"The city needs to immediately work to recover this money from Express," said Greuel. "If they are unwilling to negotiate, we will work with the city attorney's office to file charges to negotiate the money that is owed."
The audit also found the city of Los Angeles poorly negotiated a contract with Express agreeing to pay up to $1.35 per gallon for wastewater to be removed. Another local city recently negotiated a flat rate of 33 cents per gallon.
Greuel said a tip from the city's Ethics Commission prompted auditors to conduct an investigation.
"We uncovered serious wrongdoing and negligence, including massive overbilling by Express, a lack of oversight by city departments and a poorly negotiated contract by the city which resulted in millions of dollars of wasted taxpayer money," Greuel said.
Los Angeles has ended its contract with Express. Greuel is calling on all city departments to review their contracts and make sure they are all above-board.
AP contributed to this report.