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Wright-Patt decision prevented regional contractors from getting work

Contrac spending with APM LLC from 2007 to 2009

Air Force stimulus spending nationwide

Contractor continues working at Wright-Patt amid criminal inquiry

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By John Nolan, Staff Writer Updated 5:20 PM Sunday, October 11, 2009

WRIGHT-PATTERSON AIR FORCE BASE — Wright-Patterson officials said they awarded millions of dollars in work to a company now under investigation for alleged fraud because of the tight time frame for getting stimulus money spent on projects to preserve and create jobs.

The decision by the base’s 88th Contracting Squadron early this year to not open up those projects for competitive bids deprived the region’s other contractors of the potential opportunity to benefit from the additional work created by $12 million in stimulus funds.

Instead, the contracting squadron decided to spend the stimulus money for base infrastructure projects through an existing agreement with contractor APM LLC.

Because of the stimulus money, APM has received $26,383,161 from the Air Force this year, more than double the $12 million annual spending limit that the government’s contract with APM stipulates.

The base’s decision to go with APM has led to a dilemma because the company — also known as Arctic Pipe & Materials LLC — has been suspended by Air Force headquarters from further federal contracting work. An Air Force lawyer has alleged that APM, 18 other companies and four executives (including APM’s chief executive officer) withheld information from the government about the companies’ ownership and relationships to each other. The Air Force said that allowed the companies to misrepresent their eligibility for the government’s 8(a) program that is designed to give contracting opportunities to small businesses owned and controlled by socially and economically disadvantaged individuals.

Three other contracts that Wright-Patterson’s 88th Contracting Squadron administers — on-call agreements for roofing, paving and airfield services — also exceeded their annual spending limits this year. Penalties for Air Force officials overseeing such excesses can include demotions or, in cases where intent to defraud can be proved, criminal prosecutions.

APM won its current five-year contract, potentially worth $60 million, through the 8(a) program. The Air Force said APM will be allowed to finish ongoing projects or awards. That will keep the company busy at Wright-Patterson well into 2010.

The Air Force said it is investigating to determine whether crimes were committed. No criminal charges have been filed.

Keep reading: Contract work continues amid investigation

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