Lawmaker's Kin Win $108M FEMA Contract
Associated Press WriterNovember 15, 2005, 1:13 PM EST
NEW ORLEANS -- The uncle and father of a Louisiana lawmaker won three no-bid contracts worth $108 million to provide temporary housing for Hurricane Katrina evacuees, stirring complaints of a sweetheart deal from rival businesses and prompting a state investigation. A state agency is investigating because the lawmaker's family did not have a Louisiana license to sell new trailer homes until well after the company provided the first ones to the Federal Emergency Management Agency.
FEMA wants 125,000 campers and mobile homes for those who lost their homes in the storm that struck Aug. 29. The New Orleans-area motorcycle shop owned by Rep. Gary Smith's family received FEMA contracts to provide 6,400 trailers. Smith's uncle, Glen Smith, said he was able to secure the contracts because he has worked with the federal government for nearly four decades during disasters, removing debris, dredging rivers, and providing mobile housing following Hurricane Andrew in 1992. "We know what it takes to get them satisfied," Glen Smith said. "They didn't just walk up and give us a jackpot. It's not like that."
Trailer dealers were upset that Smith's motorcycle business did not have a license from the state Recreational and Used Motor Vehicle Commission to sell new trailers until mid-October. Glen Smith said he already had a license to sell used trailers and was not aware he needed another one. The commission is close to finishing its investigation into the motorcycle shop's license, said John Torrance, executive director of the agency. The shop's owners are likely to face fines, he said. FEMA spokesman Larry Orluskie said he did know the specifics of Smith's contracts or the licensing requirements. "This is a contract that's going to be looked at along with all the other contracts that are being scrutinized," he said. "If there's something inappropriate, it will be revealed."
No-bid contracts awarded by FEMA for temporary housing in trailers and on cruise ships have been questioned by state and federal lawmakers and businesses that have complained of favoritism. Critics of the government's no-bid contracts have called them gifts to politically connected companies. FEMA said they were needed to speed recovery efforts. Federal auditors are looking into several deals. David Gaffney, owner of Innovative RV in Baton Rouge, said he made three dozen calls to FEMA officials over several weeks trying to see if he could get a contract to sell trailers to the agency. "I was screaming at them," he said. "I'm a mile from the staging area and watched all these trailers roll by me." He finally was told he only could sell FEMA the 37 trailers that were already on his lot, unlike the deal Smith received. Gaffney said he could have supplied the trailers to the government at a lower price than Smith is offering.
Glen Smith said the contracts had nothing to do with his nephew, a state lawmaker since 1999. He said his nephew only handles legal work for the business and gets none of the profits. Gary Smith, a Democrat, also denied that his position as lawmaker had anything to do with the contract. "FEMA doesn't even know I exist," he said. Louisiana lawmakers are debating a bill that could require state officials to inform the state ethics board when they or their family members profit from federal disaster-related contracts.
Took you long enough.