For all his dismissive talk about “moving forward…not looking back,” Austin Beutner’s DWP budget proposals appear to be an attempt to start cleaning up the past and restoring trust in a rogue agency that has lost all credibility.
Billions of dollars proposed for pipe dreams for vast amounts of recycled water and thousands of acres of solar panels are suddenly off the table while spending heavily and pragmatically to repair the failing water and power systems are now in the forefront.
Keeping rates within reason also have become a priority even as Beutner — the ninth general manager in 10 years — tries to get beyond the legacy of years of mismanagement. Power rate hikes are off the table at least for a while although water
rates will go up
“In the past few years…increasing outage rates including several high-profile outages, have raised service reliability concerns,” the power fund budget document acknowledges. .
The result is spending roughly 10 percent of the power fund — $411 million — on fixing the complex system of power lines, transformers and equipment that have caused the outages after years of neglect. What’s left over will go to still to be announced renewable energy plan.
There’s also lots of money to repair the water system after the disastrous blowouts nine months ago. Then, there’s the $100 million extra to keep the pension funds afloat.
Inexplicably, wage costs are back where they were two years ago despite hiring 1,000 more workers and giving raises of 2 to 4 percent in the new fiscal year.
Tuesday’s DWP Commission meeting will be the biggest test yet of where the interim general manager is going with this rogue agency and his commitment to transparency.
With just two weeks before the start of the fiscal year, it’s hard to see how the long series of documents — short as they are in details — will get much scrutiny from the Commission, the Council and certainly not the public.
Beutner has already indicated rate hikes for water of 3 percent for most apartment dwellers and 8 percent for everybody else — the class of people that City Hall defines as rich and uses as cash cows because they have mortgages and run businesses.
What’s not clear is whether he will go for the quarterly increases in the Energy Cost Adjustment Factor that the Council limited to just one quarterly increase after weeks of lies from DWP officials, mayoral bullying and public drama.
Total power revenue is supposes to go up 10 percent to 4.85 billion — half from the 4.8 percent ECAF increase and the rest from borrowing.. Most of the increase goes to pension costs, up $70 million, an increase of more than 50 percent: interest on borrowing up $70 million, an increase of more than 20 percent, and construction contracts, up by more than $220 million, an increase of 300 percent.
Of course, the city general fund will get 15 percent more in the transfer of DWP’s power “surplus”, $254 million.
For all Beutner’s promises of transparency and the mayor’s frantic effort to get billions of ratepayer money to share with his friends, there’s no indication in the budget that his GM has a plan yet for renewable energy
What is clear is that the crazy plan to cover Owens Lake with 80 square miles is dead just like Green Path North and several other crackpot schemes the mayor wanted to buy friends in the environmental movement and rewards friends who buy him gifts and have a lot of money invested in solar companies.
Plans to spend billions of dollars on a 10-year crash program to build purple pipe far and wide to carry recycled water provide much of the San Fernando Valley with toilet-to-tap water are being sharply scaled back.
The proposal going before the commission calls for a less ambitious 20-year plan that will avoid sharp water rate hikes.
On the water side, total revenue is budgeted to be $2.1 billion, more than a 10 percent increase thanks to the water rate hike and conservation surcharges. Pension costs up by more than half to nearly $100 million.
Also on the budget without detail is Beutner’s proposal for a Rate Payer Advocate.
Will it actually be independent of the corruption at the City Hall or under the control of Controller Wendy Greuel who did her best last week to whitewash the ECAF blackmail attemption as nothing more than to “mislead” the Council, a ladylike way of saying Freeman, COO Raman Raj were lying through their teeth.
She made it clear the mayor also was a victim even though he and hsi henchmen engineerded the extortion attempt, planted a false story in the New York Times and browbeat everyone involved to get rate hikes of up to 28 percent.
Maybe that’s why Beutner briefed reporters Monday on his plan to hire two people as Rate Payer Advocates — a proposal that is the equivalent of asking BP to investigate the oil catastrophe or the mayor’s Ethics Commission ot investigation his illegal taking of expensive gifts.
Beutner is slick and I’m sure he have his soundbites carefully scripted as he did to make the scandal over DWP workers drinking and going to strip clubs go away and suggesting Greuel made some factual errors.
In his briefing, he even brought up driving a stake into the heart of the DWP legend by selling its headquarters building on North Hope Street and leasing back part of it.
“It’s real simple. If you can’t raise rates, what are you going to do?”
“Do you want to own a building, or do you want to
have renewable energy?” he added. “You pick. I don’t care. If you like
the building better, that’s fine. You can’t have both. So policy is
about making an informed choice.”