Amy Whitten, a Mississippi attorney who received a subcontract with the state Department of Environmental Quality in the aftermath of the Deepwater Horizon oil disaster, shared her Ridgeland office address with two companies that also gained contracts related to the spill.
One of the companies, Covington Civil and Environmental Engineering, received tens of millions of dollars in contracts related to the April 2010 BP oil spill. The other company, Adaptive Management Services, received a small contract before eventually subcontracting under Covington.
Whitten, a longtime state contractor, has been called instrumental to the state’s case against BP and settlement negotiations that ensued.
The disaster eventually resulted in Mississippi receiving $2.2 billion from BP, much of which will be paid out over the next 15 years. Whitten received at least $1 million through DEQ’s contract with law firm Balch & Bingham.
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The Clarion-Ledger reported Wednesday that Whitten’s contracts related to DEQ are a focus of an FBI probe, according to several sources with knowledge of the investigation, including people who have been interviewed by the FBI.
An even more lucrative post-spill contract than Whitten’s went to Covington, which still holds the multi-million program management contract for coastal restoration.
Although based in Gulfport, Covington listed on initial contract documents one of its addresses as the same Ridgeland office where Whitten’s firm, The Whitten Group, is located.
Todd Hairston, Covington’s executive director, told The Clarion-Ledger that Whitten wasn’t using all the space in her office so he set up shop and paid to have walls built, splitting the office space into two. The building landlord would not speak to The Clarion-Ledger.
Covington’s Jackson metro area office is no longer located there, but at another building down the street, Hairston said.
The engineering firm has reaped close to $20 million to date with more than $15 million left in the contract, which ends in 2019.
The contract includes work under the federal Natural Resource Damage Assessment, the RESTORE Act and the National Fish and Wildlife Foundation, through which settlement money is funneled to the states affected by the oil disaster.
The funding sources have different purposes and elements often referred to as separate “buckets” of money.
Who is Covington?
Rimmer Covington founded Covington, which has a 23-person staff made up of engineering, science, environmental and program management professionals. The small, lesser-known coastal firm was not the obvious choice for a major restoration program management contract worth millions.
Hairston said the DEQ director at the time, Trudy Fisher, opened up an opportunity to the firm, first with three smaller contracts.
In spring 2012, after Hairston said he began to hear chatter that DEQ wanted to hire a coastal firm to work on restoration efforts, he contacted Fisher and was able to get a meeting with her.
He told her about the company’s experience, about himself and left the meeting feeling hopeful.
“She called me and said, ‘OK. I’m going to execute a small contract. It’s not going to be some big deal for you. Don’t start thinking that this is a big deal,’ ” Hairston said. “I had the conversation with my staff before we started on that like, ‘Look, here’s the deal. We’re getting a contract with DEQ. We’ve never had a contract with DEQ before. We live here and work here where the oil spill happened. We need to capitalize on this … This is our home. We have the ability, if we produce right now, to make real changes in the community we live in.’”
Keith Harkins, who retired in 2013 as DEQ’s director of administration, was with the agency when it awarded Covington’s first three contracts, though at the time he had “certainly never heard of them,” he said.
In June 2012, DEQ entered its first $49,000 consulting contract with Covington.
The month before, Whitten — all while holding multiple contracts and subcontracts with DEQ — had filed paperwork as the registered agent for a new company, Adaptive Management Services, which also listed her office as its address.
AMS was a one-man firm founded by Stephen Parker, who had been employed by the company awarded the first coastal restoration master contract in 2010, a consortium of Louis Berger Group and Neel-Schaffer called Mississippi Resource Restoration Group.
Then in July 2012, DEQ awarded AMS a small $49,500 consulting contract so Parker could continue the work he was doing after he resigned from MRRG.
AMS eventually would subcontract under Covington’s future DEQ contracts.
Today, Parker works as an employee with Covington. Parker was “at the negotiating table with DEQ and BP for all early Mississippi restoration projects,” according to Covington’s website.
Master contract worth millions
By all indications, Covington excelled under its first consulting contract.
“We knew that in order to at least compete with those big Jackson firms, we had to produce better than them. And we did,” Hairston said. “We did a great job — enough that in three or four months, Trudy said, ‘OK, I like what I’m seeing. We’re going to do another one.”
DEQ entered the second contract with Covington in September 2012. It eventually totaled half a million dollars after an extension in 2013. The contract detailed work under Gov. Phil Bryant’s GoCoast2020 project created in response to the RESTORE Act, through which Mississippi received civil penalties imposed on BP under the Clean Water Act.
The next month, Covington received a third contract eventually totaling $1.6 million for work related to the Natural Resource Damage Assessment.
After undergoing a Request for Qualifications process, DEQ awarded the $9 million program management contract for coastal restoration to Covington in August 2013.
The fact essential members of the early restoration team went to work for Covington was a huge factor in the firm’s ability to get the master contract, said Balch & Bingham attorney Teri Wyly, who was on the evaluation team. They had the institutional knowledge the agency needed, she added.
Wyly also said she had known Rimmer Covington for years prior to working with the firm in response to the oil spill. Balch had hired him and John Szabo, Covington’s principal engineer, to help develop plans on another remediation project.
In December 2014, DEQ increased Covington’s original $9 million master contract to $17 million under current Executive Director Gary Rikard. Last August, DEQ granted Covington another contract for $18.9 million to extend through July 2019.
Under these programmatic contracts, Covington is set to receive $35.9 million.
Contracting out primary duties
Covington is responsible for program management of coastal restoration projects, including planning, engineering, environmental, management and technical services. It is also tasked with helping the agency develop a comprehensive plan to restore the Coast.
Much of the work Covington does involves communicating with the federal government, justifying the projects to be funded.
“If you think about the way you draw down funds from these funding sources, you have to have varying degrees of engineering and science in your submittal to, let’s say, NFWF, or bucket two, bucket three of RESTORE and NRDA in order to even get to the point where you can draw those funds down. You have to develop and package the projects in a way that they’re fundable by that entity,” Hairston said.
The funding groups must be sure the proposed projects are in line with the court requirements, Hairston explained.
“You have to give them enough information about the project for them to understand, and their scientist to understand, you’ve done your background work and this is going to be a sustainable impact for the Coast,” Hairston said.
In other words, the $20 million paid to Covington so far includes no bricks and mortar or design work on specific projects. Instead, Covington is responsible for overseeing the work and facilitating reimbursement requests for the contractors who are hired to complete projects.
“The norm is for Covington to do enough work in order to get the money drawn down and then put out the RFQs (Request for Qualifications),” Hairston said.
In hiring Covington, DEQ has essentially contracted out many of its primary duties as the agency in charge of clean-up efforts.
“I don’t have the expertise in place, and I can’t go out and hire, because of salary restrictions, someone who can help us with that work,” Rikard said. “Early on, even before, during Mrs. Fisher’s tenure here, the executive staff along with the governor’s office decided, ‘Hey, we need a programmatic manager here.’”
Contact Anna Wolfe at 601-961-7326 or firstname.lastname@example.org. Follow her on Twitter.