The Coalition Provisional Authority (CPA): Origin, Characteristics, and Institutional Authorities
Congressional research reportApr 27, 2007
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Prepared for Members and Committees of Congress
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Responsibility for overseeing reconstruction in post-conflict Iraq initially fell to the Office of
Reconstruction and Humanitarian Assistance (ORHA). Established in early 2003, ORHA was
headed by Lieutenant General Jay M. Garner, U.S. Army (ret.). By June 2003, ORHA had been
replaced, or subsumed, by the Coalition Provisional Authority (CPA), which was led by
Ambassador L. Paul Bremer III. On June 28, 2004, CPA ceased operations.
Whether CPA was a federal agency is unclear. Competing, though not necessarily mutually
exclusive, explanations for how it was established contribute to the uncertainty about its status.
Some executive branch documents supported the notion that it was created by the President,
possibly as the result of a National Security Presidential Directive (NSPD). (This document, if it
exists, has not been made available to the public.) Another possibility is that the authority was
created by, or pursuant to, United Nations Security Council Resolution 1483 (2003). Finally, two
years after CPA was established, a Justice Department brief asserted that the then-Commander of
U.S. Central Command (CENTCOM) had created CPA.
Given that its organizational status is uncertain, an examination of selected features of CPA might
be instructive in assessing what type of organization it was. The authority was closely aligned
with the Department of Defense (DOD); the Under Secretary of Defense designated the Secretary
of the Army as executive agent for CPA. Other significant features of the authority included its
Office of Inspector General (OIG, or IG), which was expected to work closely with the DOD and
U.S. Agency for International Development (USAID) Offices of Inspector General; the extent of
its procurement activities; its regulatory authority; and its Program Review Board. An undated
organization chart provided some insight into the structure of the authority, although it did not
include some key offices and positions, such as the Deputy Administrator, the OIG, and the
legislative affairs staff. Provisions in several statutes included reporting requirements that bore
directly or indirectly on CPA. These included Sections 2202(b), 2203, 2207, and 3001 of P.L.
108-106 (117 Stat. 1209), and Section 1203 of P.L. 108-136 (117 Stat. 1392).
Subsequent to the dissolution of CPA, the question of its status arose in a lawsuit filed against
Custer Battles, LLC (CB), a company that performed work for CPA. Two former employees of
CB alleged in a lawsuit filed under the False Claims Act (FCA) that the company had defrauded
the federal government. (The case is United States ex rel. DRC Inc. v. Custer Battles, LLC (E. Va.,
No. CV-04-199-A).) Justice Department attorneys concluded that CPA was an instrumentality of
the U.S. government for the purposes of the FCA, but the presiding judge determined, in his
August 2006 opinion, that CPA was not an instrumentality. This report will be updated as events
warrant.
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Introduction ..................................................................................................................................... 1
The Office of Reconstruction and Humanitarian Assistance and the Coalition Provisional
Authority ...................................................................................................................................... 1
Key CPA Personnel ......................................................................................................................... 3
Establishment of CPA...................................................................................................................... 4
National Security Presidential Directive ................................................................................... 4
United Nations Security Council Resolution 1483 ................................................................... 8
General Franks ........................................................................................................................ 10
Selected Characteristics of CPA .................................................................................................... 12
CPA’s Relationship to the Department of Defense.................................................................. 13
CPA Office of Inspector General............................................................................................. 16
Procurement Activities ............................................................................................................ 17
Appropriated Funds for the Reconstruction of Iraq .......................................................... 17
CPA Solicitations .............................................................................................................. 20
Program Review Board..................................................................................................... 21
Protests.............................................................................................................................. 21
Appropriated Funds for the Operating Expenses of CPA ................................................. 24
Regulatory Authority............................................................................................................... 25
CPA Organization Chart.......................................................................................................... 26
Statutory Reporting Requirements Concerning CPA and the Reconstruction of Iraq ................... 28
Status and Characteristics of CPA as Related to the False Claims Act (FCA) ........................ 32
Discussion of CPA......................................................................................................................... 36
Post-CPA Organizations ................................................................................................................ 38
Iraq Reconstruction Management Office (IRMO) and Project and Contracting Office
(PCO) ................................................................................................................................... 38
Office for Reconstruction and Stabilization............................................................................ 38
Conclusion..................................................................................................................................... 38
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Figure 1. Coalition Provisional Authority ..................................................................................... 27
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Table 1. Statutory Reporting Requirements Concerning the CPA and the Reconstruction
of Iraq ......................................................................................................................................... 29
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Appendix. ...................................................................................................................................... 40
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Author Contact Information .......................................................................................................... 41
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The Coalition Provisional Authority (CPA or “the authority”) was established approximately one
month after United States and coalition forces took control of Baghdad in Iraq on April 9, 2003.1
The authority’s mission was “to restore conditions of security and stability, to create conditions in
which the Iraqi people can freely determine their own political future, (including by advancing
efforts to restore and establish national and local institutions for representative governance) and
facilitating economic recovery, sustainable reconstruction and development.”2 Information
provided on the CPA website indicated that “[t]he Governing Council and the Coalition
Provisional Authority will be dissolved” by June 30, 2004, and that “[t]his will end the
responsibilities of the Coalition as an occupying power as specified in the United Nations
resolutions.”3
After examining the origin of CPA, this report discusses three views on how the authority was
established, reviews selected characteristics of the authority, identifies statutory reporting
requirements concerning the authority and the reconstruction of Iraq, examines the implications
of U.S. v. Custer Battles for CPA, explores several policy issues, and briefly describes post-CPA
organizations.
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Responsibility for providing humanitarian assistance and aiding in the reconstruction of postwar
Iraq initially fell to the Office of Reconstruction and Humanitarian Assistance (ORHA). ORHA
was established by National Security Presidential Directive (NSPD) 24, which was signed by the
President on January 20, 2003. This document also gave DOD responsibility for post-war control
of Iraq.4 NPSD 24 has not been released to the public. A news article stated that ORHA was tied
to the Pentagon and that, while the U.S. Agency for International Development (USAID) would
handle much of the humanitarian and reconstruction work, ORHA would be in charge of the
funding.5 As early as February 12, it was reported that Lieutenant General Jay M. Garner, U.S.
Army (ret.), had been selected to serve as the coordinator for humanitarian and reconstruction
assistance, and that he would report to General Tommy R. Franks, then-commander of U.S.
Central Command.6 Lieutenant General Garner was appointed by the Secretary of Defense, and
his position description as head of ORHA stated:
1
CRS Report RL32105, Iraq: Foreign Contributions to Stabilization and Reconstruction, by Christopher M. Blanchard
and Catherine Dale.
2
U.S. Office of Management and Budget, Report to Congress Pursuant to Section 1506 of the Emergency Wartime
Supplemental Appropriations Act, 2003 (P.L. 108-11), June 2, 2003, p. 2.
3
Coalition Provisional Authority and Iraqi Governing Council, The November 15 Agreement: Timeline to a Sovereign,
Democratic and Secure Iraq, available at http://iraqcoalition.org/government/AgreementNov15.pdf.
4
U.S. Department of Defense, Office of the Inspector General, Contracts Awarded for the Coalition Provisional
Authority by the Defense Contracting Command-Washington, Report D-2004-057, March 18, 2004, p. 1, available at
http://www.dodig.osd.mil/Audit/reports/FY04/04057sum.htm.
5
DeYoung and Morgan, “U.S. Plan for Iraq’s Future is Challenged; Pentagon Control, Secrecy Questioned,” p. A21.
6
Peter Slevin, “U.S. Military Lays Out Postwar Iraq Plan; Officials Brief Congress on Rebuilding Battered Economy,
(continued...)
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This Office [ORHA] is established at the direction of the President of the United States, and
is located for administrative purposes under Boards, Commissions and Task Forces,
Washington Headquarters Services. This Office is under the supervision of the Under
Secretary of Defense for Policy.7
Signed by the Office of the Under Secretary of Defense for Policy on February 11, 2003, this
position description was not approved and certified by the Director, Administration and
Management, Office of the Secretary of Defense, until March 5, 2003.8
As late as mid-April, it appeared that Lieutenant General Garner was still in charge of ORHA.9
However, a news report dated May 2 stated that President George W. Bush planned to name
Ambassador L. Paul Bremer III as special envoy and civil administrator of Iraq, and that
Lieutenant General Garner would report to Ambassador Bremer.10 On May 6, 2003, President
Bush announced that he had appointed Ambassador Bremer as Presidential Envoy and that he
would serve as the senior leader of the coalition. (Unlike his appointment as an ambassador
earlier in his career, Senate confirmation was neither required nor sought.) The White House
press release also stated:
In his capacity as Presidential Envoy, he will oversee Coalition reconstruction efforts and the
process by which the Iraqi people build the institutions and governing structures that will
guide their future.... Ambassador Bremer will report to Secretary of Defense Rumsfeld and
will advise the President, through the Secretary, on policies designed to achieve American
and Coalition goals for Iraq.11
No mention was made of Lieutenant General Garner or ORHA in the press release.
On May 11, 2003, the Washington Post reported the existence of the Coalition Provisional
Authority.12 On May 13, 2003, the Secretary of Defense designated Ambassador Bremer as CPA
Administrator.13 The first regulation issued by Ambassador Bremer, dated May 16, 2003,
identified him as Administrator of CPA. The authority’s Inspector General (IG) stated, in his
initial report to Congress, that OHRA became CPA in May 2003.14 However, a March 2004 DOD
IG report stated that the Deputy Secretary of Defense, in a June 16, 2003, memorandum,
dissolved ORHA and shifted ORHA’s functions, responsibilities, and legal obligations to CPA.15
(...continued)
Reshaping Society,” Washington Post, February 12, 2003, p. A21.
7
U.S. Department of Defense, Office of the Inspector General, Contracts Awarded for the Coalition Provisional
Authority by the Defense Contracting Command-Washington, p. 1.
8
Ibid.
9
Peter Baker, “U.S. Forces Will Redeploy into 3 Zones; Marines to Occupy Southern Iraq as Army Takes over North;
General Will Oversee Capital,” Washington Post, April 15, 2003, p. A31.
10
Mike Allen, “Expert on Terrorism to Direct Rebuilding,” Washington Post, May 2, 2003, p. A1.
11
White House, Office of the Press Secretary, “President Names Envoy to Iraq,” May 6, 2003, available at
http://www.whitehouse.gov/news/releases/2003/05/20030506-5.html.
12
Peter Slevin, “Reject Baath Party, U.S. Tells Iraqi Job Hopefuls,” Washington Post, May 11, 2003, p. A22.
13
Donald Rumsfeld, Secretary of Defense, “Designation as Administrator of the Coalition Provisional Authority,”
memorandum, May 13, 2003.
14
U.S. Department of Defense, Office of the Inspector General, Contracts Awarded for the Coalition Provisional
Authority by the Defense Contracting Command-Washington, p. 2.
15
Ibid.
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Apparently, no official announcement was made at the time (that is, May or June 2003) that
ORHA had been replaced, or subsumed, by CPA.
By June 18, Lieutenant General Garner no longer was the head of ORHA. A Department of
Defense (DOD) news transcript dated June 18 identified him as the former director of ORHA,
and indicated he had returned to the United States a couple of weeks earlier.16
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Ambassador Bremer’s deputy was Richard Henry Jones, who was also the U.S. Ambassador to
Kuwait. Ambassador Jones, who was on extended temporary duty (TDY) in Iraq, was assigned to
the CPA position sometime in November 2003.18
Sir Jeremy Greenstock, the United Kingdom’s Special Representative in Iraq, was referred to, in
some news articles and documents, as a deputy to the CPA Administrator, or was identified as
effectively serving as a deputy to Ambassador Bremer.19 A news bulletin produced by the U.S.
Permanent Mission to the United Nations Office and Other International Organizations in Geneva
identified Sir Jeremy as the CPA deputy.20 Sir Jeremy’s appointment as the United Kingdom’s
Special Representative was announced June 16, 2003, by the Prime Minister’s official spokesman
(PMOS). He replaced John Sawers.21
Other senior CPA officials included Rear Admiral David J. Nash, U.S. Navy (ret.), who was
director of the Program Management Office (PMO), which had responsibility for monitoring
contracts funded by the Emergency Supplemental Appropriations Act for Defense and the
Reconstruction of Iraq and Afghanistan for FY2004 (FY2004 emergency supplemental).22 Rear
Admiral Nash began his duties in July 2003. Major General Ronald L. Johnson, U.S. Army, was
U.S. Deputy to the PMO, and also served as the commander of the Gulf Region Division of the
Army Corps of Engineers. As of February 2004, Lawrence Crandall was the U.S. Agency for
International Development (USAID) Deputy to the PMO. On January 20, 2004, Stuart W. Bowen
16
U.S. Department of Defense, “Secretary Rumsfeld Media Availability with Jay Garner,” news transcript, June 18,
2003, available at http://www.defenselink.mil/transcripts/2003/jun2003.html.
17
For information on civilian personnel management under ORHA and CPA, see Special Inspector General for Iraq
Reconstruction, Iraq Reconstruction: Lessons in Human Capital Management, January 2006, available at
http://www.sigir.mil/reports/pdf/Lessons_Learned_Feb16.pdf.
18
Information provided by telephone by the Department of State country office for Kuwait and Bahrain to the author
on March 1, 2004.
19
Ewen MacAskill, “Iraq after the War: Blair Envoy Warns Iran on Meddling,” Guardian, October 23, 2003, p. 4;
Philip Stephens, “Now Bush Can Make a Fresh Start,” Financial Times, December 16, 2003, p. 23; Owen Bowcott and
Brian Whitaker, “Trouble Looms after Coalition Tells Kurds Self Rule Can Stay,” Guardian, January 6, 2004, p. 17;
Anton La Guardia, “U.S. General Will Lead Iraqi Army,” Daily Telegraph, March 11, 2004, p. 12; Patrick Cockburn,
“Bremer Tries to Salvage Appointed-Government Plan Amid Shia Opposition,” Independent, January 17, 2004, p. 13.
20
Judy Aita, “U.N. Election Team at Work in Iraq,” Daily Bulletin, February 10, 2004, p. 1, available at
http://www.cpa-iraq.org/pressreleases/20040210_UN_back.html.
21
Prime Minister’s Office, “Press Briefing: 11AM Monday 16 June 2003,” available at http://www.number-10.gov.uk/
output/Page3924.asp.
22
P.L. 108-106; 117 Stat. 1209.
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Jr. was appointed as Inspector General by the Secretary of Defense. Rear Admiral Larry L. Poe,
U.S. Navy (ret.), was the Deputy Inspector General.23
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Detailed information that explicitly and clearly identifies how CPA was established, by whom,
and under what specific authority, is not readily available. Instead, there are three alternative
explanations for how it was established: one version suggests that the President established CPA;
another alternative suggests that CPA was established pursuant to a United Nations (U.N.)
Security Council resolution; and the third indicates that it was created by General Tommy Franks,
U.S. Army, who was Commander of the U.S. Central Command (CENTCOM) from July 6, 2000,
through July 7, 2003.24 As will be discussed below, these three possibilities are not necessarily
mutually exclusive.
From the inception of CPA in 2003 until April 2005, when a Department of Justice (DOJ)
document stated that General Franks had created CPA, either of the first two alternatives
presented here seemed to be the most likely explanations for the establishment of CPA. The
Justice Department’s statement would seem to answer the question of who established CPA.
However, General Franks’s role was not revealed publicly until April 2005, nearly two years after
CPA was established, and it is not clear whether there are any written materials that document
General Franks having established CPA and that predate his retirement. Also, the revelation of his
role in CPA followed other, somewhat vague and sometimes contradictory explanations or
comments about CPA’s origin during its 13-month tenure. Therefore, some might suggest that
either of the other two alternatives could still be a valid explanation for the origin of CPA.
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It is possible that the CPA, as the organization that succeeded ORHA, was established by NSPD
24. Another directive, NSPD 36, dated May 11, 2004, suggests how the President could have used
this type of document to establish a temporary organization within the federal government.25 One
purpose of NSPD 36 was to establish organizations that would succeed the CPA: the Iraq
Reconstruction Management Office (IRMO), within the Department of State, and the Project and
Contracting Office (PCO), within DOD.26 The President established both organizations pursuant
to 5 U.S.C. § 3161.27 This statutory provision addresses the employment and compensation of
employees by temporary federal government organizations. Under Section 3161(a), a temporary
organization is defined as
23
Coalition Provisional Authority, Office of Inspector General, “Biographies,” available from the author. Mr. Bowen’s
biography is still available on the agency website at http://www.sigir.mil/about/leadership.aspx.
24
U.S. Department of Defense, American Force Information Service, “Abizaid Set to Supplant Franks as CENTCOM
Commander,” July 2, 2003, available at http://www.defenselink.mil/news/Jul2003/n07022003_200307025.html.
25
The document itself is unnumbered. However, an e-mail message from the State Department’s Bureau of Legislative
Affairs to the author on February 22, 2005, identified the May 11, 2004, directive as NSPD 36.
26
U.S. President (G.W. Bush), “United States Government Operations in Iraq,” National Security Presidential
Directive (unnumbered), May 11, 2004.
27
P.L. 106-398 (Division A, Title XI, Sec. 1101(a)), Floyd D. Spence National Defense Authorization Act, FY2001;
114 Stat. 1654, at 1654A-308.
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a commission, committee, board, or other organization that (1) is established by law or
Executive order for a specific period not in excess of three years for the purpose of
performing a specific study or other project; and (2) is terminated upon the completion of the
study or project or upon the occurrence of a condition related to the completion of the study
or project.
It bears noting that none of the organizations mentioned here—CPA, IRMO, and PCO—was
established by executive order or statute. However, NSPD 36 addressed this issue in the
concluding paragraph:
This NSPD shall be effective immediately, shall constitute an Executive order solely for
purposes of 5 U.S.C. 3161, and shall not be subject to Executive order 11030 of June 19,
1962, as amended.28
It is possible that the language found in NSPD 36 had been used in NSPD 24 to establish OHRA,
and eventually the CPA, to oversee the reconstruction of Iraq.29
In January 2006, the Special Inspector General for Iraq Reconstruction (SIGIR) issued a report on
civilian personnel management under ORHA and CPA. By confirming that 5 U.S.C. § 3161 was
used to hire some of the civilian personnel for ORHA and CPA, the report suggests that the
Administration established an organization using this provision of the U.S. Code. An excerpt from
the relevant section of the report follows:
The primary statutory provision that was used for employing civilians in Iraq was Title 5,
Section 3161 of the U.S. Code. The 3161 provision enables temporary organizations to
acquire staff through temporary appointments to the excepted service of the Civil Service.
ORHA and CPA used 3161 extensively to hire civilian personnel for periods of up to one
year (with the possibility of renewal).... According to a former CPA personnel specialist, the
3161 hiring authority had long existed under 5 CFR 213.3199, but it had been typically used
to fill boards or commissions. The provision was useful for rapid hiring because it allowed
appointments from outside government without the usual competition required under formal
job classifications. The use of 3161 to staff the temporary stabilization and reconstruction
organizations in Iraq appears to have been unprecedented.30
It is possible to infer, from the following excerpt from a report to Congress provided by the Office
of Management and Budget (OMB), on behalf of the President, that the President may have
played a role in creating the authority.31 Of particular interest are the statements that the CPA
28
U.S. President (G.W. Bush), “United States Government Operations in Iraq,” p. 3. Executive Order 11030 governs
the preparation, presentation, filing, and publication of executive orders and requires that executive orders be published
in the Federal Register. (3 C.F.R. 610-612 (1962).)
29
The legislative history concerning temporary organizations began in 1944, with the enactment of Public Law 359
during the 78th Congress (31 U.S.C. § 1347). Section 213 of this statute prohibits the use of appropriated funds for, or
by, any agency or entity established by executive order and “in existence for more than one year, if the Congress has
not appropriated any money specifically for such agency or instrumentality or specifically authorized the expenditure
of funds by it.” Section 1347 of P.L. 97-258 codified this provision in Title 31 of the U.S. Code. However, 5 U.S.C. §
3161 supersedes both of these statutes because it was enacted at a later date.
30
Special Inspector General for Iraq Reconstruction, Iraq Reconstruction: Lessons in Human Capital Management, p.
10. (Italics added for emphasis.)
31
The report responds to a requirement in Section 1506 of the Emergency Wartime Supplemental Appropriations Act,
2003 (P.L. 108-11; H.R. 1559).
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Administrator oversees all non-military federal government programs and activities in Iraq, and
that the President vested the authority with executive, legislative, and judicial authority.
The Administrator of the Coalition Provisional Authority (CPA) reports to the President
through the Secretary of Defense. He oversees, directs and coordinates all U.S. Government
(USG) programs and activities in Iraq, except those under the command of the Commander,
U.S. Central Command (CENTCOM).
The CPA exercises powers of government temporarily in order to provide for the effective
administration of Iraq, to restore conditions of security and stability, to create conditions in
which the Iraqi people can freely determine their own political future, ... and facilitating
economic recovery, sustainable reconstruction and development.
The CPA is vested by the President with all executive, legislative and judicial authority
necessary to achieve its objectives, exercised consistent with relevant U.N. Security Council
resolutions, including [U.N. Security Council] Resolution 1483,32 and the laws and usages of
war. The CPA Administrator has primary responsibility for exercising this authority.33
The clearest statement that the U.S. government played a part in establishing the authority is
found in a letter submitted to the President of the United Nations Security Council by the
Permanent Representatives of the United States and the United Kingdom. Dated two days after
Ambassador Bremer was appointed by President Bush as the Presidential Envoy to Iraq, the letter
stated, in part:
In order to meet these objectives and obligations [disarming Iraq and providing for the
humanitarian needs of Iraqis] in the post-conflict period in Iraq, the United States, the United
Kingdom and Coalition partners, acting under existing command and control arrangements
through the Commander of Coalition Forces, have created the Coalition Provisional
Authority, which includes the Office of Reconstruction and Humanitarian Assistance, to
exercise powers of government temporarily, and, as necessary, especially to provide security,
to allow the delivery of humanitarian aid, and to eliminate weapons of mass destruction.34
While this excerpt can be viewed as an acknowledgment that the United States (and the United
Kingdom) established CPA, it does not explain how the authority was established, nor does it
resolve the question of its organizational agency status.
Government documents supporting the notion that CPA was a federal entity (which suggests, in
turn, that it was created by the President) include two presidential memoranda. A May 6, 2003,
memorandum, as amended by a December 5, 2003, memorandum, stated, in part:35
32
U.N. Security Council Resolution 1483, which was adopted by the United Nations Security Council on May 22,
2003, “lifted civilian sanctions and provided for termination of the Oil-for-Food Programme within six months,
transferring responsibility for the administration of any remaining activity to the Authority representing the occupying
powers.” (United Nations, Office of the Iraq Programme Oil-for-Food, available at http://www.un.org/Depts/oip/
background/scrsindex.html. U.N. Security Council Resolution 1483 is available at this website.)
33
U.S. Office of Management and Budget, “Report to Congress Pursuant to Section 1506 of the Emergency Wartime
Supplemental Appropriations Act, 2003 (P.L. 108-11),” June 2, 2003 (letter), available at http://www.whitehouse.gov/
omb/legislative.
34
Sir Jeremy Greenstock, Permanent Representative of the United Kingdom, and John D. Negroponte, Permanent
Representative of the United States, letter to the President of the Security Council, May 8, 2003, available at
http://www.globalpolicy.org/security/issues/iraq/document/2003/0608usukletter.htm.
35
The December 5, 2003, memorandum directed that any references in the May 6, 2003, memorandum to the Office of
(continued...)
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In accordance with Presidential direction relating to Iraq relief and reconstruction, multiple
agencies are deployed with the Coalition Provisional Authority (CPA) and are serving as
implementing partners or executing agents for programs and projects. These agencies will
identify funding requirements for such programs and projects through CPA. OMB will work
with CPA to transfer funds to the appropriate implementing agency.36
The authority’s intimate involvement in the funding process for work done by federal government
agencies in Iraq further suggests that the CPA is a federal entity.
Language in the FY2004 emergency supplemental also stated that the CPA was part of the federal
government. In describing how the apportionment of $18.649 billion was to be carried out, P.L.
108-106 stated:
Funds appropriated under this heading [Iraq Relief and Reconstruction Fund] shall be
apportioned only to the Coalition Provisional Authority in Iraq (in its capacity as an entity of
the United States Government), the Department of State, the Department of Health and
Human Services, the Department of Treasury, the Department of Defense, and the United
States Agency for International Development ...37
According to this excerpt, the authority was an entity of the federal government.
Information provided by CPA itself indicated that its sector program management offices
(SPMOs) were part of the federal government. (The CPA’s PMO was supported by six SPMOs.)
In a written response to a question asked at a January 21, 2004, pre-proposal conference on
contracting opportunities, the CPA stated that “the Sector Program Management Office (SPMO)
is a Government entity.”38
Yet another organization related to CPA is on record as stating that “the U.S. government created
CPA....”39 The Special Inspector General for Iraq Reconstruction included this statement in its
January 2006 report on civilian personnel management under ORHA and CPA.
Nonetheless, questions remain regarding how CPA was established, who established it, the
precise nature of its relationship to DOD (including DOD components) and other federal entities,
and whether CPA was a federal agency or some other type of government organization. Another
(...continued)
Reconstruction and Humanitarian Assistance or ORHA be replaced by “Coalition Provisional Authority” and “CPA,”
respectively.
36
U.S. President (G. W. Bush), “Memorandum on Delegation of the Functions of the President under the Heading ‘Iraq
Relief and Reconstruction Fund’ in the Emergency Wartime Supplemental Appropriations Act, 2003,” Federal
Register, May 9, 2003, vol. 68, no. 90, p. 25275; U.S. President (G. W. Bush), “Transfer of Funds Appropriated to the
President under the heading Operating Expenses of the Coalition Provisional Authority, and Delegation of the
Functions of the President under the heading Iraq Relief and Reconstruction Fund, in the Emergency Supplemental
Appropriations Act for Defense and for the Reconstruction of Iraq and Afghanistan, 2004,” Federal Register, January
9, 2004, vol. 69, no. 6, p. 1645.
37
117 Stat. 1225.
38
Coalition Provisional Authority, “List of Questions and Answers Compiled from a Pre-Proposal Conference Held on
January 21, 2004,” p. 20.
39
Special Inspector General for Iraq Reconstruction, Iraq Reconstruction: Lessons in Human Capital Management, p.
36.
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unanswered question concerns the scope of CPA’s authority when it was functioning in its
capacity as an entity of the U.S. government.
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A second possibility is that United Nations Security Council Resolution 1483 (2003) was
instrumental in creating the authority, a view supported by several documents released by the
executive branch. A solicitation issued by the Pentagon Renovation Office, on behalf of CPA, for
procuring PMO support services, stated in the “overview”: “The CPA was enacted by the United
Nations Security Council under Resolution 1483 (2003).”40 Other government documents,
including the President’s proposed budget for FY2005 and P.L. 108-106, stated that the authority
was established pursuant to Resolution 1483.41 This statement does not necessarily contradict the
language found elsewhere in the FY2004 emergency supplemental stating that CPA is an entity of
the U.S. government, for the reason discussed above.
Nevertheless, repeated references to Resolution 1483 might be viewed by some as implying that
the resolution alone authorized or established a coalition-based organization in Iraq, or might
contribute to confusion about the organizational status of the authority. Relevant portions of the
resolution are as follows:
The Security Council, ... Noting the letter of 8 May 2003 from the Permanent Representatives
of the United States of America and the United Kingdom of Great Britain and Northern
Ireland to the President of the Security Council (S/2003/538) and recognizing the specific
authorities, responsibilities, and obligations under applicable international law of these states
as occupying powers under unified command (the “Authority”), ... Calls upon the Authority,
consistent with the Charter of the United Nations and other relevant international law, to
promote the welfare of the Iraqi people through the effective administration of the territory,
including in particular working towards the restoration of conditions of security and stability
and the creation of conditions in which the Iraqi people can freely determine their own
future.42
While recognizing the responsibility to be borne by the United States and the United Kingdom in
restoring security and stability in Iraq, this resolution did not establish, or authorize the creation
of, a specific organization to carry out this responsibility. In the words of a former Administrator
of the Office of Federal Procurement Policy, the resolution “noted and recognized, but did not
establish CPA.”43
Lending support to the notion that the authority was not a federal agency, but instead was an
amorphous international organization, are statements by the Department of the Army. In 2003,
two protests were filed with the General Accounting Office (GAO; this agency was renamed the
Government Accountability Office in 2004) by Turkcell Consortium, which challenged CPA’s
40
Pentagon Renovation Office, solicitation W914NS-04-R-0001, January 6, 2004, p. 2.
U.S. Office of Management and Budget, Budget of the United States Government—FY2005, Appendix (Washington:
GPO, 2004), pp. 958-959; P.L. 108-106; 117 Stat. 1226.
42
United Nations Security Council, Resolution 1483 (2003), S/RES/1483(2003), May 22, 2003, p. 2, available at
http://www.un.org/Docs/sc/unsc_resolutions.html. (Italics in original.)
43
Angela B. Styles, “Seller Beware: Assessing the Risks of Iraq Reconstruction Contracting,” Federal Contracts
Report, January 20, 2004, vol. 81, no. 2, p.65.
41
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issuance of licenses for mobile telecommunications services in Iraq. GAO dismissed both protests
without having to rule on the status of CPA.
In a letter submitted to GAO during the protest process, the U.S. Army Legal Services Agency
was unequivocal in its argument that CPA is not a federal agency:
The CPA is not a Federal agency. Rather, as the HCA [CPA’s Head of Contracting Activity]
explains: The Coalition Provisional Authority (CPA) is a multi-national coalition that
exercises powers of government temporarily in order to provide for the effective
administration of Iraq during the period of transitional administration, to restore conditions
of security and stability, to create conditions in which the Iraqi people can freely determine
their own political future, including by advancing efforts to restore and establish national and
local institutions for representative governance and facilitating economic recovery and
sustainable reconstruction and development. CPA is vested with all executive, legislative and
judicial authority necessary to achieve its objectives, to be exercised under relevant U.N.
Security Council resolutions, including Resolution 1483 (2003), and the laws and usages of
war. This authority is exercised by the CPA Administrator.
The GAO does not have jurisdiction over this protest because CPA is not a Federal agency....
The CPA is an organization comprised of members from a coalition of countries.... CPA is
analogous to an organization such as NATO’s [North Atlantic Treaty Organization’s]
Stabilization Force (SFOR) in Bosnia and Croatia. The SFOR has its own contracting
organization, the Theatre Allied Contracting Office (TACO), which may utilize the services
of United States military personnel. Like the TACO, CPA is not a federal agency. Like
NATO and SFOR, CPA is composed of an international coalition.... UN Security Council
Resolution 1483 (2003) recognizes CPA as “the Authority” to govern Iraq and grants the
CPA discretion to disburse funds in the Development Fund for Iraq (“DFI”).44
While the CPA did employ individuals from coalition countries, there were at least two significant
differences between CPA and SFOR. The SFOR is overseen by a multinational organization, the
North Atlantic Treaty Organization (NATO), and it was authorized by United Nations Security
Council Resolution 1088 (1996).45 The Security Council’s resolution explicitly authorized the
establishment of SFOR (as it also did for the precursor entity, the Implementation Force (IFOR)):
The Security Council ... authorizes the Member States ... to establish for a planned period of
18 months a multinational stabilization force (SFOR) as the legal successor to IFOR under
unified command and control....46
Given that P.L. 108-106 and other government documents stated that CPA was a U.S. government
entity, the Army’s response raises questions. Arguably, the Army was concerned that some would
assume, precisely because of references to the authority as a government entity, that CPA was a
federal agency. Another possibility is that the Army, as the executive agent for the authority
(discussed below), assumed responsibility for certain procurement activities and tasks, such as
responding to protests, and thus argued strongly for excluding CPA from the GAO protest
process.
44
Maj. Frank A. March, Department of the Army, United States Army Legal Services Agency, “Protest of Turkcell
Consortium, B-293048,” correspondence to U.S. General Accounting Office, October 21, 2003, pp. 2-4.
45
North Atlantic Treaty Organization, “History of NATO-led Stabilisation Force (SFOR) in Bosnia and Herzegovina,”
no date, available at http://www.nato.int/sfor/docu/d981116a.htm.
46
United Nations Security Council, Resolution 1088 (1996), December 12, 1996, S/RES/1088, available at
http://www.nato.int/ifor/un/u961212b.htm.
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Legislative language might contribute to questions about the status of the authority. The FY2004
emergency supplemental referred to CPA as “an entity of the United States Government.”47 In the
National Defense Authorization Act for FY2004, Section 1203(b)(1) mentioned “civilian groups
reporting to the Secretary [of Defense], including” ORHA and CPA.48 Section 1203(b)(3) referred
to the “relationship of Department of Defense entities, including” ORHA and CPA.49 The House
report accompanying H.R. 1588 (P.L. 108-136), the National Defense Authorization Act for
FY2004, in its comments on the section that became Section 1203, mentioned “Department of
Defense (DOD) civilian and military activities in post-conflict Iraq.”50 Eschewing the word
“agency” in favor of “entity,” “group,” and “activities” in legislation and congressional
documents could be a reflection of the Administration’s approach, an acknowledgment that CPA’s
status was uncertain, or a sign that Congress agreed that CPA was not an agency.
Documents produced by the Administration and the CPA do not state precisely how this
organization was established. In the preface to the first regulation of the CPA, dated May 16,
2003, Ambassador Bremer stated: “Pursuant to my authority as Administrator of the Coalition
Provisional Authority (CAP), relevant U.N. Security Council resolutions, including Resolution
1483 (2003), and the laws and usages of war ...”51 In a December 2003 memorandum on
contracting procedures for the reconstruction of Iraq, Deputy Secretary of Defense Paul
Wolfowitz wrote: “The Coalition Provisional Authority (CPA) has been established to promote
the welfare of the Iraqi people.”52 Neither statement identifies by whom, or under what authority,
CPA was established.
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General Tommy Franks’s role in the creation of CPA was revealed in a brief prepared by Justice
Department attorneys in April 2005 in the matter of United States ex rel. DRC Inc. v. Custer
Battles, LLC (E. Va., No. CV-04-199-A). Custer Battles (CB) had done work for CPA in Iraq, and
former employees of CB alleged in a lawsuit filed under the False Claims Act (FCA; 31 U.S.C.§§
3729-3733) that the company had defrauded the federal government. Attorneys for Custer Battles
responded, in part, that CPA was not a federal agency, so the FCA was not applicable. Initially,
the presiding judge invited the Justice Department to state the government’s position on whether
the FCA applied to CPA. Then, in response to a second order from the judge, Justice Department
attorneys addressed the question, in a supplemental brief, of whether CPA was a U.S. government
entity, agency, or instrumentality, and they concluded that it was an instrumentality. (See below
for more details.)
In their supplemental brief, which was also filed in April 2005, the Justice Department attorneys
also offered an explanation of who established CPA:
47
117 Stat. 1225.
P.L. 108-136; 117 Stat. 1392 at 1648; H.R. 1588.
49
Sec. 1203(b)(1)-(3) of P.L. 108-136.
50
U.S. Congress, House Committee on Armed Services, National Defense Authorization Act for Fiscal Year 2004,
H.Rept. 108-106, 108th Cong, 1st sess., May 16, 2003 (Washington: GPO, 2003), p. 359.
51
Coalition Provisional Authority, “Coalition Provisional Authority Regulation Number 1,” May 16, 2003, available at
http://www.iraqcoalition.org/regulations/index.html#Regulations. (Italics in original.)
52
Paul Wolfowitz, Deputy Secretary of Defense, “Determination and Findings,” December 5, 2003, p. 1, available
from author.
48
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The CPA was created by the Commander of the Coalition Forces in Iraq, General Tommy
Franks, United States Army, who was also the Commander of the U.S. Central Command.
The establishment of the CPA by the Coalition was formally recognized by UNSCR [United
Nations Security Council Resolution 1483]. Since the Coalition Forces had established and
exercised actual authority over the territory of Iraq, under the laws of war and occupation,
the authority of the defeated Iraqi regime of Saddam Hussein passed into the hands of the
Coalition Forces. General Franks established the CPA under the laws of war to perform civil
government functions in liberated Iraq during the brief occupation.53
This statement by the Justice Department may not settle the question of how CPA was
established, by whom, and under what authority.54 The fact that CPA had a predecessor in ORHA
raises questions about the Justice Department’s explanation for the origin of CPA. Although
ORHA and CPA were responsible for essentially the same mission in Iraq, and although CPA
subsumed, or succeeded, ORHA, the origins of these two organizations apparently differed.
ORHA was established by the President, through NSPD 24;55 CPA was established (according to
the Justice Department) by the Commander of CENTCOM, “under the laws of war.”56 (As noted
above, the CPA IG stated that OHRA became CPA in May 2003,57 while the DOD IG indicated
that the Deputy Secretary of Defense dissolved ORHA and shifted ORHA’s functions,
responsibilities, and legal obligations to CPA.58) It is unclear why two different methods were
used to create these organizations, and why, with ORHA already in place and functioning under
NSPD 24, it was necessary for the CENTCOM Commander to establish another, new
organization.
While the statement that “the authority of the defeated Iraqi regime of Saddam Hussein passed
into the hands of the Coalition Forces”59 may be accurate, and while it suggests why General
Franks established CPA, the statement appears to overlook the existence of ORHA. As noted
above, ORHA had been created in January 2003, two months prior to the fall of Baghdad. The
authority that passed into the Coalition Forces’ hands when they invaded Iraq presumably would
have been accorded to ORHA. The supplemental brief apparently fails to mention not only that
CPA was preceded by ORHA, but also that ORHA apparently was still in existence when CPA
was established.
As noted above, it appears that the Justice Department’s supplemental brief represents the initial
disclosure of the then-CENTCOM Commander’s role in creating CPA. However, the legal brief
does not include a source for this statement, and it does not otherwise indicate that there is any
written documentation of this action. It is not known how General Franks established CPA, or
53
Supplemental Brief of the United States in response to the court’s invitation at pp. 6-7, United States ex rel. DRC,
Inc. and Robert Isakson v. Custer Battles, LLC, et al. (E.D. Va. 2004) (No. CV-04-199a).
54
Justice Department attorneys noted in their supplemental brief that the discussion involving CPA “is solely for the
purpose of answering the Court’s question with respect to the FCA, and not for any other purpose.” (Ibid., p. 2.)
Nevertheless, this statement does not change the fact that the attorneys unequivocally claimed that CPA was
established by General Franks.
55
U.S. Department of Defense, Office of the Inspector General, Contracts Awarded for the Coalition Provisional
Authority by the Defense Contracting Command-Washington, p. 1.
56
Supplemental Brief of the United States at pp. 6-7.
57
U.S. Department of Defense, Office of the Inspector General, Contracts Awarded for the Coalition Provisional
Authority by the Defense Contracting Command-Washington, p. 2.
58
Ibid.
59
Supplemental Brief of the United States in response to the court’s invitation at pp. 6-7, United States ex rel. DRC,
Inc. and Robert Isakson v. Custer Battles, LLC, et al. (E.D. Va. 2004) (No. CV-04-199a).
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whether he prepared and signed any document to create CPA. Nevertheless, a CENTCOM
document that appears to be a leaflet that was developed for distribution to the Iraqi people
mentions General Franks’s role in establishing CPA.60 This document, titled “Freedom Message
to the Iraqi People,” dated April 16, 2003, and attributed to General Franks (his name is included
at the end of the message), includes the following statement: “... I am creating the Coalition
Provisional Authority to exercise powers of government temporarily, and as necessary, especially
to provide security, to allow the delivery of humanitarian aid and to eliminate weapons of mass
destruction.”61 The complete text of this document is at the appendix.
Despite the text included in the April 16, 2003, leaflet, DOD does not appear to have issued any
statement in 2003 documenting General Franks’ decision to establish CPA.62 The lack of a
document that implemented or authorized the creation of CPA also was noted by the federal judge
presiding in United States v. Custer Battles, who wrote: “This proclamation [the April 16, 2003,
leaflet] was not followed by any formal document or order establishing the CPA or defining its
legal responsibilities.”63 Additionally, no mention was made of General Franks’ role in creating
CPA during a ceremony at the White House on December 14, 2004, when he, Ambassador
Bremer, and George Tenet, the former Director of Central Intelligence, were awarded Presidential
Medals of Freedom by the President.64 The apparent lack of publicly available documentation
about the creation of CPA by CENTCOM, and the fact that disclosure of CPA’s origins was made
by the Justice Department and did not occur until spring 2005, might lead some to question
whether this explanation of CPA’s creation accurately reflects what occurred in May or June
2003.
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The asserted lack of clarity concerning authorizing authority and establishment of the CPA
arguably extended to its status within the executive branch. It is not clear whether the authority
was a federal agency, or could be treated as such. What is known is that the CPA was neither an
executive department nor a government corporation. Executive departments are identified by
statute, and government corporations are “corporation[s] owned or controlled by the Government
60
In its “lessons learned” report on contracting, the Office of the Special Inspector General for Iraq Reconstruction
(SIGIR) refers to General Franks’s message as an “order.” The SIGIR report did not repeat or affirm General Franks’s
claim that he created CPA; rather, SIGIR noted that “CPA initially was recognized as a discrete organization in a
CENTOM order” issued by General Franks. (Special Inspector General for Iraq Reconstruction, Iraq Reconstruction:
Lessons in Contracting and Procurement, July 2006, available at http://www.sigir.mil/reports/pdf/Lessons_Learned_
July21.pdf, p. 23.) (italics added) It appears, however, that General Franks’s “Freedom Message to the Iraqi People” is
not consistent with DOD’s definition of an “order.” “Order” is defined as “a communication, written, oral, or by signal,
which conveys instructions from a superior to a subordinate.” (Department of Defense, Department of Defense
Dictionary of Military and Associated Terms, April 12, 2001 (as amended through April 14, 2006), available at
http://www.dtic.mil/doctrine/jel/new_pubs/jp1_02.pdf, p. 395.) The text of Franks’s message is included in the
appendix.
61
General Tommy R. Franks, Commander of Coalition Forces, “Freedom Message to the Iraqi People,” April 16, 2003,
available from the author. This document (and an Arabic-language version) were provided electronically by U.S.
Central Command, Legislative Liaison, to the author, July 13, 2005.
62
Ambassador Bremer’s appointment as Presidential Envoy to Iraq was the subject of a White House press release in
May 2003.
63
U.S. v. Custer Battles, 376 F. Supp 2d 617 (E.D. Va. 2005) at 620.
64
White House, Office of the Press Secretary, “President Presents Medal of Freedom,” news release, December 14,
2004, available at http://www.whitehouse.gov/news/releases/2004/12/print/20041214-3.html.
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of the United States.”65 If the authority was a federal government entity, it may have been an
independent establishment, which is defined as “an establishment in the executive branch (other
than the United States Postal Service or the Postal Rate commission) which is not an Executive
department, military department, Government corporation, or part thereof, or part of an
independent establishment.”66 If it is determined that the authority was an independent
establishment, CPA also would be considered an executive agency.67 Other possibilities are that
CPA was a component of DOD, or that it was not a federal government entity. Due to its unusual
status, this examination of certain of its characteristics or features might be instructive.
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While it is clear that, ultimately, the CPA Administrator answered to the President, it is also clear
that the Administrator reported to the Secretary of Defense as well.68 Administratively,
Ambassador Bremer and the authority fell under the Department of the Army. For Ambassador
Bremer, this meant that his salary, Executive Level III, was paid by the Army.69 A report prepared
by the Office of Personnel Management (OPM), dated March 10, 2004, showed that 558 federal
government employees were detailed to CPA. The largest contingents were from the Department
of Defense (455) and the Department of State (85). Other agencies contributing personnel
included the Department of Transportation (2), the Department of the Treasury (6), the Naval
Criminal Investigative Service (1), OPM (1), the U.S. Navy (2), and unknown (6). Three detailees
were ambassadors, 65 were from the Foreign Service, 411 were identified as “federal civilian
workers,” and the remaining 79 were members of the Senior Executive Service (SES).70 (CPA
also employed individuals from coalition partner countries.71) A document available on the Army
Civilian Personnel On-Line (CPOL) website indicated that all CPA civilian employees were
realigned in 2003 to Army rolls.72
In 2003, the Secretary of the Army was designated the executive agent for ORHA, and,
subsequently, CPA, in memoranda issued by the Deputy Secretary of Defense.73 Neither
memorandum is publicly available, but a third memorandum, issued by the Deputy Secretary of
65
5 U.S.C. §§ 101 and 103.
5 U.S.C. § 104(1).
67
An “‘executive agency’ means an Executive department, a Government corporation, and an independent
establishment.” (5 U.S.C. § 105).
68
White House, Office of the Press Secretary, “President Names Envoy to Iraq,”; U.S. Office of Management and
Budget, Report to Congress Pursuant to Section 1506 of the Emergency Wartime Supplemental Appropriations Act,
2003 (P.L. 108-11).
69
Information provided by telephone by the DOD Office of Legislation Liaison to the author on February 5, 2004.
70
Letter from Kay Coles James, Director, Office of Personnel Management, to Hon. C. W. Bill Young, Chairman,
House Committee on Appropriations, March 10, 2004. Section 599C of P.L. 108-199 requires the OPM to submit a
report to the House and Senate Committees on Appropriations on the number of employees, by agency, that are
detailed to CPA. The initial report was due February 1, 2004, and quarterly updates were also required.
71
Information provided electronically by CPA’s legislative affairs office to the author on April 21, 2004.
72
Army Civilian Personnel On-Line, “FY03: The Year in Review,” no date, available from the author.
73
“Army Assigned Responsibility for Acquisition and Program Management Support for CPA,” Federal Contracts
Report, January 27, 2004, vol. 81, no. 3, p. 80. This article stated that the memorandum dated May 21, 2003,
designated the Secretary of the Army Executive Agent for the Office of Reconstruction and Humanitarian Assistance
and that the memorandum dated June 21, 2003, did the same for CPA.
66
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Defense and dated January 14, 2004, addressed acquisition and program support for the authority
and confirmed the existence of the previous memoranda:
Pursuant to Section 113 of Title 10, United States Code, the Secretary of the Army is hereby
assigned the authority and responsibility for the provision of acquisition and program
management support to the CPA (Iraq and Washington, DC) and any successor entity. The
Secretary of Defense shall determine and prioritize the requirements to be supported
pursuant to this assignment of responsibility, as necessary.
For purposes of this memorandum, acquisition support is intended to include the award,
administration and oversight of all contracts, grants, and other acquisition actions in direct
support of the CPA and any successor entity. Program management support comprises all
aspects of project oversight, including planning, scheduling and execution, as may be
required by the scope of work, directed timelines, and applicable financial management
regulations.
All addressees [listed on the memorandum] shall provide support to the Secretary of the
Army, as the Secretary of the Army considers necessary, to carry out this assignment of
responsibility. Services and supplies provided to the CPA in furtherance of this
memorandum shall be made available in accordance with DoD Instruction 4000.19 and
applicable financial management regulations. My memoranda of May 21, 2003, designating
the Secretary of the Army as Executive Agent for the Office of Reconstruction and
Humanitarian Assistance, and June 16, 2003, providing for the exercise of that responsibility
in support of the CPA, are modified accordingly.74
The following description of a DOD executive agent indicates that executive agents are assigned
responsibility for DOD missions, activities, or tasks:
The Head of a DoD Component to whom the Secretary of Defense or the Deputy Secretary
of Defense has assigned specific responsibilities, functions, and authorities to provide
defined levels of support for operational missions, or administrative or other designated
activities that involve two or more of the DoD Components. The nature and scope of the
DoD Executive Agents responsibilities, functions, and authorities shall ... be prescribed at
the time of assignment [and] ... remain in effect until the Secretary of Defense or the Deputy
Secretary of Defense revokes or suspends them.75
This definition would arguably cast CPA as a DOD component. A broad interpretation, though,
might allow the Secretary, or Deputy Secretary, to appoint an executive agent for a non-DOD
entity or even a non-governmental entity. DOD’s policy governing the use of executive agents
leaves open this possibility.
4.1. The DoD Executive Agent designation shall be conferred when: 4.1.1. No existing
means to accomplish DoD objectives exists. 4.1.2. DoD resources need to be focused on a
specific area or areas of responsibility in order to minimize duplication or redundancy, or
4.1.3. Such designation is required by law, Executive order, or Government-wide
regulation.76
74
Paul Wolfowitz, Deputy Secretary for Defense, “Assignment of Responsibility for Acquisition and Program
Management Support for the Coalition Provisional Authority,” memorandum, January 14, 2004.
75
Department of Defense Directive 5101.1, DoD Executive Agent, September 3, 2002 (certified current as of
November 21, 2003), p. 2, available at http://www.dtic.mil/whs/directives/.
76
Ibid., p. 3.
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Aside from the question of whether an executive agent can be assigned to a non-DOD or nongovernmental entity, it appears that item 4.1.1, item 4.1.2, or both might have applied to the
circumstances surrounding DOD and CPA. It seems likely that item 4.1.3 would not have applied,
because no law, executive order, or government regulation had been enacted, issued, or produced
that required or authorized the Army to serve as executive agent. No mention is made in the
Deputy Secretary’s January 14, 2003, memorandum of which rationale applied to the authority.
Deputy Secretary of Defense Wolfowitz did note that Department of Defense Instruction Number
4000.19 applied to the provision of supplies and services to the CPA. This document provides
guidance for intragovernmental and interservice support, which are defined as follows:
Intragovernmental support is support provided by a DoD activity to a non-DoD Federal
activity and vice versa—[it] does not include support provided to or received from foreign
governments.
Interservice support is support provided by one DoD activity to a DoD activity of another
Military Service, Defense Agency, Unified Combatant Command, Army Reserves, Navy
Reserves, Air Force Reserves, Marine Corps Reserves, Air National Guard, or Field
Activity.77
Deputy Secretary Wolfowitz’s memorandum did not indicate whether the authority received
support from the Army under an interservice or an intragovernmental agreement, which leaves
unanswered the question of whether CPA was part of DOD, or simply attached to it for the
purposes of facilitating coordination with, and receiving support from, the Department of the
Army. Nevertheless, DOD Instruction 4000.19 clarifies that a non-DOD entity may receive
support from DOD. In either case, intragovernmental or interservice agreement, documentation is
required.
Broad areas of recurring interservice and intragovernmental support and cooperation that do
not require reimbursement should be documented with a memorandum of agreement (MOA)
or memorandum of understanding (MOU). Recurring interservice and intragovernmental
support that requires reimbursement shall be documented on a DD [Department of Defense]
Form 1144, “Support Agreement”... , or similar format that contains all the information
required on DD Form 1144. Support that benefits a receiver without creating additional cost
to the supplier (e.g., gate guards, fire protection) may be included on a DD Form 1144, but
must be identified as non-reimbursable. Provision of a single item or one time service, sales
of Defense Business Operations Fund (DBOF) mission products and services, and
intragovernmental sales specifically directed or authorized by law may be accomplished on
the basis of an order or requisition without preparing a support agreement.78
Apparently, documentation was required for the support agreement between the Army and CPA.
If an applicable document exists and is available to the public, it might clarify what type of
agreement existed between the Army and the authority.
77
Department of Defense Instruction Number 4000.19, Interservice and Intragovernmental Support, August 9, 1995, p.
15, available at http://www.dtic.mil/whs/directives/corres/pdf/400019p.pdf.
78
Ibid., p. 4.
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An Office of the Inspector General was established for CPA by Title III of the FY2004 emergency
supplemental.79 The Secretary of Defense, in consultation with the Secretary of State, appointed
the Inspector General, and the Inspector General reported to the CPA Administrator.80 As of
March 20, 2004, the Office of Inspector General (OIG) employed 58 persons and had obtained
the services of an auditing and accounting firm.81
In addition to having the duties, responsibilities, and authorities outlined in the Inspector General
Act of 1978 (5 U.S.C. Appendix),82 the CPA Inspector General (IG) was authorized to “conduct,
supervise, and coordinate audits and investigations of the treatment, handling, and expenditure of
appropriated funds by the Coalition Provisional Authority in Iraq.”83 This involved, for example,
monitoring obligations and expenditures, reconstruction activities, contracts, and transfers of
funds and associated information between and among the CPA and other departments, agencies,
and entities of the federal government.84 It seems that the CPA IG was to be treated the same as
any federal agency’s OIG. The CPA office was to coordinate with the DOD and USAID Offices of
Inspector General.85 Additionally, any federal department or agency that was asked to provide
information or assistance to the CPA OIG was to do so.86 In his statement on the emergency
supplemental, the President apparently placed some restrictions on CPA’s OIG. He noted that the
Inspector General was to:
refrain from initiating, carrying out, or completing an audit or investigation, or from issuing
a subpoena, which requires access to sensitive operation plans, intelligence matters,
counterintelligence matters, ongoing criminal investigations by other administrative units of
the Department of Defense related to national security, or other matters the disclosure of
which would constitute a threat to national security. The Secretary of Defense may make
exceptions to the foregoing direction in the public interest.87
The CPA IG was to terminate its operations six months after the “authorities and duties” of CPA
“cease to exist,” which occurred June 28, 2004.88 Instead, Section 1203 of P.L. 108-375, which
amended Title III of P.L. 108-106, redesignated the CPA IG as the Special Inspector General for
Iraq Reconstruction (SIGIR) and made termination of the office contingent upon the obligation of
appropriated funds.89 SIGIR is to cease operations
79
P.L. 108-106; 117 Stat. 1209, at 1234.
Sec. 3001(c) and (e) of P.L. 108-106.
81
Coalition Provisional Authority, Office of Inspector General, Message from the Inspector General of the Coalition
Provisional Authority, p. 13.
82
P.L. 95-452, Sec. 1; October 12, 1978; 92 Stat. 1101.
83
Sec. 3001(f)(1) and (g) of P.L. 108-106.
84
Sec. 3001(f)(1) of P.L. 108-106.
85
Sec. 3001 (f)(4) and (5) of P.L. 108-106.
86
Sec. 3001(h)(4) of P.L. 108-106.
87
U.S. President (G. W. Bush), “Statement on Signing the Emergency Supplemental Appropriations Act for Defense
and for the Reconstruction of Iraq and Afghanistan, 2004,” Weekly Compilation of Presidential Documents, vol. 39,
November 6, 2003, p. 1549.
88
Sec. 3001(o) of P.L. 108-106.
89
For additional information on SIGIR, see http://www.sigir.mil.
80
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10 months after the date, as determined by the Secretary of State and the Secretary of
Defense, on which 80 percent of the amounts appropriated or otherwise made available to the
Iraq Relief and Reconstruction Fund by chapter 2 of title II of this Act have been obligated.90
During the 109th Congress, the SIGIR’s term initially was shortened, but then was extended.
Section 1054(b) of P.L. 109-364, the John Warner National Defense Authorization Act, FY2007,
stated that the Inspector General would terminate on October 1, 2007. Subsequently, P.L. 109-440
changed the termination date so that
[t]he Office of Inspector General shall terminate 10 months after 80 percent of the funds
appropriated or otherwise made available to the Iraq Relief and Reconstruction Fund have
been expended.... For purposes of calculating the termination of the Office of the Inspector
General under this subsection, any United States funds appropriated or otherwise made
available for fiscal year 2006 for the reconstruction of Iraq, irrespective of the designation of
such funds, shall be deemed to be amounts appropriated or otherwise made available to the
Iraq Relief and Reconstruction Fund.91
The Special Inspector General for Iraq Reconstruction reports to both the Secretary of Defense
and the Secretary of State.
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The Emergency Wartime Supplemental Appropriations Act for FY2003,92 which was the first
supplemental to provide funds for the reconstruction of Iraq, was signed on April 16, 2003, prior
to the announcement that Ambassador Bremer would be the Administration’s Presidential Envoy
to Iraq. Accordingly, there was no mention of CPA (or ORHA) in this statute. The $2.475 billion
appropriated to the President for the reconstruction of Iraq could be apportioned only to USAID
and the Departments of Defense, Health and Human Services (HHS), State, and the Treasury.93
The FY2004 emergency supplemental, which was signed by the President on November 6, 2003,
included CPA in the list of organizations to which the Iraq Relief and Reconstruction Fund could
be apportioned.94 The other five organizations in the list were the ones included in the first
supplemental.
While the authority was eligible to receive funds for the reconstruction of Iraq, apparently it did
not award any contracts funded by the FY2004 emergency supplemental. Deputy Secretary
Wolfowitz’s December 5, 2003, memorandum identifying countries whose companies were
eligible to compete for contracts funded by the FY2004 emergency supplemental also stated that
90
Sec. 1203(o) of P.L. 108-375.
Sec. 2 of P.L. 109-440.
92
P.L. 108-11; 117 Stat. 559, at 573.
93
“Apportion” refers to a procedure whereby the President, through OMB, distributes appropriated funds to executive
agencies. (31 U.S.C. § 1513(b)(1). Outside the executive branch, “the official having administrative control of an
appropriation available to the legislative branch, the judicial branch, the United States International Trade Commission,
or the District of Columbia government ... shall apportion the appropriation in writing.” (31 U.S.C. §1513(a).)
94
117 Stat.1225.
91
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the construction and services contracts funded by the supplemental “are to be awarded by the
Coalition Provisional Authority (CPA) and by the Department of Defense, on behalf of CPA.”95
Solicitations for the major design/build construction contracts were issued by the U.S. Army
Corps of Engineers, the U.S. Army Communications-Electronics Command (CECOM), and the
Naval Facilities Engineering Command. Proposals were to be submitted to the office that issued
the solicitation. Offerors96 also were required to submit copies of their proposals to the Iraq
Reconstruction Contracting Office, which was located in Alexandria, Virginia. The Pentagon
Renovation Office issued the solicitations for support for the CPA’s Program Management Office
(PMO) and sector PMOs. Proposals were to be submitted to the Pentagon Renovation Office, but
there was no requirement for proposals for the program management office PMO and sector
program management offices (SPMOs) contracts to be submitted to the Iraq Reconstruction
Contracting Office. Solicitations were issued on January 6, 2004, and by March 26, 2004, all 17
contracts were awarded.97
Apparently, no official explanation as to why the CPA did not issue these solicitations was
offered. A possible factor in the decision to decentralize the solicitation, evaluation, and award
processes might have been the scheduled termination of the CPA. Knowing that the CPA would
terminate operations by June 30, 2004, Administration officials might have chosen the route they
did in order to maintain continuity. Another possible reason why CPA was limited to monitoring
contracts may be that government officials ascertained that the authority did not have enough
personnel, or enough personnel with sufficient experience in the types of work to be done in Iraq,
to develop solicitations and evaluate proposals for seven major sectors, the PMO, and the
SPMOs. The fact that CPA needed contractor support for its PMO and SPMOs tends to support
the notion that it did not have enough resources to perform all of the necessary procurement tasks.
A third consideration might have been the possibility of protests, particularly the possibility that a
contractor would file a protest with GAO challenging the authority’s actions or decisions
concerning the award of a contract. As discussed below, a few companies did file protests with
GAO concerning CPA decisions. Perhaps the U.S. government wanted to avoid the possibility
that additional protests targeting CPA would be filed with GAO. (As noted below, CPA’s own
95
Paul Wolfowitz, Deputy Secretary of Defense, “Determination and Findings,” available from the author. In this
document, the Deputy Secretary used the “public interest” exception (see FAR 6.302-7) to full and open competition as
the authority for limiting competition for reconstruction contracts to firms “from the United States, Iraq, Coalition
partners and force contributing nations.” (Ibid.) It bears noting, however, that the Deputy Secretary of Defense did not,
and does not, have authority to use or apply this exception. Under FAR 6.302-7(c), only the Secretary of Defense, the
Secretaries of the Air Force, Army, and Navy, the Secretary of Homeland Security for the Coast Guard, the
Administrator of the National Aeronautics and Space Administration, and the head of any other executive agency may
exercise this authority, which may not be delegated.
96
An offeror is a business that submits a proposal in response to a government solicitation.
97
The contracts were awarded to AECOM (PMO support, $21.6 million), CH2M Hill/Parsons (public works and water
SPMO support; $28.4 million), Berger/URS (transportation/communications SPMO support, $8.4 million;
security/justice SPMO support, $8.4 million; buildings/education/health SPMO support, $10.7 million), Iraq Power
Alliance Joint Venture (electrical services SPMO support, $43.3 million), Foster Wheeler (oil SPMO support, $8.4
million), Fluor AMEC LLC (power generation facilities, $500 million; public works and water—northern region, $600
million; public works and water—southern region, $500 million), Washington International Inc. and Black and Veatch
(water resources, $600 million), Washington International Inc. (electricity—northern region, $500 million), Perini
Corp. (electricity—southern region, $500 million), Contrack/AICI/OCI/Archirodon Joint Venture (transportation, $325
million), Lucent Technologies World Services, Inc. (communications, $75 million), and Parsons Delaware (buildings,
education, and health, $500 million; security, justice, and safety, $900 million). (Coalition Provisional Authority,
Program Management Office, “Another Contract in Place to Continue Construction in Iraq,” press release, April 2,
2004, available from the author.
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contracting procedures applied only to non-appropriated funds, and only allowed for protests to
be filed with CPA officials.)
The former Administrator of the Office of Federal Procurement Policy, in writing about
contracting with the authority, offered another possible explanation of why government officials
chose to have DOD components issue solicitations and award contracts for the reconstruction of
Iraq:
The CPA is not the United States government. Accordingly, if one enters into a contractual
relationship with the CPA, one is not entering into a contractual relationship with the United
States. The rights and remedies available to parties contracting with the United States will
not be available in a contractual relationship with the CPA. The remedies available to an
aggrieved contracting party will be determined in part by the source of the money through
which the contracting party is paid.98
Government officials may have considered the question of the CPA’s organizational status and the
possibility that a contract with the authority would not be a contract with the U.S. government.
These considerations might have contributed to a determination that it would not be appropriate
for CPA to enter into contracts funded by appropriated funds.
There is some question as to whether the authority used appropriated funds for projects involving
the reconstruction of Iraq. In a letter it submitted to GAO on the matter of the Turkcell
Consortium protest (see below), the United States Army Legal Services Agency stated: “The
funds CPA is using for contracts are not appropriated funds.... Even if this action [issuing licenses
for mobile telecommunications] was a procurement that involved the use of funds, CPA would
use DFI [Development Fund for Iraq] funds, not U.S. appropriated funds for its CPA mission.”99
This letter was written a few weeks before the FY2004 emergency supplemental was enacted, so
possibly the Army was commenting only on conditions at the time. If so, then the Army’s
assertion in the Turkcell Consortium bid protest might not have applied to subsequent
procurement actions.
Other evidence suggests that CPA used appropriated funds for reconstruction activities. A news
article that mentioned the activities of the CPA’s Program Review Board (see below) indicates the
authority spent appropriated funds:
From minutes published by the CPA’s Program Review Board, it appears that the CPA has
the power to shift monies between appropriated funds accounts and the Development Fund
of Iraq (which contains funds from both Iraqi and foreign donated sources): “#352, Restore
Iraqi Infrastructure, $711M. [million] The Board considered the request from Task Force
RIO [Restore Iraqi Oil] for changing the funding source from appropriated funds to the
Development Fund of Iraq a previously approved request (#352, total amount approved
$962M). $251M was already provided from the Natural Resource Risk Remediation Fund
(NRRRF), an appropriated funds account. TF RIO indicated that $711M is outstanding and
required but of that amount $466M was immediately required to complete projects under
Phase I. The Board identified $500M as remaining available from two appropriated
accounts—the Iraq Reconstruction and Relief Fund (IRRF) and the NRRRF and therefore
98
Angela B. Styles, “Seller Beware: Assessing the Risks of Iraq Reconstruction Contracting,” Federal Contracts
Report, January 20, 2004, vol. 81, no. 2, p. 65. (Italics in original.)
99
Maj. Frank A. March, Department of the Army, United States Army Legal Services Agency, “Protest of Turkcell
Consortium, B-293048,” correspondence to U.S. General Accounting Office, October 21, 2003, pp. 3 and 4.
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the requirement was approved to come from the appropriated funds. A new vote may be
required for the remaining amount $211M but this was deferred.
Agenda Item #398 (‘Police equipment - Of the $90M authorized (funding source to be either
appropriated or DFI), the CPA’s Ministry of Interior team needs an immediate disbursement
of $5M. This request is for the reprogramming of $5M from appropriated or DFI (to be
determined) to vested funds. The request was recommended for approval.100
The latter passage also shows that CPA might have reprogrammed funds among the various
funding sources available to it (see below).
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CPA issued solicitations, which means it also awarded contracts, for some time. In early March
2004, the list on CPA’s website included solicitations for aerators, AK-47 assault rifles, sand bags,
portable X-Ray units, battery cells, vehicles, berets, turbine parts, a police records management
system, information technology products, agricultural equipment, satellite data communications,
and railroad equipment, parts, and services.101 It is unknown what funds CPA used to purchase
items and services listed in its solicitations. If CPA used Iraqi funds, then CPA Memorandum
Number 4 applied. Iraqi funds were defined in this memorandum as:
Funds under the control of the [Coalition Provisional] Authority consisting of (a) proceeds
from Iraqi state-owned property that has been vested or seized in accordance with applicable
law and made available to the CPA to assist the Iraqi people and assist in the reconstruction
of Iraq; and (b) funds in the Development Fund for Iraq, the establishment of which is noted
in Resolution 1483 (2203). As used in this Memorandum, “Iraqi Funds” do not include funds
provided through the appropriations process of Coalition member governments (for example,
funds provided directly to the CPA by the governments of the United States or the United
Kingdom).102
If CPA used appropriated funds, it would seem reasonable for authority personnel to have
followed the Federal Acquisition Regulation (FAR), which governs federal agency procurement
activities. A review of three CPA solicitations showed that two (sand bags and information
technology) included numerous references to the FAR (sand bags and information technology
products). The third solicitation, for berets, included only one reference to the FAR. Without
additional, detailed information about the authority’s contracting activities, it is difficult to
ascertain the source of funds and the guidance used for each procurement. The former
Administrator of the Office of Federal Procurement Policy (OFPP) has stated that “no rules [are]
in place for contracting by the CPA with U.S. appropriated funds.”103 In the absence of a clear
statement on the organizational status of the CPA, however, this assessment may or may not be
accurate.
100
Christopher R. Yukins and Mohab Khattab, “Iraq Reconstruction Awards Should Not Be Immune from Review,”
Federal Contracts Report, November 18, 2003, vol. 80, no. 18, p. 512.
101
The list is no longer available on the CPA website.
102
Coalition Provisional Authority, “Contract and Grant Procedures Applicable to Vested and Seized Iraqi Property
and the Development Fund for Iraq,” Coalition Provisional Authority Memorandum Number 4, pp. 3-4.
103
Styles, “Seller Beware: Assessing the Risks of Iraq Reconstruction Contracting,” p.65.
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Ambassador Bremer established, through Coalition Provisional Authority Regulation Number 3, a
Program Review Board (PRB), which reported directly to him. The board’s general duty was to
be “responsible for recommending expenditures of resources from the Development Fund for Iraq
and other resources identified” elsewhere in the regulation. In developing funding plans, the PRB
recommends disbursements of appropriated funds, “Iraqi property lawfully vested in the U.S.
Treasury,” funds, cash, or other financial instruments owned by Iraq or the (former) regime, and
the Development Fund for Iraq. A news article asserted that the PRB “really controls only the
Iraqi money.”104 However, as noted above, a news article indicated the PRB was involved in
spending appropriated funds. The board was also responsible for proposing “principles and
standards for expending funds for the relief and recovery of Iraq in a fair, consistent and
transparent manner, through contracts or otherwise.”105
The board consisted of a chairman, who was appointed by the CPA Administrator; the directors of
economic policy, civil affairs policy, the USAID—Iraq mission, operations, and security affairs
(all of whom apparently were CPA personnel); and authorized representatives of the commander
of coalition forces, the Iraqi Ministry of Finance, the United Kingdom, Australia, and the
chairman of the Council for International Coordination. If the PRB took action on any matter
relating to the disposition of appropriated funds, then the voting membership was also to include
authorized representatives of DOD, and Departments of the Treasury and State. Additionally, the
status of the authorized representatives of the Iraqi Ministry of Finance, the United Kingdom,
Australia, and Council for International Coordination shifted from voting to nonvoting on the
disposition of appropriated funds. Others who were permitted to attend board meetings as
nonvoting members included the CPA Comptroller and General Counsel; Program Coordinator of
the board; and authorized representatives of OMB, the Office of the Secretary of Defense, the
International Monetary Fund, the World Bank, the United Nations Special Representative of the
Secretary General for Iraq, and the International Advisory and Monitoring Board.106
ȱ
Protests challenging the authority were filed with GAO. On October 14, 2003, GAO received a
bid protest from Turkcell Consortium, which challenged the award of mobile telecommunications
licenses in Iraq by CPA. This was the first protest filed that involved the authority. The protest
was dismissed because it was based on speculation, not factual grounds, that errors occurred in
the award process.107 Turkcell Consortium filed a second protest on October 27, 2003, which was
also dismissed by GAO because the procurement did not involve “the provision of property or
services to the federal government.”108
104
Jackie Spinner and Ariana Eunjung Cha, “U.S. Decisions on Iraq Spending Made in Private,” Washington Post,
December 27, 2003, p. A15.
105
Coalition Provisional Authority, “Coalition Provisional Authority Regulation Number 3, Program Review Board,”
June 18, 2003, p. 7, available at http://www.cpa-iraq.org/regulations/
20030619_CPAREG_3_Program_Review_Board_.pdf.
106
Ibid., pp. 3-4.
107
Melanie I. Dooley, “GAO Dismisses Turkcell Protest of Iraq Telecom Licenses; Turkcell Files New Protest after
Receiving Debriefing,” Federal Contracts Report, BNA, Inc., October 28, 2004, vol. 80, no. 15. p. 405.
108
Melanie I. Dooley, “GAO Dismisses Turkcell’s Second Protest of Iraq Telecom Licenses but Leaves Door Open,”
Federal Contracts Report, November 18, 2003, vol. 80, no. 18, p. 507.
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While CPA was the organization that awarded the contract for mobile telecommunications
licenses, GAO’s second bid protest decision identified the cognizant agency as “Department of
the Army, for the agency.”109 Reportedly, the U.S. Army was also listed as the cognizant agency
on GAO’s docket for the first protest, and the solicitation number was listed as “unknown.”110
Citing a dismissal request submitted by the Army, GAO stated, in its decision on the second
protest: “The Department of the Army argued that our Office lacks jurisdiction to hear this protest
because the CPA is not a ‘federal agency.’”111 Due to the fact that both protests were dismissed on
other grounds, there was no need for GAO to resolve the question of “whether the CPA is a
federal agency for purposes of our [GAO] bid protest jurisdiction under CICA [Competition in
Contracting Act of 1984].”112 In its second decision on this case, however, GAO explained its
authority to decide bid protests and described circumstances under which it could have
jurisdiction to handle bid protests concerning CPA:
The authority of our Office to decide bid protests is based on the Competition in Contracting
Act of 1984 (CICA) ... and encompasses “a written objection by an interested party to a
solicitation or other request by a federal agency for offers for a contract for the procurement
of property or services.” Our jurisdiction does not turn on whether appropriated funds are
involved ... or on whether the competition requirements of CICA apply.
We note ... that even if we ultimately determine that the CPA is not a federal agency, we may
well assume jurisdiction if the challenged procurement is conducted on the CPA’s behalf by
an entity that is a federal agency (such as the Department of the Army).... In any event, we
would also consider a request by the CPA for our Office to consider protests outside the
framework of CICA.113
CPA’s award of a contract to Nour USA to equip the Iraqi armed forces and the Iraqi civil defense
corps also was the subject of protests. A solicitation was issued on November 11, 2003, and CPA
(which was explicitly identified as the contracting activity in the press release) received 19
bids.114 In a press release dated January 31, 2004, CPA announced that it had awarded a contract
for $327 million to Nour USA.
In mid-February, it was reported that two companies, Cemex Global Inc. and Bumar Group, had
filed separate protests, which were combined by GAO into one protest, challenging the awarding
of this contract to Nour USA. Among their concerns were (1) the relatively low cost of the Nour
USA proposal, which was $231 million lower than the Bumar Group’s proposal; (2) the fact that
Nour’s president was A. Huda Faouki, who allegedly is a friend of Ahmad Chalabi, who had been
a member of the Iraqi Governing Council; and (3) the belief that Nour USA, which apparently
was established in May 2003, had no experience in performing the work necessary to fulfill the
terms of the contract.115 Subsequently, four additional protests were filed with GAO. In each of
109
U.S. General Accounting Office, Turkcell Consortium bid protest, file B-293048.2, November 12, 2003, p. 1.
Melanie I. Dooley, “GAO Dismisses Turkcell Protest of Iraq Telecom Licenses; Turkcell Files New Protest after
Receiving Debriefing,” Federal Contracts Report, October 28, 2003, vol. 80, no. 15, p. 405.
111
U.S. General Accounting Office, Turkcell Consortium bid protest, p. 2.
112
Ibid., p. 1; 31 U.S.C. §§ 3551-3556.
113
U.S. General Accounting Office, Turkcell Consortium bid protest, pp. 2-3.
114
Coalition Provisional Authority, Program Management Office, “U.S.-Iraqi-Polish Group Receives Security
Equipment Contract,” press release, January 31, 2004.
115
Joe Harper, “Polish Arms Company Challenges CPA Award to U.S. Firm, Alleges Bid Evaluation Unfair,” Federal
Contracts Report, February 24, 2004, vol. 81, no. 7, p. 199; Melanie I. Dooley, “Coalition Provisional Authority to
Review Nour, Other Offerors to Equip Iraq Army,” Daily Report for Executives, March 5, 2004, no. 43, p. A-24.
110
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the six protests, the Department of the Army was listed as the cognizant agency and the
solicitation number (FY5866-04-R-0001) was included.116 Reportedly, CPA indicated on March 3
that it would reevaluate all timely proposals and make a new source selection decision.117 In light
of the government’s decision to reevaluate proposals, GAO dismissed all protests.118 In a March
5, 2004, press release, the CPA PMO briefly described plans for rectifying the situation, which
involved the Army, but not CPA:
Today the Army announced it will terminate its contract with Nour, USA, to equip the New
Iraqi Army. Protests were filed subsequent to the award to Nour. Protests are part of a
transparent and fair procurement process. As a result of an internal review, the Army has
determined there were irregularities in this specific contract action, and took appropriate
measures to assess the validity of the protests.
The Army will conduct a complete re-solicitation; schedule release of the solicitation is to be
determined. The Army wants to ensure the process is transparent, fair and conduct in an
expeditious manner.119
Reportedly, control of the procurement process transferred from CPA to the Army Materiel
Command.120
No explanation was provided as to why the Army terminated the contract when the press release
that announced the award of a contract to Nour identified CPA as the contracting activity (see
above). A possible question could be posed, for example, why CPA, if it was the organization that
awarded the contract initially, did not cancel the contract. While the Department of the Army
provided support to CPA, particularly in the area of acquisition, it is unclear how, why, or under
what circumstances, a federal agency might cancel a contract awarded by another entity and
assume responsibility for subsequent procurement activities.
Neither CPA nor DOD disclosed why the Department of the Army, and not the authority, was
listed on GAO’s bid protest docket for protests involving contracting actions apparently
undertaken by CPA. As for reconstruction contracts funded by the FY2004 supplemental, the fact
that DOD components, such as the Army Corps of Engineers and the Naval Facilities Engineering
Command, were the contracting activities would seem to preclude the possibility that an offeror
would file a protest with GAO challenging CPA. Considering the Department of the Army’s
assertion, during the protest by Turkcell Consortium, that CPA was not an agency, it suggests that
there might have been some (unknown) advantages to shielding CPA from protests.121 Without
further information about CPA’s procurement process and organizational status, it is unclear
whether any advantages existed, and, if so, what they might have been.
It is unknown whether any offerors filed protests under the provisions of Coalition Provisional
Authority Memorandum Number 4, which, as noted above, provided procurement rules for what
116
The file numbers assigned by GAO to these protests were B-293676.001 through B-293676.006.
Dooley, “Coalition Provisional Authority to Review Nour, Other Offerors to Equip Iraq Army,” p. A-24.
118
Ibid.
119
Coalition Provisional Authority, Program Management Office, “U.S. Army Terminates Contract to Equip New Iraqi
Army,” March 5, 2004.
120
Abby Bowles, “Army Materiel Command Put in Charge of Resoliciting Iraq Army Equipment Contract Awarded to
Nour,” Federal Contracts Report, March 16, 2004, vol. 81, no. 10, p. 279.
121
March, “Protest of Turkcell Consortium, B-293048,” pp. 2-4.
117
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may be referred to collectively as Iraqi, or non-appropriated, funds. The paragraph on protests
stated:
A contractor wishing to object to the terms of a solicitation, the termination of a solicitation,
the award of a contract, or the termination of the award of a contract, shall present the matter
to the Contracting Officer for an initial decision. The contractor shall state to the Contracting
Officer the basis for the protest. If the contractor does not agree with the Contracting
Officer’s initial decision, the Contractor may appeal the initial decision to the Head of
Contracting Activity, CPA, for resolution. The decision of the Head of Contracting Activity,
CPA, shall be the final decision in the matter.122
Not only did this provision fail to provide for any sort of external, independent review or
adjudication process (such as provided by GAO), it also omitted any requirements or procedures
for CPA personnel to respond in a timely fashion, or to provide an explanation for their decision.
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The FY2004 supplemental (P.L. 108-106) appropriated $933 million to the President for the
authority’s operating expenses. Expenses could have included “personnel costs, transportation,
supply, equipment, facilities, communications, logistics requirements, studies, physical security,
media support, promulgation and enforcement of regulations, and other activities needed to
oversee and manage the relief and reconstruction of Iraq and the transition to democracy....”123
These funds are “to remain available until September 30, 2005: Provided, That the appropriation
of funds under this heading shall not be construed to limit or otherwise affect the ability of the
Department of Defense to furnish assistance and services, and any other support, to the Coalition
Provisional Authority.”124 In a memorandum dated December 5, 2003, the President transferred
these funds to the Secretary of Defense:
The funds appropriated to the President under the heading Operating Expense of the
Coalition Provisional Authority in the Emergency Supplemental Appropriations Act for
Defense and for the Reconstruction of Iraq and Afghanistan, 2004 (P.L. 108-106), or in any
subsequent appropriation under this heading, are transferred to the Secretary of Defense, for
an account designated Operating Expenses of the Coalition Provisional Authority,
International Reconstruction and Other Assistance, Army.125
Information is not available to explain whether the CPA Administrator had access to these funds,
or if he relied on the Secretary of Defense for purchasing supplies and equipment needed by CPA.
122
Coalition Provisional Authority, “Contract and Grant Procedures Applicable to Vested and Seized Iraqi Property
and the Development Fund for Iraq,” p. B-3.
123
117 Stat. 1226.
124
Ibid.
125
U.S. President (G. W. Bush), “Transfer of Funds Appropriated to the President under the heading Operating
Expenses of the Coalition Provisional Authority, and Delegation of the Functions of the President under the heading
Iraq Relief and Reconstruction Fund, in the Emergency Supplemental Appropriations Act for Defense and for the
Reconstruction of Iraq and Afghanistan, 2004,” Federal Register, January 9, 2004, vol. 69, no. 6, p. 1645.
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The CPA Administrator exercised rule-making authority, which apparently was derived from the
executive authority invested in CPA by the President. Unlike the heads of federal agencies,
however, the Administrator did not follow the Administrative Procedure Act (APA), which
governs informal and formal rule making.126 For example, the authority did not announce any
proposed, interim, or final regulations in the Federal Register.
The first regulation issued by CPA outlined the Administrator’s authority in issuing regulations,
memoranda, orders, and public notices:127
In carrying out the authority and responsibility vested in the CPA, the Administrator will, as
necessary, issue Regulations and Orders. Regulations shall be those instruments that define
the institutions and authorities of the CPA. Orders are binding instructions issued by the
CPA. Regulations and Orders will remain in force until repealed by the Administrator or
superseded by legislation issued by democratic institutions of Iraq. Regulations and Orders
issued by the Administrator shall take precedence over all other laws and publications to the
extent such other laws and publications are inconsistent. The Administrator may also from
time to time issue Public Notices.... The Administrator may issue Memoranda in relation to
the interpretation and application of any Regulation or Order.128
Enacting a regulation, order, memorandum, or public notice was accomplished by the
Administrator signing off on, or approving, the document. Subjects of these documents included:
•
Regulations: Development Fund for Iraq, Program Review Board, Governing
Council of Iraq, Council for International Coordination, Iraq Property Claims
Commission, and International Donor Assistance;
•
Orders: Penal Code, Management and Use of Iraqi Public Property, Prohibited
Media Activity, Regulation of Oil Distribution, Creation of a New Iraqi Army,
and Status of the Coalition, Foreign Liaison Missions, Their Personnel and
Contractors;
•
Memoranda: Criminal Procedures, contract and Grant Procedures,
Implementation of De-Baathification Order No. 1, Implementation of Weapons
Control Order 3, and Appointment of Deputy Ministers;
•
Public notices: Managing Financial Resources, Regarding a Responsible Iraqi
Media, Regarding the Council for International Coordination, Regarding Public
Incitement to Violence and Disorder.129
126
5 U.S.C. §§ 551-559; 60 Stat. 237. See CRS Report RL32240, The Federal Rulemaking Process: An Overview, by
Curtis W. Copeland.
127
A list of CPA regulations, orders, memoranda, and public notices is available at http://www.iraqcoalition.org/
regulations/index.html, visited February 24, 2005.
128
Coalition Provisional Authority, “Coalition Provisional Authority Regulation Number One,” p. 2.
129
Coalition Provisional Authority, “CPA Official Documents” website, available at http://www.cpa-iraq.org/
regulations/index.html#Regulations, visited February 24, 2005.
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An undated CPA organization chart is shown in Figure 1.130 While several sub-units are missing,
and it is possible that the actual organization varied from this depiction, the chart provides insight
into the authority’s chain of command and organizational scope. Organizational subunits and
positions not shown on the chart include the Deputy Administrator, Office of Inspector General,
Program Management Office and Sector Program Management Offices, legislative affairs staff
(which was located in the Washington, DC, metropolitan area), and contracting offices
(apparently, there were two contracting offices, one each in Iraq and the Washington, DC,
metropolitan area).
130
Organization chart provided electronically by CPA’s legislative affairs office to the author on February 24, 2004.
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Figure 1. Coalition Provisional Authority
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Even prior to the inception of the CPA, Congress established reporting requirements concerning
efforts to reconstruct Iraq. Table 1 lists significant reporting requirements concerning this effort
and, in particular, CPA.
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. Statutory Reporting Requirements Concerning the CPA and the Reconstruction of Iraq
Table 1
Statute (date of
enactment)
Responsible Official or
Office
Recipient(s)
Deadline(s)
Summary of Content of Report
1. Description of duties, roles, and
responsibilities of U.S. government
agencies, foreign governments, and
international organizations.
2. A strategy for coordinating the
activities of these entities.
3. Cost estimates associated with such
activities and a strategy for distributing
responsibility for paying costs
associated with reconstruction
activities.
1. Separate lists of reconstruction
activities that are anticipated, or were
initiated or completed.
2. Cost estimates for conducting
proposed activities and source of
funds.
3. Updated list of financial pledges and
contributions made by foreign
governments or international
organizations.
Justification of the use of other than
full and open competition procedures,
a description of the scope of the
contract, a description of the process
the agency used in identifying and
soliciting offers, the amount of the
contract, and justification and approval
documents.
P.L. 108-11, Sec. 1506(a)
(April 16, 2003)
President
House and Senate Committees
on Appropriations
Not later than 45 days after
date of enactment.
P.L. 108-11, Sec. 1506(b)
(April 16, 2003)
President
House and Senate Committees
on Appropriations
Not later than 90 days after
date of enactment and every
90 days thereafter until Sept.
30, 2004.
P.L. 108-106, Sec. 2202(b)
(Nov. 6, 2003)
CPA Administrator, or agency
head
1. House Committees on
Appropriations, Government
Reform, and International
Relations
2. Senate Committees on
Appropriations, Government
Affairs, and Foreign Relations
Not later than seven
calendar days before the
award of a contract under
other than full and open
competition procedures.
[Sec. 2202(b) does not
include an expiration date.]
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Statute (date of
enactment)
Responsible Official or
Office
Recipient(s)
Deadline(s)
Summary of Content of Report
CPA Administrator ,or agency
head
Publish in the Federal Register and
post on the CPA website.
Amount and scope of the contract,
how contractors were identified and
solicited, justification and approval
documents.
P.L. 108-106, Sec. 2207
(Nov. 6, 2003)
Director, OMB, in consultation
with CPA Administrator and the
House and Senate Committees
on Appropriations
House and Senate Committees
on Appropriations
Not later than seven days
before the date on which a
contract is entered into for
contracts awarded under
other than full and open
competition procedures.
[Sec. 2203 does not include
an expiration date.]
Not later than January 5,
2004. Updated reports are
to be submitted to the
committees every three
months. Sec. 2207 expires
on October 1, 2007.
P.L. 108-106, Sec. 2215(a)
(Nov. 6, 2003)
CPA Administrator
1. House and Senate Committees
on Appropriations
2. Post on CPA’s website
P.L. 108-106, Sec. 3001(i)(1)
and (4), (j)
(Nov. 6, 2003)
CPA Inspector General
1. Senate Committees on
Appropriations, Armed Services,
and Foreign Relations
2. House Committees on
Appropriations, Armed Services,
and International Relations
3. Post on CPA website
4. CPA Administrator
P.L. 108-106, Sec. 2203
(Nov. 6, 2003)
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Initial report due within 30
days after date of enactment.
Subsequent reports due on a
monthly basis until
September 30, 2006.
Not later than March 30,
2004, and every calendar
quarter thereafter.
[Apparently, this
requirement will continue
until OIG expires, which will
happen six months after
CPA is dissolved. (Sec.
3001(o).)]
1. Proposed uses of funds for Iraq
relief and reconstruction
2. Distribution of duties and
responsibilities regarding
reconstruction projects among U.S.
government agencies
3. Funds provided by foreign
governments and international
organizations
4. Foreign assets seized or frozen.
Iraqi oil production, oil revenues, and
uses of oil revenues.
A detailed statement of all obligations,
expenditures, and revenues associated
with reconstruction and rehabilitation
activities in Iraq (including the
operating expenses of CPA and a
discussion of how CPA used other
than full and open competition
procedures).
ȱ
Statute (date of
enactment)
Responsible Official or
Office
Recipient(s)
Deadline(s)
Summary of Content of Report
CPA Inspector General
1. Senate Committees on
Appropriations, Armed Services,
and Foreign Relations
2. House Committees on
Appropriations, Armed Services,
and International Relations
3. Post on CPA website
4. CPA Administrator
Summary of the activities of the OIG
in the previous six months (for
example, significant problems, abuses,
and deficiencies, and OIG’s
recommendations for corrective
action).
P.L. 108-136, Sec. 1203
(Nov. 24, 2003)
Secretary of Defense
Congress
Not later than June 30,
2004, and semiannually
thereafter.
[Apparently, this
requirement will continue
until OIG expires, which will
happen six months after
CPA is dissolved. (Sec.
3001(o).)]
Not later than 90 days after
date of enactment.
P.L. 108-199, Sec. 599C
(Nov. 25, 2003)
OPM
House and Senate Committees
on Appropriations
P.L. 108-106, Sec. 3001(i)(3)
and (4), (j)
(Nov. 6, 2003)
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Initial report due February 1,
2004. Subsequent reports
due every quarter until May
2005.
Range of infrastructure
reconstruction, civil administration,
humanitarian assistance, interim
governance, and political development
activities undertaken in Iraq by DOD
officials and those civilians reporting
to the secretary. A A required
element is a discussion of the
evolution of the organizational
structure of the civilian groups
(ORHA and CPA) reporting to the
Secretary.
Number of detailees, by agency, that
are detailed to CPA.
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A lawsuit filed under the False Claims Act (FCA; 31 U.S.C. §§ 3729-3733), and unsealed in
2004, revealed that, as part of its defense, Custer Battles, LLC (CB), contended that CPA was not
a federal agency. Because the FCA applies only to the submission of false or fraudulent claims to
the government, Custer Battles argued that if CPA were not part of the government, the FCA
would not apply. (CPA has been identified as the contracting agency for two contracts awarded to
Custer Battles involving the Baghdad International Airport (BIAP) and the Iraqi Currency
Exchange (ICE).)131 In United States ex rel. DRC Inc. v. Custer Battles, LLC (E. Va., No. CV-04199-A), two former employees of CB alleged “that security contractor Custer Battles (CB)
submitted $50 million in fraudulent contract claims” to the federal government.132 Custer Battles
argued that CPA was not part of the U.S. government and that it (CB) was paid with seized funds
and DFI funds, which meant, therefore, that the U.S. government was not involved in these
contracting activities and U.S. government funds were not expended.
Although some may concur with the judge’s 2006 analysis of the status of CPA (see below),
arguably the significance of Custer Battles, aside from the outcome, may have more to do with
the insight provided by Department of Justice attorneys and Judge T.S. Ellis, III.133 In a brief
dated April 1, 2005, and submitted to Judge Ellis, DOJ attorneys examined two issues related to
financial transactions involving Custer Battles and the BIAP and ICE contracts:
Thus, the specific issue to be determined is whether the money which defendants [Custer
Battles] requested from the CPA via their invoices under these two contracts was to be paid
out, provided or approved by the United States Government. The answer lies in the nature of
the funds used to fund these two contracts. The second issue is whether the claims were
presented to U.S. Government officials.134
The Department of Justice determined that the U.S. government possessed, controlled, and/or
administered the funds used to pay Custer Battles; the U.S. government paid out, approved, or
provided these funds; and Custer Battles had presented claims for funds to “an officer or
131
Brief of the United States in response to the court’s invitation at p. 19, United States ex rel. DRC, Inc. and Robert
Isakson v. Custer Battles, LLC, et al. (E.D. Va. 2004 ) (No. CV-04-199a).
132
Martha A. Matthews, “District Court Sets February 10 Hearing on Whether FCA Reaches Coalition Provisional
Authority Contracts, Development Fund for Iraq Monies,” Federal Contracts Report, January 11, 2005, p. 24. In
addition to the lawsuit filed by two former employees, the Air Force suspended Custer Battles effective September 30,
2004. (Excluded Parties List System, available at http://www.epls.gov/.) As reported in the Legal Times, the Air Force
suspension memorandum stated that the company had “purchased cabins, trucks, and equipment and created false
leases between CB and the sham companies, making it appear that the sham companies were leasing the goods to the
CPA through CB. The scheme allowed CB to lease the goods to the CPA at prices exceeding the original cost of the
goods.” (Jason McLure, “How a Contractor Cashed in on Iraq,” Legal Times, February 28, 2005, p. 13.)
133
The Department of Justice (DOJ) is permitted to join a suit filed under the FCA, but it has been reported that the
department declined in 2004 to join the lawsuit filed against Custer Battles.(McLure, “How a Contractor Cashed in on
Iraq,” p. 13.) Subsequently, in December 2004, Judge T. S. Ellis III, who heard the case in the U.S. District Court for
the Eastern District of Virginia, invited the federal government “to file ... a brief setting forth the government’s position
with respect to whether the FCA [False Claims Act] applies to false claims made or presented to the CPA....” (McLure,
“How a Contractor Cashed in on Iraq,” p. 13.)
134
Brief of the United States at p. 27.
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employee of the United States Government or to a member of the Armed Forces of the United
States.”135 Following from these determinations, the Justice Department attorneys concluded that
Custer Battles’s claims presented to the CPA under the BIAP and ICE contracts would
violate FCA if the claims are shown to have been knowingly false because those claims were
for funds in which the U.S. had an interest or exercised certain dominion and were to be paid
out, provided or approved by the United States and they were ultimately presented to an
officer or employee of the United States government.136
In response to an order from the U.S. district court, dated April 12, 2005, Justice Department
attorneys filed a supplemental brief that addressed the question of whether CPA was a U.S.
government entity, agency, or instrumentality for the purposes of the FCA. In their supplemental
brief, the attorneys emphasized several times that determining the status of CPA was unnecessary,
yet they did present a set of criteria for determining whether CPA was part of the U.S.
government for the purposes of the False Claims Act.137Their criteria and excerpts from their
responses follow:
How and under what circumstances was the entity created? The CPA was created by the
Commander of the Coalition Forces in Iraq, General Tommy Franks, United States Army,
who was also the Commander of the U.S. Central Command. The establishment of the CPA
by the Coalition was formally recognized by UNSCR [United Nations Security Council
Resolution] 1483.
Is the entity subject to the general supervision and direction of the Executive Branch? Is its
head appointed by the President and confirmed by the Senate? The CPA Administrator was
subject to the direction of the President. Administrator Bremer served as Presidential Envoy
and reported to the President through the Secretary of Defense.
Is the entity’s funding or its capital formed or replaced out of the public treasury? And are
any gains returned to the public treasury? The CPA’s operating funds were appropriated by
Congress.
Are all of the entity’s officers and other personnel employees of the United States? Many if
not most officers and employees of the CPA were employees of the United States. Others
were employees of other member states of the Coalition.
Are there close budgetary, auditing and fiscal controls that resemble those imposed on the
ordinary government agency? While Congress initially imposed no close budgetary, auditing
and fiscal controls over the CPA operations with regard to the DFI [Development Fund for
Iraq] that resemble those imposed on the ordinary government agency ... , Congress created
the Office of Inspector General for the CPA to perform those types of oversight functions.
Is the structure of the entity simply an administrative device established for the purpose of
carrying out a federal program with public funds? The CPA was the administrative device
135
Brief of the United States at pp. 28-30, 34-35, 37, 39.
Ibid., p. 40.
137
As reported in the Washington Post, “The briefs came after multiple requests from [Judge] Ellis, who chided the
Justice Department ... for only reluctantly weighing in on the case. Ellis said it may be because the government doesn’t
want to expose itself to liability for the CPA’s actions. [Justice Department attorney Michael F.] Hertz acknowledged
that the government had written its briefs in the case ‘as narrowly as [it] could’.” (Griff Witte, “Judge Considers
Whistle-Blowers’ Iraq Contracting Suit,” Washington Post, May 13, 2005, p. E3.)
136
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that the Coalition created under the laws and usages of war to perform civil government
functions in liberated Iraq during the brief period of occupation. As an active member of the
Coalition, the United States played an important role in, and had certain responsibilities for,
the occupation, which it chose to fulfill through creation of and participation in the CPA. The
CPA’s structure was not established by Congress, and thus, the structure is not the typical
congressionally created administrative device to fulfill a government function.138
In reaching their determination that CPA was an instrumentality of the U.S. government, the
Justice Department attorneys wrote:
... two factors tip the scale in favor of the conclusion that the CPA should be deemed to be an
instrumentality of the United States for purposes of the False Claims Act. First is the nature
of the appointment and supervision of Ambassador Bremer as Presidential Envoy and
Administrator of the CPA. All authority of the CPA rested in the Administrator, and
Ambassador Bremer was employed by the United States, served at the pleasure of the
President, and was under the supervision of the President and the Secretary of Defense.
Second, coupled with the status of Ambassador Bremer, is the fact that all of the money used
for the two contracts at issue in this case was spent only on the authority and control of an
officer or employee of the United States or a member of the Armed Forces of the United
States.... Thus, while we emphasize again that the answer to the Court’s latest question on
the nature of the CPA is not necessary to determine whether or not defendants violated the
FCA when they presented claims to the CPA under the two contracts at issue in this
litigation, we nevertheless conclude that the CPA is an instrumentality of the United States
for purposes of the False Claims Act.139
In July 2005, Judge Ellis issued an opinion noting first that, if CPA had been a U.S. government
agency, the question of whether the FCA applied to CPA contract actions “would be largely
resolved.”140 However, the judge went on to note that “the essential nature of the CPA is shrouded
with ambiguity ... the CPA’s origins are difficult to pin down, as there is no formal document—
whether statute, United Nations Security Council resolution, or other organic document—that
plainly establishes the CPA or provides for its formation.”141 Near the end of his opinion, the
judge suggested that the question of CPA’s status might need to be addressed again at some later
date: “Although it initially appeared otherwise, it now appears unnecessary to reach and decide at
this time whether the CPA is an instrumentality of the United States.... [T]he dispute as to the
nature of the CPA may ultimately prove to be material....”142
Judge Ellis then turned to the question of the source and ownership of the three funds in
question—vested funds, seized funds, and the Development Fund for Iraq (DFI)143—and
determined that the FCA applies to vested and seized funds, but it does not apply to the DFI.144
138
Supplemental Brief of the United States at pp. 6-12.
Ibid., pp. 13-14.
140
Custer Battles, 376 F. Supp. 2d at 620.
141
Ibid.
142
Custer Battles, 376 F. Supp. 2d at 620 and 649. (Italics in original.)
143
Vested funds are “Iraqi funds [that were] confiscated by the President and vested in the Department of the
Treasury.” Seized funds are “Iraqi state assets, primarily in the form of currency and negotiable instruments, [that were]
seized by the Coalition Forces occupying Iraqi territory.” The Development Fund for Iraq includes proceeds from the
U.N. “Oil for Food” program, revenues from the sale of Iraqi oil and gas, international donations, and repatriated Iraqi
assets. (Custer Battles, 376 F. Supp. 2d at 623 and 626.)
144
Ibid.
139
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Specifically, he ruled that “any request submitted to the CPA for payment from Seized or Vested
Funds constitutes a ‘claim’ within the meaning of the FCA. Requests for payment from funds in
the DFI, however, were requests for Iraqi funds and thus did not constitute an FCA ‘claim.’”
Judge Ellis’s ruling permitted the case against Custer Battles to go forward—because vested and
seized funds were used to pay the BIAP contract, and seized funds were used, in part, to pay for
the ICE contract—and, in March 2006, it was reported that a jury found that CB had “submitted
$3 million in false claims against funds seized by the United States ....”145 However, in August
2006, Judge Ellis issued a second opinion in response to Custer Battles’ request for a directed
judgment overturning the jury’s verdict. He ruled in favor of Custer Battles, noting that the
“relators did not prove that the claims were presented to the United States.”146
In crafting his 2006 opinion, which addressed the Iraqi Currency Exchange project, Judge Ellis
concluded that it was necessary to address the question of CPA’s status.147 After revisiting the
analysis of CPA included in his 2005 opinion, the judge wrote:
... [T]he result of that analysis is clear—although the CPA was principally controlled and
funded by the U.S., this degree of control did not rise to the level of exclusive control
required to qualify as an instrumentality of the U.S. government. See Rainwater, 356 U.S. at
592-54. In fact, the evidence clearly establishes that it was created through and governed by
multinational consent....148
Judge Ellis ruled on the claim involving Custer Battles’ Baghdad International Airport contract in
early 2007. He determined that Custer Battles had not “fraudulently induced Iraq’s Coalition
Provisional Authority (‘CPA’) to award it a contract to perform security services for the Baghdad
International Airport (‘BIAP’) by representing that it would provide 138 security personnel.”149
Specifically, Judge Ellis noted the following:
In summary, undisputed facts manifestly demonstrate that Relators cannot establish a
fraudulent inducement claim under the FCA because they have failed to show (i) that Custer
Battles made a false statement regarding fixed security personnel staffing levels; (ii) that
Custer Battles knowingly made this allegedly false statement; and (iii) that this allegedly
false statement was material to the CPA’s decision to award the BIAP contract to Custer
Battles.150
Except for a summary of what transpired previously in this case, the judge did not re-visit the
issue of the status of CPA in his 2007 opinion.
145
Martha A. Matthews, “Jury Finds Custer Battles Made $3M in False Claims under One Iraq Contract,” Federal
Contracts Report, vol. 85, no. 10, p. 283.
146
U.S. v. Custer Battles, No. 04-199, 2006 U.S. Dist. LEXIS 58217 at *2 (E.D. Va. August 16, 2006). The term
“relator” refers to a private individual who may “bring a lawsuit on behalf of the United States, where the private
person has information that the named defendant has knowingly submitted or caused the submission of false or
fraudulent claims to the United States.” (U.S. Department of Justice, “False Claims Act Cases: Government
Intervention in Qui Tam (Whistleblower) Suits,” n.d., available at http://www.usdoj.gov/usao/pae/Documents/
fcaprocess2.pdf, p. 1.)
147
“[O]n January 30, 2006, the BIAP contract claims were severed from the ICE contract claims ... because the claims
involved wholly separate factual and legal issues.” (U.S. v. Custer Battles, No. 04-199, 2007 U.S. Dist. LEXIS 8473 at
*9 (E.D. Va. February 2, 2007).
148
U.S. v. Custer Battles, 2006 U.S. Dist. LEXIS 58217 at *31.
149
U.S. v. Custer Battles, 2007 U.S. Dist. LEXIS 8473, at *2.
150
Ibid., at *40-*41.
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Custer Battles has yielded two views of the status of CPA: DOJ attorneys determined, for the
purposes of the FCA, that it was an instrumentality of the U.S. government, but Judge Ellis
reasoned that it was not. Additionally, at least one alternative explanation still exists regarding the
creation of CPA, which was discussed above. That is, the President may establish an organization
under 5 U.S.C. § 3161. However, without access to NSPD 24, which apparently created, or
authorized the establishment of, ORHA, and which also may have been the instrument under
which CPA was created, it is difficult to ascertain whether this could be a valid alternative
explanation, or the definitive explanation.
Yet another possibility is that CPA was a hybrid organization, meaning that it had multiple
origins. Perhaps, then, the seemingly contradictory explanations actually are a reflection of the
organization’s hybrid status. Furthermore, if CPA was a hybrid organization, could this mean that
it was part U.S. government organization and part multinational organization? If so, how might
this arrangement have affected how CPA operated, what would the implications have been for
CPA’s activities, and to whom was CPA accountable?
The differing interpretations offered by Justice Department attorneys and Judge Ellis and the
questions surrounding NSPD 24 highlight the difficulties inherent in attempting to discern the
true origins of CPA. Thus, it appears that the question of how CPA was established, by whom, and
under what circumstances remains unanswered, at least for some.
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The status of this organization remains open to question. A letter exists that states that the United
States, and the United Kingdom, created the authority; in 2005, Justice Department attorneys
identified General Franks as the individual who established CPA; and the possibility exists that
the organization’s origins are to be found in NSPD 24. No explicit, unambiguous, and
authoritative statement has been provided that declares how CPA was established, under what
authority, and by whom, and that clarifies the seeming inconsistencies among alternative
explanations for how CPA was created.
Perhaps this ambiguity allowed the authority to perform multiple roles, each with its own chain of
command, stakeholders or constituents, funding, and accountability policies and mechanisms. A
statement in the FY2004 emergency supplemental—“in its [CPA] capacity as an entity of the
United State government”—suggested that U.S. government entity is only one of CPA’s roles.
Other roles might have included temporarily aiding in the governing of Iraq and serving as part of
a coalition. Possibly, the mix of arrangements allowed CPA to operate with greater discretion and
more authority, and have access to more resources, than if it had been solely a federal agency, or
an arm of the United Nations.151 CPA personnel also might have been able to work more
151
In a briefing on contracting programs in Iraq, Lawrence Di Rita, Principal Deputy Assistant Secretary of Defense for
Public Affairs, stated: “We’re in a war, we’re in a global war on terror. We have—many of the restrictions on how
money is appropriated and spent are based on rules and statutes that have developed over a course of time that was not
a period of war. So we’ve got a certain disconnect between the need to spend money quickly now, and we’ve got
certain funds available to do that—the CERP [Commanders Emergency Response Program] is a pot of money that’s
got fewer restrictions, relatively speaking, attached to it. It is certainly understandable that a military commander who
just knows if he had $10 million he can address some issues, isn’t going to necessarily be the one who’s patient enough
to sort through all the peacetime restrictions on the use of funds. That’s somebody else’s job; people are doing that.
These restriction are real, they were put in place for a very good reason. But they’re restrictions that bear some scrutiny
now that we’re trying to address a problem that is real time; and it’s not only a real-time problem, it’s a real-time
(continued...)
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efficiently and effectively under this mix. By operating under more than one set of laws,
regulations, and policies, CPA possibly could have expanded the scope and reach of the
organization’s authority beyond what it would be otherwise. For example, the CPA Administrator
drafted the regulations, orders, memoranda, and public notices that applied to Iraq; and the
Program Review Board had jurisdiction over four funding sources, including appropriated funds.
An advantage of having the CPA treated as part of the Department of Defense is that the chain of
command ran through the executive branch, which would not have been the case if CPA were
purely an international organization or coalition.
Billing itself as an international coalition, while eschewing the label “federal agency,” might be
construed as an effort to make the organization more palatable, at least symbolically, to Iraqis and
others. For example, the CPA website address ended “.com” and the PMO website ended “.net.”
United States government website addresses typically end “.gov.” Furthermore, the Iraqi flag is
the only flag that appeared on the two websites. No flags from coalition countries were displayed.
Potential drawbacks of this arrangement were that the lines of authority and accountability could
have become tangled, or even obscured. CPA personnel possibly could have found it difficult to
understand and delineate clearly—on a daily basis—the organization’s different roles and
associated funds, laws, and rules.152 Personnel might have been hampered by this tangle of
resources, laws, and documents, and could have found themselves engaging in questionable, and
perhaps unethical or criminal, activities. This scenario also could have proven challenging for
organizations that attempted to monitor CPA and its activities. When the authority made a
decision or expended funds, it might not have been clear to external parties under what authority
it was acting. Without transparency, the CPA might have given the appearance of shifting funds,
personnel, and tasks among different roles. Further compounding the problem, oversight
initiatives might have been met with the response that the activity in question was carried out
under an authority over which the oversight body—Congress—had no jurisdiction.
While greater transparency possibly could have helped to clarify CPA’s role(s), knowing how
CPA was established and under what authority would go a long way in helping to determine
whether it was a federal agency, the scope of its authority, and the forms, types, and mechanisms
of accountability to which it was subject. These questions remain relevant even after CPA’s
(...continued)
problem where people are being killed.... But I can tell you that the people who are responsible, who have that more—
who have that broader view of how this money is allocated and what those restrictions are, are working through the
problem in a very aggressive way—Ambassador Bremer, General Abizaid, General Sanchez.... We have a lot of
restrictions on the way some money can be spent, fewer restrictions on the way other money can be spent, and we’re
trying our best to kind of make those determinations all the time.” (Rear Admiral David J. Nash (ret.), Director, CPA
Program Management Office, and Lawrence Di Rita, Principal Deputy Assistant Secretary of Defense for Public
Affairs, “Briefing on Contracting Programs,” news transcript, March 10, 2004, available at http://www.defenselink.mil/
transcripts/transcript.aspx?transcriptid=2291.)
152
In testimony provided to the Senate Committee on Homeland Security and Governmental Affairs, the Special
Inspector General for Iraq Reconstruction suggested that the multitude of procurement rules was problematic. Under
the heading “Policy and Process Key Lessons,” he advised: Establish a single set of simple contracting regulations and
procedures that provide uniform direction to all contracting personnel in contingency environments. The contracting
process in Iraq reconstruction suffered from the variety of regulations applied by diverse agencies, which caused
inconsistencies and inefficiencies that inhibited management and oversight. (U.S. Congress, senate Committee on
Homeland Security and Governmental Affairs, statement of Stuart W. Bowen, Jr., Special Inspector General for Iraq
Reconstruction, unpublished hearing, 109th Cong., 2nd sess., August 2, 2006, available at http://hsgac.senate.gov/_files/
080206Bowen.pdf.)
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dissolution on June 28, 2004, for questions remain about what it did, how it spent money, and
what it accomplished.
While information gleaned from CPA personnel would be potentially useful in the near future, it
also could be useful in the long-term in informing any future efforts to provide aid to countries
faced with similar problems.
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On June 28, 2004, the Coalition Provisional Authority ceased operations and the United States
established diplomatic relations with the Iraqi government.153 Two organizations were established
by National Security Presidential Directive (NSPD) 36, dated May 11, 2004, to carry on some of
the work of the CPA: the Iraq Reconstruction Management Office (IRMO), within the
Department of State; and a Project and Contracting Office (PCO), within DOD.154 IRMO is
responsible for “facilitat[ing] the transition in Iraq.”155 The PCO
manages the $18.4 billion appropriated by the U.S. Congress [P.L. 108-106] to support the
reconstruction of Iraqi infrastructure. This office is responsible for all activities associated
with program, project, asset, construction and financial management of that portion of the
reconstruction effort undertaken by the U.S.156
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In 2004, the Department of State established the Office of the Coordinator for Reconstruction and
Stabilization (S/CRS) pursuant to Section 408 (Division D) of P.L. 108-447, the FY2005
Consolidated Appropriations Act. The office is responsible for, among other things, monitoring
and inventorying the non-military resources and capabilities of executive agencies, monitoring
unstable situations around the world, and planning for response efforts to crises in other countries
or regions.157
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The Coalition Provisional Authority represented a multinational effort to rebuild Iraq, restore
stability, and aid in establishing an interim Iraqi government. While its mission statement was
153
U.S. Mission Iraq, International Press Center, Office of Strategic Communications, “Ambassador Negroponte
Arrives in Baghdad,” news release, June 28, 2004, received by email, June 28, 2004.
154
U.S. President (G.W. Bush), “United States Government Operations in Iraq,” p. 3.
155
Ibid., pp. 2-3.
156
Iraq Project and Contracting Office, “About PCO,” n.d., available from the author.
157
For additional information, see CRS Report RS22031, Peacekeeping and Post-Conflict Capabilities: The State
Department’s Office for Reconstruction and Stabilization, by Nina M. Serafino and Martin A. Weiss.
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fairly clear, other aspects of the authority were more obscure, particularly how it was established,
under what authority, and by whom (within the U.S. government). Available information about
the authority found in materials produced by the Administration alternatively (1) denies that it
was a federal agency; (2) states that it was a U.S. government entity or instrumentality; (3)
suggests that it was enacted under United Nations Security Council Resolution 1483; (4) refers to
it, and OHRA, as “civilian groups ... reporting to the Secretary [of Defense]”;158 (5) states that it
was created by the United States and United Kingdom; and (6) asserts that it was established by
the then-Commander of CENTCOM. Without a clear, unambiguous statement that declares the
CPA’s organizational status, clarifies what its relationship was with DOD and other federal
agencies, and addresses the competing explanations for how it was created, various questions are
left unanswered, including whether, and to what extent, CPA might be held accountable for its
programs, activities, decisions, and expenditures.
158
Sec. 1203 of P.L. 108-136.
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This is the text of the document issued by General Tommy R. Franks on April 16, 2003, to the
Iraqi people. The heading or title of the message is “Freedom to the Iraqi People.”
Peace be upon you. Coalition Forces in Iraq have come as liberators, not as conquerors. We
have come to eliminate an oppressive and aggressive regime that refused to comply with UN
Security Council resolutions requiring the destruction of weapons of mass destruction. The
Coalition is committed to helping the people of Iraq heal their wounds, build their own
representative government, become a free and independent people and regain a respected
place in the world. We will ensure that Iraq’s oil is protected as a national asset of and for the
Iraqi people. Iraq and its property belong to the Iraqi people and the Coalition makes no
claim of ownership by force of arms. Coalition forces respect the Iraqi people, their religious
practices, history and culture, and will safeguard Iraq’s unity and territorial integrity.
We are working with the international community to ensure the delivery of humanitarian
assistance and to promote law and order so that Iraqis can live in security, free from fear. We
are establishing the stability that will allow early progress toward political freedom and
economic prosperity. Our stay in Iraq will be temporary, no longer than it takes to eliminate
the threat posed by Saddam Hussein’s weapons of mass destruction, and to establish stability
and help Iraqis form a functioning government that respects the rule of law and reflects the
will, interests, and rights of the people of Iraq. Meanwhile, it is essential that Iraq have an
authority to protect lives and property, and expedite the delivery of humanitarian assistance
to those who need it. Therefore, I am creating the Coalition Provisional Authority to exercise
powers of government temporarily, and as necessary, especially to provide security, to allow
the delivery of humanitarian aid and to eliminate weapons of mass destruction. To facilitate
these objectives, I proclaim the following:
Members of the armed forces and security organizations shall lay down their arms, stay away
from their weapons, and remain in place. They shall obey the orders of the nearest Coalition
military commander. All other Iraqi should continue their normal daily activities; officials
should report to their places of work until told otherwise. All those engaged in the delivery
of essential services should return to their jobs. The Arab Socialist Renaissance Party of Iraq
(Hizb al-Ba’th al-Arabi al-Ishtiraki al-Iraqi) is hereby disestablished. Property of the Ba’th
Party should be turned over the Coalition Provisional Authority. Saddam Hussein’s
intelligence and security apparatus, the Al-Mukhabarat al-Iraqiyya, is hereby deprived of all
powers and authority. All Iraqis are not free to express their views without fear of
retribution. At an appropriate time, free elections will make Iraqis self-governing in local,
regional, and soon, national affairs. All parties and political groups may participate in Iraq’s
political life, except those who advocate or practice violence. Iraqis must not seek revenge.
There will be a just legal process that will safeguard the honor and dignity of the Iraqi
people. The Coalition Provisional Authority will seek a fair and prompt solution to the
problem of displaced persons and refugees. There will be a legal, organized process to
address restitution of homes that have been seized by the former regime. The Coalition will
work with Iraqis to set up a commission to deal with such claims. I call upon Iraqis to inform
Coalition Forces regarding the location of weapons of mass destruction or related materials,
facilities where such weapons are made, and individuals connected to weapons of mass
destruction. All records concerning these activities should be preserved. Iraqis should not
pass weapons of mass destruction to terrorists or terrorist organizations. I call upon Iraqis to
inform Coalition Forces regarding the location of: foreign fighters and terrorists; members of
the regime’s security apparatus; and individuals who have perpetrated crimes against
humanity or war crimes. All records concerning these activities should be preserved.
Rewards may be provided for especially important information on these matters. All barriers
to free movement of people and goods, including illegal roadblocks and checkpoints, must
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come down. We will work with regional leaders, entities, and governments that are
committed to peace and democracy to integrate them into the Coalitions’ activities. Coalition
Forces are here to ensure safety and security, and to help the people of Iraq create a better
future for their country. We pledge our support to all Iraqis who seek Iraq’s freedom and
prosperity, and the blessings of peace and security.
16 April 2003
General Tommy R. Franks
Commander of Coalition Forces159
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L. Elaine Halchin
Analyst in American National Government
ehalchin@crs.loc.gov, 7-0646
159
General Tommy R. Franks, Commander of Coalition Forces, “Freedom Message to the Iraqi People,” April 16,
2003, available from the author.
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This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.