Auditor: City’s refusal to hold Veolia accountable linked to wastewater failures

Finding 2: “The City should improve its water utility contract monitoring processes.

For years, residents asked for Veolia, the Flint, Michigan water company, to be held accountable. A petition was signed with over 1,500 signatures demanding they be fired. The second finding of the recent audit established a direct link between the city’s failure to hold the contractor accountable and the environmental damage caused by the wastewater system failures.

The investigation determined the city refused to audit Veolia as required for more than two years, and waited almost 20 months to hire an engineering firm to conduct this audit.

FROM THE AUDITOR: “In addition to the delay in providing the above-mentioned audit report, the City’s delay in procuring independent engineering firm services may have contributed to the wastewater violations discussed in Finding 1” (Audit Report, page 5).

From the beginning, after residents pointed out the connections of the contractor with the Flint, Michigan water crisis, the city chose to publicly defend Veolia and make public statements criticizing residents who raised issue with the environmental damage being done.

“City leadership made an ideological decision to ignore residents concerns and defend the Flint, Michigan water company instead of fulfilling their contractual obligation to hold them accountable,” said Jesse Phillips, President of the Winter Springs Community Association. “The audit directly ties our wastewater failures to the commissioners deliberate choice to put their head in the sand.”

In October 2019, the City of Winter Springs entered into a contract governing the operation and management of our water, wastewater, reclaimed, and stormwater utilities. This contract comes with a responsibility: the City must diligently monitor and enforce the terms and conditions, ensuring that the contractor delivers on its commitments while meeting regulatory requirements.

However, what this finding reveals is a lapse in this oversight process. The contract mandates that the City retain an independent engineering firm with expertise in water utility operations to conduct periodic inspections and performance audits of the contractor’s work. These inspections and audits are supposed to be scheduled annually or as deemed necessary.

In December 2020, the City issued a request for qualifications (RFQ) for civil engineering continuing services, including those related to water utility projects. It wasn’t until June 2021, approximately 20 months after the contract with the water utility contractor began, that the City entered into a contract with an engineering firm for these services.

Crucially, the audit discovered significant delays in the delivery of an operational audit report, with the report only received by the City in August 2023—more than two years after it was due.

While the City has indicated that audit findings will be discussed with the contractor for prompt correction, the audit identifies critical shortcomings in the monitoring process, notably the absence of periodic inspections or audits apart from this delayed report.

In essence, this finding underscores the urgency of robust contract monitoring. Without periodic evaluations of contractor performance and effective oversight, the City’s ability to ensure compliance with state laws, rules, and contract terms remains limited.

Recommendation: To address these issues, the City must establish clear policies and procedures for monitoring contractor compliance with contract terms and state laws. These policies should mandate periodic performance evaluations, no less frequent than annually. Additionally, the City must ensure that its contracted engineer conducts inspections in accordance with contract requirements, enhancing accountability and safeguarding the quality of our water utilities.