to remove a different set of villages and put some back on the list.

  • April 18th. Contract revised to reflect 7 removed villages.

  • April 28th. Initial payment still in bureaucracy.

  • May 1st. Request for what termination costs would be.

  • May 5th. Initial payment arrives. Contract terminated for “the convenience of the government.”

   If none of this sequence makes any sense to you, imagine how it looked to us. We are a small company and were able to adjust and react quickly to the many changes encountered. In the end, we were informed that the reason to terminate the contract had nothing to do with us, but other factors had intervened. We were never informed what those factors were.
   We were offered a reasonable settlement for the 34 weeks of intense planning and design that went into this futile exercise, and in the end we just regrouped and went on with other areas and projects.
One lesson for me is that just because you get a good-sounding government contract, if it is overseas, particularly in a war zone, don’t count on an expected outcome – and get the money up front.

Humphrey Blackburn is the President and CEO of Blue Future Filters, which recently moved to Custer from Sanata Rosa, CA.


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