Helicopter Shortage: State Department Fumbles Effort to Oust Blackwater from Iraq

Your tax dollars at work: as part of their effort to stop doing business in Iraq with companies affiliated with the controversial paramilitary contractor formerly known as Blackwater, the State Department earlier this year hired a rival contractor to fly civilian U.S. personnel around the war-torn country by helicopter. But officials subsequently learned that helicopters the replacement contractor, Dyncorp International, was planning to use for this service didn’t meet government safety standards. So as a result, the Department was forced to extend for several months its air-transport contract with an affiliate of ... the contractor formerly known as Blackwater.

The State Department’s machinations are the latest chapter in the government’s turbulent relationship with companies affiliated with Blackwater, a North Carolina-based paramilitary training, protection, and transport outfit whose name became one of the most toxic words in American politics after a series of incidents in which security officers employed by the firm allegedly killed or injured Iraqi civilians. The incidents, which included eight Iraqis dying on September 16, 2007 after Blackwater employees allegedly fired automatic rifles and threw grenades into a crowd in Baghdad’s Nisoor Square, led to congressional hearings, multiple U.S. investigations of Blackwater personnel, and a declaration by the Iraqi government last March that it was withdrawing the license of Blackwater and its affiliates to do business in Iraq.

Blackwater, which renamed itself Xe Services, has denied corporate wrongdoing and recently won a victory in court: a federal Judge in Alexandria, Va., dismissed on legal grounds a series of wrongful death and injury cases filed by Iraqis against Xe Services, its affiliates, and its owner, Erik Prince. (The judge did invite the plaintiffs to amend their claims.) Despite being declared persona non grata in Iraq,  Xe and its affiliates retain major contracts with U.S. government agencies—including the State Department, and reportedly, the CIA—in other parts of the world such as Afghanistan, say U.S. and private security-industry officials. State Department and industry officials also note that the incidents and investigations were related to the company’s ground-based bodyguard operations in Iraq. The company’s air-transport operations have not been implicated in scandal. 

U.S. officials familiar with the State Department’s dealings with the firm, who asked for anonymity when discussing sensitive information, said that the Iraqi government, in withdrawing the company’s permission to do business, made it clear it wanted all company-related or affiliated operations to clear out of Iraq. This included an air-transport operation run by Presidential Airways, a Blackwater/Xe affiliate, which had been one of the principal means by which civilian U.S. officials traveled around Iraq. Initially, the State Department informed Blackwater/Xe that its air-transport contract in Iraq would end on September 4. To replace Blackwater/Xe, the Department solicited bids. The winning bid, for $915 million, was submitted by Dyncorp, another large paramilitary contractor which already had operations in Iraq.

As part of its winning bid, according to the government and industry officials, Dyncorp promised that it would acquire a fleet of helicopters. Toward the end of the summer, however, State Department officials learned to their dismay that the helicopters acquired by Dyncorp for the Iraq contract didn’t meet “airworthiness” standards set by the federal government. The State Department found itself in a serious dilemma: it had told Blackwater/Xe that it had to get out of Iraq by early September, but the contractor it hired to take over Blackwater/Xe’s air operations had a helicopter fleet that had not been deemed safe enough to perform its mission.
 
One consequence, according to government officials with direct knowledge of the problem, is that the State Department is renegotiating its deal with Dyncorp, who will also have to eat the cost of the fleet of unusable helicopters which it acquired. Another consequence, the officials said, is that the Department had to arrange for the Iraq air-transport contract of the Blackwater/Xe affiliate to be extended for several months—from September to January of next year.

The State Department’s International Narcotics and Law Enforcement Bureau is now diverting a fleet of 14 department-owned Huey helicopters which were acquired for use in drug wars in Latin America and South Asia to Iraq so that when Dyncorp finally takes over from Blackwater/Xe in the New Year, it will have some helicopters to fly. State Department officials acknowledge three of the government-owned Hueys which are being re-assigned to Iraq had been in use by antidrug forces in Colombia. But the officials maintain that due to efforts by the Colombian government to assume more responsibility for fighting traffickers, the three American Hueys had already been scheduled for withdrawal from Colombia, while the other 11 Hueys now earmarked for helping Dyncorp out of its jam were sitting on the ground at an Air Force base inside the United States. Officials also acknowledged, however, that if the department had not had to divert them to Iraq, all the helicopters probably would have been re-assigned to antidrug operations in places such as Afghanistan.

Government officials say that one reason behind the fumbling and maneuvering is that because of the Iraq War, the State Department’s Bureau for Diplomatic Security, once an obscure bureaucratic backwater, found itself running a complex air-transport operation, which it had never done before.

Charlene Lamb, Deputy Assistant Secretary of State for the Diplomatic Security Bureau, told NEWSWEEK in a written statement: “In order to meet our security requirements in country and ensure the safety of our personnel in Iraq, it was necessary to shift the aviation support to an organization that could provide mission-ready aircraft on the timeline required by the embassy.” Mark Corallo, a spokesman for Xe Services, insisted that Presidential Airways, the Blackwater/Xe affiliate which is still performing the Iraq air contract, is a “separate operation with [a] separate management chain of command” from other Xe Services affiliates.

Douglas Ebner, a spokesman for Dyncorp International, confirmed that the company had “reached a mutual agreement to a task order modification” with the State Department, and added that the company planned to use the helicopters that were deemed unsuitable for the Iraq contract for other business it plans to pursue.