Report finds USAID spending on aid and housing in Haiti is 30% of what was promised

GAO report: Delays, cost hikes hit new Haiti housing

By Donna Cassata, Associated Press, June 25, 2013

WASHINGTON -- The U.S. government had ambitious plans to help earthquake-ravaged Haiti where more than three-fourths of the population lives on less than $2 a day - construction of 15,000 homes in the poorest country in the Western Hemisphere. Disputes over land rights, inaccurate estimates and higher costs have forced the U.S. Agency for International Development to drastically scale back those plans and left members of Congress questioning whether American tax dollars are delivering the help first promised after the Jan. 12, 2010 earthquake.

The Government Accountability Office, in a report released on Tuesday, found that as of March 2013 the agency had disbursed only 31 percent of $651 million despite the government's insistence that it was committed to Haiti's reconstruction. The GAO also found that "a substantial amount of progress on project activities remains to be completed."

Instead of 15,000 homes for 75,000 to 90,000 beneficiaries, the agency plans to build 2,649 homes for some 13,200 to 15,900 beneficiaries. In fact, the agency is expected to build 906 houses and non-government agencies and other partners are on tap to construct 1,743 homes.

Among the problems causing delays and cost increases was acquiring the land titles to build as well as the Haitian government's demand that the homes have flush toilets. One difficulty was that before the January 2010 earthquake, Haiti had no wastewater treatment plants.

Since then, a temporary facility has been constructed at one location and a permanent plant built near the capital city of Port-au-Prince though it's unclear whether the facilities can serve the homes.

The earthquake displaced some 2 million people, killed about 230,000 and injured 300,000. Congress voted to provide $1.14 billion in reconstruction funds, including $651 million for the agency which provides U.S. economic and humanitarian assistance worldwide.

One of the major projects are a power plant and port to support the new Caracol Industrial Park, which is projected to create thousands of jobs more than 100 miles from Port-au-Prince.* Last October, former President Bill Clinton and then Secretary of State Hillary Rodham Clinton inaugurated the industrial park and urged foreigners to invest to help Haiti rebuild.

The GAO report found the work on the first phase of the power plant was done with less money and in time to provide power to the first tenant at the industrial park. However, construction of the port will be delayed two years because of the agency lack of expertise in port planning. The position of the port engineer remains unfulfilled. "This uncertainty puts at risk USAID's investments in port planning and design, as well as the sustainability of the CIP and power plant due to the three projects' interdependence," the report said.

Beth Hogan, USAID's senior deputy assistant administrator to the Latin America and Caribbean Bureau, said the agency welcomed the report, noting that the Haiti mission finished the first part of a power plant with less funding than allocated. "Mid-point reviews such as this one are helpful to us to see how we can be more effective," she wrote in an email. "It is important to bear in mind that the report is a snapshot of progress to date, and that work in housing, energy, port construction and other areas is ongoing."

Rep. Ileana Ros-Lehtinen, R-Fla., who requested the report when she led the House Foreign Affairs Committee last year, said the findings were "alarming and showcases the need to further investigate and ensure that U.S. taxpayer dollars are not being wasted or abused in Haiti."

The committee plans to send a bipartisan delegation of staff members to Haiti, said the current chairman, Rep. Ed Royce, R-Calif.

Rep. Eliot Engel of New York, the panel's top Democrat, said the GAO found a "significant and sobering disconnect between what was originally promised for the Haitian people, and what it appears USAID is now prepared to deliver." The leaders of the committee released the report.

* The distance cited is a straight line. By road, it is much longer and it takes one, long day of driving.—ed.

 

US aid for Haiti falls short of promises

By Rashmee Roshan Lall, The Guardian - - June 28, 2013

Some of the key US-funded projects to help Haiti recover from the 2010 earthquake have been disappointingly delayed and drastically scaled down, a US government watchdog has found. US development agency USAid is spending millions of dollars to build just a small fraction of the 15,000 homes it promised - 2,649 - according to a report by the government accountability office, which tracks US federal government spending. USAid has not even started construction of the port planned two years ago as a crucial part of its strategy for Haiti's economic growth.

The report, published this month, is embarrassing for USAid, which was allocated $651m (£425m) in 2010, or roughly half of all the money earmarked by the US government to help rebuild Haiti, the poorest country in the Americas.

The report found mismanagement of a crucial housing project, originally meant for up to 90,000 people. USAid has now reduced the number of those to benefit from new housing to about 3,200 to 15,900, from 75,000-90,000, at nearly double the original cost of $59m. The cost per house has soared nearly threefold from $8,000 per unit.

The shortfall in houses is partly because of the difficulties in acquiring land titles in Haiti and the Haitian government's request for larger units with flush toilets.

But the largest chunk of USAid funding, $170.3m, went to a project that is yet to properly get off the ground - a port and a power plant to support an industrial park in Caracol, in the north. The power plant was completed under budget and ahead of schedule, but the port, which is crucial to the success of the industrial park and was to be finished by 2015, has not been started. The delay is caused by USAid's inability to find a port engineer - in two years, it tried just once to recruit a suitable person, said the report.

The report, which acknowledges that the sustainability of the park, power plant and port are "interdependent; each must be completed and remain viable for the others to succeed", casts doubt on whether the port will ever be built because of a funding gap that could double its total cost.

Jean-Baptiste Bien-Aime, the senator who represents Haiti's North-East department, the location of the proposed port and park, said the news will be a disappointment for the region, which is one of the country's poorest. The project had promised thousands of jobs.

"When President [Michel] Martelly visited here with former US ambassador Kenneth Merten, he told the people of Fort Liberté, where the port was meant to be built, that $170m was available and construction would start soon," Bien-Aime said. "The inhabitants were very happy because they thought that the construction work would create jobs as there is a big need in the area."

Caracol's former mayor, Landry Colas, said: "The industrial park works, but until now, many people in the area have not found a job."

However, sources familiar with infrastructure projects pointed out that planning and designing a port takes up to five years, according to the US army Corps of Engineers, and it may be possible to get the project back on track.

But Ileana Ros-Lehtinen, the US congresswoman who requested the investigation into relief efforts in Haiti, said the report was "alarming" and revealed an "unacceptable" level of performance by USAid. "Much of the assistance that the US has provided Haiti for reconstruction efforts has suffered from ineffective stewardship on the part of USAid ... the people of Haiti deserve better," she said.

Beth Hogan, USAid's senior deputy assistant administrator for Latin America and the Caribbean, said the report was "a snapshot of progress to date, and that work in housing, energy, port construction and other areas is ongoing".

The report came just days after radio and television stations in Haiti started airing advertisements for an anti-corruption hotline for USAid projects. The adverts, in French and Haitian Creole, were issued by USAid Haiti's office of the inspector-general to encourage people to share their stories of graft. Observers said the invitation ran the risk of building a troubling picture of the US humanitarian agency.

 

US slow to spend Haiti quake relief funds, delaying recovery

By Phillip Swarts, The Washington Guardian, June 28, 2013

Three years later, USAID has only spent half of the $651 million Congress gave to help Haitians recover from devastaing earthquake

The U.S. Agency for International Development, or USAID, was placed in charge of $651 million for Haiti relief efforts.  Three years after the earthquake, the oft-criticized agency spent less than half of that, according to a report by the Government Accountability Office that has raised bipartisan ire on Capitol Hill.

USAID not only been slow to spend money, it's cutting back on its original promises.  The original plan was to build 15,000 houses for those people displaced by the earthquake.  But now, USAID has had to revise that number and expects to complete 2,600 houses - just 17 percent of the original goal.

The number of people being helped has also dropped dramatically.  The houses were suppose to shelter between 75,000 and 90,000 people.  Now they're going to help just 13,000 to 16,000 people.

For letting taxpayer money sit unused for three years after a devastating earthquake and for botching ongoing reconstruction efforts, USAID wins this week's Golden Hammer, a distinction awarded by the Washington Guardian to examples of wasteful spending and fiscal incompetence in government.

The earthquake that hit Haiti in January 2010 was a magnitude 7 quake that killed an estimated 316,000, making it the second deadliest earthquake in history, according to the U.S. Geological Survey. (Haiti was only surpassed by a quake in China in the 1500's).

USAID said it is focusing on making the ongoing reconstruction effort a success. "Mid-point reviews such as this one are helpful to us to see how we can be more effective," a USAID spokesperson said.  "It is important to bear in mind that the report is a snapshot of progress to date, and that work in housing, energy, port construction and other areas is ongoing."

But Congress isn't likely to let the agency off easily.  Rep. Ed Royce, R-Calif., the chairman of the House Foreign Affairs Committee, said a delegation is going to visit Haiti to survey reconstruction efforts.  Then a congressional hearing will be held to find out why aid has been so slow.

The top Democrat on the committee, Rep. Eliot Engel of New York, said USAID must be held accountable. "This report shows a significant and sobering disconnect between what was originally promised for the Haitian people, and what it appears USAID is now prepared to deliver," he said.  "The Haitian people, as well as the US taxpayer, deserve better answers about our assistance than we have received to date."

The GAO also questioned USAID's help to a port project on the northern shore of Haiti that was supposed to employ thousands and boost the nation's economy.  But only 6 percent of the U.S. funds for the project have been spent, leading to serious delays. "USAID officials had initially estimated that port construction would take 2.5 years; however, USAID officials have since learned that port construction may take up to 10 years, depending on the complexity of the port designed," the GAO said.

The port serves an industrial park, and the USAID spokesperson said the agency was able to complete the first phase of a power plant for the park under budget and quickly enough to get electricity to the first tenants that moved in.

The GAO, meanwhile, recommended Congress renew the State Department's requirement to report on the situation in Haiti so lawmakers can be kept aprise of relief efforts. "Although most funds have not been disbursed, State´s reporting requirement ended in September 2012," the report said. "As a result, Congress lacks information on the amounts of funds obligated and disbursed and program-by-program progress of U.S. reconstruction activities."

Royce, Engel, and Ros-Lehtinen Release GAO Report Documenting Failings in U.S. Assistance for Haiti Reconstruction

Announcement by House Foreign Affairs Committee

Media Contact: (202) 225-5021 Jun 25, 2013

Washington, D.C. - Today, Rep. Ed Royce (R-CA), Chairman of the House Foreign Affairs Committee, Rep. Eliot Engel (D-NY), the Committee's Ranking Member, and Rep. Ileana Ros-Lehtinen (R-FL), Chairman of the Subcommittee on the Middle East and North Africa and Chairman Emeritus, released an alarming Government Accountability Office (GAO) report that documents serious delays and lack of oversight in United States Agency for International Development (USAID) assistance efforts in Haiti, following the devastating January 2010 earthquake.

Months after the earthquake, Congress provided $1.6 billion in reconstruction funding for Haiti in the 2010 Supplemental Appropriations Act -- $651 million of which went to USAID and is the subject of the GAO report.

Ros-Lehtinen said: "I requested this report one year ago with then Ranking Member Howard Berman in order to examine if funds managed by USAID and State were not fulfilling the objectives of our mission in Haiti. This GAO report is alarming and showcases the need to further investigate and ensure that U.S. taxpayer dollars are not being wasted or abused in Haiti. We have a responsibility and commitment to our nation as the largest donor and the people of Haiti to help build stable institutions, root out corruption, and help those that were devastated by the earthquake in 2010."

Engel said: "This report shows a significant and sobering disconnect between what was originally promised for the Haitian people, and what it appears USAID is now prepared to deliver. The Haitian people, as well as the US taxpayer, deserve better answers about our assistance than we have received to date."

Royce said: "I commend Ranking Member Engel and Chairman Emeritus Ros-Lehtinen for their focus on Haiti oversight. A delegation of bipartisan Committee staff will soon be visiting Haiti to prepare for an upcoming hearing on these troubling findings."

Included in the GAO's findings:
Housing: USAID's 2010 housing plans have been downscaled by an astonishing 80 percent. Of the 15,000 houses originally planned, today only 2,649 are expected to be built.
Trade: A port facility planned as an integral part of an industrial project was expected to be completed by 2015. Yet today, there is no firm date set to begin construction; if and when that happens, it could take as long as 10 years to complete.
Oversight: Reporting to Congress has been inadequate for proper oversight or even a realistic picture of what the U.S. assistance program is achieving.