Record settlement helps City of Sacramento protect ratepayers from future water meter repair costs

The City of Sacramento received $13.4 million to settle its lawsuit alleging non-compliant work and fraudulent billing on the Accelerated Water Meter Program, the City's initiative to comply with a state requirement that all urban homes and businesses have water meters by 2025.

Under the settlement, the largest in City history, Teichert Construction paid $7.5 million and the City's construction managers - Psomas and TRC Companies, Inc.- paid $5.9 million.

"Sacramentans won't be deprived of materials and services they paid for," said City Attorney Susana Alcala Wood. "The meters accurately track water use but the longevity and durability of the infrastructure supporting them remains in question. This settlement protects ratepayers by providing funds to offset replacement and repair costs, which will come sooner than intended."

In its lawsuit, the City contends Teichert used improper construction materials and methods, that its work did not meet contract specifications, and that Teichert billed the City for materials and labor not used in the course of installing approximately 13,000 water meters in South Land Park, Tradewinds, North Sacramento, Meadowview, Golf Course Terrace, and Lemon Hill.

A comprehensive City investigation into Teichert's work on the Accelerated Water Meter Program found a large volume of non-compliant work, including not installing special equipment designed to hold meters in place, backfilling excavations with unapproved materials, and using plastic pipe instead of copper pipe. Teichert refused to correct its defective work and honor its warranties, necessitating the City's lawsuit. While not parties to the litigation, the City's construction managers, Psomas and TRC, participated in this settlement solution based on the City's contention that their actions contributed to its damages.

More details about the City's lawsuit against Teichert are available here.