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Alexandra Berzon

State deal in deaths at Orleans questioned

15 July 2008

LAS VEGAS, Nevada -- Federal safety regulators have not yet released the results of an investigation into Nevada Occupational Safety and Health Administration's handling of events following the deaths of two workers last year at the Orleans.

But a former federal OSHA official said a draft of the findings calls into question the use of state resources to provide training and consultation services to Boyd Gaming Corp., owner of the Orleans and one of the state's largest employers.

The draft cleared the state agency of wrongdoing on several points. But it also challenged an exemption from most OSHA enforcement inspections that Nevada granted Boyd for several years as part of the deal OSHA negotiated with the company, said Chris Lee, a former deputy regional manager at the San Francisco Federal OSHA office, which monitors Nevada OSHA.

"There was some real question about devoting state resources to assisting what is basically a large national corporation," said Lee, who retired five weeks ago after working on drafts of the report.

"They just had a double fatality, and now they're going to be exempt from programmed inspections," Lee said. "You just have to wonder why a state, given a tightening economic situation and other demands, wouldn't suggest that a large national corporation, which you would think would have the resources, hire their own safety and health professionals."

The training and consultation deal that created the exemption from regular programmed inspections was one of many elements questioned in the wake of last year's puzzling Nevada OSHA investigation after the deaths of Orleans maintenance workers Travis Koehler and Richard Luzier.

The agency made a series of unusual moves to downgrade "willful" citations to the far less severe and damaging category of "serious" citations. The findings were revised after an appointee of Gov. Jim Gibbons and other highly placed officials became involved in the case. An OSHA investigator and a health and safety manager at Boyd quit their jobs in protest.

"Nothing in this case has been normal," said Debi Fergen, mother of Travis Koehler. "The thing that would make me feel somehow a little bit of justice is to have the truth be brought out about what OSHA did."

Koehler died Feb 2, 2007, at the Orleans when he entered a manhole in an attempt to save fellow worker Luzier, who had gone in to fix a sewage backup and had fallen in the hole. A third worker, David Snow, entered to save Luzier and Koehler, and all three lost consciousness. Snow recovered after spending several weeks on life support.

Nevada OSHA's investigation found that Boyd officials had not taken safety precautions despite being warned by employees and by OSHA about the dangers of not having a safety plan for problems that arise with the manholes.

OSHA inspector John Olaechea concluded, "Boyd Corporate had knowledge and failed to act. That is the exact definition of a willful (by indifference)."

But in a last-minute conference between OSHA and Boyd, the willful citations were changed to serious citations and fines were reduced from about $400,000 to $185,000.

After a set of unusual maneuvers to change the citations, Nevada OSHA agreed to provide safety training and other consultation services to Boyd, a service normally reserved for small companies that don't have the resources of the gaming giant. The stated goal is to help Boyd qualify for the Safety and Health Achievement Recognition Program, a federal program specifically designed for small businesses with good safety records.

The deal also means Nevada OSHA's enforcement division will not be allowed to conduct regular programmed inspections at Boyd casinos. (It will be allowed to do investigations following accidents or after complaints.)

Both Boyd and Nevada OSHA maintain nothing improper occurred in the investigation or the settlement, and said the results were a victory for safety because they would lead to an overhaul at Boyd that would make workers safer.

Boyd spokesman Rob Stillwell called the deal "a groundbreaking endeavor." "If at the end of the day this results in some positive changes, then that is a good thing," Stillwell said.

Although the company is receiving free OSHA services, Stillwell said it has also committed significant company resources to safety, including several newly created positions.

But Fergen, the Snow family and others involved in the investigation were infuriated and insisted Nevada OSHA had caved in to Boyd in reducing the citations and in providing state services for a company with Boyd's deep pockets.

Fergen and another person involved filed complaints in September with the federal OSHA office in San Francisco alleging that Nevada OSHA had broken from procedure to give Boyd favorable treatment.

Federal OSHA opened an investigation. In April, federal officials said the results would be released in a few weeks. But neither Fergen nor Nevada OSHA has received results from the agency.

Fergen recently stepped up her activism, saying she was empowered by recent hearings on Capitol Hill that highlighted the weak response of Nevada OSHA following construction deaths on the Strip.

She wrote to Nevada Democratic Sen. Harry Reid, Nevada Republican Reps. Jon Porter and Dean Heller, and California Democratic Rep. George Miller, chairman of the House Education and Labor Committee.

Only Reid's and Miller's offices responded.

Reid's office told her it will call federal OSHA to inquire. Miller's office said it will monitor the case and will call the federal agency if no response comes soon.

Fergen said federal OSHA officials told her husband the case is hung up at the agency's offices in Washington, D.C., but provided no explanation.

Several Labor Department representatives contacted for this story were unable to explain the delay.

Lee, the former federal OSHA official, said the agency's actions are limited. Federal overseers are restricted to determining whether a state OSHA followed its own approved procedures.

Although federal officials found the Boyd case troubling, Lee says, Nevada was able to justify most of its actions under state laws and codes. "We have no authority to affect the outcome of the case," Lee said.

"Let's face it," Lee said. "It wasn't just a minor issue. It was the death of a couple of employees. When you take a bird's-eye view of this thing, it looks odd. It looks like they got some preferential treatment because of who they were."

Lee says he first saw preliminary findings in the case early this year and found them unacceptable. "It didn't seem to be expressing a sufficiently strong concern," he said. He told investigators to ask more questions.

Before retiring five weeks ago, Lee saw another draft of the findings that raised one especially troubling question: Why had Nevada OSHA agreed to provide consultation and training services for a company as large as Boyd?

Nevada OSHA must ensure that Boyd is devoting enough of its own resources toward safety and health, the draft of the letter stated, and state regulators should resume regular safety enforcement at Boyd casinos if the company does not make enough progress in improving safety, according to Lee.

In raising that issue, the feds focused on a point of controversy in Nevada. The federal government says small companies — defined as those with 250 employees or less — in high-hazard industries are to receive priority in receiving free government training and consultation services, an area of the agency separate from enforcement.

Nevada OSHA spokeswoman Elisabeth Shurtleff said that, unlike other states, Nevada gives large businesses in high-priority industries — gaming, construction and manufacturing — equal weight in receiving services with small high-hazard companies.

"High-hazard industries receive this ... prioritization as 'targeted' industries, regardless of employer size. That results in intensified efforts to positively impact injury and illness rates," Shurtleff said in an e-mailed statement.

Some local safety consultants have been arguing to Nevada OSHA officials for years that the state should not give large gaming companies access to state resources meant for small businesses that couldn't otherwise pay for safety personnel or consultants.

"There are lots of consultants who can provide large companies with consultation services rather than the state providing the same services for free," said Tom McManus, vice president of SCS Engineers and a local safety consultant who has worked with many casino companies.

But those at large companies that receive the benefits believe they're worthwhile. Wayne Matherly, a safety director at the Riviera, owned by Riviera Holdings, said he has called on help from Nevada OSHA's consulting division several times. The agency's outreach helps "make sure I'm on the same track they're on. It makes sure more eyes are looking at the same property," Matherly said.

So far, the state has devoted more than 1,000 hours to reviewing safety procedures at Boyd casinos and providing training, consultation and industrial hygiene services to Boyd, Shurtleff said.

The agency informed Boyd in May that it would drop the industrial hygiene services, Shurtleff said. She declined to explain why. Boyd is now in the process of hiring a private industrial hygiene consultant.

Fergen eagerly awaits the results of her complaint, but says she won't feel relief unless Nevada OSHA is forced to reinstate the willful citations that were originally designated for Boyd. "I want those that did what they did held accountable," Fergen said.