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Inspector General Audit: ICE Wasted $17 Million on Hotels to Not House Illegal Foreign Nationals

Audit also finds ICE didn’t follow COVID-19 protocols when transporting, releasing them into U.S.
A Scottsdale, Arizona, hotel has been converted into an immigrant holding facility. Cole Lauterbach / The Center Square
A Scottsdale, Arizona, hotel has been converted into an immigrant holding facility. Cole Lauterbach / The Center Square

Endeavors, a nonprofit that’s received half a billion dollars in taxpayer money through no-bid government contracts to house foreign nationals who illegally entered the U.S. and were released by the Biden administration instead of being deported, wasted $17 million on unused hotel rooms, according to a recent audit.

The Department of Homeland Security Office of the Inspector General evaluated an $86.9 million sole source contract first awarded to Endeavors earlier this year. The contract was awarded for six months to provide “temporary shelter and processing services for families who have not been expelled and are therefore placed in immigration proceedings for their removal from the United States,” The Center Square previously reported.

The audit evaluated the process used by U.S. Immigration and Customs Enforcement (ICE) to grant no bid contracts to Endeavors and their compliance with federal law.

Sole source contracts are used when an agency can demonstrate the contract meets specific and justified criteria. If contracts don’t meet one of the criteria, they must be awarded through an open competitive process.

Endeavors has no professional history of providing housing services and has never provided beds or all-inclusive emergency family residential services, OIG auditors found. Those critical of DHS’ contract process argue the agency should be awarding contracts through an open competitive process to ensure that those bidding for funds can offer the services they claim they can provide.

Under the contract in question, for six months between March and September 2021, Endeavors was responsible for providing 1,239 beds and other necessary services in hotels. It used six hotels and repurposed them as Emergency Family Reception Sites to accommodate families staying less than three days while ICE considered conditions of release, including alternatives to detention.

IOG inspectors found that ICE didn’t “adequately justify the need for the sole source contract to house migrant families and spent approximately $17 million for hotel space and services at six hotels that went largely unused between April and June 2021. ICE’s sole source contract with Endeavors resulted in millions of dollars being spent on unused hotel space.”

The IOG made four recommendations for ICE to improve its contracting and oversight of hotel facility management and operations. ICE concurred with one recommendation and didn't concur with three. Based on information ICE provided in its response, the IOG said it considered one recommendation resolved and closed, and three recommendations administratively closed.

ICE has typically used hotels to house family units because federal holding facilities built near the border were designed to detain individuals, not families. In early 2021, ICE anticipated an increased number of families arriving at the border. After Department of Homeland Security Secretary Alejandro Mayorkas altered deportation and removal processes, for which he was sued by multiple states, ICE awarded contracts to Endeavors to manage the hotels.

OIG auditors conducted remote inspections of four hotels operated by Endeavors: Casa de Estrella and Casa Consuelo in El Paso, Texas; Casa de Paz in Pearsall, Texas; and Casa de la Luz in Phoenix, Arizona.

Auditors found that Endeavors didn’t “meet new healthcare protocols or ensure proper COVID-19 testing for families.” They found that ICE agents didn’t first test those in its care to determine if they had the coronavirus before transporting them to hotels managed by Endeavors. Once the families arrived, they weren’t “always tested by Endeavors staff upon arrival at or departure from hotels, putting migrant families and the outside population at risk of contracting COVID-19.”

According to ICE, there were 1,713 cases of COVID-19 in the six sites Endeavors operated between April 9 and Nov. 18, 2021.

Months after it received its first no bid contract, Endeavors received a second $530 million contract and hired former Biden administration official Andrew Lorenzen-Straight as its senior director for migrant services and federal affairs, Axios reported.

Lorenzen-Strait previously worked at ICE and on the Biden-Harris transition team. He also ran a consulting firm advising companies on federal procurement practices, Axios reported, and worked with the Administration for Children and Families within the U.S. Department of Health and Human Services. HHS has oversight of detaining and processing unaccompanied minors who are brought to the southern border by traffickers and cartel operatives.

DHS policy is to detain, house and release into the U.S. unaccompanied minors to a sponsor or family member. Border Patrol agents have told The Center Square, and federal agents have acknowledged, they don’t use biometric or DNA testing to confirm that those claiming the minors are family members are actual biological family members. They’ve released hundreds of thousands of minors to adults who claim to be their relatives.

Texas Gov. Greg Abbott has repeatedly raised concerns about minors being trafficked into Texas. Among the many questions he’s asked President Joe Biden and Vice President Kamala Harris is if the federal government is tracking where the unaccompanied minors are coming from, what COVID-19 variants they might have been exposed to, and how long they will be held in Texas. He’s received no response.

Last year, he directed the Texas Rangers to launch an investigation and blamed the Biden administration after reports surfaced of abuse occurring at federal facilities housing unaccompanied minors in Texas. Since then, the Biden administration has acknowledged it’s lost track of thousands of unaccompanied minors released into the U.S.

A record number of unaccompanied minors have been apprehended at the southern border since Biden’s been in office: 146,925 (FY21) and 140,186 (FYTD22), according to U.S. Customs and Border Protection data.

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