BAY AREA. Let me reproduce the whole news article so I will have a full record why the Golden Gate's retofitting projects did not make it safe for earthquake.
Ricardo Ramirez seemed an unlikely success story: At 57, the former Marine Corps judo instructor had spent more than 20 years as a paving contractor and had little to show for it but a long string of lawsuits, business failures and bankruptcies.
Then, in 1998, the struggling businessman appeared to hit upon a way to make it in a new venture. Taking advantage of city and state programs designed to help minority-owned businesses, Ramirez started turning out low-priced, locally produced concrete for projects that included earthquake retrofit work on the Golden Gate Bridge and the Bay Bridge. By 2003, his Pacific Cement venture was supplying a third of the concrete used in San Francisco's public works projects.
Prosecutors now believe it was an empire of sand.
Ramirez built Pacific Cement on a combination of moxie, deceit and greed, prosecutors say, only to have it crumble. Left behind, they say, was a costly and potentially dangerous legacy: tons of substandard concrete built into vital public structures.
Ramirez, now 65, faces charges of grand theft and fraud for allegedly passing off inferior recycled concrete -- a cheaper material that is more prone to wear, cracks and water penetration -- as meeting higher durability standards for the Golden Gate Bridge and a Burlingame wastewater treatment plant. He has pleaded not guilty.
Continued from Page A1: Ramirez was a well-connected political player who sometimes broke the rules. He had given nearly $100,000 to state and local politicians since 1995, and twice had been fined for making illegal contributions. Some of his work for San Francisco had been criticized by city officials for its poor quality. Still, he was able to secure work on major state and city projects.
His fall finally came when former truck drivers for Ramirez told prosecutors that they delivered load after load of flawed product -- recycled concrete made from ground-up construction debris, rather than hard rock -- not just to the Golden Gate Bridge and to Burlingame, but also to the retrofit of the Bay Bridge's western approach, the Muni's Third Street light-rail line and a new parking garage in Golden Gate Park.
San Francisco officials say Pacific Cement's concrete failed a "disproportionate'' number of strength tests in 2004 and 2005 as the company began to run into financial problems.
Prosecutors say Ramirez ignored warnings from his own staff against using recycled concrete. "I just said it was improper, immoral and wrong,'' said Ramirez's former sales manager, Wayne Breider. "He said I didn't know what I was talking about.''
Ramirez's attorneys and supporters say that the charges are overblown and that any flaws in the concrete were inadvertent, the result of a company expansion that proved to be too rapid. They say even prosecutors admit that nearly all the concrete Ramirez sold to public agencies passed strength tests when it was poured, and that the small amount that failed was nevertheless structurally sound.
"He was not a malicious guy. He didn't go into this business thinking he was going to rip people off,'' said San Francisco Supervisor Fiona Ma, who gave back $5,500 that Ramirez contributed in 2004 to her state Assembly bid after the news broke of the fraud allegations in May.
"He's a hard-working guy, just trying to survive,'' Ma said. "He takes care of his grandkids. He doesn't have an easy life.''
Some former workers, however, say life wasn't all bad for Ramirez. They say he liked to wear $500 cowboy boots, drove a $100,000 Mercedes-Benz and threw parties at restaurants, complete with mariachi bands, for friends he amassed over three decades as a contractor.
"He drove around looking like a big shot," said Breider, who worked five years at Pacific Cement before he was laid off in 2005. "He liked being thought of as a big shot.''
Ramirez's attorney, Dek Ketchum, said his client was "a self-made guy.''
He was also generous, Ketchum said, someone who sponsored scholarships for local high school students and never refused to help an employee in a pinch.
One of his advocates was former San Francisco Supervisor Jim Gonzalez, who did some work for Ramirez as a lobbyist in the 1990s.
"I knew him as a good, active Latino person, a self-made man,'' Gonzalez said. "He was a very strong family man -- he raised two grandchildren. I always considered him a really salt- of-the-earth guy.''
His attorney said Ramirez served stateside during the Vietnam War as a drill instructor for the Marine Corps. His career as a contractor began in 1975, when he and a half brother, Reynaldo Nunez, started a construction equipment rental business and ran it out of Ramirez's home on a 12-acre ranch in Gilroy. On his resume, Ramirez boasted that the business had started with equipment worth $39,000 and he "turned it around 30 times,'' giving him a net worth of $1.2 million in 1990.
Over the next two decades, Ramirez started at least four more businesses, including an asphalt company that he said did $5 million in work for the city of San Francisco in the 1980s. At least two of his firms were certified by the state and city as disadvantaged and minority-owned businesses. That gave Ramirez, the son of a Mexican immigrant, a leg up on bigger, white-owned companies in winning contracts for such public works projects as paving and sewer replacement.
Still, by the late 1990s several of his companies either had folded or were in bankruptcy protection. In one 1998 bankruptcy filing, Ramirez said he had $4.6 million in paving and other contracts in 1996, mostly from the city, but that business had dwindled to just $75,000 two years later.
His attorney acknowledged that Ramirez had an up-and-down financial history, but said that bankruptcies were common in that line of work. "Construction is a tough, brutal business,'' Ketchum said.
Financial issues, however, were not Ramirez's only problem.
In 1985, on a one-mile paving job on San Francisco's Bay Street from Embarcadero to Fillmore Street, Ramirez's West Bay Contractors, Engineers Inc. was faulted by city officials for defective work in at least eight locations, records show. The blacktop started to break apart soon after the project was done, and Ramirez was ordered to repave it at his expense. Ramirez complained that city inspectors were harassing him.
In 1997, in a Ramirez project to replace sewers along Jackson Street, the city refused to pay his company nearly $40,000 because of poor-quality or unfinished work, records show. Ramirez complained again of harassment.
Public Works Department construction manager Larry Wong later said Ramirez had suffered big losses on the Jackson Street project "due to third-party claims from illegal debris dumping, flooded basements, electrical outage to (an) apartment house and restaurant business, and runaway equipment damaging (a) concrete truck.''
Wong said Ramirez and West Bay had been plagued by "mismanagement, lack of proper resources, ongoing disputes with his business partner, continued bickering with general contractor and poor quality of concrete products.''
Ramirez's attorney said there was simply a personality clash between Wong and Ramirez. The quality-control problems such as those Ramirez suffered are common for contractors and, given all the work Ramirez did over the years, were not significant, Ketchum said.
"When you look at that volume of work, and you look at the number of jobs he was asked to do over, it's minuscule,'' Ketchum said. "I would put that record up against any record in the industry.''
Ramirez also had a record of making political donations to people who could help him -- though he didn't always do so legally.
An investigation by state regulators in 1997 found that Ramirez illegally contributed $2,000 to Willie Brown during the 1995 San Francisco mayoral campaign. The state Fair Political Practices Commission concluded that Ramirez had funneled money to the Brown effort by using employees and family members to get around the $500 individual limit that the city imposed.
Ramirez was ultimately fined $6,000 in the civil action by regulators and was separately ordered to perform 25 hours of community service to resolve a criminal case filed by the San Francisco district attorney's office.
Several years later, as he was branching out into work on state road projects, Ramirez donated $70,000 to Cruz Bustamante and independent expenditure committees headed by the lieutenant governor. He also gave $12,000 to groups tied to John Burton, the San Francisco Democrat who was president pro tem of the state Senate.
"He was friends with John Burton, Willie Brown, Cruz Bustamante, all the traditional folks," Supervisor Ma said.
The contributions to Bustamante and Burton got him in trouble again with state regulators, who found last year that he had failed to report most of his donations in a timely manner -- in some cases waiting three years after the fact. He was fined $1,600.
Brown says he doesn't remember Ramirez. A spokesman for Bustamante said the lieutenant governor had no comment.
Burton said Ramirez impressed him as hardworking. "It seemed like he was a little guy being pushed around by big guys,'' he said. "Like a little guy struggling to stay afloat.''
In 1998, with his latest paving and engineering business in bankruptcy protection, Ramirez hit on the idea of starting a concrete plant that he would call Pacific Cement.
He approached the Port of San Francisco about leasing a site on Pier 80, on the southeastern waterfront near the end of Cesar Chavez Street. Ramirez advertised himself in his lease proposal as a "skilled, accomplished and experienced professional in such areas as concrete, paving, excavating and building.''
He won approval, in part, because of his contacts with longtime Brown friend Charlie Walker.
Walker, a trucking contractor and self-styled "mayor of Hunters Point," went to prison in the 1980s for bilking the city's minority contracting program. Brown was his lawyer at the time, however, and when the former Assembly speaker took over at City Hall, doors opened for Walker.
When San Francisco International Airport built a new international terminal, Walker obtained a share of more than $800,000 worth of city trucking subcontracts.
In 1999, Walker testified at Port Commission hearings on behalf of Ramirez's lease bid. Walker said that he considered Ramirez a business partner and that he had invested in concrete trucks on his behalf.
Ketchum confirmed that Walker had been a business partner but said their arrangement had fallen through.
Mike Hardeman, a port commissioner who voted with the board to approve the Pier 80 deal, said he had been impressed by Ramirez's proposal. Ramirez said he would provide about 50,000 cubic yards a year of quality concrete for city projects at cut-rate prices. He promised 30 new jobs and predicted $2 million to $3 million in sales within a year.
Hardeman said commissioners had relied on port staff to do background checks on Ramirez and review his proposal. Nothing alarming turned up, he said.
"It seemed like a real reasonable deal. Everybody was happy,'' Hardeman said. "Charlie (Walker) spoke on his behalf, as did a lot of members of the public. This was a big win-win situation for everybody.''
Among the winners was Walker -- Ramirez hired his daughter Crystal Sims as a driver for the plant.
The Port Commission formally approved the deal that secured the lease for a little over $7,000 a month, and Ramirez began operations in July 1999.
But at first, business was slow. Ramirez didn't know much about concrete, and the relatives he brought in to work at the office didn't either.
"Let me put it this way," said Breider, a concrete-industry veteran who was hired as a salesman but quickly filled the expertise void in early 2000. "It used to be when you went to the prom, you dressed in a suit, with a handkerchief in the top left pocket and one in the back pocket. One is for blow, and one is for show. He's the show.''
Although he may have lacked knowledge, Ramirez's status as the only concrete provider certified by the city as a disadvantaged minority contractor practically ensured his success. And soon, Ramirez was swamped with orders. He started making twice the amount of concrete that he had estimated on his business plan.
His product didn't always pass muster. In 2000, city officials faulted Pacific Cement for pouring several loads of concrete at the Crocker Amazon skateboard park that did not meet specifications for the project. The city ordered Ramirez to replace the concrete at his expense.
That same year, Pacific was accused of supplying substandard material to the Golden Gate Park reservoir and pump station, a project worth $180,000 by Pacific's estimate. But the prime contractor defended Ramirez's product, saying "the city has in no way been compromised'' by receiving Pacific's concrete.
Ramirez's big break came in 2001, when the Golden Gate Bridge district awarded a contract that included a deal for his firm to provide concrete for an earthquake retrofit of the span, Breider said.
Bridge officials would later say that most of the 1,400 truckloads of concrete that Pacific supplied over the next four years met specifications. Prosecutors do not dispute that, saying most of the problems with bad cement cropped up in 2005. But at least one driver said the company was known to cut corners even earlier.
Joe Riblie, who worked part time for Pacific, recalled that he took one load of the company's concrete to the Golden Gate Bridge in 2002 and inspectors turned it away as inferior. He said he drove it back to the plant, where it was simply retagged and shipped back to the bridge.
"They didn't throw it away," Riblie said in an interview. "They just wet it up and told me to bring it back out there.'' He said the bridge then unknowingly took the same load it had rejected earlier.
Ketchum said that workers could make all kinds of accusations, but that the material provided to the bridge had been inspected and passed muster.
Prosecutors say Ramirez would soon find a way to cut corners that would get him in trouble.
In 2001, Ramirez met Tom Chasm, who ran an Oakland-based concrete recycling company, Specialty Crushing. Chasm said he had talked up the advantages of using recycled concrete as the base for sidewalks and under roadbeds.
Recycled concrete -- which is composed of ground-up concrete and other construction debris -- isn't strong enough for major, load-bearing structures, but it is perfect for more decorative work, Chasm said.
Ramirez "didn't say anything'' in response to the recycling idea, Chasm recalled.
But the idea clicked, Breider said. Ramirez soon decided that he, too, could grind up old concrete and put it in the mix.
Ramirez got the port's permission in 2003 to set up a portable crusher for concrete recycling at his Pier 80 plant. He told officials he needed it to break up old material so he could use it for a concrete pad to be poured for a larger plant on nearby Pier 94, where the port had given him approval to expand. He later installed two larger machines without port permission, officials say.
Ramirez's business with the city of San Francisco was growing quickly. Over three years, Pacific won contracts for the city's Youth Guidance Center, the Muni's Third Street light-rail project and the earthquake retrofit of Summit Reservoir near Twin Peaks.
His business was going so well that in 2003, state officials said he had exceeded the $750,000 net-worth limit for eligibility for disadvantaged contractor status. Ramirez appealed the ruling, saying he had made mistakes in his application, and ultimately Caltrans let him keep his disadvantaged status.
By early 2004, Breider started to hear from drivers that Pacific was using recycled concrete in projects that shouldn't incorporate it, he told prosecutors.
He saw piles of old concrete and debris at the plant at Pier 80 and asked whether the recycled material was being used in major projects. Ramirez at first denied it, according to an affidavit that prosecutors filed in court in May.
Breider said in an interview that he had warned Ramirez that recycled concrete did not meet specifications for structural projects. Despite Breider's objections, prosecutors say, Ramirez went forward with grinding up chunks of old buildings, sometimes rebar and all, and throwing it into the mix. Within months, the use of recycled concrete at Pacific Cement was routine, prosecutors say.
At this point, the orders were rolling in not only from city projects, but from Caltrans as well. Ramirez provided concrete to the rebuild of the Central Freeway and poured roughly 2,700 cubic yards -- enough to cover a football field nearly 20 inches deep -- in December 2004 and January 2005, Caltrans officials say.
He also won bids for work on the Fourth Street off-ramp of Interstate 80. Most of that concrete, roughly 2,900 cubic yards, was poured from October 2004 to May 2005, Caltrans officials say. And he got deals to provide concrete for the western approach retrofit of the Bay Bridge -- 27,300 cubic yards, enough to cover a football field 161/2 feet deep -- and for the new eastern span.
A former dispatcher for Pacific who doubled as a maintenance supervisor, Jeff Kollmann, told investigators that Ramirez had ordered him in May 2004 to use recycled concrete on all Pacific's jobs because the company's supplier of the rock normally used in concrete no longer would fill orders on credit. Recycled concrete cost $2.50 a ton to make, compared with $20 a ton to buy rock, Kollmann said.
Kollmann said he made exceptions when the concrete ordered had to withstand heavy loads or when it was destined for customers who had already complained about poor quality. However, "Ramirez would often override their decisions,'' Kollmann told prosecutors, according to the affidavit in support of the case. "This overriding mandate by Ramirez would happen even for jobs where Ramirez had previously told them not to use recycled concrete aggregate for fear of getting caught or because of complaints.''
One project that drew repeated complaints was a Burlingame sewage treatment plant, where Pacific supplied concrete in 2004.
In August 2004, a load of concrete for the new plant's control house repeatedly jammed in a pumping apparatus, which became clogged with rebar and large chunks of recycled material, Robert San Felipe, a driver that day for Pacific, said in an interview.
After several attempts at cleaning the line, San Felipe said, the pump operator tried to flush it out. The hose jerked and smashed into the face of Kenneth Mercado, a worker manning the hose, according to Mercado's lawyer, Troy Otus.
Mercado was badly injured in one eye, limiting his vision, and suffered a broken nose, Otus said.
Otus claimed in a lawsuit filed on Mercado's behalf that Pacific had been negligent for jamming the hose with recycled concrete consisting of "all types of debris, including, but not limited to rebar, glass and painted cement.''
Pacific denied the allegation and blamed the incident on the pump operator. The suit was recently settled for more than $100,000, paid by Pacific and the pump operator's insurance company, Otus said.
Pacific also told sewage plant officials that it had put construction debris in the concrete mix by mistake and that no recycled concrete had been used intentionally. According to Otus, Pacific officials said a worker had been fired over the mistake.
By December 2004, after several letters and a threatened work cutoff, the quality of the concrete being poured at the Burlingame plant improved, according to prosecutors.
Syed Murturza of Burlingame's Public Works Department said all the Pacific Cement concrete that eventually went into the structures at the sewage treatment plant met strength requirements. "Our consultant told us it is not an issue to worry about,'' he said.
Just where else Pacific's recycled concrete was poured is unclear.
In interviews with The Chronicle and statements to prosecutors, drivers said they had found rebar, wood, brick and other debris in many loads they shipped in 2004 and 2005. One driver, who was not named in a criminal affidavit, told prosecutors that Pacific Cement workers would "guard the operation from inspectors.''
The projects receiving Pacific Cement concrete were some of the biggest public works jobs going in the Bay Area -- the rebuilding of the freeway approach at the western end of the Bay Bridge, the extension of Muni's light-rail service to the Bayview neighborhood, and a garage in Golden Gate Park for patrons of the M.H. de Young Memorial Museum.
Former driver San Felipe said that in 2004 he drove a load of recycled concrete to the Muni project that hardened so fast contractors on the site told him to take it back. The rate of hardening is critical to the ultimate strength and durability of concrete, and concrete that hardens too quickly is often rejected.
"When I pulled away, I couldn't get it out of my chute," San Felipe said. "I literally had to take a sledgehammer to get it out of my truck.''
Caltrans has confirmed that some recycled concrete is in the new western approach to the Bay Bridge and says it may have to undertake a costly procedure to try to keep water infiltration from destroying the concrete prematurely.
Golden Gate Park garage officials say they're confident no recycled concrete was used in their structure, but have conducted no tests to confirm their belief. Muni refuses to comment pending the outcome of city investigations.
Testing has not borne out drivers' suspicions on all projects involving Ramirez's company. Some drivers told prosecutors that they believed they had delivered recycled concrete to a retrofitting project at the 14 million-gallon Summit Reservoir on San Francisco's Twin Peaks, but samples have revealed no sign of substandard material.
"There is no reason to believe there is anything wrong with it,'' said Tony Irons, deputy general manager for the city's Public Utilities Commission. "All the cores taken showed the concrete was acceptable.''
After Gavin Newsom became mayor in 2004, the port began pressuring Ramirez about cleaning up a pile of concrete waste on Pier 80 that authorities say was as high as 13 feet.
Prosecutors say Ramirez put the dregs from that waste pile into making more recycled concrete.
As port officials started to crack down, Ramirez accused them in a letter to the Human Rights Commission in May 2005 of being insensitive to small business. "There seems to be a pattern of discrimination by the port against Pacific Cement,'' Ramirez said.
By mid-2005, the port moved to have Ramirez stop work at the Pier 80 site and to bar him from moving to the larger Pier 94 location.
Last July, Caltrans discovered that recycled concrete had been used on the western approach of the Bay Bridge. Tutor-Saliba, the general contractor, fired Pacific.
Prosecutors say that by then, Ramirez was also forced to let many of his workers go. Breider said he had already been moved from Pier 80 to an office after he continued to object to using recycled material.
Ramirez's attorney, Ketchum, said the city's refusal to let him move to Pier 94, together with the refusal of contractors to pay Pacific some $2 million, put Ramirez in a bind. He became "trapped'' at the Pier 80 site, unable to expand, Ketchum said.
Ramirez had invested $3 million at Pier 94 in preparation of the site and equipment. "To not get the permits, it was devastating,'' Ketchum said.
Ramirez now faces charges of breaking environmental law, as well as grand theft and fraud associated with the Golden Gate Bridge retrofit and Burlingame wastewater project. Nunez, his half brother, who oversaw the Pacific Cement plant, faces the same charges, and like Ramirez has pleaded not guilty.
At the Golden Gate Bridge, prosecutors say, tests showed that anywhere from 5 percent to 35 percent of the concrete that Pacific supplied for facades on the Fort Point arch pillars was recycled. They said the problem was most evident in concrete that was poured in mid-2005.
Tests on the Bay Bridge western approach continue.
Ketchum said the amount of disputed concrete is so small as to be insignificant. "It's a contamination problem,'' he said. "It's easy to have a contamination problem. It makes no sense to claim it's a deliberate substitution.''
Walker, who has known Ramirez for 30 years, said Pacific Cement was only doing what was needed to survive in a business climate where "white folks" had it in for Ramirez from the start.
"He was a Mexican, and the whites didn't want him in on it,'' Walker said. "He tried to cut the corners so he could make money like them, and now they say he is a big old criminal. That is what it boils down to.''
San Felipe, the former driver for the firm, said the story of Pacific Cement is one of how a "perfect" opportunity to build something lasting was squandered.
"They had this city wrapped around their finger," San Felipe said. "They could have kept this business going. It would have been able to give back to the community, as far as jobs, as far as quality product. No -- greed got in their way.''
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