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Mayor Greg Fischer will replace the executive director of the Metropolitan Sewer District, as well as three board members. Fischer made the announcement today after a state audit revealed numerous problems with the way MSD has been run

In the report, state auditor Crit Luallen found numerous managerial and ethical problems with the Metropolitan Sewer District, including excessive bonuses and the lack of competitively bid contracts for the board’s legal services.

In response, Mayor Greg Fischer announced the retirement of MSD Executive Director Bud Schardein. Schardein was at MSD for 28 years, and will stay on until the spring to help his interim successor—Louisville Water Company CEO Greg Heitzman—with the transition. MSD Board Chairman Arnold Celantano and board members Doyle Stacy and Jerome Clark will also be replaced.

Fischer says the audit made it clear that a major shakeup was needed at MSD.

“There’s been way too many people being way too cozy for way too long,” he said. “And when you start finding number one, number two number three, number four, it goes on down the list, you say clearly we’ve got a culture problem that needs to be addressed.”

Heitzman will retain his permanent job at the water company, while he serves as MSD interim executive director. Fischer says there could be opportunities for collaboration between the agencies.

“We’re taking this as an opportunity now to take a look at how the water company, how MSD and how public works could potentially partner with each other,” he said.

Heitzman says he’s drafting a 90-day MSD corrective action plan to address the audit’s findings, but some issues will take longer to fix.

Fischer will update the MSD Board on the changes and his transition plan on Monday.