City ends USFilter contract
Published January 14, 2004
ANGLETON — City officials terminated
the contract with USFilter at 7:30 Tuesday morning, taking over the
city’s wastewater treatment and street maintenance for the first time
The city contends USFilter breached its contract by not hiring enough
employees to run the plants and maintain streets, not submitting annual
capital project reports and improperly charging expenses to the
maintenance and repair budget.
USFilter officials said politics, not performance, is driving the
city’s action. The company denies any breach of contract, and promises
to go to court.
The two sides met Friday after the city extended its Jan. 5 deadline at
“We met for, I’d say, about 14 minutes and they offered us
nothing,” Angleton Mayor Matt Sebesta said. “The negotiations were
fruitless and we updated council on that (Monday) night.”
Council already had given Sebesta authority to terminate the contract at
a Jan. 3 emergency meeting. Council took no action at Monday’s
City Administrator Michael Stoldt said USFilter officials gave the city
three options at Friday’s meeting: To allow the current contract to
run its course, to have the city take over street repairs without the
company paying the $400,000 the city claims it would be owed, or to go
“It seemed like negotiations were fruitless,” Stoldt said. “We are
prepared to defend our actions.”
Stoldt said the city audited the company’s invoices in 2001 and found
the improper expenses, including improper billing for electric costs.
“After the city began reconciling the USFilter maintenance and repair
bill, their expenses decreased by an average of more than $75,000
annually,” the city’s news release states.
USFilter spokeswoman Christie Kaluza said the charges to the maintenance
budget were nominal and the issue was resolved with previous City
Administrator Ruth Hertel.
“It was a ($25) gift card to an employee who received no lost time for
safety,” Kaluza said. “The candy is actually laughable. It was a bag
of peppermints that would be placed in a candy bowl in the reception
Kaluza said the city was happy enough with the company’s work to renew
the original contract in 2001 after resolving the electricity charges.
“When the city first notified the company in November 2003 of its
allegations of breach of contract, we immediately addressed these
unfounded allegations with the city, knowing that each claim against
USFilter was false,” Kaluza said. “The company values its
relationship with the city and hoped to work through this issue — an
issue obviously driven by city politics and not USFilter performance.”
The company had 16 people working in Angleton. The city contends the
contract calls for 19.
Stoldt said just three of the employees on duty Tuesday morning declined
the city’s offer to keep them on the payroll.
Stoldt said the city’s offer remains open until the positions are
“Just because you walk out today doesn’t mean you can’t come back
tomorrow,” Stoldt said he told the employees.
Stoldt said the transfer hasn’t affected operations.
Angleton isn’t the only city having problems with USFilter.
Mike Velsely, who works for the New Orleans Sewage and Water Board, said
the company also has failed to properly staff its treatment plants there
and has made improper charges to the board’s maintenance and repair
“They’re going to try to sweet talk you and then they’re going to
try to threaten you,” he said.
Kaluza said USFilter is proud of its record in New Orleans.
Michael Wright covers the city of Angleton for The Facts. Contact him at