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City Manager Ed Burchins on Monday tried to reassure city council members who suggested that Laurinburg might have been duped by a company responsible for the city’s new wireless meter reading project.

Laurinburg City Council convened a special meeting to discuss the troubled project that continues to face problems.

Burchins said that the city stopped paying Datamatic, the Texas firm responsible for installing the $2.4 million metering system in March because of concerns about the project. The process involved replacing the city’s aging water meters and replacing or retrofitting its electric meters.

A contract with Datamatic was signed on Sept. 1, 2011 and since that time all but 714 of the city’s new electric meters have been installed. On the water side, of 8,800 meters, only 78 are not yet operational.

In both cases, the uninstalled meters are intended for use on the city’s largest commercial and industrial utilities customers.

Part of the dispute is about who is responsible for 714 “three phase” electric meters that would generate approximately half of the city’s electric revenue.

“That is a point of contention,” Burchins said.

The completed system will allow for the city’s water and electric meters to be read remotely, but the biggest obstacle to the new system going online is software.

“Getting the right filter in place … to allow (meter feedback) to be transferred into our billing system” is the current stumbling block, Burchins said.

The city took a total of three bids for this project in April 2011 with the goal of recouping an investment that had already been made in nearly a half million dollars of “Firefly” wireless meter reading units from Datamatic for an earlier project. Those units were faulty, and in winning the bidding process Datamatic agreed to fully account for the faulty units with a credit toward the new project.

Burchins said part of the new deal was an effort to salvage the initial investment made in 2006 and 2007.

Councilman J.D. Willis repeatedly questioned why the city had not paid the company installments to help safeguard its $2.4 million investment.

“It seems to me that we have just been taken for a ride by Datamatic twice then,” Willis said.

But staff said the payments were made on the project as equipment was received and installed. According to utilities officials, it would not have been possible to test the equipment as it was installed.

“And now we have lost our leverage,” Mayor Tommy Parker said.

“I don’t think we have lost our leverage and I think this will still get done,” Burchins said.

A new filter is scheduled to be tested on Dec. 3.

“If that doesn’t work they will have to continue to work to get the filter right. That’s on (Datamatic),” Burchins said.

The city still has $289,000 in its possession in funds held back until completion of the project.

A number of city staff as well as Burchins traveled to California prior to the project getting underway to see a similar system in action. According to Burchins, that system as well as a system in Tampa, Fla. seemed to work without issue.

“We say that system in California and it worked perfectly,” said city Public Utilities Director Stacey McQuage.

“When (Laurinburg’s Firefly meters) are working, it’s great, but they’re just not finished yet,” McQuage said.

It remains unclear whether legal action is upcoming, but Burchins said that he is optimistic that the problem will be resolved.

Assistant City Attorney William Floyd offered to sit in on future meetings. Pertinent communications, including e-mails and contract information, have already been given to Floyd for review.

“At some point (Floyd) will advise us how to move forward from a legal perspective,” Burchins said.