Downey OKs Settlement in Overbill Case

After months of investigation, the City Council has decided to settle with an air-conditioning maintenance firm that has admitted overbilling the city by thousands of dollars since 1985.

The council voted unanimously Tuesday to accept a settlement of $14,789 from the Weatherite Service Corp. for the excessive charges, as well as staff time to investigate the matter. The overbilling went undetected until it was brought to the attention of city officials last year by a former Weatherite competitor who is also a Downey resident.

Officials say they are concerned that the overbilling escaped detection, but they as yet have no plan to change the way the city monitors contract compliance.

‘Not Comfortable’

“I’m sure the council will be looking at other contracts,” Mayor Robert G. Cormack said. Public Works Director William A. Ralph said he will seek to cancel the contract with Weatherite, which runs through September, 1989. The city would then rebid the contract, which calls for the maintenance of cooling and heating systems at the Civic Center. But the council is not likely to consider the change for about two months, Ralph said.

“I think the contract needs to be rebid,” Councilman Randall R. Barb agreed in an interview. “I’m not comfortable doing business with (a company) that sloppy.”

Weatherite officials have said a computer error was partly responsible for the overbilling. Other excessive charges occurred when Weatherite did not follow its contract with Downey, which pays the firm for labor and parts. In about a dozen cases, Weatherite charged a lump sum per job rather than billing the city for parts and labor as required by the contract. That resulted in overbillings of about $2,000.

Denies Sloppiness

“I don’t consider our accounting sloppy,” said Weatherite spokesman Steven Smith. “We made an error and we regret it.” Smith said Weatherite would seek to win back the contract if city officials decide to rebid it.