By Brian CHERNICK

The City of Glendale reached an agreement for a $1.1 million settlement with consulting firm Willdan Financial Services, three years after the city filed a breach-of-contract lawsuit that claimed the city lost revenue due to faulty methods in a water-rate study conducted by the firm in 2011.

“We are extremely satisfied with the settlement as it compensates the city for a combination of lost revenue and out-of-pocket expenses incurred by the city as a result of Willdan’s error,” City Attorney Mike Garcia said in a statement.

Willdan had been retained by the city to develop a Cost of Service Analysis (COSA) to assist with setting the 2011-12 water rate plan. Based on the findings by Willdan the council adopted a water rate structure and increased the rates for spring of 2012.

Soon after implementation, Glendale’s Water and Power noticed the generated revenue was significantly lower than what had been projected by Willdan. After a close review, and conferring with Willdan representatives, the city concluded that the loss of revenue was a result of a miscalculation because the firm used the city’s bi-monthly water usage data instead of the monthly measurements.

This error led to residents being charged a much lower water rate.

“I’m happy that our staff’s attention to detail was able to identify Willdan’s error and keep it from affecting the pocketbooks of Glendale residents,” Mayor Vartan Gharpetian said.

The flawed calculations were originally brought to the attention of council members in 2012 by the late Glendale resident Harry Zavos, who told them that the analysis could not be trusted.

The city rejected the initial Willdan Financial suggestion that Glendale Water and Power charge residents back payments to make up for the lost revenue.

“The Council believes that it is simply unfair to ask its residents to foot the bill for a consultant’s mistake,” City Attorney Mike Garcia said back in 2014.

The city subsequently filed suit to recover the lost revenue, which was approximated to be $9 million, and the cost of $107,000 that was paid to the firm to prepare the study.

Berkeley-based consultant, Bartle Wells, was brought on to analyze the miscalculated rates and to develop a new COSA for a total of $180,000.

Willdan Financial did not respond to requests for comment.

  Brian CHERNICK