Auckland Council has called in lawyers to look at claims the city's biggest bus operator will fail to meet a deadline for a new $98 million integrated public transport ticketing system.
NZBus is allegedly running way behind schedule on plans to make it easier for Auckland commuters to use public transport.
In 2009 French technology company Thales won the contract for a universal smart ticket that commuters can use on trains, buses and ferries.
The following year rival bidder Snapper Services was allowed to run its card system in Auckland.
But only if it was on buses run by its sister company NZBus, and on the condition the cards were made compatible with Thales' system by November this year.
Auckland Transport sent a strongly worded legal letter to Snapper Services last week.
It says Snapper has confirmed it will miss the deadline and goes on to claim Snapper has breached its agreement and will have the pay for cost overruns of $4 million.
Auckland Transport says missing the deadline would be unacceptable and would lead to a cost blowout of $4 million.
Auckland Mayor Len Brown is not happy.
"There is a problem and we are addressing that. We have taken steps to get our lawyers involved to and ensure the parties are aware of their legal responsibilities."
The Government, which contributed $42 million to the project, is also furious about the delays.
It has signalled it is prepared to see NZBus's fleet of 600 busses taken off the road if the deadline is not met.
Transport Minister Gerry Brownlee said last week that "if they don't meet that deadline they won't be able to take passengers on that system".
"I can't believe a big company like NZBus are going to want to start shedding passengers."
Labour says it is vital a resolution is reached as pulling the buses off the road, as signalled by Brownlee, is not realistic or practical.
ONE News political reporter Corin Dann said he spoke to Snapper Services this afternoon and they were adamant they could still meet the November deadline, and rejected any suggestion they were liable to cost overruns incurred by Auckland Transport.
And NZBus says it remains committed to Auckland's integrated ticketing system.
ONE News understands a crisis meeting of all the key players is on the cards for tomorrow.