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Lawmakers grill Artery managers on overruns
By Raphael Lewis and Sean P. Murphy, Globe Staff, 4/3/2003
PART ONE
Graphics PART TWO
Graphic PART THREE
This series has generated strong response from the state, the public, and Globe columnists.
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.
Building a reputation
Central Artery/Tunnel Project
Bechtel
Parsons Brinckerhoff
State Inspector General reports
About "Scheme Z" bridge design
State oversight of the Big Dig
Mass. Turnpike Authority
The Artery Business Committee
On February 11, 2003, Globe reporter Raphael Lewis chatted with Boston.com readers about the Bechtel series.
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Pressed to assign a dollar value to the company's share of more than $1.6 billion in construction cost overruns, Bechtel/Parsons Brinckerhoff's top executive on the project testified under oath that the figure "may be in the millions, [but] I don't think it's tens of millions."
C. Matthew Wiley, often facing tough and repeated questions, took a defiant stand on the company's record, saying that virtually all mistakes committed on the Big Dig have been the fault of the state's project managers, or other contractors. He said Bechtel's stewardship made the project a success -- even though more than 10,000 construction cost overruns have blown apart its budget.
Senator Marc R. Pacheco, who has chaired the hearings held yesterday and Monday, was incredulous: "Do you consider 10,000 change orders a success?"
Wiley responded that the company never guaranteed perfection -- nor did its contract. Asked whether Bechtel kept internal estimates about how many errors the company had committed on the project, and their dollar value, Wiley said, "I have no clue," then added afterward, "We're not running from our responsibility. We'll wait and see where the facts are."
But the senators prodded Wiley and his colleagues about their role in the apparent failures of project officials to reveal the actual cost of the Big Dig before an overrun scandal exploded in early 2000.
Wiley and his colleagues testified that, in 1994 and 1995, Bechtel agreed to downsize the project's budget so that construction cost growth, on paper, would be 7 percent, even though it historically stood at roughly 15 percent. Today, it's about 25 percent.
William Edwards, Bechtel's budget chief, said the company considered the budget "aggressive but achievable," prompting a frustrated response from Senator Mark C. Montigny, chair of the Long Term Debt Committee.
"Am I missing something here?" Montigny said. " `Aggressive but achievable' was either foolish, or you blew it." He called Bechtel's answers a "whitewash."
Bechtel managers testified that they have made all the key recommendations and many important decisions on the project, managed the entire design and construction process, and created all financial analyses to date, and yet bear virtually no contractual responsibility for construction or design errors.
Pacheco, in particular, took the testimony as a cue that the state should "never again enter into this kind of relationship" with a private construction manager. He said he would look to etch his sentiments into the state's laws in the near future.
It would be just one of several statutory changes promised or enacted since the publication of a February Globe series that examined Bechtel's management, the state's cost-recovery failures, and political influence on the project. Wiley yesterday called the series the product of "misguided critics."
But the series prompted the Legislature last month to unanimously approve a measure that extended by 10 years the statute of limitations to recover money lost to Big Dig mistakes. Governor Mitt Romney signed it.
Wiley yesterday said Bechtel's lawyers may eventually mount a legal challenge to that extension, and warned the new law may drive up the cost of future projects because contractors may balk at taking on so much risk.
Pacheco, meanwhile, chided Big Dig officials for not telling "the whole story" in their testimony to the panel Monday. At that time, Turnpike Chairman Matthew Amorello, project director Michael P. Lewis, and chief counsel Kurt Dettman testified under oath that the project's cost-recovery committee got back nearly $200,000 from Bechtel and other contractors for the botched handling of asbestos at a demolition site. As it turns out, the project's cost recovery committee had closed its inquiry into the asbestos case by assigning no blame. It took the state attorney general's office, conducting a separate investigation, to get the money.
"In the absence of the attorney general's office," Pacheco said, "there would be no cost recovery. Isn't that right?" Dettman replied, "That's right."
Pacheco, who promised to file legislation to create an independent panel of state and federal officials to take over cost-recovery from the Big Dig and Turnpike officials, shot back, "Then we're back to 10,000 change orders on a $14.6 billion project and we've recovered only $35,707."
This story ran on page B4 of the Boston Globe on 4/3/2003.
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2001
panel of powerful state senators butted heads with the Big Dig's private-sector managers for three hours at a State House hearing yesterday, challenging the firm's assertions that it gave taxpayers their money's worth on the $14.6 billion project.
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