It was like a splash of cold water in the faces of Montrealers sleeping through the city’s election campaign.

They had been lulled by the mayoral choices. There was the incumbent: Mayor Gerald Tremblay, 67. Voters were unclear what the drab technocrat had accomplished over two terms and they worried about the whiff of scandal in his administration, although he seemed clean personally.

Then, there was the main challenger: Louise Harel, 63, a unilingual francophone separatist whose claim to fame as a Parti Québécois minister is forced municipal mergers that caused years of turmoil.

Many found the third choice even more unlikely: city councillor Richard Bergeron, 54, an idealistic, bookish urban planner whose tiny party focuses largely on dreams of extensive new public transit.

The polls had shown Tremblay’s Union Montreal and Harel’s Vision Montreal statistically tied, with Bergeron’s Projet Montréal far behind. Then, on Sept. 21, three days into official campaigning, there was the big wake-up call. The city’s auditor general released a 170-page report on the largest contract in the city’s history — a $356-million deal to install water meters in commercial buildings and pressure controls in the city’s underground water network.

Tremblay had already suspended the contract in April after word emerged that former city executive committee chairman Frank Zampino, Tremblay’s right-hand man, had twice vacationed on the luxury yacht of a controversial businessman whose firm was in on the water-meter deal.

At the same time, more information emerged that three companies owned by the same businessman were being investigated by the Canada Revenue Agency for tax fraud involving an alleged phony-invoice scam. Newspaper investigations also revealed that Montreal appeared to be grossly overpaying on the water-meter contract. In fact, it was paying three times more than Toronto had.

Through it all, Tremblay, a former provincial Liberal industry minister, managed to avoid public blame, in part because his opponents were weak. Voters seemed to be giving Tremblay the benefit of the doubt, believing he was duped.

The damning report by auditor general Jacques Bergeron changed that. Bergeron (no relation to the mayoral candidate) uncovered overspending and administrative laxity and said the contract was: “Too fast, too big, too expensive.” Bergeron also said meetings between city officials and companies during the bidding process raised troubling questions. He revealed that an external accounting firm and civil servants had raised alarms about irregularities in how the contract tenders were being handled; the warnings were ignored. And while Bergeron didn’t lay blame, he forwarded documents and information to the Sûreté du Québec, the provincial police force, which is investigating the contract.

Tremblay immediately cancelled the contract (the city may owe up to $75 million in penalties). He accepted the resignations of his two top bureaucrats, who both walked away with hefty severances. The mayor also proposed a code of ethics, something he had promised to bring in after a spate of scandals in his first mandate but which he never followed through on. Tremblay blamed the water-meter fiasco on “administrative shortcomings” and “procedural oversights.”

Voters weren’t so sure. In a poll conducted for La Presse in the days after the report’s release, 51% of respondents said they didn’t believe the mayor when he said he didn’t know anything was wrong with the contract. Tremblay’s approval rating also took a hit. A majority of those polled, 65%, said they were not satisfied with his administration, a seven-percentage-point increase from two weeks earlier.

Tremblay’s fall from grace doesn’t seem to be benefiting Harel. The two front-runners are still tied. But Bergeron’s fortunes are rising: the poll placed his support at 20%, up six points from two weeks earlier.

The water-meter deal and, by extension, the election are now the talk of the town. IE