U.S. Army Corps of Engineers

The Europe District of the U.S. Army Corps of Engineers is hosting an Industry Day on August 15, 2018 in Tel Aviv. The event begins at 09:00 at The Ritz-Carlton Herzlia.

This conference will present an overview of upcoming construction projects in Israel and provide U.S. firms with an opportunity to meet potential Israeli subcontractors or suppliers.

Although these construction projects are performed in Israel, the law requires that the prime contracts must be awarded to U.S. firms and they, in turn, are permitted to subcontract up to 75% of the work to Israeli companies. Given the millions of dollars that have been obligated to the program, there are many opportunities for American and Israeli firms to work together.  Continue Reading Upcoming Industry Day in Tel Aviv

My partner, Ed DeLisle, and I recently attended two Industry Days sponsored by the Army Corps of Engineers (“USACE”).  The first one was held in New York City on October 20th, and the second one was held in Tel Aviv on November 5, 2014. The purpose of the programs was to introduce American and Israeli construction contractors and A/E firms to the upcoming opportunities in Israel. Information was provided on the general scope of USACE design build and design bid build projects within Israel; typical infrastructure and facilities being procured; potential repair, maintenance and construction opportunities to support Israeli Ministry of Defense (“MoD”) facilities in Israel; as well as information on the solicitation and proposal process. The projects are funded by the Foreign Military Finance program and it is projected that  hundreds of millions of dollars in military construction will be undertaken by the Corps in the near future, with significant expenditures in the next year.Israel Construction Site

The contracts, for the most part, will be solicited as Multiple Award Task Order Contracts (“MATOC”), but there will also be some stand-alone projects that will be solicited through individual Requests for Proposals. An important requirement of the program is that all of the contracts must be awarded to American companies, and those companies will generally be expected to perform at least 25% of the work with their own forces. That 25% does not necessarily involve field labor, and may be made up of activities associated with construction management. The idea is to assure that American companies benefit financially from the program and that they remain responsible for project completion. The Corps is understandably wary of companies that serve only as “brokers,” and expects the American contractors to be fully engaged in the performance of the projects.

Since most American companies will not want to incur the expense of sending their own labor forces to Israel, teaming arrangements with Israeli subcontractors will be vital.  Fortunately, there are a number of very capable Israeli construction contractors interested in the work and many of them attended the Industry Day in Tel Aviv. At this point, however, there are more available Israeli subcontractors than there are American companies participating as primes, so the Corps is interested in generating more participation by American firms.

Given recent events, the first thing that many people will think about is whether it is safe to work in Israel. The answer is “yes,” not only because the extent of the turmoil is often exaggerated by the media, but because all of these projects will be performed on Israeli military bases. Even the recent rocket attacks from Gaza did virtually no damage because of the overwhelming success of the Iron Dome missile defense system. I can tell you that Ed and I were not concerned at all about our safety while in Israel and the daily life of Israeli citizens was entirely normal. That being said, American sureties are inherently risk averse and some contractors are having difficulty obtaining bonding. Although the Corps is currently requiring payment and performance bonds, there is also a possibility that some solicitations may permit Bank Letter Guarantees as the Corps has done in the past.

If you are interested in learning more about this program and the opportunities for American construction contractors, please contact us. We can put you in touch with both American and Israeli companies, as well as the knowledgeable people in the Corps of Engineers.  The program is administered by the Europe District of the Corps located in Wiesbaden, Germany.

Michael H. Payne is the Chairman of the firm’s Federal Practice Group and, together with other experienced members of the group, frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues, and dispute resolution…

A decision has been issued in the United States District Court for the Eastern District of Louisiana, by Judge Stanwood R. Duval, Jr., dismissing the consolidated class action lawsuit against the United States Army Corps of Engineers for the failure of the Orleans Parish outfall canals and, in particular, the 17th Street Canal that allegedly accounted for approximately 80% of the flooding of downtown New Orleans in the wake of Hurricane Katrina (“In Re: Katrina Canal Breaches Consolidated Litigation, No. 05-4182 E.D. La.).  The only remaining defendants are the Orleans Parish Levee Board and the New Orleans Sewerage and Water Board.

Judge Duval ruled that the 17th Street, London and Orleans Avenue outfall canals were federal flood control projects and therefore statutorily immune from suit under the Flood Control Act of 1928.  In an opinion that was very critical of the Corps of Engineers, Judge Duval stated the following:

“While the United States government is immune for legal liability for the defalcations alleged herein, it is not free, nor should it be, from posterity’s judgment concerning its failure to accomplish what was its task. The citizens of each and every city in this great nation have come to depend on their government and its agencies to perform certain tasks which have been assigned to federal agencies by laws passed by Congress and overseen by the Executive Branch.

It should not be unreasonable for those citizens to rely on their agents, whom they pay through their taxes, to perform the tasks assigned in a timely and competent way. However, because of § 702c, there is neither incentive, nor punishment to insure that our own government performs these tasks correctly. There is no provision in the law which allows this Court to avoid the immunity provided by § 702c; gross incompetence receives the same treatment as simple mistake.

This story–fifty years in the making–is heart-wrenching. Millions of dollars were squandered in building a levee system with respect to these outfall canals which was known to be inadequate by the Corps’ own calculations. The byzantine funding and appropriation methods for this undertaking were in large part a cause of this failure. In addition, the failure of Congress to oversee the building of the LPV and the failure to recognize that it was flawed from practically the outset–using the wrong calculations for storm surge, failing to take into account subsidence, failing to take into account issues of the strength of canal walls at the 17th Street Canal while allowing the scouring out of the canal–rest with those who are charged with oversight.

The cruel irony here is that the Corps cast a blind eye, either as a result of executive directives or bureaucratic parsimony, to flooding caused by drainage needs and until otherwise directed by Congress, solely focused on flooding caused by storm surge. Nonetheless, damage caused by either type of flooding is ultimately borne by the same public fisc. Such egregious myopia is a caricature of bureaucratic inefficiency.

It is not within this Court’s power to address the wrongs committed. It is hopefully within the citizens of the United States’ power to address the failures of our laws and agencies. If not, it is certain that another tragedy such as this will occur again.”