|
|
|
|
|||
|
| |||
business & economy
Also in this section:
Parsons Brinckerhoff, caught in multiple scandals, uses certain methods to advance and protect its interests ACP consultant in trouble over Big Dig --- or is it off the hook? by Eric Jackson, mainly from other media Parsons Brinckerhoff, the huge American construction company that in consortium with Bechtel has managed the infamous Boston "Big Dig" traffic tunnel project, looks like it's in big trouble in Massachusetts. This is of more than passing interest here in Panama, because the Panama Canal Authority (ACP) used Parsons Brinckerhoff to do its controversial $5.25 billion cost estimate for the Torrijos - Alemán Zubieta Plan to expand the Panama Canal and has recently given the company a new 10-year consulting contract. The brief summary of Parson Brinckerhoff's Big Dig woes is that in 1985 it began the project to solve Boston's traffic problems by burying them in a network of expressway tunnels under the city estimating a $2.6 billion cost and shortly after the ribbon cutting earlier this year, way behind schedule and with costs approaching $15 billion, a huge concrete ceiling panel came crashing down in one of the tunnels, killing Costa Rican immigrant Milena Del Valle and injuring her Puerto Rican husband Angel Del Valle. It turns out that Parsons Brinckerhoff had signed off on the use of inferior steel fasteners to hold up the project's roof and there will now be more costs and traffic closures in order to correct the problems. The dead woman's family is suing for big bucks, the state's attorney general has called for a criminal investigation and the scandal is affecting this year's Massachusetts governor's race. In a primary to be held on September 19, Massachusetts Attorney General Thomas Reilly is in a tight race with former Coca-Cola corporate lawyer Deval L. Patrick and pharmaceutical exec Christopher F. Gabrieli for the Democratic gubernatorial nomination to face Republican Kerry Healey, with the winner replacing the GOP's retiring Mitt Romney. It's Reilly who has convened the Big Dig grand jury that's investigating Parsons Brinckerhoff and others. Ah, but Reilly has a political problem, a cloud whose silver lining most probably accrues to the benefit of Parsons Brinckerhoff. You see, his campaign has taken more than $35,000 from executives and lobbyists with Big Dig companies. Not only that, but with state inspector general reports going back to at least 1992 that detail how Parsons Brinckerhoff, which works for the state on a "cost plus" basis, has cheated Massachusetts out of at least tens of millions of dollars, Reilly let the statute of limitations run out and thus fumbled away the state's ability to seek refunds in court. Gabrieli? He's in third place and trying to move up in the primary field by running attack ads about the Big Dig. However, one of his key campaign advisors and the head of Women for Gabrieli happens to be an attorney who represents the Bechtel / Parsons Brinckerhoff consortium. Republican hopeful Healey's campaign is chiming in with a statement that "Tom Reilly is the only candidate that has explaining to do to the voters, the only one that has a clear conflict of interest with his cost-recovery efforts and taking thousands of dollars of donations from these companies." A spokeswoman said that, which for one thing meant that the candidate herself would not have to answer come-back questions about the contributions she has taken from Big Dig contractors. Leave it to Patrick to be the major party candidate with the cleanest hands. Although the scandal has been growing for years and he hasn't had anything to say about it until recently, now he tells a tale of how Parsons Brinckerhoff tried to cheat Coca-Cola on the construction of a factory in Ireland and he, the heroic fighting corporate lawyer that he is, did battle with the bad guys as any worthy son of Hibernia would. So how is it that a company like Parsons Brinckerhoff can get away with the biggest cost overruns in any highway project anywhere and not only keep the job but manage to taint all sides of a large state's gubernatorial race? It's because the company has a certain method of operation, one that has surely been noticed with approval by ACP executives and the Panamanian political class. To wit: · Parsons Brinckerhoff makes lots of campaign contributions, both to candidates and ballot issue committees, covertly if possible. In the United States it gives to both parties, with only a slight tilt toward Republicans. In the Seattle area, where there is a referendum about a tunnel project, the Seattle Post - Intelligencer reports that the company has laundered its donations to the "yes" side through an industry group. In Panama there is no public disclosure requirement so we don't know how much of the "yes" campaign is being bankrolled by Parsons Brinckerhoff. · Parsons Brinckerhoff puts friends and relatives of public officials with whom it deals on the payroll for no-show jobs, a version of the scam Panamanians know as the "botella." A report for the Boston Globe details how Parsons Brinckerhoff secured its Big Dig position by doing this with the administrations of former Massachusetts governors Paul Celluci and William Weld. · Parsons Brinckerhoff "bonds" with public entities that are supposed to be playing the part of their employers. It's not only a matter of campaign funding and the hiring of friends and relatives, but also of becoming the nearly impenetrable repository of unfavorable information. Public entities may be subject to transparency laws, but Parsons Brinckerhoff is a private concern that claims a duty of loyalty something akin to the mafia's code of omerta to those public agencies. In one of the rare instances in which the veil has been pierced, investigators for the US Securities and Exchange Commission, working on behalf of people and institutions who had bought bonds to finance the Big Dig without having been informed of its problems, found that for many years Parsons Brinckerhoff had a fairly accurate estimate of how bad the cost overrun problem was but conspired with state officials to conceal this information from the public. · Parsons Brinckerhoff helps politicians sell boondoggles that both the company and the officials know in advance will cost more than the price that's advertised to the public. Most probably this was the case in Boston, where the essential problem was that, to save money on land purchases, Parsons Brinckerhoff based the original $2.6 billion price tag on a novel scheme to skip the normal procedure of building a concrete tube through a system of drainage slurries. The biggest of the cost overruns on the Big Dig came from the water leakage problems that most competent civil engineers would have foreseen. In a Charlotte, North Carolina light rail transit project that has so far cost more than double the originally publicized price, Parsons Brinckerhoff's estimates didn't include the basic item of allowance for inflation. (The city council members who called them on the omission at the time were not re-elected and now Parsons Brinckerhoff refuses to talk about the omission, claiming that the person who did the estimate is no longer with the company so it's not their problem.) In a 1990s mass transit project in Los Angeles --- one that featured a huge sinkhole caused by halving the amount of concrete called for in contract specifications --- a consortium between Parsons Brinckerhoff and Parsons Dillingham gave an estimate of $227 million for design, engineering and management work alone, but by the time it was over this part of the contract went up to $670 million. So why, other than in an El Panama America op-ed column by Miguel Antonio Bernal, hasn't the presence of the scandalous Parsons Brinckerhoff on the canal expansion scene been mentioned in this country's Spanish-language media? It helps those who don't care to discuss this that the owners of the mainstream corporate news media have their family and business ties to the construction and banking industries that will likely benefit from the Torrijos - Alemán Zubieta Plan, and even more so if it involves big cost overruns. That most of the mass media are openly aligned with the governing PRD or its junior partner the Partido Popular also serves to keep Parson Brinckerhoff's name out of our news. That former El Panama America editor and MEDCOM talk show host Milton Henríquez is heading the "yes" campaign's publicity effort is also useful for the purpose of information control. On the ACP's part, a little bit of misdirection goes a long way. Punch in "Brinckerhoff" on the authority's website search engine and you will draw a blank --- they have misspelled the name by leaving out the "c." The English-language online media, however, have been a problem. The "yes" campaign, however, is now addressing it. In an email to The Panama News, Mary Whittle of the ACP's US-based English-language PR firm Edelman explained Parsons Brinckerhoff's role (having done the $5.25 million cost estimate and now having been retained on a 10-year contract) in this way: Also, just quickly on the point you made with respect to ACP working with Parsons Brinckerhoff - ACP has actually not signed any contracts with any firm for the actual expansion project. If majority of the Panamanian people says "yes" to expansion, then and only then will ACP begin the bidding process for expansion contracts. The ACP has worked with Parsons Brinckerhoff (along with several international firms), in parts of the planning process for the expansion master plan. But to be absolutely clear, no one has been signed for the actual expansion itself. The defense has been carried into the English-language Internet email groups as well. On the Panama Forum a US resident who supports the Torrijos - Alemán Zubieta Plan cited an article from that most disinterested source, the website of Parsons Brinckerhoff's Boston Big Dig consortium partner --- http://www.bechtel.com/newsarticles/408.asp --- to demonstrate the proposition that in "1994 Bechtel/Parsons Brinckerhoff (B/PB) provided the Governor and state officials with a Big Dig cost estimate of almost $14 billion, a figure uncannily close to the current $l4.l billion estimate. B/PB's $14 billion estimate in 1994 starkly contradicted the $8 billion estimate (more exactly $7.998 billion) offered publicly by Big Dig officials at that time." On the strength of that corporate lawyer Juan Ramón Vallarino J., who also happens to be part of the official vote-counting apparatus for the October 22 referendum, chimed in: "it seems to me that Parsons Brickenhoff [sic] is off-the-hook for Big Dig over runs." Well, let's see now: they started the job in 1985 with a cost estimate of $2.6 billion, by 1994 had revised this upwards to around $14 billion but helped public officials conceal this number from the public at the time, the cost is now approaching $15 billion and still growing, and that's "off the hook?" We already know that the advertised $5.25 billion price of the Torrijos - Alemán Zubieta Plan is a lowball bid. The MEDCOM television stations are running ACP ads about how the ballot proposal includes a bridge or tunnel across the Atlantic entrances to the canal in order to connect Colon's Costa Abajo to the rest of the country. But Edelman told The Panama News that "The bridge/tunnel is actually not a part of the third set of locks project and is not needed to transit vessels in any way. The Panamanian Constitution actually says that only the third set of locks project needs to go to a referendum. The project will be paid with income from the Canal as part of its regular investment projects." However they want to cook the books, add several hundred million dollars to the cost. The interest paid on the loans taken out to do the job is not included in the price tag. To this, Edelman responds: "The costs of financing were not left out. They were included and analyzed and form part of the return on investment calculation. Financing costs are typically and by practice, not included in the project budget but, rather, in the cash flow analysis - as was done for this project. Financing costs are costs of the money to finance - as opposed to costs of the project per se. Projects are always budgeted and analyzed without financing schemes because the way a project is financed might make it more or less attractive." Former Panama Canal administrator Fernando Manfredo and the canal's former chief engineer Tomás Drohan are only the most prominent of those who claim that the $5.25 billion figure is way low. Parson Brinckerhoff's cost underestimate is central to the "no" campaign's attempt to have Panamanian voters see the Torrijos - Alemán Zubieta Plan as something akin to the Big Dig or the scandal-plagued French failure at building a canal here in the 1880s. Ah, but Parsons Brinckerhoff has proven time and again that it has ways to get off of hooks. They left it to the Massachusetts attorney general whom they bankrolled to plead, at a recent campaign forum reported on by the Boston Globe, that "I'm as outraged and upset and angry at what has happened with the Big Dig as any one of you or anyone in this state." They left it to the Massachusetts inspector general to explain the method of operation used to hide the true costs the Big Dig: "Records show that they did so by applying a largely semantic series of exclusions, deductions, and accounting assumptions...." And although you won't see it on TV or read about it in La Prensa, that's what our government and our canal authority have bought into. And Angel Del Valle, who paid part of the price for the Big Dig boondoggle by seeing his wife crushed to death and having to contend with sudden losses of balance due to his own inner ear injury? "Many people may be thinking about money, but at this point I don't care about it at all," Del Valle told an AP reporter after filing suit against Parsons Brinckerhoff et al. "In the accident, a person died. That was my wife, and that's all I care about. That's why I want justice done."
Also in this section:
News |
Business
|
Editorial
|
Opinion
|
Letters
|
Arts
|
Review
|
Community
|
Fun
|
Travel Make the
Executive Hotel your headquarters in Panama City --- http://ww.executivehotel-panama.com Find the boat of your dreams through Evermarine --- http://www.evermarine.com |
|||||||||
|
