Boston tunnel settlement to cost builders $458 mln

By Scott Malone and Svea Herbst-Bayliss

BOSTON (Reuters) - The lead contractor and consultants on Massachusetts' "Big Dig" roadway project have agreed to pay $458 million to settle an inquiry into defects in the tunnels that led to a fatal accident in 2006, federal and state officials said on Wednesday.

The settlement would allow lead contractor Bechtel/Parsons Brinckerhoff to avoid criminal charges related to the death of Milena Del Valle, a 38-year-old woman killed when a three-ton chunk of the tunnel's ceiling fell and landed on her car.

The agreement signals one of the final chapters in the 16-year, $15 billion Big Dig saga, the United States' costliest public works project.

The project replaced an aging overhead highway that cut Boston's downtown in two with 7.8 miles of underground roadway topped with parks, connecting the city to its airport.

Under the settlement, Bechtel Infrastructure will pay $357.1 million, its joint venture partner Parsons Brinckerhoff will pay $50 million, with insurers and consultants paying the remaining $51.1 million. The bulk of the funds -- more than $400 million -- will go into a fund to pay for future repairs to the project.

The contractors remain financially responsible for any additional "catastrophic" events causing more than $50 million in damages, but only up to $100 million per incident.

"This agreement does not relieve Bechtel Parsons Brinckerhoff from liability for an future catastrophic events that occur over the next 10-year period," U.S. Attorney Michael Sullivan told reporters.

"We understand and acknowledge with this resolution that our performance did not meet our commitment to the public or our own expectations," said John MacDonald, chairman of Bechtel/Parsons Brinckerhoff, in a statement. "We deeply regret the tragic death of Milena del Valle."

NO CRIMINAL CHARGES

Massachusetts Attorney General Martha Coakley said the state could have brought criminal charges over the fatal collapse, but the maximum penalty the corporate defendants would have faced would be a $1,000 fine.

"We can't send corporations to jail," Coakley said. "The amount of money that has been paid and will be paid over the next several days and months ... far outweighs what we could have accomplished, certainly in a criminal indictment."

Privately owned Bechtel/Parsons Brinckerhoff, state authorities and other contractors still face a civil lawsuit brought by Milena Del Valle's family, including her husband, Angel. He was in the car with her on the July 2006 night of the collapse but crawled to safety.

A federal investigation found the collapse occurred because contractors had used the wrong grade of adhesive to suspend the tunnel's massive ceiling panels. The concrete panels are suspended below the tunnel's top, to allow for airflow.

Massachusetts authorities in September 2007 charged the company that provided the adhesive, Powers Fasteners of Brewster, New York, with involuntary manslaughter. That case is pending.

TROUBLED HISTORY