For Some Stimulus Contractors, a Blemished Past

One company paid nearly $1 million for destroying seagrass in the Florida Keys marine sanctuary. Another settled a discrimination case after federal investigators found it refused to hire black employees. A third firm was rebuked by the Army for poorly screening interrogators it hired – interrogators who later abused prisoners at Abu Ghraib.

Despite those problems, the three companies have won millions of dollars in contracts under the economic stimulus package.

In the three months since President Obama signed the $787 billion stimulus bill, the federal government has awarded more than 800 contracts to repair military buildings, thin forests and clean up Cold War nuclear plants. Much of the initial $3.8 billion in awards has gone to large companies with long records of working with the government.

But some contractors have paid hefty fines for breaking environmental, safety or other regulations, an examination of the first round of stimulus contracts shows.

Obama has said the scope of the stimulus demands "unprecedented efforts to root out waste, inefficiency and unnecessary spending." ProPublica plans ongoing coverage as contracts roll out and is recruiting volunteers to join the effort through our ProPublica Reporting Network.

None of the contractors’ past violations were deemed serious enough to disqualify them from future government business. That typically requires a criminal charge, delinquent taxes or an attempt to defraud the government. Outside of that, agencies have discretion to suspend or ban a contractor for "any offense indicating a lack of business integrity."

Government officials, the companies and even some advocacy organizations say past mistakes shouldn’t necessarily tar a contractor forever. But there will soon be thousands of contractors who will receive billions more in taxpayer dollars from the stimulus.

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