by Andrew Walden
Federated States of Micronesia President Peter Christian’s son-in-law Master Halbert is facing trial in Honolulu for accepting bribes from Lyon Associates, a Hawaii-based engineering contractor which was given control of FSM Program Management Unit (PMU) when Christian became President.
Now an email from Lyon Associates co-owner, James Lyon, indicates that Christian’s son, Christopher Ivan Christian, was also offered a “retainer” --$5K per month by Lyon with a plan to increase to $10K. It is not clear whether Christopher Ivan Christian accepted the offer, but many of the PMU-related proposals outlined in Lyon's email did get enacted.
The email, sent March 29, 2015 by Lyon to Christopher Ivan Christian, was provided to Hawai’i Free Press by a US federal source. It has not previously been made public. Christopher Ivan Christian did not reply to a request for comment. His LinkedIn page indicates he was an "administrator" for GMP Hawaii, Inc from 2005-2014. GMP Hawaii owner Wagdy Guirguis was convicted of tax evasion in November, 2018.
The email outlines Lyon Associates' plan to take control of PMU when President Christian takes office six weeks after the date of the email.
The email also points to Lyon’s previous eight years of FSM airport contracting work as “a similar contract structure that has worked so well.…” Lyon points out “Massy has a track record of spending $300M in airport projects over past 8 years.”
“Massy” refers to Master Halbert, son-in-law of then-incoming FSM President Peter Christian. Lyon says Halbert is “the absolute key to this concept moving forward.”
In Lyon’s email, “Mori” refers to former FSM President Manny Mori who termed out of office May 11, 2015 and was replaced by current FSM President Peter Christian. Christian’s first term ends this year and he faces reelection before the FSM Congress. We have also included a 2008 news release from the Mori administration which outlines Mori’s plans for PMU and mentions many of the individuals named in the Lyon email.
“Mao” refers to Lyon employee Mao Peng, who became head of Lyon staff at PMU.
“Westerfield” refers to the previous PMU Chief Contracting Officer under Mori, Robert A Westerfield III.
“Lukner” refers to Lukner B. Weilbacher, FSM Secretary of Transportation, Communications and Infrastructure (TC&I), who, according to the FSM Government website, continues to oversee the Program Management Unit (PMU). Weilbacher has not responded to multiple requests for comment.
Misspellings and hard returns are in the original.
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From: <Jim.Lyon@LYON.US.com>
Date: March 29, 2015 at 8:33:08 PM GMT+11
To: Christopher Ivan Christian
Subject: Country Mechanic
LYON would like to retain your services @ $5k/mo as our mechanic to fix this ckusterfuck Mori created with the Perpetually Mismanaged Unit;
Starting this Wed, April 1.
Please send invoice on who/where to write check to;
funds will be distributed locally monthly.
We support a similar contract structure that has worked so well for the 4 airports over the past 8-years;
One american, couple of Filipinos, & a ton of Pohnpeians running PMU under the direction of the TC&I Secretary.
However, a capacity building contract serves the country better;
So one day, outside firms like LYON will not be necessary.
We want to train 100 Pohnpeians in design, construction management, project management;
& contracts so you can break out of this perceived need of giving all your money to haoles.
50% of the construction Contract sizes will be kept around $50K so local firms can bid;
we can rapid fire designs out of Manila til the cows come home - BUT we want the design done in your country as much as practical in balancing quality & speed.
LYON will maintain a separate (from Mao's office) & fully staffed office in Kolonia;
will fly in Filipinos & Americans as necessary.
Westerfield is a cancer, Bruce Howell is a nice guy but that's about it, & PMU continues to fuck up Weno Road;
they paid Professionally Incompetent Idiot Jerry Kramer $24M & now messing up GPPC's $8M contract by forcing them to use 2-year old cement & crushed coral in the mix.
Kramer's $14M claim against FSM;
Should be fought with every resource possible - would be a humiliating loss to a charlatan like Jerry.
$32M for 4-miles of a simple concrete road;
is a definite world record.
Hopefully the new AG;
will drop this bullshit Dana Smith Weno claim he fucked your country & LYON up with - Hate that asshole.
The key is the TC&I Secretary position;
Massy has a track record of spending $300M in airport projects over past 8 years.
He has the balls & brilliance to make bold decisions;
& he is the absolute key to this concept moving forward.
We propose to lease the second floor starting May 1 @ $3K/mo;
Please remove all the walls and paint each wall surface a different color - yellow, blue, green, orange & "LYON" painted outside in black like the font on the recent shirts we sent.
LYON proposes to retain Lukner to run this office if this PMU contract can be secured;
we will place an American who will work with him.
LYON will set up 10 Autocad stations & train top high school students & College students year round;
Will pay them thru this contract & they will learn on the job about engineering & construction - Lukner the Professor!
We will bring out Filipinos as instructors;
also want to hire Tommy Rehr, who is working with Brian Etcheit now.
We can set up a surveying group as well;
concrete testing, whatever is desired can be accomplished.
Once the PMU contract is up & running;
We propose to increase your monthly retainer to $10K & more as we grow this contract.
$25M/year 'til 2022 will be deposited into the COMPACT account;
there is ~$200M in there now so $300M to be spent.
Currently DOI has the USNavy to do FSM & RMI projects since no confidence in Mori;
hopefully LYON will be selected for these projects but sure makes everything a lot more complicated than it has to be.
LYON would like to target revenue of $5M a year for 8-years;
2/3 of this revenue will be in the form of salaries for Pohnpeans & 1/3 for Americans & Filipinos.
For $5M/year, ~$3M for Pohnpeians;
say $3K/mo x 2.5 markup = $7.5K x 12 months = $90k - means we can hire ~ 35 full time Pohnpeians.
Assuming we pay $2/hr to train high school kids @ 4-hours/day for 5 days = $40 x 2.5 markup = $100/week;
Hiring 100 kids can be achieved for ~$500K/year.
You tell us who to hire;
will have to weed out the B-players & must keep high standards.
Time & materials contract is the absolute best way to go & not a lump sum;
We sell time & can easily hire bodies since all $ are pre-negotiated.
The more we pay our crew;
The more money we ALL make.
Not too many places have $300M to spend;
& you can create all the jobs imaginable with this one contract.
It's time to put money into the pockets;
Of Pohneians.
Jim Lyon, PE, LEED AP, CFM
LYON.US.com
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President Mori discusses reorganization of Compact infrastructure Program Management Unit and is assured that goal to implement $35 million per year in infrastructure development is on track
News Release from Office of the President
Palikir, POHNPEI (FSM Information Service): March 24, 2008 - President Manny Mori has received assurances that the newly restructured FSM Program Management Unit (PMU) is on track in its target to implement at least $35 million per year in Compact Infrastructure Development Program projects over the next four years.
In a briefing called by President Manny Mori and Vice President Alik Alik, PMU Contracting Officer, Mr Robert A. Westerfield III, reported that the PMU has now been relocated to the Office of the President from its previous location in the Department of Transportation, Communications and Infrastructure and is being staffed to meet its new expanded role as principal technical manager of the Compact Infrastructure Development Program (IDP).
The IDP is a prescribed component of the Amended Compact of Free Association between the FSM and the United States. At least 30 percent of the annual Compact grant funds from the US must be spent on approved infrastructure, principally for Education and Health.
Management of the IDP PMU was previously contracted to GMP, Hawaii, Inc. However, in April 2007, the US Government informed the FSM Government that US Compact funds could not be used to fund any additional task orders under the contract between FSM and GMP after May 17, 2007. This action followed a report by the US Department of Interior Office of Inspector General that was critical of the GMP contract on the grounds that it contained conflicts of interest and questionable procurement provisions. There had also been concerns raised by both the FSM and US Government about the pace, quality and cost of IDP implementation. As a result of the US decision the FSM Government could not certify the availability of funds and thus no new work could be undertaken by GMU under the PMU contract. Therefore the FSM Government informed GMP that its contract had expired.
In January, 2008, during the Chief Executive's Conference (CEC), held in Pohnpei, the four state Governors and the President adopted a Resolution to relocate the FSM PMU to the Office of the President for closer supervision.
Mr Westerfield reported that staffing of the reorganized PMU would be completed as soon as the enabling Executive Order is completed. The PMU is expected to eventually have 20 staff, with four persons responsible for overall management to be based in Palikir and four-person teams of field engineers, inspectors and local support staff to be based in each of the four states.
An FSM citizen will be recruited for the top position of PMU Manager, to facilitate coordination with state governments and stakeholders. The other PMU staff members already recruited are Mr. Dana Smith, Special Project Manager for Legal Affairs based in the Palikir office, and Mr. Glen Bagley who has just been recruited as PMU Field Engineer, Yap office. Both were present in the briefing.
President Mori set a target date of June 1, 2008, by which all essential PMU posts at both state and national levels should be filled.
Mr. Westerfield reported that the establishment budget for the FSM PMU is expected to be around $1 million in 2008 but annual operating costs thereafter should be around $600,000 per year. He said this is significantly lower than the cost previously incurred by the FSM Government in its contract with GMP & Associates. Under that arrangement GMP had charged overseas based differentials for professional costs and was paid a percentage of project construction costs for management services.
Mr. Westerfield told the President and Vice President that the FSM PMU will need to address nearly $100 million worth of IDP projects in 2008 due to the slow rate of implementation of the IDP over the past four years. Out of a portfolio of 20 projects approved, pending and identified to date under the IDP, estimated to cost $65.2 million, only four projects, totaling $7,393,000, have yet been fully completed.
He explained that the target IDP project implementation rate of $35 million per year for the next four years had been derived by realistically spreading the backlog of $48 million of un-programmed and un-implemented IDP funds over four years while also staying current in implementing the $23 million in IDF grants that is available each year until the end of the funding under the Amended Compact in 2023.
Mr Westerfield also noted that, in addition to the $80 million portfolio of pending and new IDP projects, the FSM governments are also currently implementing a significant program of infrastructure projects for Airport Improvement Projects funded by the US Federal Aviation Authority, as well as projects funded by the Asian Development Bank under the Basic Social Services Grant and the Omnibus Loan to FSM for improvement of state utility infrastructure.
He told the President that this volume of infrastructure work poses serious challenges for implementation capacity within FSM. Local firms can only handle a portion of the work while the availability and cost of overseas engineering services and contractors is more difficult because of the increased contract work in Guam associated with the US military relocation there and similar IDP and CIP work on-going in the Marshall Islands and Palau.
Mr Westerfield confirmed to President Mori that under the terms of the Amended Compact and the IDP grant requirements, projects funded under the IDP must meet applicable international standards. As a consequence they were sometimes more expensive and difficult to design and construct than previous projects that did not have to meet these standards. However, the higher standards help to ensure that projects are designed and built with sufficient sturdiness, functionality and safety to meet the needs of the future.
President Mori urged the PMU to look more broadly for engineering services and contractors, including to Australia, New Zealand, the South Pacific, Philippines and Asia, in order to ensure that the infrastructure program is not further delayed and competitive prices are achieved.
The President also asked the PMU management to pay attention to local contracting capacity for large projects and to ensure that large foreign contractors comply with the requirement that at least 25 percent of the work be sub-contracted to local firms. Mr Westerfield advised the President that the PMU is looking into options to enable local contractors to meet the bond requirements that contractors must post for projects in excess of $3 million.
President Mori reminded the PMU team that his Administration places very high priority on the full and effective implementation of the Amended Compact. This includes efficient and full implementation of the IDP grants just as much as the utilization of the operating budget sector support grants also available under the Amended Compact.
President Mori said he expected that the PMU could be transferred back to the appropriate line Department once the backlog of projects has been cleared. To that end he urged the PMU to work toward successfully implementing at least $35 million of projects in 2008 and to seek to complete $50 million of project work in 2009.
The President also reminded the PMU team that the successful and full implementation of the IDP is very important to future users and beneficiaries especially as most of these facilities would be for education and health purposes. He pointed out too that implementation of the IDP was also important for the local, State and FSM economy, through the opportunities opened to local suppliers, contractors and employees and the expenditures and revenues generated in the community.
In light of the high public importance and visibility of the Compact IDP, President Mori requested the PMU to regularly disseminate public information on the status of the IDP implementation and to provide timely notification of opportunities for local suppliers and contractors.
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Background:
Documents:
Other Micronesia Corruption:
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