Sent by Kamala Rao on 12-11-2007:
Although the article notes the "success" of the Big Dig, as measured in travel times, I would have to say the project is a miserable failure in terms of how the benefits were achieved. For a mere fraction of the amount spent, residents could have gotten improved travel times and a new, central green space through improved rapid transit and land-use planning; plus, they would've gotten better air quality and a reduced dependence on foreign oil in the deal.
A financial analyst, Ms. Gelinas notes that the project
team should've accounted for inflation in its initial cost
estimates in order to understand the true lifetime costs of the Big Dig. Likewise, Ms. Gelinas should account for how much the world has changed since that initial cost
estimate was made and realize that the old paradigm of
providing endless highway capacity for droves of single-
occupant vehicles has come up against an emerging set of
environmental limits, not the least of which includes
climate change and global-oil depletion.
States, cities, and towns across America must spend hundreds of billions of dollars annually to preserve the nations infrastructurethe backbone of its private-sector economyand yet more to build the next generation of roads, bridges, tunnels, and dams. Spending so much money wisely is daunting. The good news: no matter how complex and expensive any future project is, its unlikely to be more so than the Big Dig, Massachusettss three-decade-long quest to bury and expand the Central Artery, Bostons major interstate highway, and carve out a new underwater tunnel to Logan Airport.
Conceived in the 1970s and finished, more or less, in 2005, the Big Dig is modern Americas most ambitious urban-infrastructure project, spanning six presidents and seven governors, costing $14.8 billion, and featuring many never-before-done engineering and construction marvels. Long before construction peaked around the turn of the millennium, eating up $100 million a month for three years, the Big Dig was a local legend, spawning dozens of jokes. (Wouldnt it be cheaper to raise Boston than to bury the highway? Congressman Barney Frank asked.) Later, when fewer people viewed the Dig whimsically, it was the setting of a 2002 murder-mystery novel. And last year, after falling concrete panels in a Big Dig tunnel that had been open for three years killed a 38-year-old car passenger, the project became a reminder that infrastructure failure can exact a cruel price.
Every major decision that could conceivably be made on an infrastructure project was made on the Big Dig, from how to pay for it to how to forge the public and political support for it to how to manage its construction and maintenance. Its stewards have encountered every imaginable public-infrastructure pitfall, and fallen into many. The Big Digs story is an invaluable lesson: How can America invest in infrastructureand do it smart?
The reasons for the Big Dig date back nearly 80 years. In 1930, a city planning board noted that Bostons street system should be adapted to the requirements of the motor age and proposed an elevated expressway. The Central Arterys first planners acknowledged that the erection of . . . elevated structures . . . in downtown Boston would hurt some residents quality of life. But a vehicular subwaythe first mention of the idea that, half a century later, would become the Big Digwould interfere with sewers and with . . . rapid transit subways. The state and city had the luxury of deciding to build an elevated highway because bottom-up, Jane Jacobsinspired urban coalitions didnt exist yet to thwart the eras top-down, Robert Mosesstyle urban planners.
The Great Depression and the Second World War temporarily interfered with the idea. By the late 1940s, Boston still didnt have its highway, despite two decades of planningand despite the increasing need for fast access to the city, which was hemorrhaging jobs to the suburbs. But in 1949, six years before Congress and President Eisenhower funded the Interstate Highway System, Massachusetts started building the hideous green steel Central Artery that would scar Boston, physically and psychologically, for the rest of the century. Boston was a pioneer, but this was bad pioneering, says Rick Dimino, former city transportation commissioner and today president of the business group A Better City.
Its easy to follow officials reasoning for building the Artery along Bostons waterfront. Thats where Bostons business district, once centered on shipping, was located, after all. But the Artery vivisected Boston. It barred pedestrians from the water. It overwhelmed low-rise streets, a historic outdoor fruit and vegetable market, and even the historic Faneuil Hall with traffic, noise, and shadow. It erased swaths of the working-class Italian North End, displacing 573 businessesmostly small shops and trading firmsand hundreds of families. Owners of some buildings that escaped the bulldozers bricked over windows that faced the Artery. Boston understood the Arterys impact so quickly that in 1954 it changed tack and buried a last stretch in a tunnel.
Though it did enable suburban workers to get to new office jobs, the Artery quickly became obsolete. Its intended daily capacity was 70,000 cars, but it soon groaned under 170,000. Poorly designed and constructed, it had structural problems and an accident rate four times the national average, because drivers veering toward the Arterys abundance of downtown exits collided with drivers continuing to the increasingly busy Logan Airport. The building of the Artery turned Bostonians so vehemently against highways that the state halted their construction in the early seventies, killing a planned inner belt that, after displacing another 4,000 families, would have carried traffic from the downtown Artery to other parts of the city. But because the belt and the Artery had been conceived as an integrated system, Artery traffic had nowhere to go. Little more than a decade after the Artery opened, Massachusetts and Boston started scheming to junk it.
When Governor Michael Dukakiss administration started thinking about fixing this mess in the seventies and early eighties, it had learned the lessons of the Arterys construction well. But how to fix the Artery, and heal the downtown neighborhoods that it sliced through, without uprooting more residents and slapping a closed for construction sign on Boston? How to ease traffic by building an airport tunnel that, unlike the two existing tunnels, would bypass downtown, when the politically powerful neighborhood near the airport opposed new traffic and the seizing of homes?
If Robert Moses and Jane Jacobs had a child, it might have been Fred Salvucci, Dukakiss transportation secretary, who concocted the Big Dig project. Armed with two MIT engineering degrees, Salvucci had fought the inner belt from city hall before joining Dukakis; he even had firsthand experience of how highway construction affects cities, having seen the state seize and raze his elderly grandmothers house to make way for a road. Salvucci remembers persuading Dukakis to support the Big Dig by making two crucial pledges: It would enhance the urban environment rather than degrade it, and there would be no taking of housing. The state then won the public over by mollifying anyone, anywhere, who had anything at all to do with the project. We learned from Westway, says Salvucci, referring to New Yorks plan to depress its West Side Highway, which failed because the city didnt garner various interest groups support before seeking congressional approval.
Massachusettss task was partly northeastern politics as usual. Unions knew that theyd benefit from a project labor agreement, through which their workers would agree not to strike if contractors, even nonunion ones, would hire through union halls. Police officers would get tens of millions of dollars annually in overtime, since local law mandates that a policeman watch over any work site. Minority-group reps were pleased with a pledge to hire blacks and women for construction jobs.
But the state had a new task, one that would become a feature of big infrastructure projects nationwide: mitigation. Broadly speaking, mitigation was the states promise to alleviate the Big Digs impact on Boston, from interrupting business to harming the environment. Mitigation eventually accounted for about one-third of the Big Digs costfrom the thousands of dollars needed to outfit North End apartments with air conditioning, soundproof windows, and firm mattresses as residents settled in for a decade of construction to the more than $1 billion needed to rework a planned bridge that business leaders, residents, and the nearby city of Cambridge considered ugly.
Mitigation made downtown businesses happy, promising not to shut down any of the Central Arterys six lanes during construction, and promising further that companies such as Fidelity Investments wouldnt lack electricity or telephones for even a few hours as contractors dug up miles of utilities to make room for underground highways. Mitigation made Gillette, Bostons biggest manufacturer, happy, working with the company to marry its complicated underwater infrastructure to the Big Digs. Mitigation made the post office happy, building temporary roads to a distribution station. Mitigation made airport neighbors happy, vowing that cars from the airport tunnel wouldnt exit onto residential land. Mitigation also made environmentalists happy with its promise to preserve as open space three-quarters of the land that the Arterys demolition would create (the highway tunnels that would run underneath couldnt support heavy construction, anyway). It made more ambitious environmentalists happy, promising to improve mass transit and to use some of the excavated dirtwhich, because it had saltwater in it, couldnt be dumped inlandto transform a Boston Harbor island from a noxious landfill into a beachfront park. It made archaeologists happy, paying to catalog artifacts dating back to colonial days. It didnt make rats happy: after near-hysteria that construction would unleash vermin whose underground lairs also dated to colonial days, the project launched an aggressive rodent-control program.
The mitigation, some of which was sensible, tempered even reasonable criticism of the Big Dig. Few locals voiced skepticism during planning. Once you got your own interest protected, you kept quiet, to make sure that the project, free of local opposition, would win federal funding. Thanks largely to mitigation efforts, more than 80 percent of Boston residents and nearly two-thirds of state residents supported the Big Dig in its early years.
Mitigation notwithstanding, the Big Dig still would probably be a near-forgotten dream like Westway if not for Massachusettss Washington dominance in the late seventies and eighties. Democrats ran Capitol Hill, and Massachusettss wholly Democratic congressional delegation had a lot of seniority. Everyone in Massachusetts thus assumed that they would fund the project with ten-cent dollars, of which the feds would pay the other 90.
Even so, Massachusetts got its initial federal funding only because of Salvuccis and Dukakiss brilliant and successful argument: since it had built its Artery before the Interstate Highway System paid for such projects, the state should be able to use the federal money that it hadnt spent back then to rebuild the Artery. This fluke explains why Massachusetts, at a time when other northeastern states were ignoring infrastructure in favor of expanding social programs like Med-icaid, focused on nuts and bolts: it knew that if it did so, it could tap into free federal money. Taking this argument to Washington, legendary Massachusetts Democrat Tip ONeill, the Houses majority leader and soon to be its Speaker, in 1976 inserted placeholder funds for the Big Dig into a congressional blueprint of costs to complete the Interstate Highway System.
A decade later, though, President Reagan didnt care to give Massachusetts Democrats billions for what skeptics considered a highway beautification project. When Reagan vetoed a 1987 highway bill that contained the Big Digs first significant federal funding, the real politics started. Tip, and Ted Kennedy in the Senate, garnered enough supporters, including 13 Republicans, for an override. In a preview of how Washington would work over the next two decades, they approved goodies that other states wanted, too. Wavering out-of-state politicians came on board.
After Tips override, local Big Dig planners never worried about pesky things like whether cost estimates and project scope were reasonable. Massachusetts had proved that it was more powerful than the president; surely there would always be more money where its initial funding came from. But over the ensuing decades, the Big Digs price tag waxed and Massachusettss congressional power waned. Washington imposed a firm dollar cap on its Big Dig spending at the turn of the millennium, leaving Massachusetts to pay the rest. State taxpayers would eventually foot nearly half the projects cost.
The Bay States experience is a lesson for state officials: the clout you have today may be gone tomorrow. If you think that an ambitious projects benefits exceed its costs, convince your taxpayers up frontrather than getting Washington, which may change its mind down the road, to get its taxpayers to pay.
In retrospect, its amazing how much went right after construction started in 1991. Over 14 years, Massachusetts, its consultants, and its contractors carved canyons under Boston while the city hummed above. They designed and built seven and a half miles of highway161 miles of separate lanesmore than half of them in tunnels. They built six interchanges and 200 bridges.
One of the innovations that made this work possible was the slurry wall, also used at New Yorks World Trade Center, which allowed the state, as Salvucci puts it, to build huge underground tunnels arthroscopically, without pockmarking Boston with huge uncovered holes. The slurry wall, in effect, let Boston dig itself up without shutting itself down. The Big Digs general reliance on new technology was a major factor in one of the project officials biggest decisions: choosing a consortium made up of Bechtel and Parsons Brinckerhoff as the management consultant. Parsons was an expert in innovative urban tunneling dating to the early twentieth century, when it built New York Citys subways. Bechtel had constructed the Hoover Dam as well as most of modern Saudi Arabia, and had fabled political connections to accompany its engineering and logistics mystique. Caspar Weinberger and George Shultz, both in Reagans cabinet, were Bechtel menthough that connection hadnt helped Salvucci at veto time.
One of the creative, audacious, and potentially disastrous things that Bechtel and Parsons, as well as the states contractors, did right on the Big Dig was jacking up the Central Arteryreplacing the half-million-ton highways 69 support columns with temporary underpinnings so that contractors could remove the columns and make way for the tunnels. Pinning the Artery wasnt the Big Digs only never-before-done feat. The striking Zakim Bridgethe one redesigned after community outrageis the worlds widest cable-stayed asymmetrical bridge, expanding from eight lanes to ten to account for complicated traffic flow.
Elsewhere, underneath active railroad tracks, engineers froze ground too soft to withstand construction and pushed prebuilt tunnel sections through. They erected a huge temporary dam to dry out a basin in which to construct tunnel segmentsand then flooded the basin, floating the segments and resinking them in their new underwater homes. They built underground bridges to hold up subways, threading highway tunnels above and below mass transit. And though insurance tables had predicted 40 serious accidents during the project, the Big Dig suffered only a quarter of that total, and three construction deathsshowing how much things had changed since, say, the 1870s, when raising the Brooklyn Bridge took 27 lives.
Leave it to Massachusetts, though, to turn the Big Digs reputation from resounding success to humiliating failurefirst in terms of the projects cost. From day oneeven after accounting for politicians erring on the low side to gain public approvalthe Big Dig was fated to cost more than its 1982 price tag of $2.6 billion.
That number didnt include much of the projects mitigation, including big changes like the billion-plus extra to remake the Zakim Bridge. Nor did it include the real costs of staying on schedule. The Big Dig often let its contractors start work on pieces of the project before designs for other key parts were complete. This approachpart of the projects philosophy of getting things done now and asking questions latermeant expensive changes to contracts. By the early 1990s, as the state added new work, and as its consultants and contractors looked underground to see what was actually there, the Big Digs price tag had ballooned to nearly $8 billion.
True, critics arent being entirely fair when they compare the projects final cost, $14.8 billion, with the initial estimate; $2.6 billion in 1982 is $5.6 billion today, thanks to inflation. And inflation has similarly distorted the cost of the many expensive changes made to the projectbecause the more realistic cost estimates that accounted for those changes were also calculated in then-current dollars, rather than in the dollars that the state eventually had to pay. Still, theres a lesson here for managers of other infrastructure projects: be careful with that first number, because it can become a permanent benchmark against which to measure success or failure.
Perhaps its understandable that inflation and massive increases in scope would swell the projects price tag. But the Big Digs planners truly failed the public through a deliberate decision: for years, they used dubious accounting methods that hid true costs.
In 1994, two years into construction, Bechtel and Parsons officials compiled convincing evidence that the Big Dig would cost nearly $14 billion in completion-year dollarsfar more than public officials were disclosingand took their findings to the state, says former state inspector general Bob Cerasoli, who supervised a 2001 report on the Big Digs finances. But the state didnt tell the public, so alarming Bechtel that its president flew to Boston to see then-governor William Weld. Afterward, according to Cerasolis report, state managers directed state and [Bechtel and Parsons] staff to . . . maintain the fiction of an . . . $8 billion project. . . . They did so by applying a largely semantic series of exclusions, deductions, and accounting assumptions that covered up the $6 billion difference, often with the knowledge of federal highway officials.
Some state officials thought that if they delayed disclosing money woes, the public would be so thrilled with early improvements like the Ted Williams Tunnel, which opened in 1995, that they wouldnt pay attention to boring finances. But as an internal pros and cons document noted, if the state didnt inform bondholders, it risked fraud chargesand, in fact, federal securities regulators later reprimanded Welds Big Dig boss, James Kerasiotes, for misleading investors. Even more pressing, the state needed actual money to continue its project, so it had to come clean despite worries that we could become the central controversy of the next year in Massachusetts. It was after the state finally fessed up that the feds imposed their permanent funding cap on the project.
Massachusettss desire to insulate the public from the Big Digs costs also led to a fateful decision by Governor Weld. Weld needed a ready source of money for the project, without hiking taxes or cutting spending elsewhere. So he transferred the Big Digs assets to the Massachusetts Turnpike Authority, an unaccountable public entity akin to New Yorks Metropolitan Transportation Authority, in return for some of the authoritys future toll revenue, which would back Big Dig bonds. This costly trade added a new layer of bureaucracy to the project, which needed, more than anything, one elected person to be ultimately accountable. After last years fatal ceiling collapse, Mitt Romney, governor for nearly four years, could point to the fact that his predecessors appointee still ran the Big Dig.
But the Big Digs biggest pitfall was that Massachusetts never understood a basic fact: that it couldnt pay someone else to assume its own responsibility for an immensely complex, risky project. As the National Transportation Safety Board (NTSB) would later say in its report on the 2006 ceiling collapse, Bechtel and Parsons, the states long-term consultants, were performing the role that would normally be carried out by a government agency, specifically, the state highway department.
Since costs turned the Big Dig into a scandal, the public has often seen Bechtel and Parsons as its villains. The perception in Massachusettsnever dispelled by state officialsis that the duos thousand-plus white-collar workers, dwarfing their few dozen public-sector counterparts, ran the Big Dig, expertly controlling and manipulating designers, contractors, and information, without letting anyone else have much say, from colleagues at lowly engineering firms to meddling public officials. But even assuming the worstand the reality is more complicatedpeople usually cant manipulate you unless you let them. As early as 1991, the states inspector general warned of the increasingly apparent vulnerabilities . . . of [Massachusettss] long-term dependence on a consultant whose contract had an open-ended structure and inadequate monitoring. The main deficiency, as later IG reports detailed, was that Bechtel and Parsonsas preliminary designer, design coordinator, construction coordinator, and contract administratorwere often in charge of checking their own work. If, say, the team noticed in managing construction that a contract was over budget because of problems rooted in preliminary design, it didnt have much incentive to speak up.
The state should also have known that when consultancy work will last years and when consultants plan to introduce technologies so sophisticated that they can overwhelm the states ability to oversee them, the states going to wind up in a vulnerable position. Massachusetts would have been smart to introduce some checks and balances early onperhaps splitting the work that Bechtel and Parsons were doing into smaller parts, having separate consultants for preliminary design and for project management work, or keeping some of the management in house. Instead, in the name of cost efficiencies, the state further blurred the distinction between public and private sectors by folding Bechtel and Parsons employees and its own workers into one integrated project organization in 1998. And though the states Massachusetts Turnpike Authority was at the top of the new organization chartwhich was immensely complicated by multiple layers of theoretical oversight, including supervision from federal highway officials as well as the feds General Accounting Officethe state designated Bechtel and Parsons its owners representative in some areas, complicating even further the answer to the straightforward question: Who was in charge?
Massachusettss laissez-faire attitude followed from a fundamental misapprehension: that Bechtel and Parsons were their partners, not outside consultants, and were thus assuming some performance risk. In a 1994 interview, Kerasiotes, then the states transportation secretary, argued that Bechtels incentive to perform its job properly was its reputation: Go to San Francisco, walk in the lobby of Bechtels headquarters, he suggested. What youre going to see [are] prominent pictures of the Central Artery. . . . If they are causing this project to screw up, . . . theyre not going to market themselves that way.
But Bechtel and Parsons never took on any performance riskrisk that the public sector carries as the ultimate funder and manager. If the project were an investment-banking deal, Bechtel would have been an advisor counseling a company on whether to undertake a merger, not an investor in that merger. Our contractual responsibility as management consultant was to deliver a professional standard of care, not to guarantee the contractors work, says Keith Sibley, Bechtel and Parsonss longtime Big Dig director. Its a crucial distinction: Bechtel and Parsons promised not perfect results but professional advisory and management workand reasonable people may differ about what constitutes professional. Its particularly difficult to assess decisions made under an integrated project organization, where everything is opaque about who was responsible for which decisions, or whether particular decisions were the result of public and private collaboration.
This problem of murky responsibility came up repeatedly during the Big Dig, but most tragically with the ceiling collapse. Designers engineered a lightweight ceiling for the tunnel in which Milena del Valle died. But Massachusetts, annoyed by cost overruns and cleanliness problems on a similar ceiling, and at the suggestion of federal highway officials, decided to fit the new tunnel with a cheaper ceiling, which turned out to be heavier. Realizing that hanging concrete where no built-in anchors existed to hold it would be a difficult job, the ceilings designer, a company called Gannett Fleming, called for contractors to install the ceiling with an unusually large built-in margin for extra weight. Shortly after contractors installed the ceilingusing anchors held by a high-strength epoxy, as Gannett specifiedworkers noticed that it was coming loose. Consultants and contractors decided to take it apart and reinstall it. Two years later, after a contractor told Bechtel that several anchors appear to be pulling away from the concrete, Bechtel directed it to set new anchors and retest. After the resetting and retesting, the tunnel opened to traffic, with fatal consequences.
In hindsight, they all did the wrong thing. The real problem was that the poorly labeled and poorly marketed fast set epoxy that the contractors used for the ceiling wasnt suitable for long-term loads of any type: the company that made the glue, Powers Fasteners, didnt warn clearly that the epoxy wasnt interchangeable with another, suitable standard set epoxy that it made. The National Transportation Safety Boards report noted the companys failure, and Massachusetts has indicted Powers for criminal negligence. But the feds also mentioned that neither Gannett nor Bechtel and Parsons had thought about the ceilings long-term performance, when the earlier ceiling failures should have made it clear to both Bechtel and a construction contractor that reinstallation hadnt worked. Finally, the report points out, once the tunnel opened in 2003, Massachusetts was supposed to conduct regular inspections, which likely would have revealed the ceiling panels obvious displacement well before the collapse.
Massachusetts, after taking a hands-off approach to its projects risks during construction, is today using its most fearsome powerthe power to indictto push Bechtel and Parsons to settle with the state for hundreds of millions of dollars and avoid criminal charges. Massachusettss approach is a warning to future private-sector contractors and consultants: if something goes disastrously wrong with a project in which thousands of critical decisions were made with public and private cooperation, the state may use the criminal-justice system as a cudgel to deflect its own accountability.
Massachusetts might have avoided some problems by transferring certain Big Dig risks to the private sector through discrete, well-defined deals: signing a long-term contract with a firm to help build, operate, and maintain the Zakim Bridge, for instance. Such an endeavor, though, would have required aggressive public-sector management of initial costs, scope, and complex contract languagethings the state hasnt excelled at.
Any risk transfer, moreover, would have been limited. Massachusetts could never have turned over full technical, operational, and financial risks of the Big Dig to any reputable company or group. The project had too many unknowns. Smart, reputable companies dont take unlimited risks at the behest of a fickle, indecisive client for a limited profit. The best thing Massachusetts could have done was to realize the projects real risks so that it could manage them effectively.
Now Democratic governor Deval Patrick has the most important job: monitoring the Big Digs technologically pioneering infrastructure to make sure its holding up now that drivers are using it every day, particularly since the NTSB report indicates a lack of attention to long-term performance in at least one safety-critical area, the fallen ceiling. A key question is whether the tunnels will hold up over time better than have the assets that so many states built so shabbily in the middle of the last century, such as the old Artery and the Tappan Zee Bridge that connects New York City to upstate. The Brooklyn Bridge has lasted, seemingly, forever: Will the Big Dig?
The wrong lesson to take from the Big Dig is that other states shouldnt bother with ambitious infrastructure. While the Big Digs real worth will be measured in decades, its impact so far, three years after workers dismantled the Central Artery, shows its value. Travel time through downtown at afternoon rush hour is down from nearly 20 minutes to less than three, consistent with pre-construction estimates. Elsewhere on the underground highways, travel times are between one-quarter and two-thirds shorter; average speeds in some sections have shot from ten miles per hour to 43 (speed, rather than drivers veering toward too many exits in slow traffic, is the tunnels biggest safety problem). Airport trips are between one-half and three-quarters shorter. A 62 percent drop in hours spent on the new roads saves nearly $200 million annually in time and fuel.
For the first time in generations, downtown Boston viewed from above is unchoked by traffic. Cars zoom beneath the ground and reappear, emerging to leave the city over the Zakim Bridge. Downtowns biggest challenge is making sure that the still-unfinished greenway parks, where the Artery used to be, weave Boston, its waterfront, and its neighborhoods together again.
Investors and residents are responding positively to the infrastructure improvement. As the Boston Globe reported in 2004, commercial properties along the old Artery increased in value by 79 percent in 15 years, nearly double the citywide increase of 41 percent. Owners have reconfigured buildings to open views where they once bricked up windows, and are renovating property in other newly accessible parts of Boston. The North Ends Italian restaurants are putting sidewalk cafés where they once hid from the Artery. The North End wont be the North End of 1950, though, just because the Artery is gone. The Artery preserved us, says Fredda Hollander, a longtime resident. Tourists and well-heeled potential residents once put off by the physical and psychological barrier now happily wander over from other parts of the city, pushing up both commercial and residential prices.
By taking so long, Massachusetts has proven that infrastructure investments are for future generations. To longtime Bostonians, the new parkland may always be a marker of a phantom Artery, and the Big Dig may always be a scandal. But Boston is welcoming residents and visitors who know nothing about the Artery or the saga surrounding its successor. The states and citys job is to make sure that the Big Dig runs smoothly in the future so that their new constituents dont have to learn about it.
Nicole Gelinas, a City Journal contributing editor and the Searle Freedom Trust Fellow at the Manhattan Institute, is a Chartered Financial Analyst.