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Pet Project Alert: City Looting DWP and Ratepayers

From Jack Humphreville

LA Watchdog: Today the Board of Commissioners of the Los Angeles Dept. of Water and Power will approve the transfer of $246,534,000 of ratepayers’ money to the city’s General Fund.

But this haul does not appear to satisfy the voracious appetite of City Hall for the ratepayers’ cash.

At its Nov. 20 meeting, the DWP Board of Commissioners approved a Cooperative Agreement with the Dept. of Public Works where DWP will “invest” a maximum $1.2 million over the next three years to support the implementation of the Los Angeles River Revitalization Master Plan. This is in addition to the $5.25 million that already has been provided to fund the first three phases of this very ambitious plan.

The long term Master Plan calls for the “revitalization of the 32 miles of the Los Angeles River and adjacent businesses and neighboring communities. The goals are to provide retail space and housing; enhance water quality; and improve the environment, water resources, and the ecological functioning of the L.A. River. The Los Angeles River Revitalization Plan includes master planning, governance proposals, economic development proposals and modeling, and 239 proposed projects that could be implemented as part of the Master Plan, all of which will require development prior to implementation.”

Should We Have to Pay the Bill?

While a revitalized L.A. River may contribute greatly to our local economy, our environment, and the quality of life in Los Angeles, should DWP and its ratepayers foot the bill for the implementation of the plan?

Despite the flimsy arguments from the political establishment supporting this expenditure, the answer is simple. No.

Going one step further, imagine the price tag for ratepayers when it comes time to finance the 239 proposed projects envisioned by the River Revitalization Master Plan. A number will be harebrained schemes cooked up by the light bulbs and their cronies who occupy City Hall.

No doubt, this would include City Council member Ed Reyes’s $1.1 billion pipe dream to bury miles of high voltage transmission lines along the L.A. River.

In yet another assault on the DWP’s coffers, one week from today the City Council will approve the DWP’s plan for a $25 million floating cover for the Elysian Park Reservoir to comply with water quality standards mandated by Environmental Protection Agency regarding open reservoirs.

As part of this plan, DWP and ratepayers will be hit up for an additional $16 million in “enhancements” and “mitigations” that were demanded not only by local activists, but other political constituencies throughout the city.

$$$ Problem Worsens

Of course, this pork-laden alternative is preferable to the $110 million buried reservoir plan that was supported by Councilmembers Reyes and Eric Garcetti.

Like Looney Tunes, That’s Not All Folks.

On Oct. 29, the DWP Board of Commissioners held a joint meeting with the Board of Public Works to review the city’s Water Integrated Resources Plan. This ambitious IRP involves not only DWP’s expensive efforts regarding water conservation and recycling, but the city’s responsibilities for wastewater and stormwater.

While it makes sense for the various departments of the city to coordinate their efforts and resources, it also appears that the city is preparing yet another raid on DWP’s treasury (and ultimately the wallets of the ratepayers) to finance obligations that are the responsibility of Public Works, Recreation and Parks, and other city departments.

Unfortunately, the raids on the DWP piggy bank are not confined to the L.A. River, Elysian Park, and the city’s Water Integrated Resources Plan.

Over the past seven years, Mayor Villaraigosa and the City Council have increased the Transfer Fee from 5 percent to 8 percent of Power System revenues, resulting in an additional $100 million “contribution” by ratepayers to the city’s General Fund.

Another Bill to Pay

We are also getting soaked for the $250 million IBEW Labor Premium every year as a payback for the generous campaign contributions by IBEW Union Bo$$ d’Arcy.

We are funding the numerous city employees (and their $200 million of transferred pension liabilities) that were dumped on the DWP as part of the city’s efforts to downsize its General Fund workforce.

We are footing the bill for the Headworks Reservoir and River Supply Conduit, the $500 to $750 million pet projects of Mr. Garcetti and Tom LaBonge designed to finance the local park surrounding the Silver Lake and Ivanhoe reservoirs as well as preserve the million dollar views of the politically powerful residents.

There are numerous other pet projects: the IBEW Joint Training and Safety Institutes; the loans to Street Services for LED lighting; financing parks and museums for the Dept. of Recreation and Parks; the Fiber Optic Network that DWP purchased from the city at an inflated price; and funding the maintenance of the Fire Dept.’s hydrants.

At the same time that the city is ripping off ratepayers, the Herb Wesson City Council has voted to place on the ballot a measure to increase our sales tax to a mind boggling 9.5 percent, the proceeds of which will fund about 70 percent of the $300 million increase in General Fund salaries, benefits and pension contributions next year.

Rather than approve this $215 million increase in the sales tax, ratepayers must demand greater transparency of the relationship between DWP and the city.

Furthermore, the City Council, its Energy and Environment Committee headed by Jose Huizar, and the Finance and Budget Committee chaired by Paul Krekorian must cease and desist from raiding our Dept. of Water and Power and taxing hard working Angelenos without their approval.

Instead, the City Council must seek voter approval of the $246 million Transfer Fee as required by Prop. 26 (The Supermajority Vote to Pass New Taxes and Fees Act) that was approved by California voters in November of 2010.

The message is direct: No more pet projects, greater transparency, and voter approval of the 8 percent Transfer Fee. Otherwise, forget about increasing our sales tax to 9.5 percent.

Mr. Humphreville writes LA Watchdog for CityWatc.h He is the President of the DWP Advocacy Committee and the Ratepayer Advocate for the Greater Wilshire Neighborhood Council. He is the publisher of the Recycler – He may be contacted at

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