Big Dig firm apologizes, considers fund for repairs

Top executives of the company managing the Big Dig, testifying at a packed State House hearing yesterday, apologized for lapses that led to a massive leak in the Interstate 93 northbound tunnel wall on Sept. 15, and agreed to consider the creation of an unusual escrow fund to pay for future leak repairs.

The conciliatory remarks constituted the first admission of a major mistake by Bechtel/Parsons Brinckerhoff since engineering work began on the project two decades ago.

In addition to the apology, Bechtel/Parsons Brinckerhoff chairman John MacDonald said the firm would pay, along with the construction firms involved, for the cost of repairing the wall damaged by the September leak, and made the same pledge to cover the bill for inspecting thousands of additional wall panels for possible flaws in coming weeks.

''We apologize for our mistakes," MacDonald said of the leak, which occurred in a section of the tunnel wall that Bechtel/Parsons Brinckerhoff engineers knew to be structurally flawed when it was built in 1999.

MacDonald expressed openness to the establishment of the escrow fund, proposed by Senator Steven A. Baddour, cochairman of the Legislature's Joint Transportation Committee, which held the hearings. Baddour is pushing for the fund to make sure that money is available to continue leak repairs even after Bechtel Corp. of San Francisco and Parsons Brinckerhoff of New York leave town when construction of the Big Dig is complete next year.

Yesterday's testimony, unlike so many past State House appearances by Bechtel/Parsons Brinckerhoff executives throughout the long and controversial history of the $14.6 billion project, was a stark departure for a company that repeatedly insisted that it has ''met or exceeded its contractual obligations" in all regards, despite massive cost overruns and construction delays.

At first, MacDonald resisted the escrow fund idea, saying it would be unnecessary.

''We are convinced that when the project is done it will meet all standards for being dry," said MacDonald.

But after being pressed on the issue by Baddour and later by the House chairman of the committee, Representative Joseph F. Wagner, a Chicopee Democrat, MacDonald relented, agreeing to discuss the matter with the lawmakers at an unspecified date.

Baddour, a Methuen Democrat, told MacDonald and other Bechtel/Parsons Brinckerhoff executives he was pleased that the company took responsibility, but said, ''I'm disappointed that it took this committee to force you to take responsibility for mistakes for the first time in the history of the project."

Calling Bechtel/Parsons Brinckerhoff ''the epitome of Teflon," Wagner said the firm has been expert at deflecting blame to construction contractors, the state or others. ''It's always someone else's fault," he said. ''Nothing ever sticks to you."

Wagner asked MacDonald whether Bechtel/Parsons Brinckerhoff expected that its share of the blame in the Sept. 15 leak would be more or less than 50 percent of the estimated $250,000-to-$500,000 repair cost.

''Less," said MacDonald.

''You do a pretty good job of placing the problem at the feet of others," Wagner said.

Wagner then took exception to a letter he received from Bechtel/Parsons Brinckerhoff, dated Nov. 19, after Globe stories uncovering the leak problem. The letter stated that the company was still investigating what caused the Sept. 15 leak, even though company engineers were aware the wall section had significant construction flaws that would make it susceptible to a major leak.

''You knew by the time that letter went out what you have said here today, that Bechtel/Parsons Brinckerhoff was responsible," Wagner said. ''This is why you have a real credibility problem."

Lawmakers also questioned MacDonald about other, unrelated leaks in the roofs of the I-93 tunnel system, but MacDonald declined to shoulder blame for that situation. There are at least 700 such leaks in the I-93 corridor, and water seeping, trickling, and pouring through them has begun to stain tunnel walls, corrode steel, short out overhead lights, and even spill onto the roadway.

Earlier this week, two engineering specialists hired by the Turnpike to assess the extent of the leak problem testified that the tunnels are structurally sound, but could deteriorate and become unsafe if a rigorous leak-patching and maintenance program were not in place. Such work, they said, could take a decade or more, and cost several million dollars.

The Bechtel/Parsons Brinckerhoff testimony was the climax of this week's often-tense Joint Transportation Committee hearings, which sought to uncover not only the causes of the various wall and roof leaks, but also who is responsible for them, and whether the Turnpike Authority is willing to pursue Bechtel/Parsons Brinckerhoff and contractors for the costs of the repairs.

Turnpike chairman Matthew J. Amorello, whom Governor Mitt Romney has asked to resign because of the leak debacle, testified yesterday that he is committed to pursuing the project managers as well as general contractors such as Modern Continental Co. of Cambridge for the cost of repairing the leaks and related damage. He also said that he now has Bechtel/Parsons Brinckerhoff executives' assurances that the firm will approach its Big Dig work with the same attention to detail that it gives to the building of nuclear power plants.

But neither Amorello nor the Turnpike's Big Dig project director, Michael P. Lewis, could assure skeptical lawmakers that the managerial lapses that led to the wall leak in September would not happen again. ''I cannot say that it would not happen again," said Lewis, who also told lawmakers, ''I'm the one who's responsible; I'm the project director."

While Amorello testified that the Big Dig's budget has built-in contingencies for leak repairs and other unanticipated costs, he refused to say that the project's $14.6 billion cost estimate would hold until construction is finished late next year. He said the turnpike is still wrestling with contractors over hundreds of millions of dollars in cost overruns, some of which are related to the leaks.

In written testimony, a top official in the US Department of Transportation's Office of Inspector General labeled the work of an Amorello-appointed cost-recovery legal team ''anemic" and called on the Legislature to create a bipartisan independent commission to investigate the cause of the leaks, who is responsible, and ensure ''that they bear the costs of the leaks and not the taxpayers." Over roughly two years the cost-recovery team has recouped $3.5 million, out of more than $700 million in identified cost overruns attributed to mistakes or omissions.

The testimony, offered by Assistant Inspector General Debra S. Ritt, said Amorello's team, led by retired Judge Edward M. Ginsburg, had already investigated 13 leak-related cost overruns for ''which the team determined there was no contractor liability."

''The Commonwealth must move expeditiously in identifying a solution," Ritt's testimony said. ''If the leak problems are not resolved before the project's scheduled completion in September 2005, the Commonwealth may be saddled with significant maintenance and repair costs."

Ginsburg and his colleagues were scheduled to testify yesterday, but lawmakers spent so much time questioning Bechtel/Parsons Brinckerhoff executives and Amorello that there was no time to do so. Baddour said he would make sure Ginsburg gets his say at a hearing in the near future. In the past, Ginsburg has maintained that his team is aggressively pursuing refunds for mistakes and shoddy construction, and has filed a dozen lawsuits -- including the one against Bechtel/Parsons Brinckerhoff.

It was clear from the questioning yesterday that many legislators are no longer content to allow the turnpike to manage the leak negotiations with Bechtel/Parsons Brinckerhoff and contractors. Several yesterday said they were supportive of the escrow account idea, an idea first floated by Baddour.

Representative James M. Murphy, a Weymouth Democrat, said it's common in real estate transactions for money to go into escrow when a flaw is found in an about-to-be purchased house.

Representative Brian Knuuttila, a Gardner Democrat, said: ''Do the escrow. The mileage you will get out of that is incredible."

''What we are concerned with is problems down the road, when you have packed up and gone," said Senator Robert L. Hedlund, a Weymouth Republican.

Senator Mark C. Montigny, a New Bedford Democrat and one of Beacon Hill's harshest critics of Bechtel/Parsons Brinckerhoff, said the private-sector managers had ''outgunned and outsmarted" the state to avoid responsibility for mistakes.

''That," Montigny said, ''is what is so galling."

Raphael Lewis's e-mail address is rlewis@globe.com. Sean Murphy's is smurphy@globe.com.