News

PWSA sues ex-management firm after water quality, billing issues

PITTSBURGH — The Pittsburgh Water and Sewer Authority is suing its former management firm, Veolia Water North America-Northeast, the authority announced Wednesday.

Veolia was hired by PWSA in 2012 to help improve the authority's performance. Under the contract, which expired in 2015, Veolia assumed responsibility for executive, management and operations at PWSA.

PWSA asserted that Veolia grossly mismanaged its operations, misled and deceived PWSA to maximize its own profits.

“Based on a comprehensive review of their performance, it is clear Veolia cared more about their bottom line than providing residents with the high quality water and customer service they deserve,” Pittsburgh Mayor Bill Peduto said in a statement released to Channel 11.

PWSA said that during Veolia’s tenure failures included the botched implementation of a new automated water meter reading system, the improper billing of PWSA customers and the mishandled change in chemicals related to corrosion and lead control.

Earlier this year, PWSA was cited by the Pennsylvania Department of Environmental Protection for failing to notify the DEP of the change. At the time, PWSA said its board was not notified of the change either. PWSA changed its corrosion and lead control methods back to those that were originally permitted by DEP.

Seventeen of 100 homes tested this spring had lead levels exceeding the limit set by the Environmental Protection Agency.

In 2015, customers, claiming that they received monthly bills for thousands of dollars sued PWSA and Veolia.

"Despite receiving significant sums from PWSA, Veolia failed to perform as required," PWSA chairman Alex W. Thomson said in a news release. "This failure has resulted in significant damages to PWSA and left the Authority in a worse position than when Veolia was engaged."

Veolia is also facing a lawsuit filed by Michigan Attorney General Bill Schuette, which claims the company's negligence exacerbated the city of Flint's lead-tainted water crisis.

Veolia called the claims “unwarranted.”

PWSA is seeking damages that were not anticipated to exceed the $12.5 million it had already paid or still owes Veolia. A binding arbitration hearing will be held within the next four months.

Veolia issued a statement late Wednesday in response to the PWSA's lawsuit.

“Today's highly inflammatory action by Pittsburgh Water and Sewer Authority is nothing more than an effort to redirect blame for their failures and not fulfill their contractual obligations to Veolia,” the statement read, in part. “Veolia met its obligations and fulfilled the requirements of our contract in a fully transparent manner. We stand behind the work performed on behalf of PWSA and strongly urge PWSA to stop trying to blame others for their failures and fulfill their obligations under the contract with Veolia.”

RELATED CONTENT: