Audit of the Bureau of Overseas Buildings Operations Commissioning of Diplomatic Housing at U.S. Embassy Kabul, Afghanistan

AUD-MERO-19-37
    Report Contents
    Unclassified
    Unclassified


    What OIG Audited
    Beginning in 2010, the Department of State (Department), under the supervision of the Bureau of Overseas Buildings Operations (OBO), has significantly expanded the construction of new facilities at U.S. Embassy Kabul, Afghanistan. These facilities, which cost approximately $791 million, consist of office buildings and staff living quarters, including the construction of Staff Diplomatic Apartment (SDA) buildings. This audit focused on the commissioning of SDA-2 and SDA-3. Commissioning is the systematic process of ensuring that all building systems perform interactively, in accordance with the design documentation and intent, and with the owner’s operational needs.

    The Office of Inspector General (OIG) conducted this audit to determine whether (1) the OBO commissioning of SDA-2 and SDA-3 was done in accordance with all applicable policies and procedures, (2) documentation associated with the commissioning process was maintained in accordance with Department requirements, and (3) Integrated Systems Tests (IST) for both buildings were conducted in accordance with Department guidance.

    What OIG Recommends
    OIG made five recommendations to OBO to improve the commissioning process and strengthen contract administration. On the basis of OBO’s response to a draft of this report, OIG considers all five recommendations resolved, pending further action. A synopsis of OBO’s response to the recommendations offered and OIG’s reply follow each recommendation in the Audit Results section of this report. OBO’s response to a draft of this report is reprinted in Appendix C.

    What OIG Found
    OBO adhered to it policies and procedures in commissioning SDA-2 and SDA-3 because of the latitude it has in deciding when buildings can be declared substantially complete, which is required before occupancy. This latitude allowed OBO to accommodate the U.S. Ambassador to Afghanistan’s January 2019 request that OBO expedite occupancy because of security threats. As a result, substantial completion was declared and occupancy allowed even though commissioning of 8 of 22 building systems was not complete. OIG concluded that if OBO had managed SDA-2 and SDA-3 to its earlier contract completion date of May 2018 rather than as a single project with one completion date for the entire Embassy Kabul project, which consisted of the construction of multiple buildings over the span of almost 10 years, SDA-2 and SDA-3 could have been fully commissioned prior to occupancy. This is important because occupying buildings before commissioning is complete increases the risk that deficiencies in building construction and systems may not be identified before warranties expire.

    OIG also reviewed commissioning documentation and found that most, but not all, construction and commissioning agent contract requirements were fulfilled. This occurred, in part, because the Contracting Officer’s Representative acted outside his authority and instructed the contractor that delivery of some documents was not required.

    Finally, OIG found that ISTs were not conducted for SDA-2 or SDA-3 in accordance with OBO’s Construction Alerts. The purpose of this test is to verify that building systems function reliably following a power outage. OBO made this test mandatory in 2015 for all future construction contracts; however, the construction contract for Embassy Kabul began in 2010. Accordingly, the test was not contractually required, and OBO did not modify the contract to include it.

    Recommendation Number
    1
    Closed Implemented

    OIG recommends that the Bureau of Overseas Buildings Operations, in conjunction with the Bureau of Administration, Office of Acquisitions Management, develop and implement a policy stating that construction contract solicitations and the terms and conditions of the awarded contract require only the delivery of documents needed to support the purpose of the contract and the commissioning process.

    Recommendation Number
    2
    Closed Implemented

    OIG recommends that the Bureau of Overseas Buildings Operations, in conjunction with the Bureau of Administration, Office of Acquisitions Management, assess the required frequency of commissioning agent contract deliverables to determine whether an adjustment to the frequency is needed and, if so, revise the commissioning agent's scope of work.

    Recommendation Number
    3
    Closed Implemented

    OIG recommends that the Bureau of Overseas Buildings Operations update all commissioning plans to reflect the modifications made to construction contracts as a result of implementing the recommendations pertaining to the delivery of documents needed to support the purpose of the contract and the commissioning process and the frequency of the contract deliverables (Recommendations 1 and 2).

    Recommendation Number
    4
    Closed Implemented

    OIG recommends that the Bureau of Overseas Buildings Operations develop and implement tailored terms and conditions for construction contracts involving multiple buildings requiring necessary documents and deliverables, such as Operations and Maintenance manuals, to be provided for each individual facility at Substantial Completion, Beneficial Occupancy, and building turnover.

    Recommendation Number
    5
    Closed Implemented

    OIG recommends that the Bureau of Overseas Buildings Operations (OBO) review all active construction contracts that were awarded prior to the 2015 and 2016 Construction Alerts to determine whether they have been modified to require Integrated Systems Tests. If not, OBO should ensure that the contracts are modified to include them.