The Wall Street Journal: Puerto Rico utility ignored lawyers’ advice on $300 million Whitefish contract

WASHINGTON — Puerto Rico’s power company didn’t follow its lawyers’ advice when it agreed to a $300 million grid-construction contract with Whitefish Energy Holdings LLC, according to documents released by a House committee probing the now-canceled deal.

Email communications show at least seven types of contractual protections for the public power monopoly known as Prepa that were recommended by its lawyers at Greenberg Traurig LLP or included in draft documents but omitted from an Oct. 17 agreement with Whitefish, according to records released Monday by the House Committee on Natural Resources.

The emails raise new questions about a disaster-recovery contract that is under review by federal criminal investigators and multiple congressional panels. Prepa selected Whitefish — a startup firm based in rural Montana that had two employees when Hurricane Maria hit — as the general contractor for repairing the storm’s damage without a competitive bidding process.

Gov. Ricardo Rosselló canceled the deal last month under criticism from members of Congress and local politicians over how it was awarded and priced. The controversy has galvanized Congress to examine the U.S. territory’s management of federal disaster-assistance dollars and its safeguards against waste and corruption.

An expanded version of this report appears on WSJ.com.

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