KBR wins praise despite disputes

WASHINGTON — The Pentagon has refused to pay $600 million worth of bills submitted by Houston-based KBR for providing logistical support for U.S. troops and is still haggling with the company over another $800 million. But such billing disputes did not keep KBR from receiving high marks for its performance.
William Reed, director of the Defense Contract Audit Agency, told the Senate Armed Services Committee on Thursday that auditors had examined $16.2 billion worth of charges KBR had racked up for building bases, running mess halls and providing a host of other support services for U.S. troops in Iraq, Afghanistan and elsewhere. And after combing through the company's billings, auditors challenged $1.9 billion worth of them.

Eventually, the Pentagon agreed KBR, the largest private contractor working in Iraq, should be reimbursed some $500 million. But Reed said the auditors rejected another $600 million in costs, concluding those billings constituted overcharges or lacked adequate documentation to merit reimbursement. The parties are still negotiating over the remaining $800 million.

KBR spokeswoman Heather Browne said that in "instances where there have been questions raised regarding charges related to our work, we have routinely provided information requested of us and have fully cooperated with the agencies requesting information, recognizing that audits are a routine process of any government-related work."
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