Here some excerpts from that towns newspaper, September 2008:
Water firm has mixed record
The company that may soon run Nashua's water system has been the subject of two investigations and is facing a class-action lawsuit in the city of Indianapolis, its largest water customer in the United States.
The lawsuit, filed this year on behalf of customers, claims Veolia Water does not read meters as often as legally required and has overestimated water bills. The suit is still pending, awaiting official class-action designation from a court, but a lawyer handling the case says there could be upwards of 400 plaintiffs.
"I've done a few class actions before, but I've never, ever had an outpouring like I've had here," said Peter Kovacs, of the Indianapolis firm Stewart & Irwin. "At one point, I had hundreds of voice mail messages.
Based on a rash of complaints about overestimating water bills, the Indiana Utility Regulatory Commission launched an informal investigation into Veolia this year, according to public information officer Danielle Dravet.
The lawsuit, filed after the commission's investigation began, is still in the evidence-collection phase known as discovery, Kovacs said.
According to the Indianapolis Star, city officials say Veolia is required to read each meter at least every two months. But neither the city nor state regulators checked to make sure that was actually happening before customer complaints came in, according to the Star report, published in April.
According to David Gadis, president of Veolia Water Indianapolis, the suit has no merit. It involves a group of homes whose meters could not be read because they were hit multiple times by inclement weather. Then, when a combined water and sewer rate increase took effect soon after, it looked as through bills had been inflated, he said.
"It's just an unfortunate situation," Gadis said.
Gadis said Veolia is working with Indiana regulators to go to every-month meter reading.
The meter-reading lawsuit was news to some Nashua leaders last week.
"This is the first that I've heard of information . . . about some of the issues they've dealt with," Mayor Donnalee Lozeau said. "I guess it would be fair to say that anyone can be sued or investigated for anything. The fair thing to do is make sure they're substantiated."
"I have not, heard, no," Brian McCarthy, the alderman who testified on behalf of the city during the eminent domain hearings, said. "What that would cause us to do is probably strengthen the wording in regards to billing and estimation.
" McCarthy was referring to the city's contract with Veolia, which he said is subject to editing before the final signatures are placed. The contract is one of several details that would have to be ironed out before Veolia took charge. Veolia's base fee is nearly $5 million a year. That amount doesn't include a variety of costs, including emergency services and major improvement projects. The company is also being paid a transition fee of $1.34 million.
This year wasn't the first time Veolia's operations in Indianapolis made the news.
According to a 2006 Los Angeles Times report about privatized water systems throughout the country, consumer complaints in Indianapolis tripled in 2002, the first year of Veolia's contract, and the company admitted to mailing more than 15,000 incorrect bills.
"Inadequate maintenance caused hundreds of fire hydrants to freeze, hampering efforts to put out fires that consumed a church and other buildings," the article said. "Then, on Jan. 6, 2005, heavy rains swelled the White River and triggered a chain of system failures at the White River Treatment Plant. Officials issued a boil-water advisory, 40,000 schoolchildren took an unscheduled holiday and residents of the nation's 12th largest city learned they could no longer take their tap water for granted."
Gadis said the problems that day were caused by an operator error, and that Veolia decided to err on the side of caution by issuing the boil-water advisory, even though testing later proved the water was safe.
As for the billing issue, Gadis said Veolia inherited a flawed billing system when it came to town in 2002 after the city purchased its private water company.
"We at Veolia, voluntarily, have spent millions of dollars correcting this system," he said.
Also in 2005, Veolia was the subject of a grand jury investigation in Indianapolis for allegedly falsifying water quality documents, but charges were never filed, according to the Star.
So far this year, the Indiana Utility Regulatory Commission has logged 445 complaints or inquiries about Veolia, Dravet said.
Although the number of billing complaints in Indianapolis has increased this year, Veolia points out the number of complaints about water quality has drastically declined in the last six years.
There were about 500 complaints per year about taste and odor before Veolia took over, and that number has declined to fewer than 10, Gadis said. Only 10 taste and odor complaints in 2008?
Water problems were so bad in Indianapolis someone wrote a book about it. The water system, fed by reservoirs, had a recurring algae problem, particularly in hot and dry weather and in areas with stagnant water.
McCarthy said Veolia would automatically be responsible for making water quality improvements because it would have to comply with federal clean water standards that are set to increase over a period of years.
"We would certainly hold them to those standards and more," McCarthy said. "Where there is room for improvement, we will require it."
There have been several lawsuits with Veolia and the city of Nashua, here is one of them. December, 2008,
Another article that begs the question, why did the politicians do an 180°