Follow Us:

17
Jun 2010
L.A. council panel investigates DWP threat to withhold money amid budget crisis

One week after Los Angeles City Controller Wendy Greuel accused the Department of Water and Power of misleading the public about its financial situation, a panel of the Los Angeles City Council is demanding to know who will be disciplined over the incident.

The council's Audits and Governmental Efficiency Committee approved a motion earlier this week asking for a report from Mayor Antonio Villaraigosa and the DWP spelling out the form of punishment that will result from the DWP's threat to withhold $73.5 million from the city budget.

The DWP said three months ago that it could not provide the money unless the council approved an electricity rate increase sought by Villaraigosa. Greuel said the DWP misled the public, among others, because it had enough money to make the transfer even without the rate increase.

"Trying to lie to the council and scam us is outrageous and I don't think we can just let it go," said Councilman Paul Koretz, who heads the three-member audit committee.

The committee also asked the city's lawyers to determine whether any laws were broken as part of the threat.

No one from the DWP went to Tuesday's committee meeting, where Greuel presented her report. Koretz said he viewed the DWP's absence as another sign of its "arrogance."

DWP officials said they could not attend because they had a board meeting scheduled at the same time. During that meeting, Interim General Manager Austin Beutner laid out his new strategic plan for the utility, which calls for the sale of major DWP assets, such as its stake in an Arizona coal-fired power plant and its downtown Los Angeles headquarters. "The board meeting required the attendance and participation of all senior managers," DWP spokesman Joe Ramallo said in an e-mail. "We advised council member Koretz in advance of this conflict, and requested the meeting be rescheduled. No disrespect was intended."

Last week, Beutner suggested Greuel's report contained factual errors. He provided no details and Ramallo said the utility is continuing its review of her report.

The council ultimately approved a smaller rate increase than originally proposed, which paved the way for the DWP to send the $73.5 million.

The audit committee's request now heads to a second council committee for review. Koretz, who represents part of the Westside, said he also wants to know whether Villaraigosa's office had a hand in the DWP's threat.

"I suspect there are folks in both offices that are responsible, because the mayor was clearly pushing hard" for the rate increase, Koretz said. "And the DWP was the agency that transmitted all this misinformation."

AddToAny

Share:

Related News