IEM, a North Carolina-based disaster management company, has for a second time been awarded the contract to oversee the state's $1.6 billion flood recovery plan, after previously winning and then being stripped of the contract in a botched bid process last month.
Gov. John Bel Edwards announced the selection Thursday morning, adding that the controversial move to scrap the first bid award would ultimately save the state money. His spokesman Richard Carbo said the second round of bids had lower labor and total cost estimates than the initial round. However, no firm estimates were provided by Thursday afternoon about what the total cost to the state would be. A copy of IEM's latest bid proposal, provided to The Advocate, was heavily redacted and contained no labor rates.
Carbo said negotiations with IEM are ongoing but the full contract would be available within the next two days.
The contractor selection comes just three days after the funds appropriated by Congress were finally made available to the state.
"It was our goal to hire a contractor that would provide quality work with rigorous oversight at the most cost savings for the people of Louisiana," Edwards said in a statement. "IEM has made that commitment to the state, and I am personally going to hold them to it. This is a difficult process, and sometimes takes longer than anyone, including me, would like, but I do believe it's important for us to get this right."
Last month, the state voided a contract solicitation that yielded five bids to run the flood recovery program. IEM was initially selected as the contractor with a contract of $250 million, but was later disqualified after the State Licensing Board of Contractors ruled that IEM and two other companies did not have the proper licenses in place.
The decision came under scrutiny, The Advocate reported, because the attorney who advised the state licensing board has a son who worked for the employers of the third-placed bidders. That company, SLS, did have the proper licenses.
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State officials said restarting the solicitation was necessary because of the widespread confusion over what licenses were required, and because the bids all came in higher than officials had estimated.
The contractor selection snafu fueled intense criticism from some members of the state's Congressional delegation, such as U.S. Rep. Garrett Graves and U.S. Sen. John Kennedy.
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Graves has attacked Edwards in recent weeks, saying the state was left unprepared to administer the federal allocation because a contractor had not yet been selected.
The $1.6 billion Congressional appropriation to Louisiana's flood victims was made available to the state on Monday. The state is still surveying victims for eligibility, and those interested in participating in the program can complete a survey at restore.la.gov. Edwards' team has been adamant that the state's timeline for recovery has been unaffected by the process of selecting a contractor.
Robert Bruno, an attorney for IEM said their team is ready to hit the ground running.
"We were ready to start work a month ago," Bruno said. "We're ready to roll and we understand the staffing needs. We understand every aspect of the procedure. We really feel like our main goal is to get people back in their houses."
IEM filed suit last month after the contract award was revoked, challenging the licensing board's decision.
Bruno said he expects that lawsuit will be dropped.
Tim Barfield, a manager with PDRM, the company which filed the complaint about IEM's licensing in the first round, declined comment.
IEM was founded in Baton Rouge, but later relocated. After Hurricane Sandy, IEM helped manage a $1 billion recovery housing program in New York, where it disbursed $100 million for reconstruction and repairs in the first two months. The company also worked as a subcontractor for Louisiana's Road Home Program after Hurricane Katrina.