Two years ago, San Francisco authorities blamed a local businessman for orchestrating a fraud scheme that resulted in tons of substandard concrete being used in public structures.
But the fraud case against Ricardo Ramirez crumbled earlier this year when prosecutors dropped those charges as part of a deal under which he pleaded guilty to a single environmental count. Ramirez will serve a year of home detention and avoid jail time as long as he pays $427,000 in fines and restitution.
Meanwhile, the public is stuck with his legacy. Substandard concrete from Ramirez's now-defunct company was poured into a half-mile stretch of the Bay Bridge's rebuilt western approach. Inferior, less-durable material also was used on a retrofit project at the Golden Gate Bridge, a wastewater treatment plant in Burlingame, the new parking garage in Golden Gate Park, the Municipal Railway's Third Street light-rail line and other projects.
Some agencies say the material is not a problem. At the Bay Bridge approach, however, Caltrans and its main contractor will pay hundreds of thousands of dollars to keep concrete from deteriorating decades earlier than it should. None of the money that Ramirez must pay to settle his criminal case will go toward shoring up the taxpayer-funded project.
With great fanfare in May 2006, San Francisco District Attorney Kamala Harris announced that Ramirez stood atop an empire of fraud.
"We must ensure that our public projects receive quality materials and are not victims of fraud," the city's top prosecutor said. "We will continue to work with all these public agencies to protect the environment and to protect public safety."
Ramirez, now 67, presided over several failed paving ventures before forming Pacific Cement in 1998. The company took advantage of government programs that help minority-owned businesses, and by 2003 he was supplying a third of the concrete that San Francisco used for public works.
Recycled concrete cheaper
But the company started having financial problems, and Ramirez turned to passing off recycled concrete, made from ground-up concrete debris, as the more expensive and durable product that is made solely from hard rock, authorities said.
San Francisco prosecutors originally charged him with 14 felonies and 14 misdemeanors, including nine counts related to the use of recycled concrete. They said Pacific Cement had supplied the inferior product for a 4-inch-thick decorative facade on a pylon that supports the arch over Fort Point at the Golden Gate Bridge. At the Burlingame sewage plant, the material went into a foundation of a control room building, prosecutors said.
At the time, authorities pointed to tests and accounts by workers indicating that Pacific Cement had delivered substandard concrete to a host of other major public works projects. But Ramirez was never charged in connection with any of them.
Then, in January, San Francisco prosecutors dropped 27 of the 28 counts they had filed against Ramirez and agreed to a deal in which he pleaded guilty to a single environmental charge of illegally storing waste oil at a concrete-production facility he leased from the city on Pier 80.
Harris' office had no explanation for why it dropped the concrete case. It issued a statement stressing that Ramirez had pleaded guilty to the "most serious environmental charge" he faced and that he would pay restitution.
Ramirez's attorney, Stuart Hanlon, said the deal was reached after prosecutors told him that the concrete Ramirez supplied to the Golden Gate Bridge and Burlingame sewage plant projects met strength standards set by the state.
Under the deal, Ramirez must pay about $56,000 to the Golden Gate Bridge district, $80,000 to the port for cleanup and $41,600 to compensate the city's toxics division for cleanup and inspection of his plant site.
Ramirez's half-brother, Reynaldo Nunez, who helped run Pacific Cement, was charged with the same original crimes but pleaded guilty only to one lesser environmental count. He was fined $500 and given three years' probation.
Ramirez, who has been sued by the city for lease violations as well as by contractors over the allegedly inferior concrete he supplied, says he is nearly bankrupt. He has until Aug. 20 to mortgage properties to pay the fines and restitution, Hanlon said.
Bridge got biggest batch
The project to replace the Bay Bridge western approach, which is scheduled to be finished next year, appears to have gotten the single biggest infusion of substandard concrete from Pacific Cement of any public works job.
It is unclear why San Francisco prosecutors never filed charges against Ramirez in connection with the rebuild.
Tony Anziano, the Caltrans official in charge of the project, said his agency had been defrauded by Pacific Cement. He said that Caltrans had always cooperated with prosecutors and that he couldn't explain why they hadn't pursued charges.
Prosecutors said that they lacked evidence against Ramirez in the Caltrans project at the time they brought the case against him, and that over the next two years they never got what they needed.
Anziano says Caltrans will have to make the best of the situation.
"I'm not thrilled about the fact that we have recycled concrete in there," Anziano said. Caltrans assumes that all of 27,000 cubic yards of concrete that Pacific Cement supplied for the project - enough to cover a football field 16 1/2 feet deep - was recycled.
The material went into a half-mile stretch leading to the Fremont Street ramp. Anziano stressed that the concrete meets building requirements for freeway structures, but said it may not last as long as it should - 60 years - because recycled concrete is prone to micro-cracking and moisture infiltration.
Anziano said the main contractor on the rebuild will treat the road deck area with a moisture-proofing material. New concrete columns, he said, are being treated with a solution that prevents paint from bonding, which should protect them.
If left untreated, the roadway material could fail in as few as 30 years, Anziano said.
The cost of coating the inferior concrete is expected to run in the hundreds of thousands of dollars and be divided between the state and the bridge contractor, Tutor-Saliba Corp.
Anziano said Caltrans has ways of detecting substandard concrete before it hardens, but acknowledged that Pacific Cement had gotten around the safeguards. Still, he said, nothing has changed in how Caltrans deals with cement providers.
"You go into contracts assuming we are dealing with honest people - you have to," he said.
At the Golden Gate Bridge, Pacific Cement delivered a dozen truckloads of adulterated concrete in summer 2005, authorities said.
It was a small fraction of all the loads delivered, bridge officials stressed. Chief engineer Denis Mulligan said the bridge district had spent tens of thousands of dollars analyzing the concrete. "All that was shared with the district attorney," he said of the results.
Mulligan said Harris' office hadn't told him it was dropping the charges, but he wouldn't fault prosecutors for doing so.
"We are pleased we were able to participate in the filing of the charges," he said. "It's the people's money, taxpayers' money. ... If someone does something inappropriate, we aggressively pursue the matter."
One of the other victims was the Burlingame sewage plant, where substandard materials were used in making a control room to operate the plant. However, tests showed that the recycled concrete did not contain glass or other debris that could have made the material more vulnerable to cracking and water damage.
"The fact of the matter is the concrete is there, undisturbed, and doing fine," said Syed Murtuza, head of public works for the city. "If the tests had found something different, you would see I would have reacted differently."
Former drivers for Pacific Cement told prosecutors and The Chronicle that they had also delivered substandard concrete to the new garage near the M.H. de Young Memorial Museum in Golden Gate Park, the UCSF hospital in Parnassus Heights, San Francisco's new Youth Guidance Center and the Third Street Muni rail line.
Garage officials have insisted their structure is safe, although they never conducted tests to determine whether it contained inferior concrete. They have not returned calls seeking comment.
Muni officials not concerned
Muni officials say tests showed that recycled concrete was used only in the sidewalk, traffic barriers and decorative elements of the Third Street light-rail project, not structural ones. Judson True, a spokesman for Muni, said the agency has no safety concerns about the concrete.
Ramirez, as part of the plea agreement, can't run a concrete company in San Francisco for the five years the deal is in effect. Hanlon said his client is mortgaging properties to make restitution.
Ramirez is now at home wearing an electronic ankle bracelet, Hanlon said. "He's working," the lawyer said, but "not working in San Francisco, that's for sure."
Hanlon insisted that prosecutors oversold the case, and that the public is not at risk from the recycled concrete that Ramirez poured.
"It became an issue of, did people get what they bargained for?" Hanlon said. "That's not a huge issue, in the scheme of things."
He added, "This was not the crime of the century. If people were endangered, it was. But this wasn't."
Where the concrete went
Ricardo Ramirez's Pacific Cement supplied substandard, recycled concrete to a number of public works projects in the Bay Area as it encountered financial difficulties about five years ago, according to San Francisco prosecutors, other government officials and former drivers for the now-defunct company.
Golden Gate Bridge: About a dozen truckloads of recycled cement went into a 4-inch-thick decorative facade on a pylon that supports the arch over Fort Point. Under his plea deal, Ramirez must pay $56,000 to the bridge district.
Bay Bridge western approach: Based on tests it has performed on the new approach, Caltrans assumes that all 27,000 cubic yards of concrete that Pacific Cement supplied for the project was recycled. Caltrans and its main contractor, Tutor-Saliba Corp., are expected to split the cost of treating the concrete to make it last as long as it should. Ramirez was never charged in connection with the deliveries, and none of the restitution he must pay to resolve his criminal case will go to Caltrans.
Muni's Third Street light-rail line: Muni officials say a small amount of recycled concrete from Pacific Cement went into sidewalks, traffic barriers and decorative elements on the line, which opened in 2007. Muni has no plans to treat the concrete to make it last longer.
Golden Gate Park garage: Former Pacific Cement drivers have said they delivered loads of recycled concrete for the garage next to the M.H. de Young Memorial Museum that opened in 2005. Officials who oversee the garage have never commented on the case.
Burlingame sewage plant: The original criminal case against Ramirez included charges that he defrauded Burlingame by delivering substandard concrete for its sewage treatment plant. City officials say that the material was used for the foundation of a control room building and that they have no plans to replace or treat it.
E-mail Jaxon Van Derbeken at email@example.com.
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