BIG DIG REVIEW TO TARGET COST OVERRUNS

Author(s):    Sean Murphy, Globe Staff Date: November 23, 2002 Page: A1 Section: Metro/Region

The Big Dig's top official yesterday agreed to work with the state Inspector General's office in a comprehensive review of the $14.6 billion Central Artery/Tunnel Project, with an eye toward recouping from contractors some portion of the billions of dollars in cost overruns rung up on the project so far.

One of the prime objectives of the planned review will be to determine whether the private-sector project manager, Bechtel/Parsons Brinckerhoff, which has received more than $1 billion in fees, made mistakes for which the state should be reimbursed. Inspector General Greg Sullivan, whose office has tracked Big Dig costs for several years, asked in a letter dated Thursday for the cooperation of Matthew Amorello, chairman of the Massachusetts Turnpike Authority, which oversees the project.

"This office intends to work with the Turnpike Authority to conduct a top-to-bottom review," Sullivan said yesterday. "For the benefit of taxpayers, this needs to be done."

Sullivan said he had not received a personal reply from Amorello, who is a relative newcomer to the Big Dig, having ascended to the position of chairman in February. But in an interview late yesterday, Amorello said he was willing to undertake the review with Sullivan's office.

"We're at the final stages of this long project and it's appropriate to now get geared up to take a close look at the state's potential to recover any costs," he said.

Amorello said he expected to meet with Sullivan soon to formalize an approach. He said the Inspector General's office has the advantage of subpoena power, which means it can compel the release of documents from private companies, such as Bechtel.

Amorello declined to comment on specific potential issues with Bechtel, but Sullivan, in his letter, said, "Based on anecdotal evidence, I believe that there is a genuine potential for monetary recovery."

In recent weeks, Amorello said, Turnpike lawyers assigned to the project have begun sorting through the massive paperwork covering the 15-year-old project to evaluate Bechtel's performance.

Besides Bechtel, Amorello and Sullivan say they will scrutinize the performance of other contractors, including two dozen design firms hired at a cost of $1 billion to do the project's final design.

The state, meanwhile, is already engaged in negotiations with construction contractors over what share of cost overruns are the responsibility of the construction contractors.

The project's price has risen from $10.8 billion in 2000 to $14.6 billion today.

Andrew Paven, a spokesman for Bechtel, declined to address the company's position on whether it owes the state anything. "There is a contractual process for looking at these things and we have said we will never shrink from our responsibilities," he said.

At stake is millions of dollars in potential savings for state taxpayers. The federal government in 2000 reacted to the latest in a series of cost escalations by saying it would cut off further funding of the project, leaving the state taxpayers to finance at least $6 billion of the project on their own.

In 2000, the Inspector General's office released a report critical of the project's performance in holding contractors accountable for mistakes.

"Although the project is winding down, nearly 70 percent of project costs are still within the statute of limitations for possible legal action regarding cost recovery," Sullivan wrote in Thursday's letter. "This opportunity must be acted on expeditiously.

"The commonwealth should not unfairly bear the costs and the blame for all the project's monetary problems," the letter said.

Sullivan said such a review would take about a year, and require the hiring of expert consultants in law, engineering, and construction. He said the cost of the review would be the Turnpike Authority's.