California bullet train officials say they were told to suppress bad news and 'shut up'

March 9, 2020 5 AM PT

When Mark Styles was hired in October 2018 to help oversee Central Valley scheduling for the California bullet train, he soon learned he had walked into a mess.

Over the previous half decade the project had repeatedly fallen behind schedule, and the cost by 2018 had jumped from $64 billion to $77 billion in two years.

A core problem was the project’s operating culture, in which managers for WSP, the bullet train’s lead consultant, threatened to punish or terminate employees if they failed to toe the company line, Styles said.

“I was told to shut up and not say anything,” said Styles, a career construction manager who was hired as WSP’s senior supervisory scheduler in the project’s Fresno office. “I was told that I didn’t understand the political arena the project was in. I told them I am not going to shut up. This is my job.”

The atmosphere described by Styles has been corroborated by a half dozen current and former senior officials knowledgeable about the project’s Fresno office.

The officials say it helps explain why California’s high-speed rail endeavor has barreled ahead for more than a decade, despite warnings it was structured on risky assumptions and could run out of money before any trains operate.

WSP spokeswoman Denise Turner Roth rejected Styles’ claims. “We always work carefully with our client to evaluate the demands of each project and to prepare realistic and transparent recommendations regarding schedule and budget,” she said.

But other ex-WSP employees in the Fresno office, including engineer Vera Lovejoy and project controls coordinator Todd Bilstein, say they were also discouraged from sharing bad news with bosses.

“I wanted the project to succeed,” said Lovejoy, who left the project in 2019 after one year. “I was eager to help deliver it. But I couldn’t stay. If you rock the boat, you are labeled as not a team player.”

Bilstein also left in 2019 after a nine-month tenure.

“If I was to give a talk at a construction conference, I would say they were not following generally accepted project management principles,” he said. The company’s failures, he said, ran the gamut of estimating costs, scheduling construction and managing change orders.

“Revealing bad news was discouraged,” he added. “I just couldn’t continue to work there. I don’t work that way. American professionals don’t work that way.”

Styles, who has no lawsuit or other legal claims, is also no longer with WSP. He left in November, calling it “the worst job of my career,” and moved to a new construction job out of state.

Brian Kelly, chief executive of the California High-Speed Rail Authority, said in a statement that the agency “takes seriously any claim of wrongdoing by an employee or contractor. We have procedures in place for any such claim to be raised and reviewed. We have an expectation that all employees act within the law and that our contractors meet the requirements of state and federal law.”

He added in an interview, “Our focus is on the mission in front of us.”

In the last half year, Kelly has moved to make changes in his organization’s culture, replacing numerous middle-level management officials, orchestrating more documentation for its plans and vowing to improve transparency in the agency operations.

WSP and Parsons Brinckerhoff, which merged in 2014, have been on the project since the 1990s. The Montreal firm, one of the largest infrastructure engineering organizations, is working under a $666-million contract.

When he arrived at the project’s Fresno office, Styles said, he found a dysfunctional operation like he had never seen before — a pressured environment that aimed to contain bad news that could damage the project’s fortunes.

At the time, the rail authority was confronting delay claims, resulting from its slow acquisition of land, and change orders — both amounting to millions of dollars in higher costs.

Within days, he asked to see the detailed justification documents for the change orders. He said he wanted to understand the delays and how they would affect future construction, a routine part of a scheduler’s job.

WSP management, he said, told him that he didn’t need to see the documents. WSP was pushing to “keep the numbers looking good,” which in some cases involved altering reports written by its staff to make construction progress look better, he alleges.

Styles and other sources speaking off the record say that the bullet train schedule, which calls for installing 119 miles of track and a complex signal system from Madera to Wasco by 2022, is “impossible,” even though the project’s budget is predicated on the completion date.

To install track by 2022 would normally require all of the bridges, viaducts, trenches and other structures to be completed beforehand. As a stopgap measure, the rail authority now plans to install track in five-mile discontinuous segments, which the Federal Railroad Administration has criticized as illogical.

A more likely scenario would have the current construction completed between 2025 and 2028, which would drive costs up and force the state to either find new money or curtail the project, Styles and others said.

Rail authority spokeswoman Annie Parker said the agency has acknowledged repeatedly that “the deadline is a challenge.” It will require boosting monthly construction spending from the current $46 million to $70 million, said chief financial officer Brian Annis, who added that its construction pace is improving.

Sylmar-based Tutor Perini, which is building rail structures in Madera and Fresno counties, said a week ago it will complete its work in 2023. The company’s contract was initially $1 billion, but delay claims and change orders have doubled the amount.

Chief Executive Ron Tutor told security analysts in a recorded telephone call on Feb. 26, “With our extending the completion date from the end of ’21 to the first quarter of ‘23, once again, we are in discussions with the owner to resolve payment for that further delay. However, it seems certain that given all of the results and resolves over the last 90 days that that should be the final end date for high-speed rail.”

It would mean that the rail authority could not begin to install track and signals until after that construction is completed.

When The Times asked the rail authority if it had comment on Tutor’s statement, it received an email Friday from Tutor saying his statement to investors had caused “some confusion.” He said that he hopes that “substantial completion” of his company’s work would occur in early 2022, leaving “paperwork, acceptances and contractual documentation” to be completed in early in 2023.

Turning around the multibillion-dollar project has proved difficult for years, given California’s complex governance structure, flawed contracts and past decisions, officials close to the project say. Executives in civil engineering firms say the rail authority lacks technical resources.

“They have all these people in top jobs with no technical background,” said a top executive at a major European engineering firm, who worked on the project. “They are politicians. They never disclose the full cost. They give you incremental truth. They believe that is a successful business model. They should cancel the contracts and start over.”

The Federal Railroad Administration, which oversees billions of dollars in grants, has long warned the rail authority it risked missing deadlines and was headed for big cost overruns. In December 2016, the FRA warned the state that the cost of the Central Valley construction could jump by $3.6 billion. After The Times obtained a copy of the confidential report and published its findings, the rail authority denied the legitimacy of the analysis. Today, the cost is even higher than the FRA projected.

WSP said it stands by the job it is doing for the bullet train. “To the extent WSP prepares cost and schedule estimates for the program as a whole, WSP brings world-class talent to the project that prepare professional estimates based on client needs and the information available when generated,” Turner Roth said.

Styles said he was shut out of work not long after taking the job at WSP, though the company did not fire him. Over many months, Styles, who was being paid $170,000 annually, said he kept advising management about the problems and writing procedures for contract compliance.

In a Facebook posting in June, Styles wrote that he had been warned by a co-worker “to be careful” and “you know too much” and to take a lower profile. “I’d rather be dead than a coward,” he wrote.

Styles filed an ethics complaint against his former employer in June, which was examined by a management committee in Chicago. “The committee concluded there was no proof that WSP violated ethics with the state,” he said.

Turner Roth said, “In 2019, an employee — who has since left the company — raised a question about the schedule data submitted to WSP by the construction managers and construction contractors. In response to this question, WSP thoroughly investigated the matter, and concluded there was no wrongful conduct by WSP employees in their review of contractor submissions.”

As for Lovejoy, whose career includes engineering jobs at major public agencies and corporations, she said problems started more than a decade ago when the Obama administration issued a $2.5-billion grant from its economic stimulus program, intended for “shovel-ready projects.”

The grant came about four years before the first construction contract was issued, and actual work did not begin for two more years. “It was so far from shovel-ready,” Lovejoy said.

Another former WSP employee, who spoke anonymously out of concern that he would face retribution, supported Styles’ assertion that monthly and annual reports submitted by staff often were changed by WSP management before they were reviewed in meetings and sent to state executives.

“We gave them the bad news and they wouldn’t accept it,” he said.

The Times has previously reported that the project has struggled to relocate pipes, electrical lines and other infrastructure that stands in the way of securing parcels and laying track. Today, the rail authority is short by 497 of the 2,042 parcels it needs, according to its most recent progress report. In December, the authority acquired only five parcels.

In late 2018, Hemanth Kundeti, a database manager, was hired into the project to help improve property records, but he lasted only several months.

Kundeti, an employee of a subconsultant to WSP, said he developed his own software tool that could track the work more accurately. It would have allowed the state to replace a subcontractor that was charging $2 million annually to maintain the records, he said.

When he proposed the tool to WSP and state officials, it was rejected. In February 2019, he was twice reprimanded for “insubordination” for continuing to promote his software, according to a copy of the reprimand. In response, he wrote on his warning letter that management “without healthy debate is dangerous for any organization.” He was terminated a few weeks later.

“I am still reeling from the after-effects of being terminated for trying to save taxpayers’ money from being wasted,” said Kundeti, who has found a new job.

California bullet train officials say they were told to suppress bad news and ‘shut up’

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