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The Boston Globe OnlineBoston.com Boston Globe Online / Easy Pass

State IG says Bechtel masked role in overruns

By Anthony Flint, Globe Staff, 2/27/2003

   
 THE SERIES

PART ONE
Bechtel's mistakes drive up cost overruns, and company profits.

Graphics
Bechtel's fee overruns
Map of major conflicts
History of the contract
Contract modifications
Cross section of roadway
Construction cost overruns


PART TWO
State officials overlook and excuse Bechtel's mistakes for a decade.

Graphic
Cost recoveries initiated


PART THREE
Powerfull allies help protect Bechtel and its bottom line.

 FOLLOW-UPS

This series has generated strong response from the state, the public, and Globe columnists.
More Globe coverage

 GLOBE DEFENSE OF SERIES

On Feb. 20, 2003, Bechtel/Parsons Brinckerhoff issued a document disputing the findings of the "Easy Pass" series. Globe editor Martin Baron responded with a defense of the Globe's reporting.
Read Bechtel's statement
Read the Globe's statement

 PHOTO GALLERY

Building a reputation
Bechtel has never shied away from big construction projects, but worldwide achievements are accompanied by controversy.
See past Bechtel projects

 FROM THE ARCHIVES

2001
Review cites flaws at Big Dig
Cerasoli charges Big Dig coverup
$1.4b overrun known in '99
Firm rejects call to offset costs
'99 memos warned of tunnel leaks

2002
Officials disclose more defects
Lawsuit raises Big Dig questions
State to reopen deal with Bechtel
Big Dig hires quality manager
US knew of hidden expenses
Big Dig overrun just plain big
SEC probers to target Big Dig
Big Dig review to target overruns
Turnpike, firm set deal on leak cost

2003
Contracts to be reviewed

 RELATED LINKS

Central Artery/Tunnel Project
www.bigdig.com

Bechtel
www.bechtel.com

Parsons Brinckerhoff
www.pbworld.com

State Inspector General reports
On the history of the Central Artery/Tunnel project's finances:
www.state.ma.us/ig/publ/cat01ex.htm
On the Central Artery/Tunnel project's attempts to recover money for mistakes:
www.state.ma.us/ig/publ/catcrex.htm

About "Scheme Z" bridge design
libraries.mit.edu/rotch/artery/

State oversight of the Big Dig
www.state.ma.us/catocc/

Mass. Turnpike Authority
www.massturnpike.com

The Artery Business Committee
www.arterybusiness.com

 ONLINE CHAT

On February 11, 2003, Globe reporter Raphael Lewis chatted with Boston.com readers about the Bechtel series.
Transcript of chat

 CONTACT THE GLOBE

Any tips? Let us know.
Phone: 617-929-3379
E-mail: bigdigtips@globe.com

 MORE BOSTON.COM COVERAGE


Beyond the Big Dig   What happens to the ribbon of land being created by the depression of the Central Artery? A joint effort between The Boston Globe, MIT, and WCVB-TV explores.
A special report


Progress updates on the Big Dig. Info
 


The company in charge of the Big Dig has concocted a ''cover story'' to distance itself from $1 billion in cost overruns that were the result of errors, omissions, and other problems in plans for which the company ultimately had responsibility, state Inspector General Gregory W. Sullivan said yesterday.

In defending its performance, the joint firm of Bechtel/Parsons Brinckerhoff ''has tried to evade responsibility for cost overruns by misrepresenting and minimizing its obligations under its contract,'' Sullivan said, after releasing a 54-page report responding to the company's rebuttal to a Boston Globe series on the errors and overruns.

Andrew Paven, a spokesman for Bechtel, said, ''We stand by our work, and our detailed rebuttal to the Globe series. We will review the IG's claims.''

The Globe series found that $1.1 billion in Big Dig cost overruns was tied in various ways to Bechtel, the company that oversaw the process of drawing designs for the massive project. The company has said the increased costs were due to changing site conditions and routine changes in the contracts executed by other companies, for which Bechtel could not be held responsible.

The inspector general's office performs independent assessments of state contracts and makes recommendations to the state government. In the past, it has investigated some Big Dig contracts, declaring earlier this month that Bechtel owed the state $65 million for design errors and management oversights on one aspect of the project.

Yesterday's report is particularly critical of the company's assertion that changing site conditions led to overruns, saying such language ''masks ... the true nature of the overruns and obfuscates [the company's] culpability for its share of responsibility for the overruns.''

The report comes as Adrian Zaccaria, president of Bechtel Group, the lead firm in the joint venture, arrives in Boston tomorrow for a meeting with Governor Mitt Romney, who is reviewing the potential for cost recovery from the engineering partnership.

Sullivan's report scrutinizes the role of Bechtel as the lead entity in charge of the $14.6 billion project to submerge the Central Artery and link Interstate 90 with Logan Airport through the Ted Williams Tunnel. Bechtel did research on soil conditions and construction challenges, and sketched out preliminary designs for virtually all of the project's components. Other contractors took over at that point, though Bechtel/Parsons Brinckerhoff was contractually obligated to monitor all work for professional standards.

Cost overruns of about $730 million were the result of major revisions and additions that needed to be made to incomplete preliminary designs, the report says. It dismisses Bechtel's contention that the company was operating on a ''fast track'' system where construction routinely started before design plans were 100 percent complete. No evidence of a ''fast track'' system could be found, the report says.

Nor can an additional $340 million in contract modifications be explained away as the result of ''differing site conditions,'' the report says. ''The attribution of cost overruns to differing site conditions has been used by [the company] as a cover story for its failure to perform its contractual obligation to fully assess site conditions during the design stage,'' it says.

The company's contract clearly spells out its responsibilities and obligations, the report says, chastising Bechtel's assertions that it was not responsible for various costly modifications. ''It would appear that [Bechtel] has been paid nearly $2 billion to simply monitor these design contracts, process payments and pass documents through to the Turnpike Authority,'' Sullivan's report says. ''For $2 billion, the Commonwealth expected [the company] to do more than shuffle paper.''

In some cases, the report suggests that Bechtel is responsible for greater sums than those identified in the Globe series. The failure to include the FleetCenter in preliminary designs resulted in not just $1 million but ultimately $2.5 million in additional costs, primarily because a vent building abutting the FleetCenter had to be redesigned, the report says.

The company has said that only $30,000 was needed to rectify the FleetCenter error, which it attributed to a separate design firm.

Sullivan's report, however, supports the Globe's findings that costly revisions, corrections, and additions to contracts for several components of the project can be traced back to Bechtel: the construction of tunnels between Haymarket Square and North Station; the support of Green Line track near the FleetCenter; the filling in of a gap between sections of the Ted Williams Tunnel; and a leak in the submersion of tunnel boxes in the Fort Point Channel.

Sullivan also concluded that there was an insufficient procedure in place to monitor Bechtel, and that the company was wrongly put in charge of effectively reviewing its own work. Efforts to recover costs have been ineffective because of the faulty system, the report says.

Romney has said he wants an explanation of the overruns and will continue to try to recover costs. The Legislature this week extended the allowable amount of time for recovering costs.

Anthony Flint can be reached at flint@globe.com.

This story ran on page A1 of the Boston Globe on 2/27/2003.
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