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Iraq War Contractor Lands $40M Deal to Build Covid-19 Field Hospital

A defense company that bungled an enormous Iraq War contract for health care centers has landed a $40 million award to build a 200-bed field hospital for patients battling coronavirus.

BRONX, N.Y. (CN) — A defense company that bungled an enormous Iraq War contract for health care centers has landed a $40 million award to build a 200-bed field hospital for New Yorkers battling Covid-19.

Parsons Corporation won the Department of Defense contract on April 3, according to federal records that describe the construction of “an alternative care facility” in the Bronx. The borough has racked up the highest transmission rate, though not raw numbers, of the virus across New York City.

“We are working closely with the Army Corp of Engineers to determine how Parsons can appropriately provide support amid the coronavirus outbreak in New York,” Bryce McDevitt, a spokesman for Parsons, said in an email Wednesday.

In confirming the project this week, U.S. and local officials told reporters that the field hospital in the city’s third-largest park, named for the prominent colonial-era Van Cortland family, will address a critical bed shortage.

“There’s a desperate need,” state Assemblyman Jeffrey Dinowitz, whose district includes the Bronx, told The New York Daily News earlier this week. “These beds will partially alleviate that situation.”

Construction is already underway. The tabloid quoted City Councilman Andrew Cohen, also from the Bronx, as saying the hospital will be operational in three weeks.

Though expressing optimism, Parsons’ spokesman seemed to question the facility’s future.

“The field hospital effort is not definitized, but we are standing by to support and are optimistic about this project’s potential to mitigate existing pressure on the city’s medical facilities,” McDevitt said.

The contract shows an end date of Oct. 3, 2020, as of press time. 

By contrast, the makeshift hospital that the Army Corps of Engineers constructed inside Jacob K. Javits Convention Center has 20 times the capacity as its Bronx equivalent and is nearly $10 million cheaper.

Explaining the discrepancy, McDevitt noted: “This effort would require building a complete, previously nonexistent alternate care facility from the ground up, which is significantly different than converting an existing convention center into a makeshift hospital.”

The Department of Defense initially granted the $15.2 million contract for the New York Convention Center Operating Corporation to build the 4,000-bed facility inside the Javits Center on March 25. A week later, the Pentagon doubled that contract to $30.5 million, which is expected to be paid in full on Thursday.

For Parsons, the Van Cortland Park deal comes nearly 16 years exactly since it secured a $240 million award to build 150 health care centers in Iraq. As detailed in a subsequent report from the inspector general for Iraq construction, however, Parsons had spent roughly 77% of their contract two years in, with “little progress made.” Only six health care centers had been completed. Eight had been canceled, and 131 were partially constructed, with 121 later “terminated for convenience,” according to the April 2006 report.

When shown the details of the contract, Assemblyman Dinowitz answered that he did not know who held the contract.

“My immediate priority is the health and safety of my constituents and New Yorkers, so my questions focused on the number of beds and how quickly this would be able to serve our community,” Dinowitz wrote in an email.

Now that he knows those details, Dinowitz raised serious questions.

“This and all contracts, especially those that involve the Trump administration, should be strictly monitored,” the assemblyman continued. “Right now, my focus is still on the health and safety of our community — but eventually, I will want to know who else was considered for this contract and what their track record is with similar projects. I will also want to know if there are any conflicts of interest that were not made immediately clear — particularly given this administration's proclivity for using our government to benefit themselves financially.”

Until that time, Dinowitz has other priorities.

“Bad contracts are absolutely a problem, but the larger problem in my opinion is that countless people are likely to die because Donald Trump failed to take quick and decisive action to prepare for this pandemic,” the Bronx Democrat added. “Frankly, I am scared every day that I will wake up to another text message or phone call saying that someone I know and loved has died from Covid-19. We all saw this coming, and it didn't have to be like this. President Obama had a pandemic plan, Donald Trump ignored it and Donald Trump is responsible for whatever lives are lost because of our country's lack of preparation and inadequate response to the novel coronavirus.”

The U.S. contracting database shows that Parsons did not receive any government money between 2008 and 2011 and much smaller awards before this year.

The Bronx contract represents nearly two-thirds of the $62.7 million in U.S.-government contracts Parsons has been awarded since 2008, the earliest year recorded in the database, and the company’s website indicates that they are seeking to create other alternative care centers in response to the pandemic. 

In a statement about his company’s pandemic response, Parsons CEO Chuck Harrington wrote: “We rapidly convert conference centers, arenas, hotels and other areas into healthcare facilities to treat patients.”

Founded in 1944, Parsons went public last May, with a roughly $500 million initial public offering on the New York Stock exchange. It moved its headquarters from California to Virginia that year. 

The Pentagon did not immediately respond to an email seeking comment.

New York is the U.S. epicenter of the novel coronavirus pandemic. On Wednesday, it counted its second consecutive day of record-high deaths from Covid-19. The state recorded 779 on Wednesday and 731 on Tuesday, raising the death toll to 6,268.

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