Sacramento sues contractor over water meter installation. Here’s what city claims
The city of Sacramento filed a lawsuit Wednesday against Teichert Construction Company alleging fraudulent billing for its work to install water meters across the city.
“The city’s lawsuit contends that 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 its work,” according to a city news release Wednesday.
“It is unfortunate that Teichert decided to cut corners and misrepresent its work to the city,” City Attorney Susana Alcala Wood said in the release. “By filing this lawsuit, the city is holding Teichert accountable for violating its contract and for depriving ratepayers of materials and services they paid for.”
Sacramento-based Teichert Construction “strongly disputes” the city’s characterization of its work, and claims the city owes it over $2 million, company spokesman Clark Hulbert said.
“The system, which was inspected by the city at the time it was completed, is performing as it should and — as the city itself has noted — ratepayers should not expect any problems with their service,” Hulbert said in an email. “We have offered to work with the city to address its concerns but the city seems to be focused on an unwarranted payday rather than a constructive resolution. Teichert, a local, family-owned company founded in 1887, is owed more than $2 million by the city and is fully prepared to defend the integrity of its work.”
The issues won’t affect bills for property owners, but they will cause the city to face “excessive costs for replacement or repair sooner than intended,” the city release said.
The city hired Teichert and several other companies to install water meters through the city in 2017 through 2020, under the Accelerated Water Meter Program, to comply with a state law that mandates all urban homes and businesses have metered waters by 2025.
The city awarded the company a $62 million contract to install about 13,000 water meters in the South Land Park, Tradewinds, North Sacramento, Meadowview, Golf Course Terrace, and Lemon Hill neighborhoods, the city release said.
In 2019, the city learned of improper installations at several residential properties, the city release said.
“The city repeatedly asked Teichert to disclose all locations where it deviated from the contract specifications, but Teichert refused to provide the information,” the city release said. “The city ultimately launched a comprehensive investigation into Teichert’s work, through which the city found a 90% rate of non-compliant work.”
The city claims the company failed to install special equipment designed to hold meters in place, filled excavations with unapproved materials, and used plastic pipe instead of copper pipe, the city release said.
The company disputes the city’s claims.
“(The city’s) purported deviations from the contract were performed with the full knowledge of the city’s inspectors,” Hulbert said in the email. “In many cases, Teichert’s work improved the quality of the water meter system. To address any city concerns regarding the overall longevity of the equipment, Teichert has offered to extend warranties well beyond the one year outlined in its contracts with the city. The city has not accepted this offer.”
The 256-page lawsuit, filed Wednesday in Sacramento County Superior Court, claims breach of contract, negligence, breach of warranties, violation of California False Claims Act, fraud and deceit, negligent misrepresentation, enforcement of performance bond, and violation of contractors state license laws.
In addition to Teichert, the lawsuit names Massachusetts-based Liberty Mutual Insurance Company as a defendant.
If residents have questions about their meters, they can call 3-1-1 or email 311@cityofsacramento.org, the city release said.
This story was originally published April 13, 2022 at 12:02 PM.
