HAITI 

RECONSTRUCTION

USAID Infrastructure 

Projects Have Had 

Mixed Results and 

Face Sustainability 

Challenges

Report to Congressional Requesters

June 2013

GAO-13-558

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-13-558, a report to

congressional requesters

June 2013

HAITI RECONSTRUCTION

USAID Infrastructure Projects Have Had Mixed 

Results and Face Sustainability Challenges

Why GAO Did This Study

On January 12, 2010, an earthquake in

Haiti caused about 230,000 deaths, 

resulted in 300,000 injuries, and 

displaced about 2 million persons. 

Following immediate relief efforts, 

Congress provided $1.14 billion for 

reconstruction in the Supplemental 

Appropriations Act, 2010. USAID is 

responsible for implementing $651 

million of this amount, and it has 

allocated about $268 million of this and 

other funding to construct a power 

plant and port to support the CIP in 

northern Haiti and permanent housing 

in several locations. The Act required 

State to report periodically to Congress 

on funding obligated and disbursed 

and program outputs and outcomes. 

GAO was asked to review USAID’s 

efforts in Haiti. This report examines 

USAID’s (1) funding obligations and 

disbursements and State’s reports to 

Congress on funding and progress; (2) 

USAID’s progress in two CIP-related 

activities—a power plant and port; and 

(3) USAID’s progress in constructing 

permanent housing. GAO reviewed 

documents and interviewed U.S. 

officials in Washington, D.C., and Haiti, 

and visited planned and active sites.

What GAO Recommends

Congress should consider requiring 

State to provide it with periodic reports 

on reconstruction progress, funding, 

and schedules until most funding for 

each program sector has been 

disbursed. Also, GAO is 

recommending USAID (1) hire a port 

engineer to oversee port planning and 

construction and (2) provide timely 

community support mechanisms for 

each new settlement to help ensure 

sustainability of its permanent housing 

program. USAID agreed with GAO’s

recommendations. 

What GAO Found

As of March 31, 2013, the U.S. Agency for International Development (USAID) 

had obligated $293 million (45 percent) and disbursed $204 million (31 percent) 

of $651 million in funding for Haiti from the Supplemental Appropriations Act, 

2010 (the Act). The Department of State (State) submitted four of five periodic 

reports to Congress, as required by the Act. The reports included information on 

funding obligated and disbursed and anecdotal information on outputs and 

outcomes of some activities, as the Act required. The Senate Appropriations 

Committee, in its Committee Report accompanying the Act, had also directed 

State to report more detailed information on funding and sector activities in Haiti, 

which State did not include in the reports. Although most funds have not been 

disbursed, State’s reporting requirement ended in September 2012. As a result, 

Congress lacks information on the amounts of funds obligated and disbursed and 

program-by-program progress of U.S. reconstruction activities.

USAID has allocated $170.3 million to construct a power plant and port to 

support the newly developed Caracol Industrial Park (CIP), with mixed results. 

According to USAID documents and external studies, the sustainability of the 

CIP, power plant, and port are interdependent; each must be completed and 

remain viable for the others to succeed. USAID completed the power plant’s first 

phase with less funding than allocated and in time to supply power to the first CIP 

tenant. Port construction will not begin until at least 2 years later than originally 

planned due in part to a lack of USAID expertise in port planning in Haiti. In 

January 2011, the mission made an unsuccessful attempt to solicit a person to fill 

a vacant port engineer position but made no additional attempts prior to May 

2013 and this position currently remains unfilled. As a result, planning has been 

hindered by (1) unrealistic initial timeframes, (2) delays in awarding the contract 

for a feasibility study, and (3) incomplete information in the feasibility study. 

According to initial estimates of port construction costs, USAID funding will be 

insufficient to cover a majority of projected costs. The estimated gap of $117

million to $189 million is larger than initially estimated, and it is unclear whether 

the Haitian government will be able to find a private sector company willing to 

finance the remainder of the project.

USAID has reduced its permanent housing construction targets in Haiti. USAID

initially underestimated the funding needed for its New Settlements housing 

program. As a result, the agency increased the amount allocated by 65 percent, 

from $59 million to $97 million, and decreased the projected number of houses to 

be built by over 80 percent, from 15,000 to 2,649. The estimated number of 

beneficiaries was reduced from 75,000 to 90,000 to its current estimates of 

approximately 13,200 to 15,900. Cost increases resulted from inaccurate original 

estimates that used inappropriate cost comparisons and from the Haitian 

government’s request for larger houses with improvements such as flush toilets. 

USAID currently estimates construction will be completed almost 2 years later 

than initially scheduled. Delays occurred due to the difficulties of securing land 

titles and coordination issues with partner donors. USAID is attempting to 

mitigate potential sustainability risks, such as the possible lack of economic 

opportunities, affordability of housing and services, and community cohesion, but 

gaps in the support of community development mechanisms may increase these 

risks.

View GAO-13-558. For more information, 

contact David Gootnick at (202) 512-3149 or 

gootnickd@gao.gov.
Page i GAO-13-558 Haiti Reconstruction

Letter 1 

Background 3

Most of USAID’s 2010 Supplemental Funds Have Not Been 

Obligated or Disbursed, and State’s Reports to Congress 

Generally Met Requirements but Were Incomplete and Not 

Timely 8

USAID Completed the Power Plant for Less Than Allocated but the 

Port Was Delayed; Their Sustainability Depends on the CIP’s 

Success 11

USAID’s Development of New Housing Settlements in Haiti Has 

Been More Costly and Slower Than Expected; Sustainability 

Challenges Remain 25

Conclusions 37

Matter for Congressional Consideration 39

Recommendations for Executive Action 39

Agency Comments and Our Evaluation 39

Appendix I Scope and Methodology 41

Appendix II Comments from the U.S. Agency for International 

Development 46

Appendix III GAO Contact and Staff Acknowledgments 49

Tables

Table 1: Fiscal Year 2010 Supplemental Funding for PostEarthquake Reconstruction in Haiti, as of March 31, 2013 4

Table 2: USAID Sector Activities and Amounts of Supplemental 

Funding Allocated, Obligated, and Disbursed, as of March 

31, 2013 9

Table 3: Total USAID Funding Allocated, Obligated, and Disbursed 

for Components of the CIP Power Plant, as of March 31, 

2013 15

Contents 
Page ii GAO-13-558 Haiti Reconstruction

Table 4: Total USAID Funding Allocated, Obligated, and Disbursed 

for Components of a New Northern Port in Haiti, as of 

March 31, 2013 19

Table 5: Total USAID Funding Allocated, Obligated, and Disbursed 

for Permanent Housing Activities, as of March 31, 2013 29

Figures

Figure 1: Development Corridors and Selected Sites Targeted by 

the U.S. Post-Earthquake Assistance 6

Figure 2: Caracol Industrial Park under Construction, Haiti, 

January 2013 14

Figure 3: USAID-Funded Power Plant at the Caracol Industrial 

Park, Haiti, December 2012 16

Figure 4: Map of Ports in Haiti and Dominican Republic for 

Potential Use by CIP Tenants 23

Figure 5: USAID Cost Estimates for Preparation of One Plot and 

Construction of One House in Haiti 26

Figure 6: Permanent Houses to Be Constructed on USAID Plots in 

Haiti, 2011 and 2013 Projections, as of April 2013 30

Figure 7: Number of Houses and New Settlement Locations 

Planned in Haiti, as of April 2013 31

Figure 8: Unoccupied Permanent Houses, Water Distribution 

Towers, and Sewage System Trenches in Caracol-EKAM, 

Haiti, December 2012 32
Page iii GAO-13-558 Haiti Reconstruction

Abbreviations

the Act Supplemental Appropriations Act, 2010

AAD Activity Approval Document

CIP Caracol Industrial Park

DLA Government of Haiti Decreed Land Area

EPA U.S. Environmental Protection Agency

IDB Inter-American Development Bank

the mission U.S. Agency for International Development mission in Haiti

NGO nongovernmental organization

NOAA National Oceanic and Atmospheric Administration

Red Cross American Red Cross

Sae-A Sae-A Trading Co. Ltd.

State Department of State

UN United Nations

USACE U.S. Army Corps of Engineers

USAID U.S. Agency for International Development

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Page 1 GAO-13-558 Haiti Reconstruction

441 G St. N.W.

Washington, DC 20548

June 18, 2013

The Honorable Eliot Engel

Ranking Member

Committee on Foreign Affairs

House of Representatives

The Honorable Ileana Ros-Lehtinen

House of Representatives

On January 12, 2010, an earthquake centered near Port-au-Prince, Haiti, 

caused physical, social, and economic devastation to the poorest country 

in the Western hemisphere. The earthquake is estimated to have caused 

approximately 230,000 deaths, resulted in 300,000 injuries, and displaced 

approximately 2 million people from their homes. According to the United 

Nations (UN), the earthquake killed more than 16,000 of Haiti’s civil 

service employees and destroyed almost all ministry buildings. The World 

Bank reported that the earthquake caused $7.8 billion in damage (about 

120 percent of Haiti’s 2009 gross domestic product). Following the 

earthquake, the country received unprecedented pledges of support from

around the globe. The UN Office of the Special Envoy for Haiti reported in 

December 2012 that, to help Haiti recover from the earthquake, bilateral 

and multilateral donors, including the United States, have allocated $13.3 

billion and so far disbursed $6.4 billion. Individuals, private firms, and 

others gave an additional $3.1 billion in private donations.

In July 2010, the U.S. Congress passed the Supplemental Appropriations 

Act, 2010 (the Act),1 which provided more than $1.14 billion in 

reconstruction funds for Haiti, $651 million of which was provided to the 

U.S. Agency for International Development (USAID) for bilateral 

 

1

Supplemental Appropriations Act, 2010, Pub. L. No. 111-212, 124 Stat. 2302, 2323 (July 

29, 2010). In the Act, Congress also made funds available to GAO to monitor U.S. postearthquake assistance to Haiti. In response, in May 2011, we issued a report 

(GAO-11-415) that described planning efforts and oversight structures. In November 

2011, we issued a report (GAO-12-68) that addressed USAID’s progress, staffing, 

continued planning, and sustainability challenges facing its activities. See GAO, Haiti 

Reconstruction: U.S. Efforts Have Begun, Expanded Oversight Still to Be Implemented, 

GAO-11-415 (Washington, D.C.: May 19, 2011); and Haiti Reconstruction: Factors 

Contributing to Delays in USAID Infrastructure Construction, GAO-12-68 (Washington, 

D.C.: Nov. 16, 2011). 

 
 

Page 2 GAO-13-558 Haiti Reconstruction

reconstruction activities. The Act required the Department of State (State) 

to provide periodic reports to Congress on funding obligated and 

disbursed and program outputs and outcomes. USAID has allocated 

approximately 40 percent of its supplemental funding,2 as well as other 

funds, to support the construction of (1) a power plant that will provide 

electricity for the new Caracol Industrial Park (CIP) in northern Haiti near 

Cap-Haïtien; (2) a new port along Haiti’s northern coast near the CIP; and 

(3) permanent housing in new settlements in the Port-au-Prince, St-Marc, 

and Cap-Haïtien areas.

You asked us3 to examine U.S. reconstruction efforts in Haiti. This report 

addresses (1) USAID’s progress in obligating and disbursing program 

allocations and State’s periodic reporting to Congress on the status of the 

U.S. reconstruction efforts; (2) USAID’s progress in planning and 

constructing the CIP-related power plant and port; and (3) USAID’s 

progress in planning and constructing permanent housing.

To address these objectives, we reviewed reports, documents, and 

funding data and interviewed officials from USAID and State in 

Washington, D.C., and Haiti. To assess the reliability of funding data, we 

examined USAID and State data sources and conducted interviews with 

cognizant officials from USAID and State.4 We determined that the data 

we used were sufficiently reliable for our purpose of reviewing U.S. 

funding provided for Haiti reconstruction. In Haiti, we visited sites under 

construction or planned for construction for the power plant, port, and 

permanent housing, and visited the CIP. To address the sustainability of 

these projects, we used the Organisation for Economic Co-operation and 

Development’s definition of sustainability—”the continuation of benefits 

from a development intervention after major development assistance has 

been completed.” We operationalized this definition by specifying that 

sustainability is the ability of the Haitian government and individuals to 

 

2

The source of the Act’s funding allocated to USAID is the Economic Support Fund 

account.

3

We performed this review in response to a June 2012 request from Representative 

Ileana Ros-Lehtinen and Representative Howard Berman, Chairman and Ranking 

Member of the House Foreign Affairs Committee for the 112th Congress. In February 

2013, the committee’s Ranking Member for the 113th Congress, Representative Eliot 

Engel, signed on as a co-requester.

4

See appendix I for more information about how we assessed data reliability and our 

overall scope and methodology.
 

Page 3 GAO-13-558 Haiti Reconstruction

operate and maintain the new infrastructure in such a condition as to 

produce the projected benefits.

We conducted this performance audit from August 2012 through June 

2013 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.

More than 75 percent of Haiti’s population lives on less than $2 a day, 

and Haiti’s unemployment rate is estimated at 60 to 70 percent. These 

conditions were exacerbated when a large earthquake devastated parts 

of the country, including the capital, on January 12, 2010. Since the 

earthquake, Haiti has suffered from a cholera epidemic that, as of March 

2013, had affected almost 650,000 persons and caused over 8,000 

deaths. In March 2013, the International Organization for Migration 

estimated that, of the original 2 million persons affected, about 320,000 

individuals remained displaced in camps from the earthquake.

In response to the earthquake, Congress provided more than $1.14 billion 

in reconstruction funds for Haiti in the Fiscal Year 2010 Supplemental 

Appropriations Act. Of this amount, USAID received $651 million through 

the Economic Support Fund for its bilateral reconstruction activities, as 

shown in table 1.

Background 
 

Page 4 GAO-13-558 Haiti Reconstruction

Table 1: Fiscal Year 2010 Supplemental Funding for Post-Earthquake 

Reconstruction in Haiti, as of March 31, 2013

Dollars in millions

Recipient Reconstruction amount

State and USAID

State

USAID 

Bilateral Reconstruction Activities

Transferred to Haiti Reconstruction Funda

Transferred to Smithsonian Institution

$917.7

144.7

773.0

651.0

120.0

2.0

Treasury 219.8

USAID Inspector General 4.5

Total $1,142.0

Source: USAID and the 2010 Supplemental Appropriations Act (Pub. L. No. 111-212).

Notes: In November 2011, we reported that USAID and State were allocated $917.7 in supplemental 

funding, including $770 million to USAID and $147.7 million to State (see GAO-12-68). State’s current 

amount of $144.7 million is $3 million less and USAID’s current amount is $3 million more because 

State transferred $3 million to USAID for bilateral reconstruction activities.

a

The Haiti Reconstruction Fund is a multidonor trust fund organized to help finance high-priority postearthquake reconstruction projects.

The Act required State to provide periodic reports to Congress on the 

program. Specifically, the Act required State to submit five reports to the 

Senate Committee on Appropriations, beginning in October 2010 and 

every 180 days thereafter until September 2012, on funding obligations 

and disbursements and program outputs and outcomes. In addition, the 

Senate Committee on Appropriations, in its Committee Report 

accompanying the Act,5 directed that State’s reports include, among other 

things, (1) a detailed program-by-program description of USAID’s 

activities; (2) a description, by goal and objective, and an assessment of 

the progress of U.S. programs; and (3) amounts of funding obligated and 

expended on the programs during the preceding 6 months.

In our November 2011 report on Haiti reconstruction,6 we reported that 

USAID had difficulties securing staff—particularly technical staff such as 

 

5

See S. Rep. 111-188, Senate Committee on Appropriations, Making Emergency 

Supplemental Appropriations for Disaster Relief and Summer Jobs for the Fiscal Year 

ending September 30, 2010, and for Other Purposes, May 14, 2010. 

6

GAO-12-68. 
 

Page 5 GAO-13-558 Haiti Reconstruction

contracting officers and engineers—who were willing to live and work in 

the country after the earthquake and who could bring the expertise 

necessary to plan and execute large, complex infrastructure projects. We 

also reported that such difficulties had contributed to delays in U.S. 

efforts. As of December 2012, the USAID mission in Haiti (the mission) 

had increased its direct-hire staff positions filled from 7 of 17 (41 percent) 

soon after the earthquake to 29 of 36 (81 percent) positions filled.

The overall 5-year U.S. reconstruction strategy for Haiti, known as the 

Post-Earthquake USG Haiti Strategy: Toward Renewal and Economic 

Opportunity, is consistent with the government of Haiti’s development 

priorities in that it seeks, among other goals, to encourage reconstruction 

and long-term economic development in several regions of the country. 

These areas, known as “development corridors,” include the Cap-Haïtien 

region on Haiti’s northern coast and the St-Marc region on Haiti’s western 

coast; these areas were not close to the earthquake epicenter but were 

where some people from Port-au-Prince were displaced after the 

earthquake. The strategy notes that 65 percent of Haiti’s economic 

activity was located in greater Port-au-Prince and that the U.S. 

government’s intent is to support new economic opportunities in other 

development corridors, in addition to assisting with reconstruction in the 

Port-au-Prince corridor, which suffered the most damage from the 

earthquake (see fig. 1).
 

Page 6 GAO-13-558 Haiti Reconstruction

Figure 1: Development Corridors and Selected Sites Targeted by the U.S. Post-Earthquake Assistance

Note: The selected sites in this map include the three USAID bilateral activities we focus on in this 

report: CIP power plant, port, and permanent housing.

On January 11, 2011, the U.S. government, the government of Haiti, the 

Inter-American Development Bank (IDB), and a private South Korean 

garment manufacturer, Sae-A Trading Co. Ltd. (Sae-A), signed an 
 

Page 7 GAO-13-558 Haiti Reconstruction

agreement to support development of the CIP that included the following 

commitments:

• the IDB committed to provide funding to the Haitian government to 

build the CIP and some associated facilities;

• the U.S. government committed to build a power plant, contribute 

toward the building of a nearby port, and support the construction of 

5,000 nearby housing units with associated site infrastructure; and

• Sae-A committed to be the anchor tenant and hire 20,000 local 

employees at the CIP.

In concert with its economic growth efforts, USAID, in coordination with 

State’s Office of the Haiti Special Coordinator in Washington, D.C., 

developed the New Settlements program to address the severe postearthquake permanent housing shortage in Haiti. USAID’s goal was to 

construct up to 15,000 new permanent houses on previously 

undeveloped sites in three designated development corridors—10,000 in 

Port-au-Prince and St-Marc, and 5,000 in Cap-Haïtien. In part, USAID’s 

program aimed to support the Haitian government’s goal of decentralizing 

economic growth outside Port-au-Prince by increasing the housing stock 

in communities near the industrial park planned for northern Haiti. USAID 

planned to provide funding for the preparation of all the settlement sites, 

to include activities such as grading the land and providing proper 

drainage, access roads, pedestrian pathways, and infrastructure for 

delivery of utility services. Each new settlement site would include a 

certain number of plots on which USAID or a partner nongovernmental 

organization (NGO) would then construct a house. Of the 15,000 plots it 

planned to develop, USAID planned to build 4,000 houses, while NGOs 

and other donor partners would build 11,000 houses. USAID estimated 

that, when completed, about 75,000 to 90,000 people would benefit.
 

Page 8 GAO-13-558 Haiti Reconstruction

As of March 31, 2013, the majority of supplemental funding for USAID’s 

program sector activities had not been obligated7 or disbursed.8 The 

Department of State submitted four of five reports to Congress, as 

required in the Supplemental Appropriations Act of 2010, but did not 

submit them in a timely manner. State did not include some information 

that the Senate Committee on Appropriations had directed State to 

include in the report on funding, program sector activities, and progress 

toward achieving the goals and objectives of the program. All reporting 

requirements have now ended.

As of March 31, 2013, 31 percent of the supplemental funding provided 

for Haiti reconstruction efforts had been disbursed. Of the $651 million in 

funding from the 2010 Supplemental Appropriations Act that USAID has 

allocated for bilateral earthquake reconstruction activities, USAID had 

obligated about $293 million (45 percent) and disbursed about $204 

million (31 percent). The amount of funds obligated and disbursed varies 

among activities in the six sectors of activities to which supplemental 

funds were allocated. For example, the majority of funding obligated to 

date has been obligated in just two sectors (shelter and governance and 

rule of law), as shown in table 2.

 

7

An obligation is a definite commitment that creates a legal liability of the U.S. government 

for the payment of goods and services ordered or received. See GAO, A Glossary of 

Terms Used in the Federal Budget Process, GAO-05-734SP (Washington, D.C.: 

September 2005). This report defines obligations as the total amount of orders placed, 

contracts awarded, services received, and similar transactions during a given period that 

will require payments during the same or future period. USAID labels these actions 

“subobligations.” In State’s reports to Congress on Haiti funding, for USAID-managed 

accounts, funds listed as “total obligations” or “obligated” refer to these subobligations. 

Nonetheless, consistent with 31 U.S.C. §1501, which defines when an agency can record 

an obligation, USAID generally treats as an obligation the bilateral agreements it makes 

with other countries to deliver assistance.

8

According to USAID, supplemental funds provided for Haiti post-earthquake recovery 

were scheduled to be disbursed over the course of the 5-year period beginning with the

January 3, 2011, issuance of the Post-Earthquake USG Haiti Strategy. 

Most of USAID’s 2010 

Supplemental Funds 

Have Not Been 

Obligated or 

Disbursed, and State’s 

Reports to Congress 

Generally Met 

Requirements but 

Were Incomplete and 

Not Timely

The Majority of 

Supplemental Funding Has 

Not Been Obligated and 

Disbursed
 

Page 9 GAO-13-558 Haiti Reconstruction

Table 2: USAID Sector Activities and Amounts of Supplemental Funding Allocated, Obligated, and Disbursed, as of March 31, 

2013

Dollars in millions

Sector of USAID Activity Allocated

Total

obligationsa Percentage 

obligated Disbursements

Percentage 

disbursed

Shelterb $83.1 $47.4 57 $30.6 37

Energyb 135.1 41.1 30 32.8 24

Ports and transportationb 84.2 4.3 5 3.9 5 

Food security 82.5 29.6 36 24.7 30

Health and disabilities 99.4 38.1 38 17.7 18

Governance and rule of law 120.4 95.4 79 64.8 54

Operating and other expensesc 46.2 37.2 81 29.4 64

Total $651.0d $293.0d 45 $204.0d 31

Source: USAID.

a

An obligation is a definite commitment that creates a legal liability of the U.S. government for the 

payment of goods and services ordered or received. See GAO, A Glossary of Terms Used in the 

Federal Budget Process, GAO-05-734SP (Washington, D.C.: September 2005). This report defines 

obligations as the total amount of orders placed, contracts awarded, services received, and similar 

transactions during a given period that will require payments during the same or a future period. 

USAID labels these actions “subobligations.” In States reports to Congress on Haiti funding, for 

USAID-managed accounts, funds listed as “total obligations” or “obligated” refer to these 

subobligations. Nonetheless, consistent with 31 U.S.C. § 1501 defining when an agency can record 

an obligation, USAID generally treats as an obligation the bilateral agreements it makes with other 

countries to deliver assistance.

b

Amounts of funding for the shelter, energy, and ports and transportation sectors include all fiscal 

year 2010 supplemental funding for those sectors. Amounts of funding for the New Settlements 

Program, the CIP power plant, and a new port, which we discuss later in this report, are subsets of 

the funding amounts in each of these sectors.

c

Operating and other expenses apply to all sectors; they are not a specific sector of USAID activity.

d

Amounts of sector activities do not add to the total amounts allocated, obligated, and disbursed due 

to rounding.

In its periodic reports to Congress, State reported on the general amounts 

of supplemental funding obligated and disbursed, as required in the Act. 

State also included some anecdotal information on program outputs and 

outcomes, which the Act also required. For example, the report submitted 

by State in January 2013 noted that work had begun to rehabilitate 

damaged irrigation systems and that reconstruction of earthquakedamaged health infrastructure was underway. However, State’s reports 

did not include, among other things, (1) a detailed program-by-program 

description of USAID’s activities; (2) a description, by goal and objective, 

and an assessment of the progress of U.S. programs; and (3) amounts of 

funding obligated and disbursed on the programs during the preceding 6 

months, as directed by the Senate Committee on Appropriations in its 

State’s Reports Generally 

Met the Requirements of 

the Act but Did Not 

Include Detailed 

Information as Directed by 

the Senate Committee on 

Appropriations 
 

Page 10 GAO-13-558 Haiti Reconstruction

report accompanying the Act.9 For example, none of State’s reports 

included a program-by-program description of USAID’s sector activities, 

such as shelter and energy, or an assessment of sector progress. In 

particular, State’s final report, submitted to Congress in January 2013, did 

not mention that USAID had substantially reduced the number of 

permanent shelters it had planned to construct. Further, State’s January 

2013 report did not mention that USAID had not generated any outputs or 

outcomes for the port construction project, even though the report did 

mention that USAID had experienced significant delays in planning the 

project, including a feasibility study that was initially scheduled to be 

completed 7 months earlier in May 2012. Finally, while State’s reports 

included overall cumulative amounts of funding obligated and disbursed, 

they did not provide such information for specific programs during the 

preceding 6 months. State’s inclusion of such information, as well as 

sector-specific funding information directed by the Senate committee, 

could have been useful in informing Congress of USAID’s progress.

State submitted four of the five required reports to Congress on the status 

of U.S. efforts in Haiti, but none of the submitted reports was delivered in 

a timely manner. The Act required State to submit the five periodic reports 

beginning in October 2010 and approximately every 6 months thereafter 

until September 2012. State did not submit the first report, required in 

October 2010, because, according to State officials, the supplemental 

funds had just been received, there was little to no activity to report, and 

the Post-Earthquake USG Haiti Strategy had not yet been approved.10

State submitted its initial report in July 2011—more than 2 months after 

its April 29, 2011, due date for the second required report—included 

funding and activities through March 31, 2011. The three subsequent 

reports were submitted in January 2012, June 2012, and January 2013. 

The submission dates for all four reports ranged from more than 1 month 

to nearly 4 months late. In addition to the late submission of the reports, 

the “as of” date of funding data presented in the reports was not timely. 

For example, the report submitted in January 2013 included funding data 

as of September 30, 2012—nearly 4 months earlier than the date the 

 

9

S. Rep. 111-188, Senate Committee on Appropriations, Making Emergency 

Supplemental Appropriations for Disaster Relief and Summer Jobs for the Fiscal Year 

ending September 30, 2010, and for Other Purposes, May 14, 2010. 

10The strategy was approved on January 3, 2011.

State Prepared Four of 

Five Required Reports to 

Congress but Did Not 

Submit Them in a Timely 

Manner
 

Page 11 GAO-13-558 Haiti Reconstruction

report was submitted. All reporting requirements under the Act have 

ended.

We discussed the reports with State officials, who noted that State and 

USAID routinely provide funding and progress information to Congress 

through other reporting mechanisms. For example, State and USAID 

arrange oral briefings and periodic conference calls with congressional 

staff about every 2 months, and other meetings as requested by 

members of Congress. State officials emphasized that they considered 

the reports to Congress to be only one tool in its range of reporting 

mechanisms.

USAID has committed $170.3 million to construct a power plant and port 

to support the newly developed CIP, with mixed results to date. In June 

2012, the USAID mission completed the first phase of the CIP power 

plant for $17.0 million, 11 percent less than the $19.1 million allocated, 

and in time to supply the first CIP tenant with power. Planning for the port 

is behind schedule and will result in port construction beginning at least 2 

years later than initially planned. The mission has had a vacant port 

engineer position for more than 2 years, having made one unsuccessful 

attempt to fill this position prior to May 2013 when it issued a second 

solicitation to fill the position. As of June 2013, this position remains 

unfilled. The lack of port expertise at the mission has contributed to (1) 

unrealistic initial time frames, (2) delays in awarding the contract for a 

feasibility study, and (3) incomplete information in the feasibility study. 

According to initial estimates of port construction costs, USAID funding 

will be insufficient to cover approximately $117 million to $189 million of 

projected costs, and it is unclear whether the Haitian government will be 

able to find a private sector company willing to finance the remainder of 

the project. Sustainability of the port and power plant depend on the 

viability of the industrial park, which will generate a substantial portion of 

the revenue for both facilities, as well as other factors such as the 

government of Haiti’s capacity to manage or oversee these investments.

USAID Completed the 

Power Plant for Less 

Than Allocated but 

the Port Was Delayed; 

Their Sustainability 

Depends on the CIP’s 

Success 
 

Page 12 GAO-13-558 Haiti Reconstruction

The U.S. government supports a public-private partnership to develop the 

CIP in northern Haiti with $170.3 million in funding allocations to projects 

related to a nearby power plant ($97.9 million) and port ($72.4 million).11

According to State officials, the U.S. government’s decision to provide 

funding for the power plant and port was bolstered by review of an 

economic impact study of the CIP commissioned by the IDB and State’s 

own calculations.12 State officials acknowledge that the limited availability 

of credible data for Haiti can introduce significant margins of error into 

assessments of the CIP’s impact on the region’s net employment or 

income. Therefore, such estimates are subject to considerable 

uncertainty. The findings from the IDB study and State’s calculations 

included the following:

• The IDB-commissioned study estimated that the CIP would increase 

total employment by about 75,000 jobs, including 37,000 permanent 

jobs at the CIP, and generate $360 million in annual income, including 

approximately $150 million to CIP employees, most of whom are 

projected to receive the minimum wage.13

• State officials calculated that the CIP will create up to 65,000 jobs on 

site by using an estimate of the average number of square meters per 

factory worker observed in light manufacturing facilities worldwide.14

This simple calculation assumes that all available factory space in the 

CIP would be filled and that the tenants would be from those same 

types of industries.

 

11Public-private partnerships are contractual arrangements between public entities from 

any level of government with private companies. Establishing public-private partnerships 

is one of the goals of USAID Forward, USAID’s current reform agenda. USAID uses these 

partnerships to leverage the resources and expertise of the private sector.

12The IDB commissioned additional economic impact, environmental, and social 

assessments of the CIP after signing the framework agreement, including both before and 

after construction of the CIP began. According to State officials, it was more cost effective 

for the IDB to commission intensive studies of the CIP after due diligence was performed 

on the anchor tenant and an agreement was signed, to avoid the possibility of investing 

larger amounts of funding in a project that would not move forward without private sector 

interest.

13See KOIOS Associates, Development of the Industrial Park Model to Improve Trade 

Opportunities for Haiti (Acton, MA: Sep. 20, 2010).

14State used this calculation to develop its projection that the CIP would create “up to 

65,000 direct jobs,” which it has used in its public announcements about the U.S. 

government’s support of the CIP. State officials have noted that they also expect 

additional jobs to be created in the area surrounding the CIP that are not included in this 

projection, such as jobs selling food and wares to CIP employees. 

U.S. Government Supports 

Power Plant and Port on 

the Basis of Some Analysis 

of CIP’s Impact
 

Page 13 GAO-13-558 Haiti Reconstruction

However, these estimates may overstate the impact on total employment 

and income in Haiti because they do not account for the possibility that 

people employed in CIP-related jobs might otherwise be employed in the 

formal or informal sector in absence of the CIP.15

The IDB’s progress in building the CIP and filling it with tenants is still 

ongoing (see fig. 2). Sae-A moved in to the first CIP building in March 

2012. By December 2012, it had shipped its first container of clothes to 

the United States and, by January 2013, was employing approximately 

1,300 Haitian employees from the surrounding communities. Two other 

companies, a paint manufacturer and a textile manufacturer, have also 

moved into the CIP. According to the State Senior Advisor for the CIP, 

these three tenants project they will together create approximately 21,000 

jobs in the CIP by 2016. As of May 2013, according to State officials, the 

government of Haiti was progressing in talks with four other potential 

tenants.

 

15According to the International Labour Organization, the informal sector comprises smallscale, self-employment activities by households for which no complete sets of accounts 

(including balance sheets of assets and liabilities) are available, making it difficult for 

statisticians and policymakers to track jobs in this sector.
 

Page 14 GAO-13-558 Haiti Reconstruction

Figure 2: Caracol Industrial Park under Construction, Haiti, January 2013

Note: The CIP land area is 252 hectares; one million square meters of factory space are planned to 

be built in this area.

The USAID mission completed the first phase of the CIP power plant, with 

a designed capacity of 10 megawatts,16 for $17.0 million, 11 percent less 

than the $19.1 million allocated (see table 3). The power plant project 

benefited from the mission having a Senior Energy Advisor on staff from 

April 2011 through February 2013 who used his background in electrical 

engineering to oversee and manage the project.17

 

16Although the power plant has a designed capacity of 10 megawatts, it currently 

produces 1.7 megawatts based on the current needs of CIP tenants. Megawatt is the 

standard term of measurement for bulk electricity that is generally used to describe the 

output of power plants. One megawatt is equal to 1 million watts, enough for 16,666 60-

watt light bulbs.

17In addition, according to USAID mission officials, USAID was able to achieve these 

lower costs through its competitive bidding process. The winning contractor for 

construction of the plant was able to supply key equipment at a reduced price. 

USAID Mission Completed 

the First Phase of the 

Power Plant for Less Than 

Allocated, with 

Environmental Studies 

Completed and Plans for 

Expansion 
 

Page 15 GAO-13-558 Haiti Reconstruction

Table 3: Total USAID Funding Allocated, Obligated, and Disbursed for Components of the CIP Power Plant, as of March 31, 

2013

Dollars in millions

CIP power plant components Allocated

Total

obligationsa Percentage 

obligated Disbursements

Percentage 

disbursed

Completion of a 10-megawatt power plant 

(Phase I)c $19.1 $18.6 97 $17.0 89

Installation of electrical power distribution 

systems to residential customers 10.9 2.4 22 1.1 10

Operations and maintenance of the power 

plant for 3 years —-b 0.0 0 0.0 0 

Design and construction of at least 13 

megawatts of additional power generation 

(Phase II) —- 0.0 0 0.0 0 

Design and construction of a 2- megawatt solar 

energy farm at CIP —- 0.0 0 0.0 0 

Other CIP power plant-related projectsd 1.7 0.0 0 0.0 0 

Total for CIP power plant $97.9 $21.0 21 $18.1 18e

Source: GAO analysis of USAID data.

Notes: The funding allocations to the CIP power plant are from fiscal year 2010 supplemental funding, 

as well as funding from the fiscal year 2010, 2011, and 2012 appropriations for the Economic Support 

Fund. The funding allocations from the 2010 supplemental funding to the CIP power plant are a 

subset of all funding allocations to the energy sector shown in table 2.

a

An obligation is a definite commitment that creates a legal liability of the U.S. government for the 

payment of goods and services ordered or received. See GAO, A Glossary of Terms Used in the 

Federal Budget Process, GAO-05-734SP (Washington, D.C.: September 2005). This report defines 

obligations as the total amount of orders placed, contracts awarded, services received, and similar 

transactions during a given period that will require payments during the same or a future period. 

USAID labels these actions “subobligations.” In State’s reports to Congress on Haiti funding, for 

USAID-managed accounts, funds listed as “total obligations” or “obligated” refer to these 

subobligations. Nonetheless, consistent with 31 U.S.C. § 1501 defining when an agency can record 

an obligation, USAID generally treats as an obligation the bilateral agreements it makes with other 

countries to deliver assistance.

b

For the three activities to which no funds have been obligated, individual amounts allocated are 

procurement-sensitive and therefore not shown in the allocations column. However, USAID 

documents indicate that together these three activities are allocated $66.2 million, which is included in 

the total.

c

Funding for Phase 1 of the power plant went to two contracts for (1) design and supervision of 

construction and (2) construction and short-term management.

d

The funding allocation to “other CIP power plant-related projects” is reserved for any unspecified 

need during the CIP power plant’s development. For example, it could be used if a negotiated 

contract were to be priced higher than the contract’s budgeted amount.

e

Total disbursements for all components of the CIP power plant are 18 percent of the amount 

allocated because Phase I of the power plant was completed for less than expected and most other 

activities have not begun, in accordance with USAID’s phased approach to building the plant.
 

Page 16 GAO-13-558 Haiti Reconstruction

The power plant was commissioned in June 2012, 5 months later than 

initially planned, but in time to provide power to the CIP as needed (see 

fig. 3).18

Figure 3: USAID-Funded Power Plant at the Caracol Industrial Park, Haiti, December 

2012

A contractor completed a required environmental assessment of the 

power plant project in June 2011, prior to the award of the construction 

 

18In April 2011, USAID projected that construction of Phase I of the power plant would be 

completed by January 2012. However, the procurement period for the construction 

contract took longer than expected in part due to questions from prospective offerors that 

led to multiple amendments to the solicitation. In addition, construction of the CIP was a 

few months behind schedule, so the first CIP tenant did not need power from the plant 

until after June 2012. 
 

Page 17 GAO-13-558 Haiti Reconstruction

contract for Phase I.19 The assessment produced more than 200 

suggested mitigation measures to reduce the plant’s potential 

socioeconomic and environmental impacts, all of which USAID has or 

plans to have implemented.20 The contractor that performed the design 

and oversight of construction for Phase I oversaw the implementation of 

mitigation measures relevant to the construction phase. According to 

USAID officials, relevant mitigation measures are also incorporated into 

the operations and maintenance contract for the first 3 years of the plant’s 

operations, making this contractor responsible for any measures needed 

to mitigate the impact of the plant on the surrounding environment during 

that time.

Future plans for the plant include:

• Distribution of electricity outside the CIP: USAID plans to distribute 

electricity to as many households, local businesses, and public 

buildings in local communities as feasible over the next 2 years, with 

an interim goal of connecting 1,800 residences by May 2013. The first 

several residences were connected in October 2012, and 243 

residences and businesses were connected by February 2013.

• Plan for future expansion: To accommodate the CIP’s future energy 

needs once it has expanded and the needs of local communities once 

more of them are connected, USAID has plans (1) to build an 

adjacent solar energy farm with 2-megawatts capacity and (2) to 

expand the power plant to at least 25-megawatts capacity, including 

power from any renewable sources. The time frame for these 

expansions is dependent on the pace of development of the CIP and 

its energy needs.

• Transfer of operations to Haitian government: After the first 3 years, 

the Haitian government will take over plant operations and therefore 

 

19Federal regulations require that USAID ensure that environmental and socioeconomic

factors and values are integrated into decision making for new development projects. (22 

C.F.R § 216.1). This environmental assessment of the CIP power plant was prepared in 

accordance with required regulatory procedures, and also to comply with the 

environmental requirements set forth by the Haitian government and the USAID Bureau 

for Latin America and the Caribbean Region 22 C.F.R. § 216.6). 

20For example, for water quality, proposed measures included installing drip pans to 

prevent oil leakage and storing potential pollutants on sealed surfaces to prevent soil 

contamination. For air quality, proposed measures included designing generators and 

smokestacks with available emissions control devices and controlling dust during the 

construction phase. For the health and safety of workers at the plant, proposed measures 

included installing a fire detection system and providing adequate ventilation.
 

Page 18 GAO-13-558 Haiti Reconstruction

will be responsible for implementing any mitigation measures, 

including those needed to mitigate additional emissions from the 

plant’s future expansion.

USAID has allocated $72.4 million to plan and contribute toward building 

a new port in northern Haiti; however, only $4.3 million (6 percent) was 

obligated as of March 2013 due to planning delays (see table 4). In an 

August 2011 draft Activity Approval Document (AAD) for the port sector,21

USAID planned for a feasibility study to be completed by the second 

quarter of fiscal year 2012, with construction to begin in spring 2013 by a 

private company that would supplement USAID’s funding contribution for 

construction and then operate the port once it is completed in fall 2015.22

However, the feasibility study was not completed until February 2013, and 

the mission has no current projection for when construction of the port 

may begin or how long it will take because more studies are needed 

before the port site can be selected and the port designed. Nevertheless, 

as a result of these planning delays, port construction will not begin until 

at least two years after initially planned. In addition, USAID officials had 

initially estimated that port construction would take 2.5 years; however, 

USAID officials have since learned that port construction may take up to 

10 years, depending on the complexity of the port designed.

 

21According to USAID policy, AADs are detailed planning documents that include, at a 

minimum, a description of the project or activity, including its intended results, 

implementation methods, and financing plans. The AAD also demonstrates that all preobligation requirements have been met; clarifies management responsibilities; and 

summarizes environmental review requirements and gender issues. The AAD for the port 

sector was first drafted in August 2011 and has not yet been approved.

22This plan will allow USAID to leverage funds and expertise from the private sector 

through a public-private partnership in the form of a build-operate-transfer concession. 

Under this type of concession, a private company would contribute to the construction of 

the port and then operate and retain revenues from the port for the term of the concession 

contract. During operations, Haitian operators and officials would be trained by the private 

operators so that the Haitian government would be able to manage the port at the end of 

the concession contract.

Lack of USAID Mission 

Technical Expertise 

Contributed to Port 

Planning Delays
 

Page 19 GAO-13-558 Haiti Reconstruction

Table 4: Total USAID Funding Allocated, Obligated, and Disbursed for Components of a New Northern Port in Haiti, as of 

March 31, 2013

Dollars in millions

Port components Allocated

Total

obligationsa Percentage 

obligated Disbursements

Percentage 

disbursed

Feasibility study $4.3 $4.3 100 $3.9 91

Any further studies, design, and U.S. 

contribution to construction of port 68.1 0.0 0 0.0 0 

Total for a new northern port $72.4 $4.3 6 $3.9 5 

Source: GAO analysis of USAID data.

Notes: The funding allocations to a new northern port shown here are a subset of all 2010 

supplemental funding allocations to the port sector shown in table 2.

a

An obligation is a definite commitment that creates a legal liability of the U.S. government for the 

payment of goods and services ordered or received. See GAO, A Glossary of Terms Used in the 

Federal Budget Process, GAO-05-734SP (Washington, D.C.: September 2005). This report defines 

obligations as the total amount of orders placed, contracts awarded, services received, and similar 

transactions during a given period that will require payments during the same or a future period. 

USAID labels these actions “subobligations.” In State’s reports to Congress on Haiti funding, for 

USAID-managed accounts, funds listed as “total obligations” or “obligated” refer to these 

subobligations. Nonetheless, consistent with 31 U.S.C. § 1501 defining when an agency can record 

an obligation, USAID generally treats as an obligation the bilateral agreements it makes with other 

countries to deliver assistance.

The USAID mission in Haiti lacks staff with technical expertise in 

planning, construction, and oversight of a port, as there is a vacant 

position for a port engineer on staff. According to USAID officials, USAID 

has not constructed a port anywhere in the world since the 1970s, and 

USAID does not have a port engineer or port project manager among its 

direct-hire staff. In January 2011, the mission in Haiti put out a solicitation 

to fill the vacant port engineer position. This solicitation produced two 

applicants, one of which was offered the position but declined it in May 

2011. Since then, no attempts were made to fill the position until another 

solicitation was sent out in May 2013 to which interested parties were to 

respond by June 7, 2013. As a result, as of June 18, 2013, the position 

remains unfilled. According to mission officials, it is difficult to find 

someone with the right skill set who is willing to work in Haiti, although 

USAID officials have also commented that, in hindsight, more effort 

should have been put into ensuring that the mission had port expertise 

earlier in the port planning process.

This lack of a USAID mission staff person with port expertise has 

contributed to the port project being behind schedule. Delays in the port 

feasibility study were caused by:
 

Page 20 GAO-13-558 Haiti Reconstruction

• Unrealistic initial time frames: Without port expertise, USAID 

initially estimated that the planning and design process for the port, 

including the port feasibility study, would take a little over 1 year to 

complete. Since then, USAID officials have learned from the U.S. 

Army Corps of Engineers (USACE), which has extensive port 

expertise, that they expect the port planning and design process to 

take 2.5 to 5 years. According to USAID officials, this estimate is 

consistent with the time frames used by the Millennium Challenge 

Corporation, which has rehabilitated ports in developing countries.

• Delays in awarding the feasibility study: The contract for the 

feasibility study was awarded 3 months later than initially planned 

because at the time, according to USAID officials, mission staff were 

focused on the CIP power plant. None of these staff had primary 

responsibility for the port, so the port project did not move forward 

simultaneously. In addition, USAID needed to clarify the technical 

requirements and revise the statement of work for the port feasibility 

study four times, thereby lengthening the time before companies 

could submit proposals.

• Incomplete information in the feasibility study: Without a port 

engineer or project manager to contribute to the statement of work for 

the feasibility study, USAID did not require the contractor to obtain all 

the information necessary to help select a port site.23 According to 

USAID officials, when the study was completed as planned in May 

2012, the contractor had met the requirements in its statement of 

work. However, the Mission Environmental Officer determined that 

multiple environmental issues not adequately addressed in the initial 

study needed additional examination. Subsequently, the contract for 

the feasibility study was amended six times and extended by 9 

months to obtain more information. USAID officials stated that, in 

retrospect, they realized it would have been helpful to involve other 

U.S. agencies with port expertise when writing the original statement 

of work to have avoided the need for so many revisions. In November 

2012, the contractor submitted another draft of the study that USAID 

 

23The statement of work was initially focused on evaluating construction of a new port in 

Fort-Liberté Bay in addition to the option of expanding the existing Cap-Haïtien port. FortLiberté Bay had been chosen as a preferred location along the northern coast for a port by 

two 2011 studies of the Haitian port sector conducted by the International Finance 

Corporation and the U.S. Trade and Development Agency. For the purpose of the 

preliminary environmental assessment in USAID’s port feasibility study, a baseline of a 

“no action” alternative was also assessed in which the proposed port expansion 

improvements in northern Haiti would not occur. In September 2012, the statement of 

work was amended so that the contractor would also assess four alternative sites. 
 

Page 21 GAO-13-558 Haiti Reconstruction

environmental staff determined to have some gaps. USAID then met 

with officials from USACE, the U.S. Environmental Protection Agency 

(EPA), and the National Oceanic and Atmospheric Administration 

(NOAA) in December 2012 to identify the additional economic, 

environmental, technical, and other information needed to select a 

site. Further information was added to the study before it was finalized 

in February 2013. However, other studies strongly recommended by 

USACE, EPA, and NOAA, such as building oceanographic navigation 

models and completing marine mitigation work to protect endangered 

species in the area, still need to be performed.24

Port construction costs remain uncertain because the port site, design, 

and needed mitigation measures have not been determined. However, 

rough estimates in the February 2013 feasibility study project that the cost 

of port construction at the two locations still under consideration ranges 

from $185 million to $257 million. In addition to funding for the port 

feasibility study, USAID has $68.1 million allocated toward port planning 

and construction. USAID does not know what portion of this funding is 

needed for the additional studies and design; however, it is clear that the 

amount remaining for construction will be a significantly smaller portion 

than USAID had initially planned to contribute to the project’s total 

construction cost.25 As a result, USAID officials recognize that there is a 

risk that no private company interested in operating the port would be 

willing to cover the entire remaining costs of construction, particularly 

given the political risks of operating in Haiti. Therefore, the Haitian 

government may need to secure additional donor funding to increase the 

public sector contribution to building the port.

 

24USAID is currently designing the scope of work for a site-specific environmental 

assessment that will look in more depth at a site in Fort-Liberté Bay, as well as another 

site from the feasibility study to be studied as an alternative. USAID also plans to have 

officials from other agencies or contractors perform the additional studies needed. 

According to USAID officials, in the absence of port expertise within the mission, they are 

uncertain how long each assessment will take without consulting further with other 

agencies. However, consultations with USACE indicate that the studies will take at a 

minimum 1 year to complete.

25In the draft AAD, USAID initially estimated that construction would cost $103 million, 

approximately $40 million of which would be paid for by a private sector partner.
 

Page 22 GAO-13-558 Haiti Reconstruction

Sustainability of the CIP, port, and power plant are interdependent. We 

identified a number of key issues to the sustainability of each of these 

projects.

• The CIP depends on a functioning power plant and port access: 

Before USAID began its CIP-related investments, northern Haiti did 

not have reliable energy infrastructure or sufficient port capacity to 

support a completed industrial park. Other power plants in the region 

produce intermittent power.26 The existing ports in Haiti have high port 

costs and those in the Dominican Republic that currently 

accommodate cargo traffic are distant from the CIP, raising the cost of 

doing business at the CIP (see fig. 4). In addition, according to the 

port feasibility study, the Cap-Haïtien port, the closest current port to 

the CIP, has limited capacity. The study concluded that the CIP will 

only succeed if expanded, efficient port facilities are developed 

nearby.27

 

26According to a March 2012 study of Haiti’s energy sector, only about 15 percent of 

businesses have access to electrical service. The study noted that many businesses 

prefer to generate their own power to ensure its reliability.

27Further, the State Senior Advisor for the CIP stated that additional port capacity would 

be needed by 2015 to accommodate projected freight traffic to and from the CIP and the 

increasing demand for oil to operate the power plant.

Sustainability of the CIP, 

Power Plant, and Port Are 

Interdependent and 

Depend on Haitian 

Government Capacity
 

Page 23 GAO-13-558 Haiti Reconstruction

Figure 4: Map of Ports in Haiti and Dominican Republic for Potential Use by CIP Tenants

a

The Manzanillo port is currently only used by two banana exporters, but plans are under way for its 

expansion to accommodate greater cargo traffic. Current projections indicate fees at this port, once 

developed, will be approximately $150 per container.

b

Estimated truck costs to the CIP demonstrate a combination of the distance to the CIP and the 

condition of connecting roads, as truck costs are higher on roads that are more difficult to travel.

• The port and power plant depend on revenues from the CIP: CIP 

tenants will generate a substantial portion of the revenue for the 

power plant and port, so the sustainability of these projects will 

depend on the Haitian government finding additional tenants and 
 

Page 24 GAO-13-558 Haiti Reconstruction

maintaining the park. Potential tenants may be wary of moving to the 

CIP because of Haiti’s history of instability and corruption or the lack 

of Haitian government capacity, although as noted earlier, according 

to State officials, there were four additional potential tenants for the 

CIP as of May 2013.

• All three projects depend on Haitian government capacity: The 

Haitian government will be responsible for maintaining and managing 

the CIP and power plant and for overseeing the private company that 

will operate the new port. Studies of the CIP have cited concerns 

about the relevant Haitian government ministry’s ability to manage 

and maintain the infrastructure in and around the CIP given their 

limited staff and technical resources. Aware of such concerns, the CIP 

has contracted a professional industrial facility management firm to 

operate and maintain the park. According to the September 2011 AAD 

for the energy sector, the sustainability of investments in the Haitian 

energy sector depends on legal, regulatory, and management reforms 

to improve the commercial viability of Haiti’s electrical system and 

provide resources for its maintenance and operations. To address this 

for its first 3 years, USAID will pay for a contractor to operate and 

maintain the power plant, and to prepare the Haitian electricity 

department to take over these functions after the 3 years. According 

to USAID documents, Haiti will need institutional and regulatory 

reforms to ensure efficient customs operations and competitive port 

charges, to curtail monopolistic practices, and to facilitate private 

investment in the port sector.

• Obtaining revenue for the power plant from electricity 

distribution outside the CIP: As of February 2013, the few 

customers connected to the power plant outside the CIP had largely 

paid their initial bills on time.28 However, according to a 2010 report on 

the Haitian energy sector, 64 percent of Haitians do not pay their 

electricity bills in a timely manner and 33 percent do not pay at all. In 

addition, USAID officials have recognized that it is common 

throughout Haiti to tap into lines without paying, and this practice is 

unlikely to have repercussions. As a result, the USAID operations and 

maintenance contractor plans to provide training to local communities 

on the use and value of electricity.

• Attracting a private company to construct and operate the port: 

The government of Haiti has considered charging $260 for each 

 

28As of February 2013, 98 percent of the 243 residences and businesses then connected 

to the CIP power plant had paid their initial bills on time, according to USAID officials. 
 

Page 25 GAO-13-558 Haiti Reconstruction

container coming into the northern port to use the revenues generated 

for social programs. However, the port feasibility study concluded that 

such a government surcharge would make the project financially 

infeasible. State officials have communicated this information to the 

Haitian government to encourage them to lower the surcharge to 

allow the port to be successful. Given this and other risks associated 

with the port listed above, it is unclear whether the Haitian 

government will be able to find a private company interested in 

investing in port construction and operations. This uncertainty will 

remain until USAID and the Haitian government begin work on the 

solicitation for a private company after all port studies are completed, 

the site is selected, and the port design is completed.

Since its initial planning and cost estimating began in 2010, USAID’s 

funding for the New Settlements program has significantly increased, 

while the number of permanent houses USAID projects will be completed 

has been reduced by over 80 percent. USAID underestimated 

construction costs at the time the New Settlements program was 

developed, and construction costs further increased after the Haitian 

government requested design changes that included larger houses with 

features such as flush toilets. USAID experienced problems securing 

clear land title for the new housing sites and in coordinating with NGOs 

and other partner donors. These issues have resulted in delays, with the 

program currently expected to be completed nearly 2 years later than 

initially scheduled. Moreover, the sustainability of these new settlements 

will depend heavily on the capacity of the Haitian government to provide 

key services and the ability of residents to maintain their homes. In

addition, there is a potential gap in service to support the community 

management mechanisms that USAID officials consider crucial to the 

sustainability of each new settlement. If such support is reduced or 

delayed for some settlements, sustainability risks may increase.

USAID underestimated the construction cost of its New Settlements 

program. These costs are comprised of two main categories: (1) cost of 

site preparation per plot and (2) cost of construction per house. In its 

planning documents, USAID originally estimated costs at $1,800 per plot 

and $8,000 per house. As of April 2013, average costs based on awarded 

contracts have increased to $9,598 per plot and $23,409 per house. 

Overall, the cost for USAID to prepare a plot and build a house increased 

from original estimates of $9,800 to average costs of $33,007. These cost 

differences stem primarily from the inaccuracy of USAID’s original 

USAID’s Development 

of New Housing 

Settlements in Haiti 

Has Been More Costly 

and Slower Than 

Expected; 

Sustainability 

Challenges Remain

USAID’s Cost Estimates 

Increased Sharply
 

Page 26 GAO-13-558 Haiti Reconstruction

estimates, and secondarily from Haitian government requests for design 

changes. Figure 5 compares the original estimates, initial contract costs, 

and revised contract costs.

Figure 5: USAID Cost Estimates for Preparation of One Plot and Construction of 

One House in Haiti

Note: Cost estimates are the weighted average costs of site preparation and house construction for 

two active settlement sites designated by USAID as Caracol-EKAM and Government of Haiti Decreed 

Land Area (DLA) 1.5. The costs are different at the two sites and may vary at future sites.

More details on the reasons for cost differences in this program are 

outlined below. 
 

Page 27 GAO-13-558 Haiti Reconstruction

• Original estimates: By November 2010, USAID had developed its 

original cost estimates for the New Settlements program.29 Prior to the 

earthquake, the mission had no housing programs in Haiti, and as a 

result did not have its own historical data on construction costs and 

few existing relationships with potential shelter sector partners. The 

mission hired a Senior Shelter Advisor and staffed a shelter team to 

develop the original cost estimates, layouts, and design concepts for 

what would become the New Settlements program. According to 

USAID officials, these estimates were not adequately supported; they 

did not document the sources of data or the methodologies used to 

derive these estimates. Rather, the original estimates were based in 

part on the USAID shelter team’s calculations and costs reported by 

the World Bank and an NGO that was building houses in northern 

Haiti. USAID mission officials noted that these original cost estimates 

were used to develop the budget and projected goals of the New 

Settlements program. However, to meet certain technical and financial 

planning requirements,30 the shelter team prepared independent 

government cost estimates prior to issuing solicitations for bids for 

each site preparation and each housing construction project. The first 

independent government cost estimates for site preparation and 

housing construction were conducted in September and November 

2011, respectively. Those efforts provided the shelter team with more 

detailed and accurate information to guide them through the 

procurement process.31

• Initial contract costs: By April 2012, USAID awarded multiple 

contracts for construction projects at two settlement sites, where costs 

exceeded the original estimates. In particular, site preparation per plot 

increased from $1,800 to $6,165, a 242-percent increase. The 

inaccuracy of the site preparation estimates had a more substantial 

impact on USAID’s program budget and goals than the inaccurate 

estimates of housing construction costs because USAID planned to 

 

29Original cost estimates were included in draft versions of the Shelter AAD as early as 

November 2010 and were finalized in August 2011. According to USAID officials, AADs 

for all sectors of Haiti’s Relief and Reconstruction efforts went through a more extensive 

and rigorous review process than usual. 

30See 22 U.S.C. § 2361(a) for grants requiring technical or financial planning. 

31An independent government cost estimate is conducted to check the reasonableness of 

a contractor’s cost proposal and to make sure that the offered prices are within the budget 

range for a particular program. In these two instances, USAID developed independent 

government cost estimates of $4,929 per plot and $14,931 per house. 
 

Page 28 GAO-13-558 Haiti Reconstruction

finance all site preparation costs, while NGOs and other partner 

donors would finance and build the majority of houses. According to 

USAID officials, original estimates did not adequately consider the 

stringent international building codes and disaster resistance 

standards planned for New Settlement houses and did not take into 

account the extent or complexity of service infrastructure USAID 

intended to provide. Furthermore, USAID officials noted that, as 

multiple reconstruction efforts have progressed, the demand and cost 

for construction materials has increased.

• Revised contract costs: By July 2012, USAID signed a revised 

contract to accommodate design changes requested by the Haitian 

government, which also increased costs. Specifically, the design 

changes called for an increase in the size of housing units, from about 

275 square feet to about 450 square feet, and the inclusion of flush 

toilets, rather than a more traditional dry toilet system. USAID agreed 

to these changes and revised the initial contracts to include these 

modifications and allow for the increased costs. The Haitian 

government’s design changes drove total cost increases up from the 

initial contract costs by 34 percent, from $24,625 to $33,007. Officials 

noted that providing housing with higher earthquake and hurricane 

resistance standards and with electricity, plumbing, and flush toilets, 

takes longer to construct and costs more than options provided by 

other donors.

Based on original estimates, the New Settlements program was allocated 

approximately $59 million under USAID’s Shelter AAD32. However, 

USAID increased the program budget after receiving multiple bids from 

private sector contractors for both site preparation and housing 

construction. USAID also dedicated additional funds to institutional 

strengthening to support local organizations’ beneficiary selection, and 

added a community development component. All together USAID 

increased program funding to approximately $97 million, about a 65-

percent increase. As of March 31, 2013, USAID had obligated about $48 

million and had disbursed about $32 million for New Settlements 

permanent housing activities (see table 5).

 

32This amount includes $3.5 million to fund technical assistance to strengthen the capacity 

of national, local, and community institutions to improve urban management.

Program Funding Has 

Significantly Increased
 

Page 29 GAO-13-558 Haiti Reconstruction

Table 5: Total USAID Funding Allocated, Obligated, and Disbursed for Permanent Housing Activities, as of March 31, 2013

Dollars in millions

New Settlements program components Allocated Total obligateda Percentage obligated Disbursements

Percentage 

disbursed

Construction-related activities $79.4 $36.8 46 $21.8 27

Project management-related activities 8.0 6.5 81 4.9 61

Institutional strengthening (including 

beneficiary selection and community outreach 

activities)b 4.8 4.8 100 4.8 100

Community development 5.0 0.0 0 0.0 0 

Total for New Settlements program $97.2 $48.1 49 $31.5 32

Source: GAO analysis of USAID data.

Notes: The total funding allocations for the New Settlements Program include $83.1 million from fiscal 

year 2010 supplemental funding (as shown in table 2 above) and about $14 million in annual 

allocations from annual allocationsl from fiscal years 2009, 2010, and 2012.

a

An obligation is a definite commitment that creates a legal liability of the U.S. government for the 

payment of goods and services ordered or received. See GAO, A Glossary of Terms Used in the 

Federal Budget Process, GAO-05-734SP (Washington, D.C.: September 2005). This report defines 

obligations as the total amount of orders placed, contracts awarded, services received, and similar 

transactions during a given period that will require payments during the same or a future period. 

USAID labels these actions “subobligations.” In State’s reports to Congress on Haiti funding, for 

USAID-managed accounts, funds listed as “total obligations” or “obligated” refer to these 

subobligations. Nonetheless, consistent with 31 U.S.C. § 1501 defining when an agency can record 

an obligation, USAID generally treats as an obligation the bilateral agreements it makes with other 

countries to deliver assistance.

b

These funds went to support USAID’s Emergency Capacity Assistance Program which, in addition to 

other responsibilities, was directed to support the development of the beneficiary selection process 

and community management committees.

USAID has reduced its program targetss a number of times. As of April 

2013, it had reduced the number of houses it expects USAID and its 

partners to complete, and therefore the number of beneficiaries, by over 

80 percent. Of the 15,000 houses originally planned,33 only 2,649 are 

expected to be completed, with USAID building 906 houses and NGOs 

and other partner donors estimated to build 1,743 (see fig. 6). USAID 

officials noted that USAID would commit no further funds to housing 

construction and will only commit funds for site preparation if USAID has 

written agreements with partner donors. Therefore, the estimated number 

of houses and completion dates may vary from current projections. 

 

33USAID planned to develop 15,000 plots, on which USAID planned to build up to 4,000 

houses, while NGOs and other donor partners would build 11,000 houses.

USAID Reduced Projected 

Numbers of Houses and 

Beneficiaries and Shifted 

Their Distribution
 

Page 30 GAO-13-558 Haiti Reconstruction

Figure 6: Permanent Houses to Be Constructed on USAID Plots in Haiti, 2011 and 

2013 Projections, as of April 2013

USAID also reduced the total number of projected beneficiaries from an 

original estimate of 75,000 to 90,000 to its current estimate of 

approximately 13,200 to 15,900. USAID originally planned for new 

settlements to be distributed geographically with 5,000 houses to be built 

in the northern Cap-Haïtien corridor and 10,000 houses to be built in the 

Port-au-Prince and St-Marc corridors, closer to where the earthquake’s 

epicenter occurred. In addition to the overall decline in housing numbers, 

the distribution of these houses between the north and south also shifted. 

Current projections are for the Cap-Haïtien corridor to have 1,967 houses, 

or 74 percent of the total. A combined 682 or 26 percent of the total are to 

be built in the Port-au-Prince and St-Marc corridors. Of those houses in 

the Cap-Haïtien corridor, over 90-percent are planned to be within a 13-

mile radius of the CIP (see fig. 7).
 

Page 31 GAO-13-558 Haiti Reconstruction

Figure 7: Number of Houses and New Settlement Locations Planned in Haiti, as of April 2013

Note: At least one additional site is planned in the Cap-Haïtien corridor, but its precise location has 

not yet been finalized.
 

Page 32 GAO-13-558 Haiti Reconstruction

USAID is nearing completion of two settlement sites, Caracol-EKAM in 

the Cap-Haïtien corridor and DLA 1.5 in the St-Marc corridor. The 

Caracol-EKAM settlement is projected to provide permanent houses to 

approximately 3,750 to 4,500 residents,34 and the DLA 1.5 settlement is 

projected to provide permanent houses to approximately 780 to 936 

residents. Beneficiaries will begin to occupy houses once all construction 

is complete. The planned move-in date for beneficiaries at both 

settlements is July 2013 (see fig. 8).

Figure 8: Unoccupied Permanent Houses, Water Distribution Towers, and Sewage 

System Trenches in Caracol-EKAM, Haiti, December 2012

The U.S. government’s January 2011 strategy projected that all USAID 

permanent housing construction and site preparation under the New 

Settlements program would be completed by July 2012, but the current 

estimated completion date for planned sites is March 2014, nearly 2 years 

later. Housing construction began at Caracol-EKAM and at DLA 1.5 in 

April 2012. NGO and other partner donor financed housing construction 

on USAID prepared sites is planned but has not yet begun.

 

34At Caracol-EKAM, USAID is trying to develop public-private partnerships to facilitate 

construction of additional houses, according to USAID officials. However, as of April 2013, 

there were no formal commitments. 

USAID’s Program Plans 

Have Been Delayed by 

Land Title Issues and 

Reduced Partner Donor 

Participation
 

Page 33 GAO-13-558 Haiti Reconstruction

According to State and USAID officials, USAID faced difficulties trying to 

secure proper land title for permanent housing, which resulted in delays. 

These delays affected the implementation of the program and availability 

of NGO and other partner donor financing. For example, according to 

USAID officials, USAID spent a substantial amount of time trying to 

secure clear title to private and government-owned land but was able to 

acquire only one site through private owners because of difficulties in 

confirming legitimate ownership. USAID discontinued attempts to partner 

with private owners in August 2011. Additionally, land titling issues arose 

with government-owned land. For example, although USAID officials 

reported that the agency had conducted due diligence and approved 15 

potential housing sites in November 2010, USAID later found that the 

secure land titles for some of these sites could not be confirmed due to 

unclear or disputed ownership, and thus reduced the number of site 

options and further delayed site selection. 

Partnering with NGOs and other donors on the planning and construction 

of permanent houses was more complicated and time consuming than 

USAID originally expected.35 According to USAID officials, NGOs and 

other partner donors have their own processes, procedures, and goals

that often differ from those of USAID. According to USAID officials, the 

mission shelter team was involved in negotiations with several key donor 

partners as early as November 2010. In January 2011, the President of 

the American Red Cross (Red Cross) announced its intention to partner 

with USAID and provide $30 million to build homes on at least two sites. 

Later, in June 2011, USAID signed a memorandum of understanding with 

the Red Cross to build more than 3,000 houses; however, according to 

USAID officials, that partnership did not materialize because of difficulties 

and delays in securing land title from privately owned sites near Port-auPrince. In addition, according to USAID officials, the partnership was 

further delayed because of turnover in various Red Cross leadership 

positions, resulting in shifting approaches to the development of housing 

settlements.36 According to officials, USAID also had plans to partner with 

 

35Examples of other donor partners that are not NGOs include the Qatar Haiti Fund, the 

Inter-American Development Bank, and the Fund for Economic and Social Assistance, a 

Haitian government entity,

36USAID officials stated that discussions with the Red Cross did not cease after the July 

2011 memorandum of understanding failed to progress. In October 2012, USAID and the 

Red Cross signed a letter of intent to create a partnership to build houses at a USAID site 

and have been in ongoing negotiations to finalize an agreement, although with a much 

reduced scope. 

Land Titling Issues Created 

Delays 

NGO and Other Partner Donors 

Will Build Fewer Houses Than 

USAID Anticipated
 

Page 34 GAO-13-558 Haiti Reconstruction

Food for the Poor, an NGO with experience building houses in Haiti, to 

build 750 of the houses at Caracol-EKAM. However, this discussion 

ended in part because that NGO decided it did not want to assist in 

building communities that large.37

The success of USAID’s New Settlements program relied heavily on 

partner NGOs. The USAID mission was confident that the program would 

attract partners because one of the primary challenges NGOs faced in the 

first year after the earthquake was finding suitable land with clear title. 

According to one of USAID’s implementing partners, NGOs providing 

housing assistance hesitate to invest in land for new housing if legal proof 

of ownership cannot be secured. By securing land title, the program 

would help partners avoid the complex land tenure issues that were 

already seriously impeding many of their shelter programs. However, 

lengthy delays in resolving land title issues contributed to difficulties in 

solidifying partnerships because the delays allowed time for potential 

NGO partners to change their shelter strategies or commit their funds to 

other reconstruction activities.

According to USAID, the sustainability of the new housing settlements will 

depend on broad factors such as the capacity of the Haitian government 

and regional economic opportunities. USAID is attempting to ensure the 

viability of settlements by locating them in areas with employment, 

healthcare, education, and transportation. In the Cap-Haïtien corridor, the 

United States and other international donors are making multiple 

investments in new infrastructure, such as the CIP and potential port, to 

create an economic growth pole in the region. If those efforts do not 

successfully provide adequate economic opportunities, beneficiaries may 

not be able to afford the fees and services connected with their new 

homes, or may have to relocate altogether. USAID is also working with 

the Haitian government in areas where capacity issues exist, such as 

energy sector management.

In addition, more site-specific factors will affect sustainability. USAID has 

made some limited mitigation efforts, but notes that further support for 

community development is necessary to maintain the settlements over 

 

37USAID currently has a memorandum of understanding signed with Food for the Poor 

and the Fund for Economic and Social Assistance to build houses at various USAID sites 

in the Cap-Haïtien corridor. 

New Housing Settlements 

Have Numerous 

Sustainability Challenges
 

Page 35 GAO-13-558 Haiti Reconstruction

time. Local governments and community members need to provide 

ongoing support, maintenance, and management of the new settlements 

to ensure their sustainability. Specifically, beneficiaries will face sitespecific issues related to affordability, community management, and the 

possibility of informal expansion or sprawl of shantytowns.

• Affordability: According to USAID officials, the Haitian government 

has indicated that beneficiaries must make some number of monthly 

payments, in an amount to be determined, before title to the house is 

conferred. Beneficiaries will also face charges for utilities and 

services, such as electricity and sewage.

• Housing payments: According to USAID officials, although 

beneficiaries are scheduled to move into the Caracol-EKAM and 

DLA 1.5 settlements as early as July 2013, a beneficiary 

agreement has not yet been finalized, and the exact amount and 

structure of the monthly payments remain uncertain. USAID 

officials have said that a contract, or occupancy agreement, will be 

signed before beneficiaries move in. Fees for utilities and services 

may or may not be rolled into, collected, and paid through these 

monthly housing payments. The monthly housing payment 

structure may be flat or tiered, meaning amounts may be set at a 

flat rate for every household or may be progressive depending on 

income level.

• Electricity: USAID plans to install electricity, with individual meters, 

in each new house. USAID officials acknowledged that nonpayment for electricity is a fairly common practice in parts of Haiti 

where electrical grids exist. Therefore, it remains to be seen 

whether the practice of non-payment may also be a challenge at 

the new settlement locations. 

• Sewage: Prior to the January 2010 earthquake, there were no 

wastewater treatment plants in Haiti. A temporary facility has been 

constructed at the CIP and there are plans to build a permanent 

facility there as well. In addition, a treatment plant was opened in 

May 2012 near the Port-au-Prince metro area. These facilities 

may be able to serve some settlements, but it is unclear if they will 

be able to serve all of the facilities and at what cost to beneficiary 

households. One senior USAID official acknowledged that if septic 

tanks are not emptied regularly, there is a potential for a public 

health risk.

• Community management: The New Settlements program currently 

plans to create eight new “communities,” of between 148 to 1,283 

households, each with beneficiaries from various locations in Haiti and 

with varied income levels. USAID officials acknowledged concerns 
 

Page 36 GAO-13-558 Haiti Reconstruction

about issues that might arise among the beneficiaries themselves and 

between the settlement and surrounding communities.

• Shantytowns: There is a risk that informal dwellings, or shantytowns, 

may be built around the new settlements to take advantage of the 

economic opportunities or services available near those locations. If 

employment opportunities at the CIP draw a large number of people, 

the current housing stock may be too low to accommodate them.

To mitigate these types of site-specific sustainability concerns, USAID 

obligated $4.8 million for development of the Emergency Capacity 

Assistance Program to establish community management committees, 

self-governing bodies made up of selected beneficiaries, and to create 

other mechanisms intended to support community development. To 

address issues related to affordability, USAID, through this assistance 

program, worked to ensure that the household income and employment 

status were criteria addressed in the beneficiary selection process.38 To 

address other issues, USAID planned for the community management 

committees to promote social cohesion, to serve as a decision-making 

body, and to act as the residents’ representatives with government 

counterparts. At the Caracol-EKAM settlement, a provisional community 

management committee was formed and will be trained to engage with 

local and national authorities to help ensure that community services such 

as grounds keeping, infrastructure maintenance, and solid waste 

collection are undertaken.39 However, funding for ECAP only allowed for 

some of these initial activities to take place at the Caracol-EKAM 

settlement, and, according to officials, the program ended in April 2013.

USAID allocated $5 million to support community development efforts at 

the new settlements. In April 2013, USAID issued a request for 

applications to find an implementing partner for a community 

development program for Caracol-EKAM, at an estimated cost of $1.3 to 

$1.5 million. This partner would provide support for the phased 

occupation and management of the settlement and engage in an array of 

 

38At Caracol-EKAM, 74 percent of selected beneficiary households have monthly incomes 

over 4,000 gourds. The remaining 26 percent with lower monthly incomes are considered 

to be economically vulnerable households. Although not finalized, USAID has stated that 

monthly housing payments will be designed to be affordable for all households, including 

those that are economically vulnerable. 

39This provisional committee was formed from an initial pool of beneficiaries, but a 

permanent committee will be formed once all beneficiary households have moved in. 
 

Page 37 GAO-13-558 Haiti Reconstruction

activities designed to help ensure its long‐term sustainability. Although 

still in the planning stage, USAID’s current budget indicates over half of 

the community development funds will go toward assisting just three 

sites, including Caracol-EKAM. The remaining five or more settlement 

sites face the possibility of delayed or reduced support. To address that 

gap, USAID plans to foster partnerships with other organizations to assist 

and contribute to these activities. USAID has entered into such a 

partnership with the International Federation of the Red Cross to provide 

community development support at DLA 1.5. Additionally, in a 

memorandum of understanding between USAID and partner donors, it is 

noted that partner donor funds are to be provided for community 

development activities at those settlements; however that understanding 

does not fully secure such a financial commitment. Similarly, according to 

USAID officials, the agreement USAID is attempting to finalize with the 

Red Cross will budget for community development activities to be 

covered with Red Cross funds. However, there is the possibility that such 

partnerships will not be available to support all the settlements. USAID 

officials responsible for key parts of the New Settlements program have 

stated that it is crucial to have these support mechanisms in place to 

ensure a smooth transition when beneficiaries move in, to set the tone for 

interaction among beneficiaries moving forward, and to ensure that 

community management needs are understood and acted upon. 

Furthermore, USAID documents state that it is critical to initiate the 

beneficiary organization process as soon as beneficiaries occupy their 

homes because it may be difficult to work with beneficiaries before they 

arrive. Failure to find an implementing partner to provide and create these 

support mechanisms for each settlement may further increase the 

sustainability risks inherent in large-scale housing reconstruction projects, 

thus endangering the significant investments already committed to these 

efforts.

Following the January 2010 earthquake in Haiti, the U.S. government 

made a strong commitment to Haiti’s reconstruction and economic 

development. As of March 2013, more than 3 years after the earthquake, 

USAID had obligated only 45 percent and disbursed only 31 percent of

the $651 million in supplemental funding it was provided. State’s most 

recent report to Congress on program funding and progress—its final 

mandated report—was submitted in January 2013. However, the majority 

of reconstruction funding has not been disbursed, and a substantial 

amount of progress on project activities remains to be completed. Without 

complete and accurate reporting from State, Congress lacks the critical 

Conclusions 
 

Page 38 GAO-13-558 Haiti Reconstruction

information on program funding and progress it needs to fully oversee the 

use of the Haiti reconstruction supplemental funding.

USAID’s progress in supporting the CIP-related investments of the power 

plant and port have had mixed results. The power plant was completed in 

time to provide electricity for the CIP’s first tenant, in part because the 

USAID mission in Haiti had on staff a senior energy advisor to help plan 

and oversee the project. However, the mission has not filled an equivalent 

position to oversee the port project and has experienced delays and 

challenges associated with this significant project. The USAID mission 

continues to lack technical port expertise to oversee this project to which 

more than $72 million in U.S. funding has been allocated, is at least 2 

years behind schedule, and has been found to be more complex than 

initially envisioned. Further, USAID’s contribution to port construction was 

not intended to fund the entire port, and it is unclear whether the Haitian 

government will be able to find a private sector company willing to 

contribute the large amount of remaining funding through a public-private 

partnership. This uncertainty puts at risk USAID’s investments in port 

planning and design, as well as the sustainability of the CIP and power 

plant due to the three projects’ interdependence. 

USAID developed the budget and projected targets of the New 

Settlements program using faulty and inaccurate cost estimates, which 

has led to a significantly reduced number of USAID-funded houses for the 

Haitian people. USAID agreed to the Haitian government’s request to 

enlarge and upgrade the houses, further reducing the number of houses it 

would build. As a result, USAID currently has plans to provide less than a 

quarter of the houses it originally projected it would build, and at a much 

greater cost. Difficulties in securing land title and challenges in 

establishing partnerships with NGOs also delayed and further reduced 

USAID’s targets. Furthermore, the sustainability of USAID’s New 

Settlement program is uncertain. The agency has dedicated some 

funding to help ensure sustainability through the development of 

community support mechanisms; however, it is unclear if funding for 

these support mechanisms will be available for each new settlement. In 

addition, USAID has taken steps to secure commitments for partner 

donor funding to assist in these efforts, but has not yet secured such 

commitments for all planned settlements and it is uncertain whether the 

partner organizations will be able to fulfill their commitments. These 

community support mechanisms are essential to helping ensure that the 

settlements become viable, cohesive communities and that beneficiaries 

maintain them once they move in. Without this support in place, 
 

Page 39 GAO-13-558 Haiti Reconstruction

sustainability issues may be exacerbated and USAID’s housing efforts 

placed at risk of deterioration.

To ensure that Congress has current information on the status of Haiti 

earthquake reconstruction activities and is able to provide appropriate 

oversight at a time when most funding remains to be disbursed, Congress 

should consider requiring State to reinstitute the requirement to provide it 

with periodic reports until most of the funds in each sector are disbursed. 

In these reports, Congress should consider requiring State to provide 

information such as progress in U.S. program sectors; amounts of funding 

obligated and disbursed in each specific sector; sector and project cost 

increases; changes in project schedules; and existing difficulties and 

challenges to successful project completion.

To strengthen USAID’s ability to complete its projects in Haiti and to 

maintain their sustainability, we recommend that the USAID Administrator 

take the following two actions.

• To ensure proper oversight over the continued planning for and 

construction of a new port in northern Haiti and to enable the project

to move forward in a well planned and timely manner, USAID should 

fill the vacant port engineer position at its Haiti mission within time 

frames that avoid future project delays.

• To promote the sustainability of the New Settlements permanent 

housing program, and to protect the significant investments already 

made, the USAID Administrator should direct the USAID Haiti mission 

to ensure that each new settlement has community support 

mechanisms in place prior to beneficiary occupation. As part of that 

process, the mission should consider making additional funds 

available, as needed, to help ensure this support.

We provided a draft of this report to USAID and State for review and 

comment. USAID provided written comments on a draft of this report, 

which are reprinted in appendix II. State did not provide written 

comments. USAID agreed with both of our recommendations. 

USAID agreed with our recommendation that it fill the vacant port 

engineer position at the Haiti mission within time frames that avoid future 

project delays. In its letter responding to our draft report, USAID noted 

that, in May 2013, it issued a solicitation for a ports advisor, recognizing 

the need to fill the position to move its program forward. In June 2013,

Matter for 

Congressional 

Consideration 

Recommendations for 

Executive Action

Agency Comments 

and Our Evaluation
 

Page 40 GAO-13-558 Haiti Reconstruction

USAID noted that it expected to fill the position soon; however, as of June 

18, 2013, the position was vacant.

USAID also agreed with our recommendation that each new permanent 

housing settlement have community support mechanisms in place before 

the beneficiaries occupy the houses. As noted in our report, USAID stated 

that $5 million has been set aside to finance community development 

activities. In its comments on this report, USAID added that the mission is 

prepared to provide additional resources, if required. USAID also 

elaborated on the ongoing and planned activities intended to facilitate 

community development and sustainability at the first two settlement 

sites. We acknowledge USAID’s efforts to provide community 

development support at these two sites and support the agency’s 

intentions to implement our recommendation at future settlement 

locations.

State and USAID both provided technical comments. We incorporated 

those comments, along with information contained in USAID’s written 

response, into the report where appropriate

As agreed with your offices, unless you publicly announce the contents of 

the report earlier, we are planning no further distribution until 30 days 

after the report date. At that time, we will send copies to interested 

congressional committees, the Secretary of State, and the USAID 

Administrator. In addition, the report will be available at no charge on the 

GAO Web site at http://www.gao.gov. 

If you or any of your staffs have any questions about this report, please 

contact me at (202) 512-3149 or gootnickd@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

on the last page of this report. GAO staff who made major contributions to 

this report are listed in appendix III.

David Gootnick

Director, International Affairs and Trade
Appendix I: Scope and Methodology

Page 41 GAO-13-558 Haiti Reconstruction

We reviewed infrastructure-related post-earthquake reconstruction efforts 

in Haiti undertaken by the U.S. Agency for International Development 

(USAID).1 This report addresses (1) USAID’s progress in obligating and 

disbursing program allocations and the Department of State’s (State) 

periodic reporting to Congress on the status of the U.S. reconstruction 

efforts; (2) USAID’s progress in planning and constructing two activities 

related to the Caracol Industrial Park (CIP)—a power plant and port; and 

(3) USAID’s progress in planning and constructing permanent housing.

In response to a congressional request to examine the Supplemental 

Appropriations Act, 2010 (the Act), we focused our review on three 

sectors of USAID reconstruction activities: power plant, port, and 

permanent shelter. These three activities comprise about $268 million of 

the overall $651 million in supplemental and other funds allocated to 

USAID for bilateral reconstruction activities. We also included lesser 

amounts of regular fiscal year appropriations allocated to the three 

activities within our scope.

To obtain information on the appropriations, allocations, and planned and 

ongoing uses of U.S. reconstruction funding for Haiti,2 we reviewed the 

Act, enacted by Congress in July 2010; State and USAID FY 2010

Supplemental Appropriations Spending Plan, issued by State in 

September 2010; and the interagency Post-Earthquake USG Haiti 

Strategy: Toward Renewal and Economic Opportunity, issued by State in 

January 2011. We also reviewed the Action Plan for National Recovery 

 

1

Supplemental Appropriations Act, 2010, Pub. L. No. 111-212, 124 Stat. 2302, 2323 (July 

29, 2010). The law mandated that funds previously available to GAO pursuant to Title I, 

Chapter 4 of Pub. L. No. 106-31 (to monitor provision of assistance to address the effects 

of hurricanes in Central America and the Caribbean) also be available to GAO to monitor 

post-earthquake expenses related to Haiti, including relief, rehabilitation, and 

reconstruction aid. In May 2011, we issued a report that described the planned uses for 

U.S. reconstruction assistance, USAID’s internal controls for overseeing U.S. 

reconstruction funds, and Interim Haiti Recovery Commission governance and oversight 

structures. In November 2011, we issued a report that described planned and ongoing 

uses for U.S. reconstruction assistance and identified factors contributing to delays in 

USAID infrastructure construction. See GAO, Haiti Reconstruction: U.S. Efforts Have 

Begun, Expanded Oversight Still to Be Implemented, GAO-11-415 (Washington, D.C.: 

May 19, 2011); and Haiti Reconstruction: Factors Contributing to Delays in USAID 

Infrastructure Construction, GAO-12-68 (Washington, D.C.: Nov. 16, 2011). 2

USAID and State have changed amounts allocated for infrastructure construction 

activities as plans have developed. We are reporting amounts allocated based on the 

most current information we received.

Appendix I: Scope and Methodology
Appendix I: Scope and Methodology

Page 42 GAO-13-558 Haiti Reconstruction

and Development of Haiti, issued by the government of Haiti in March 

2010. In addition, we reviewed the Haiti Reconstruction Grant Agreement, 

signed by the U.S. and Haitian governments in May 2011. We met in 

Washington, D.C., and in Port-au-Prince, Haiti, with officials from USAID 

and State. USAID defines allocation as the identification and setting aside 

of resources for a specific program action.

To determine the amounts of funding obligated and disbursed from 

USAID’s supplemental funding, as well as funding from other sources for 

reconstruction activities, we analyzed data reported by USAID as of 

March 31, 2013. These data include information on obligations and 

disbursements of supplemental appropriation funding overall, as well as 

amounts provided for particular activities within our scope.

To assess the reliability of the data on planned allocations, obligations, 

and disbursement, we conducted follow-up correspondence and 

interviews with cognizant officials from USAID and State. We asked them 

standard data reliability questions—including questions about the 

purposes for which funding data were collected, the use of the data, how 

the data were collected and generated, and how the agencies ensured 

that the data were complete and accurate. We determined the data to be 

sufficiently reliable for the purposes of this report.

To describe State’s decision for the U.S. government to support the CIP, 

we interviewed State officials to determine the rationale for the decision 

and reviewed portions of the framework agreement laying out the terms of 

the public-private partnership to be followed by the Haitian government, 

the Inter-American Development Bank (IDB), and the anchor tenant, a 

private Korean garment manufacturer, Sae-A Trading Co. Ltd. (Sae-A). 

We reviewed studies and reports on the Haitian economy and the 

potential economic impact of the CIP that State officials had reviewed 

before making this determination. We also reviewed any types of 

calculations that State officials had conducted about the effect of the CIP 

on job and economic growth in Haiti. When reviewing these studies, 

reports, and calculations, we noted the methodologies used and any 

potential limitations those methodologies may have had on their findings. 

To ascertain the IDB’s progress in building the CIP, we performed a site 

visit at the CIP in December 2012, interviewed the CIP’s construction 

manager, and received a tour of the Sae-A facility. In addition, we 

received copies of more recent photos and videos of the CIP that were 

taken by IDB staff in January 2013. To determine the Haitian 

government’s progress in filling the CIP with tenants, we met with State’s 

Senior Advisor for Industrial Development in Haiti who works with the 
Appendix I: Scope and Methodology

Page 43 GAO-13-558 Haiti Reconstruction

Haitian government to recruit companies to the CIP to learn about the 

recruitment process and its progress. From this State official, we also 

received documents containing summaries of information about new and 

potential tenants to the CIP.

To describe USAID’s progress with the CIP power plant, we reviewed 

plans for the power plant as outlined in the September 2011 Activity 

Approval Document (AAD) for the Haitian energy sector and compared 

these plans with the time frames, costs, and descriptions of the power 

plant project in award documents and amendments, as well as progress 

reports from the construction contractor. We also interviewed USAID and 

State officials in Washington, D.C., and Haiti to determine the reasons for 

any differences between planned and actual costs and time frames. To 

describe how USAID assessed the power plant project for its 

environmental and social impact, we reviewed the June 2011 

environmental assessment of the CIP that a USAID contractor had 

performed. To determine how USAID followed up on mitigation measures 

suggested in this environmental assessment, we interviewed USAID 

officials and reviewed contracts for building, overseeing the construction 

of, and operating and maintaining the power plant, as well as progress 

reports from the construction and oversight contractors that included 

updates on the mitigation measures being taken. To determine the 

planning and progress made regarding electricity distribution from the CIP 

power plant to residences and businesses outside the CIP, we 

interviewed USAID officials and reviewed USAID planning documents, 

the cooperative agreement for initial power distribution outside the CIP, 

and progress reports from the nongovernmental organization (NGO) 

responsible for this distribution.

To describe USAID’s progress with a new port for the Cap-Haïtien 

corridor, we reviewed plans for the port such as those articulated in the 

most recent draft of the AAD for the Haitian port sector dated August 

2011, in procurement documents for the port feasibility study, and in 

interviews with USAID and State officials. We then reviewed the port 

feasibility study and interviewed USAID officials on the process and 

results of that study to determine USAID’s progress against its initial 

plans.

To describe USAID’s progress constructing permanent houses under its 

New Settlements program, we reviewed plans as outlined in the August 

2011 AAD and compared these plans with the time frames, costs, and 

descriptions of the New Settlements program in design packages, award 

documents and amendments, and progress reports from various site 
Appendix I: Scope and Methodology

Page 44 GAO-13-558 Haiti Reconstruction

preparation and construction contractors. We also interviewed USAID and 

State officials in Washington, D.C., and Haiti to determine the reasons for 

any differences between planned and actual costs, time frames, and 

expected results. We calculated the weighted average cost of 

construction per plot and per house by (1) calculating the total cost of plot 

and house construction for the two sites that had awarded contracts, (2) 

calculating the total number of plots and houses at both sites, and (3) 

dividing the first number by the second. For the initial average cost per 

plot, we used data on costs and numbers of plots and houses at each site 

obtained from initial contracts. For the revised average cost per plot, we 

used data on costs and numbers of plots and houses at each site 

obtained from modifications to the initial contract. To discuss the role of 

NGOs and other partner donors in the New Settlements program, we 

reviewed various documents related to partners who had planned or 

committed to building houses on USAID-developed sites. We interviewed 

a partner organization housed with the Haitian government and funded by 

the IDB; however, we were unable to interview other potential partner 

NGOs because negotiations over the terms of agreements were ongoing.

In addition, we interviewed the implementers responsible for a 

cooperative agreement with USAID related to community development 

and beneficiary selection efforts for the New Settlements program and 

reviewed the beneficiary selection data they had gathered for the 

Caracol-EKAM site.

To determine the sustainability of the power plant, port, and new 

settlements, the definition of sustainability we use is based on the 

Organisation for Economic Co-operation and Development definition, 

which defines “sustainability” as “the continuation of benefits from a 

development intervention (such as assets, skills, facilities, or improved 

services) after major development assistance has been completed.” We 

operationalized this definition by specifying that sustainability is the ability 

of the Haitian government to operate and maintain the USAID-funded 

power plant, port, and new settlements in such a condition as is required 

to produce the projected benefits. To determine issues that may affect the 

sustainability of these three projects, we reviewed reports commissioned 

by agencies and organizations, such as USAID, State, the International 

Finance Corporation, the World Bank, and the U.S. Trade and 

Development Agency, on the Haitian energy, port, and shelter sectors. 

We reviewed procurement documents, assessments, and progress 

reports related to these specific projects. We also interviewed USAID 

officials to understand their key sustainability concerns for these projects.
Appendix I: Scope and Methodology

Page 45 GAO-13-558 Haiti Reconstruction

We traveled to Haiti in December 2012 and met with U.S. officials from 

USAID and State, and representatives from some of USAID’s partners 

involved in implementing the projects in our review—including the IDB, 

Sae-A, and construction firms and partner donors involved in the New 

Settlements program. In the Cap-Haïtien corridor, we visited the CIP, the 

CIP power plant, one of the sites for the proposed port, and all New 

Settlement sites under construction or planned for future construction. In 

the Port-au-Prince corridor, we visited the New Settlement sites under 

construction and planned for future consideration, sites where temporary 

shelters were built, and sites damaged by the earthquake.

We conducted this performance audit from August 2012 through June 

2013 in accordance with generally accepted government auditing 

standards. Those standards require that we plan and perform the audit to 

obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings 

and conclusions based on our audit objectives.
Appendix II: Comments from the U.S. Agency 

for International Development

Page 46 GAO-13-558 Haiti Reconstruction

Appendix II: Comments from the U.S. Agency 

for International Development

GAO received USAID’s 

letter on June 3, 2013.
Appendix II: Comments from the U.S. Agency 

for International Development

Page 47 GAO-13-558 Haiti Reconstruction
Appendix II: Comments from the U.S. Agency 

for International Development

Page 48 GAO-13-558 Haiti Reconstruction
Appendix III: GAO Contact and Staff 

Acknowledgments

Page 49 GAO-13-558 Haiti Reconstruction

David Gootnick, (202) 512-3149 or gootnickd@gao.gov

In addition to the contact named above, Leslie Holen (Assistant Director), 

Lynn Cothern, Heather Latta, George Taylor, and Brian Tremblay made 

key contributions to this report. Ashley Alley, Etana Finkler, Justin Fisher, 

Courtney LaFountain, and Mary Moutsos provided technical assistance.

Appendix III: GAO Contact and Staff 

Acknowledgments 

GAO Contact

Staff 

Acknowledgments 

(320937)
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