***Another interesting plotline in the story of Bechtel’s contract coup is the company’s relationship with the current head of USAID, Andrew Natsios. As chairman of the Massachusetts Turnpike Authority in 2000-2001, Natsios worked closely with Bechtel on Boston’s "Big Dig" construction project—Bechtel was and is the project’s principle contractor. In the 1980s, Bechtel estimated the Big Dig’s price tag would be $2.5 billion. Since then the cost has ballooned by more than 560% to over $14 billion due in large part to Bechtel mismanagement and the lack of state oversight of its work. When Natsios took over the Turnpike Authority, he promised to rein in the overruns. He worked with Bechtel to renegotiate its Big Dig contract, and succeeded in reducing their management fees. But Natsios permitted the Bechtel team to continue to review and evaluate their own work, basically changing little. During Natsios’ tenure, the cost estimate of the Big Dig continued to rise. A few months after he left for his post at USAID, $300 million more in cost overruns were announced. Natsios denies allegations that he gave preferential treatment to Bechtel for the Iraq reconstruction contract. ****
http://www.dollarsandsense.org/archives/2003/0703tavares.html****Bechtel is also the subject of a review ordered by Gov. Mitt Romney of Massachusetts over its handling of the nation's largest urban transit construction project in Boston. Known as the "Big Dig" for the giant, 10-lane tunnel it aims to install under city streets, the project, contracted to Bechtel and construction firm Parsons Brinkerhoff in 1985, is currently about $1.6 billion over budget. State oversight of the project was taken over in 2000 by former Massachusetts Secretary for Administration and Finance Andrew Natsios, who left that post to become director of USAID.
Updates
As of March 31, 2004
On January 6, 2004, USAID awarded the second major Iraq reconstruction contract to Bechtel. The Iraq Infrastructure II contract has a total value of up to $1.8 billion; work is scheduled to continue through December 2005. Bechtel's previous reconstruction contract extends through December 2004. It was not disclosed how much Bechtel stands to gain from the Iraq II contract, but USAID told the San Francisco Chronicle that it would not exceed 10 percent of the total value. The company will be working with California-based Parsons and Horne Engineering Services of Fairfax, Virginia. ****
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