Private management in government comes at a high price

On December 16, 2012, the Centro de Periodismo Investigativo documented that the Puerto Rico Aqueduct and Sewer Authority (AAA) paid 11 outside contractors more than $574 million between 2009 and June 2012, under the “Republican vision” of shrinking government and outsourcing functions after Fiscal Emergency Law 7.

On the Comptroller’s Office list, Truenorth Corp. (IT systems / “business transformation”) received on June 14 an annual contract of $11,139,710 running through June 30, 2013. Since July 2009, AAA had awarded it contracts totaling $38 million. Overall, Truenorth held $46,364,404.15 in contracts with various agencies of that administration, of which $38 million were with AAA.

After AAA executive president José Ortiz was appointed to the PREPA board (November 2011), Truenorth entered PREPA under a non-financial agreement (Dec. 26, 2011) and on February 27, 2012 signed a $1,828,380 contract for administrative consulting.

CPI placed ~300 private-company employees working inside AAA and contrasted career salary scales with private billing. Registered contracts ≠ adjudicated theft; amounts are reported contractual payments.

Source: Centro de Periodismo Investigativo. https://periodismoinvestigativo.com/2012/12/sale-cara-la-nueva-gerencia-privada-en-el-gobierno/