After reading recent articles in the news regarding PPP
(Public Private Partnerships), I've come to the conclusion
that not only do the private companies involved in tunnel
construction probably live by the motto “Do we, cheat
him, and how!” but there is a big possibility the
politicians that sign off on these projects are conspiring
to hide the true costs.
Summary of articles
The issues of Seattle's Big Bertha stoppage, lowball bid,
cost overruns were foreshadowed in our own Red Line tunnel
construction. It appears a clever way has been devised by
Municipalities and construction co's to circumvent an honest
bidding process. One commentator on an article stated that
Govt. entities "pair down the job scope in a effort
to keep the budget in line with funding.... the contractor
knows what it will take to do the job right...but if he
bids the job accordingly he loses the bid. So he bids
according to minimum scope and waits for the
engineers to fix the problems to make the project
right...."change orders" come flooding
in". Tunnel companies invest in lawyers who work
with these type of loopholes in this process.
As one of the articles points out, some politicians
heading entities like Metro monetarily benefit via political
contributions etc. It was also pointed out that in the case
of Boston's Big Dig, there was a conspiracy by the
"project officials and Bechtel-Parsons" with
"state officials and the Federal Highway
Administration" to hide the the true cost of the
project from the public. It sounds like this "minimum
job scope" approach for the bidding phase is
intentionally created or allowed by corrupt
politicians/Metro boards/entities involved in overseeing the
projects for the benefit of the tunnel contractors who take
full advantage of the loopholes provided, upping the final
costs to many times over their original ridiculously low
bid...all along, using the legal system to deflect
liabilities onto others (taxpayers).
In their lawsuits, the tunnel companies also seek
reimbursement for delays and interest on late payments from
the tax payers, which in past cases like the Big Dig and the
LA Red line, has doubled the cost overages.
This is my prediction for the 710: The company that
bids on the 710 tunnel conspires with political/Metro
entities and wins it for the low ball (fantasy) bid of $2.81
(maybe 5b, but definitely under 8 billion)...then taxpayers
will probably pay an extra $17b to 21.2 billion in change
orders, legal expenses and interest, by the the end of the
project and the lawsuits that follow.
This formula for corruption (excuse me,
I meant business) works so well they get away with repeating
it project after project. Should a lawsuit go to a jury
trial and be decided against the construction co., no
problem, the co keeps appealing till it reaches a superior
court judge who decides the case in the contractor's favor.
In other words if you want a project built that the
taxpayers would never approve based on how expensive it will
be, use private companies instead that can
eventually sue taxpayers as a way to pay for the
project - hence the real reason PPP's were created.
The articles below cover the topics of:
1) MTA, and tunnel contractor history.
2) Follow the money into political pockets.
3) Actual conspiracy to hide the true
cost, "pair down the job scope" and
"lowball bids" a.k.a. one tunnel, not two ;)
4) How Tunnel construction co's use "change
orders" to reimburse themselves for the "true
amount" the bid should have been. Then tack on
reimbursement for "delays and interest" on late
payments - doubling the cost of the "overages".
5) How
private contractors aggressively use the legal
system against taxpayers deflecting the liabilities onto them.
- No Light at End of the Tunnel : Subway: Contractor digging Red Line route through the Hollywood and Studio City hills faces critical tests, key questions about safety. December 21, 1995|JON D. MARKMAN | TIMES STAFF WRITER, 3 pages, http://articles.latimes.com/1995-12-21/local/me-16344_1_red-line-route
- HR 2104 (Filner) “Safety, Efficiency and Accountability in Transportation Projects through Public Inspection Act” Disaster Examples http://www.nashtu.us/download/HR%202104%20-%20Disaster%20Examples.pdf
- Taken for a Ride: Parsons Brinckerhoff Expose, http://digital.library.ucla.edu/websites/2008_993_087/page/taken1.html, By Tara Servatius (2008) Note: This article from 2008 quotes The total cost at that time for the Big Dig as 14 billion, now it's reached 24 billion.
- Tunnel partner known to fight tough with public agencies , By Mike Baker, Seattle Times staff reporter, Originally published April 27, 2014 at 7:59 PM | Page modified April 28, 2014 at 12:17 PM, http://seattletimes.com/html/localnews/2023475883_berthatutorxml.html
- Front-runner to build SF subway station has history of cost overruns , by Zusha Elinson — August 9, 2012, 12:00 a.m. http://californiawatch.org/money-and-politics/front-runner-build-sf-subway-station-has-history-cost-overruns-17493
- Comment on the article, https://www.baycitizen.org/news/government/front-runner-build-sf-subway-station-has/
- Seattle Tunnel Partner Wins $80 Million Dispute Over Boston’s Big Dig, By JOHN RYAN, 9:58 AM MON JULY 21, 2014 http://kuow.org/post/seattle-tunnel-partner-wins-80-million-dispute-over-boston-s-big-dig