While local published reports term the DOT's consideration an "investigation," Peter Babachicos, a project manager at the DOT's office here tells GlobeSt.com that he wouldn't call it an investigation or even an audit. "We're doing research, he says. "It's preliminary work and we haven't decided whether to proceed with an audit."
One billion dollars in claims charges have already been paid out to contractors on the Big Dig, according to Sean O'Neill, spokesperson for the Big Dig. Approximately $1.2 billion in claims issues need to still be considered. Historically, about half of what is claimed by the contractor is usually paid. "We are well within our negotiation range," O'Neill tells GlobeSt.com.
Babachicos insists that nothing prompted the DOT's decision to start looking into the claims process. "Claims are an important issue," he says. "We'll make a decision on whether it's worth doing an audit." An audit of the claims process was last done in 1994.
The approvals process for claims and changes on the Big Dig has recently changed. Until September, two representatives from the Turnpike Authority and one representative from the Federal Highway Authority would sign off on the claim. After September, the claim went to the board members of the Turnpike Authority and their lawyers. It is unclear why the change in process was made.
But O'Neill says that he is not worried about the DOT's plans. "We look forward to working with them," he says. "There is a great deal of oversight on this project," he notes referring to the federal highway authority, the state highway authority and Price Waterhouse Coopers, the accounting firm.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
