Synagro, City of Detroit Agree to Void Tainted Contract

Within days of James Rosendall's guilty plea in federal court to bribery charges (reported here), Synagro Technologies and the City of Detroit have reached an agreement to terminate the $1.2 billion sludge contract at the center of a still-unfolding public corruption scandal.

As outlined in a DWSD Press Release (here) and as reported by the Detroit Free Press on January 29, 2009:

"City officials called Synagro President Robert Boucher this morning and asked if Synagro would agree to terminate the contract. Boucher immediately accepted, understanding the taint that former Synagro vice president James Rosendall’s guilty plea put on the deal.

“I think they recognized that the contract could not be allowed to continue,” Detroit Mayor Ken Cockrel Jr. said. “If we have a contract that has been let and approved by the City of Detroit and we have a representative … who has pled guilty in a court of law to paying bribes, the contract at least on the surface obviously appears to be tainted.”

"Darci McConnell, a spokesperson for Synagro, issued a statement on behalf of the company, expressing its disappointment.

“We reached this mutual decision with the city because it was appropriate under the circumstances,” she said. “We at Synagro take our, legal, ethical and environmental obligations seriously, and we are confident that the controls we have in place will ensure that inappropriate behavior will not be repeated.”

"Synagro’s agreement to terminate the contract without a fight saves the city from what would have been a costly legal fight to void the contract."

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This story is reported by the Detroit Free Press (here and here).

DWSD Board of Water Commissioners Approves Proposed Settlement

On January 28, 2009, the DWSD Board of Water Commissioners voted unanimously to approve a landmark settlement (reported here) with its suburban customers. The agreement must also be ratified by Detroit City Council, where questions about the sale of the Oakland-Macomb Interceptor (OMI) are likely to be raised. Wayne, Oakland and Macomb Counties also must ratify the agreement. Attorneys representing these counties reportedly told the Court at a hearing in December that they would recommend the terms of the settlement to their respective clients.

Upcoming (2009) Design and Construction Projects Identified by DWSD

DWSD has published its list of Proposed Construction and Consultant Contracts for Q1 2009 here. This list includes 15 projects that DWSD expects to advertise for bids between January and March, 2009. Most of the proposed contracts (9/15) are expected to be in excess of $5 million.

The construction projects planned include:

• Electric Avenue Reservoir Construction and Booster Pump Station Rehabilitation (DWS-873);
  
• Chemical Treatment System Modifications at the Northeast, Springwells, Lake Huron and Southwest Water Treatment Plants (DWS-867);
  
• Springwell Water Treatment Plant Discharge Header Pipe System Replacement (D/B) (SP-567);
  
• Southwest Water Treatment Plant Sludge Treatment and Waste Washwater Treatment Facilities (SW-548); and
• Parallel 42-Inch Water Main in 24 Mile Road, from Foss Road to Fairchild Road (WS-674).