Question: While advising that it would be very difficult to hold the line, B/PB worked aggressively with MHD and MTA to recommend and implement savings and

While advising that it would be very difficult to hold the line, B/PB worked aggressively with MHD and MTA to recommend and implement savings and cost containment measures necessary to meet the state's objectives. By 2000, however, project scope changes, contractor claims, rising construction costs, and changes in allowable accounting practices made it impossible for MTA to maintain its zero-budget-growth mandate. MTA's chairman announced a revised cost estimate of $12.2 billion (including inflation). The new figure proved highly controversial, and various public officials as well as the media moved quickly to assign responsibility for what was widely termed a "cost overrun." The Inspector General of Massachusetts reported in 2001 that B/PB consistently "disclosed its bona-fide total cost projections to Big Dig officials" during the entire 1994-2001 period. The IG added, "B/PB insisted upon and, in fact, made full disclosure to local FHWA officials of each exclusion, deduction, and accounting assumption" used in the project's cost estimates

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!