Probes may test Bechtel's clout

Bechtel Corp., one of the world's largest construction and engineering firms, has few equals when it comes to wielding political power and fending off enemies.

The company and its management partners on Boston's $14.6 billion Big Dig hired a team of deeply connected lobbyists and lawyers to help it influence local and state officials. It enjoyed minimal state oversight and denied responsibility for cost overruns and leaky tunnels.

When Bechtel finally faced scrutiny from state officials in recent years, the company was accused of stonewalling investigators and sued to block release of negative information.

Now Bechtel faces the biggest test of its political influence and legal strategies in Massachusetts, after concrete ceiling panels collapsed in the Interstate 90 connector tunnel and killed Milena Del Valle, a motorist.

State Senator Marc R. Pacheco , a Taunton Democrat who convened a 2003 legislative committee to review Bechtel's Big Dig operations, had a close-up view of the corporation's power.

``State agencies and auditors were like fleas on this big giant," Pacheco said. His panel's report criticized conflicts of interest, secrecy, and weak state supervision of the Central Artery project.

Bechtel has said that under its Big Dig contract, state officials -- not the company -- were responsible for the final approval of design work.

That stipulation, it said, means the Bechtel/Parsons Brinckerhoff project management partnership is not liable for expenses involving design failures on the project.

But a lawyer who specializes in construction litigation said the company might not be able to avoid blame for inadequate inspections of the ceiling bolts .

``Having a direct obligation to see that these bolts are tested, I feel they are going to have a hard time ducking responsibility," said the lawyer, Russell Conn , of Conn Kavanaugh Rosenthal Peisch & Ford , in Boston.

Attorney General Thomas F. Reilly has launched a criminal investigation and abandoned negotiations on a civil cost-overrun settlement that could have insulated Bechtel from future liability. Conn predicted that a major and costly legal fight between Bechtel and the state may ensue.

``I'm sure Bechtel will match the state dollar for dollar, and then some," he said.

Bechtel spokesman Andrew Paven declined to comment on the ongoing investigations.

Nationwide, critics say Bechtel has worked to deflect responsibility for problems on other public projects, including a multi billion dollar nuclear waste cleanup plant at the federal Hanford Reservation in Washington state, and design for the planned Yucca Mountain nuclear waste storage facility in Nevada.

Bechtel also has a national reputation for being aggressive with both oversight authorities and critics, said Tom Carpenter , director of the nuclear oversight program at the Government Accountability Project , a national nonprofit advocacy group that is monitoring the Department of Energy's Hanford cleanup. ``They just decide not to tell important things to the agency and do it their way."

The Hanford project, which has tripled in cost to more than $13 billion over six years, has been marked by delays and construction problems, including what a federal audit described as ``inadequate oversight" of Bechtel by the US Department of Energy.

Initial planning for Yucca Mountain, which is eventually supposed to hold the nation's spent nuclear reactor fuel, has been plagued with quality problems, according to a federal report reviewed by the Globe.

The company also faced criticism because contracts awarded to it by the Bush administration for Iraq reconstruction were not initially put out to bid, and for its response to Hurricane Katrina, including $48 million in alleged double-billing for maintenance of temporary housing trailers. The company said it did not double-bill the government, blaming the problem on ``initial miscalculations on estimates."

Bechtel strictly adheres to its contracts and the law and takes pride in its national and international work, said company spokesman Michael Kidder . Large government projects like the Big Dig and Hanford are inevitably complicated, he added.

``Good oversight is good business as far as Bechtel is concerned," Kidder said. ``The huge scope of these projects, and some are first of a kind, are bound to cause some wrinkles along the way, and they become lessons learned."

Privately owned and based in San Francisco, Bechtel has 40,000 employees worldwide and revenues of $18.1 billion in 2005 -- about as much as the state collected in taxes last year.

It built the Hoover Dam in the 1930s, oversaw construction of the English Channel rail tunnel connecting Britain and the continent, and has won thousands of big contracts from the US government, and nations and corporations around the world. It also has strong connections to the national Republican Party. Two former Bechtel executives, George Shultz and Caspar Weinberger , served as department secretaries in the administration of President Ronald Reagan.

The company, through its political action committee, contributes generously to Republican and Democratic candidates nationwide. In Massachusetts it has forged ties with political operatives from both parties.

Despite its highly publicized problems, Bechtel has an international reputation for getting projects done on time and within budget, said John J. Kosowatz , managing editor of the trade journal Engineering News-Record.

``There's very few companies in this country or other countries that have the size and the deep pockets and the engineering and construction expertise that Bechtel brings to the table," he said. ``If you're looking for one company to do the job, your options are limited."

Pacheco's Senate committee found in 2003 that Bechtel's lawyers fashioned contract agreements with the state that resulted in state officials and company supervisors working side by side. Those on-the-job relationships affected the state's ability to objectively assess the project's progress and quality, the committee said.

Weak government oversight is not unique to Massachusetts, said Laton McCartney , author of ``Friends in High Places ," a 1989 book Bechtel has disputed. The company has a history of using political and legal influence to reduce aggressive government monitoring, McCartney said.

``It's not just lining up the guy who is the building inspector," McCartney said. ``They would co-opt the whole supervising, regulatory infrastructure."

Efforts by contractors to influence government oversight are common in the public construction industry, McCartney said. But with Bechtel, ``what makes it more visible or pervasive is the scale of their projects."

Kidder, the Bechtel spokesman, said the company's methods are not unusual in the large-scale construction industry. In Massachusetts, the Bechtel/Parsons Brinckerhoff partnership retained Peter Berlandi , the top fund-raiser for former governor William F. Weld, to work as a lobbyist.

``What we do is standard practice, where we go into a marketplace and retain folks who are well-known in that particular area to help us with the introductions and open doors in the community," Kidder said.

In Massachusetts, the company repeatedly sought to keep critical information out of the public eye , and also out of the hands of independent investigators hired by the Big Dig. In 2003, it tried to stop the release of federal audits that detailed $31 million in cost overruns. It lost, but fighting Bechtel's court injunction request consumed the Senate Post Audit and Oversight Committee staff's time.

It also drew the ire of a former probate judge, Edward M. Ginsburg , an independent lawyer who was hired by the Massachusetts Turnpike Authority to lead a probe and cost-recovery effort after Big Dig tunnels leaked in 2004. Ginsburg complained to the authority that Bechtel was slow to respond to requests to turn over records despite public calls for transparency by the authority's chairman, Matthew J. Amorello.

``It is indeed ironic that the people trying to get this information on behalf of the public are being impeded and thwarted by the actions and delays of Bechtel/Parsons Brinckerhoff," Ginsburg wrote in a letter to a turnpike manager in December 2004. The partnership denied Ginsburg's accusations.

Even when a majority of sitting board members on the Turnpike Authority expressed frustration with cost overruns under Bechtel's management, they were unable to wrest control from the company. Acting Governor Jane Swift removed from the board two major Bechtel critics, Jordan Levy and Christy Mihos , who is running for governor.

Some Democrats and Big Dig skeptics said Swift fired them to insulate Bechtel from criticism, but Swift said she took the action because they refused to increase Turnpike tolls.

Levy said Bechtel never responded to his demands for accountability.

``They just ignored me," he said. ``They didn't take me seriously, because they knew they had connections in other places."

Christopher Rowland can be reached at crowland@globe.com.