Montreal, Canada --- (METERING.COM) --- September 23, 2009 - Montreal auditor general Jacques Bergeron has presented his report on the City’s $355.8 million (US$332 million) water meter contract with private consortium Génieau, which became mired in controversy because of alleged irregularities with the tendering process.

In the report Bergeron concludes that there were a number of administrative irregularities, poor management and multiple omissions of relevant information to elected officials before they approved the project. Moreover the contract price for the project, while competitive, appears to be too high, and could have been reduced by breaking up the contract into smaller jobs for different contractors.

As far back as 2004 the city council agreed to the installation of water meters in the industrial, commercial and institutional sectors, and eventually, after some evolution of the project, the contract to install and manage an automated meter reading system was awarded to Génieau – comprised of the Groupe-Conseil Dessau-Soprin and Simard-Beaudry Construction – in November 2007.

However, earlier this year it emerged that the now retired former head of the city’s executive committee, Frank Zampino, maintained a friendship with businessman Tony Accurso, who led the Génieau consortium, and had vacationed on Accurso’s yacht in the Caribbean during the tender process for the contract. This led Montreal mayor Gérald Tremblay to suspend the contract pending an investigation.

Bergeron finds in the report that the installation of the water meters seems to be justified, but the network optimization component of the project, which includes a flow measurement and leak detection capability, does not optimize cost effectiveness for the city.

In concluding Bergeron suggests that the city reviews the contract with Génieau, and its whole approach to water delivery, given the deterioration in the delivery infrastructure and the huge future costs involved.

As a result of the report Mayor Tremblay has indicated that he plans to cancel the contract, which was Montreal’s largest ever municipal contract.

In a subsequent statement Génieau said the consortium responded in good faith to the call for proposals and over the next few weeks, with support from legal advisors, will evaluate the financial consequences resulting from the termination of the contract.