Four months into into his reign as the ninth DWP General Manager in 10 years, Austin Beutner — despite working part-time and on a temporary basis — this week quietly carried out a major reorganization of the utility in part to focus on his goal of using its resources to create jobs and drive economic development.
She is a graduate of then Mayor Richard Riordan’s Business Team, a former vice president of Genesis LA now led by DWP Commission President Lee Alpert and most recently worked in a non-staff position as Council President Eric Garcetti’s planning and economic development director.
Whether those changes are for the common good likely will not be debated or examined by the City Council which is busy trying to protect itself from the wrath of the public enraged by endless rate hikes, failed and contradictory practices and long-time mismanagement of their most valuable and vital asset.
What Beutner has done nothing about are the villains who bear so much responsiblity for what is wrong at the DWP.
On Day One of his term at DWP, Beutner made peace with union bully Brian D’Arcy whose use abusive tactics and threats of strikes that amount to nothing but blackmail have won him a long series of spectacularly lucrative contracts.
“People have made labor the issue
and I don’t think it’s the top issue facing the agency,” Beutner said back in April, making it clear that peace at any price would be his policy no matter what the “people” think.
The price of that peace was to leave Raman Raj, D’Aarcy’s lackey, in place running the day-to-day operations as chief operating officer, the No.2 position that is more important than ever because most of Beutner’s time is spent on his duties as First Deputy Mayor and jobs czar.
D’Arcy and Raj — what a team to rely on!
Nothing good has ever come, can ever come, with those two in power. Reforms being pushed by the Council like the Rate Payer Advocate, changing the composition of the Board of Commissioners and requiring a timely and public budget are meaningless as long as the people in charge have utterly no respect for the public or the public interest.
D’Arcy’s outrageous excesses and destructive behavior were well documented in a “for your eyes only” report to then Mayor James Hahn by DWP Assistant General Manager Mahmud Chaudhry which eventually leaked to the LA Weekly in 2005.
Chaudhry exposed how D”Arcy controls the management, threatens their careers as well as those of city politicians and warns he will turn off the city’s water and power if he doesn’t get what he wants.
“The DWP has become a fox-run henhouse of epic proportion,” Chaudhry
wriote. “The union now runs the department. They blur the line between .
. . bargaining and criminal extortion.
“By choosing union peace at any price, DWP leadership finds itself
paying an exorbitant price. Anxious
to avoid conflict, management finally relinquished the duty — and with
it the power — to exert control. With no one minding the store, it may
be a matter of time before the union’s extreme bargaining advantage
begins to impact the annual [revenue] transfer to the city.”
A few months after his report surfaced, Mayor and Antonio Villaraigosa and the Council approved the richest contract in city history with raises of up to 6 percent a year to IBEW Local 18 workers whose salaries already were 30 to 40 percent higher than other city workers in the same jobs or those of private utility workers.
It wasn’t long before Villaraigosa brought Raj back to the DWP and foisted him as chief operating officer on David Nahai when he took over as General Manager. He did this in the full knowledge that Raj’s previous short stint at the DWP under David Freeman ended disastrously with lawsuits and his dismissal in 2001.
To say the least, there is nothing in Raj’s career that suggests he is at all qualified for such a high position — except for his slavish loyalty to D’Arcy.
Let’s start with Raj’s personal financial management.
On Feb. 24, 1992, Raj and his wife Mrinalini, then living in Laguna Niguel, filed for Chapter 7 Bankruptcy in the Central
District of California,
That was done just six days after a judgment of $2,275.31 was entered against him for breach of
contract in the North Pomona Courthouse in a case filed by Wells Fargo Bank.
Five years later, on Feb. 20, 1997, Raj encountered another financial problem. The IRS filed a tax lien against him for $16,503. It took him until 2000 when he was working for the DWP to be released from the lien.
Then, there’s his rather undistinguished career as a business executive, bouncing from job to job without making the kind of noteworthy successes that ought to be necessary to be the man running the DWP.
He worked as a mid-level executive at Kaiser Permanente, Flying Tigers and the Southland
Corp. before a stint as managing director
at the Metropolitan Transportation Authority where he was anything but a success. His main task involved labor negotiations and he reportedly was forced to resign after running afoul of upper management.
He did get to connect with labor leaders and ultra-liberals like Councilwoman Jackie Goldberg who helped him land a job at the DWP in 1999 as chief administration officer overseeing labor relations and human
resources where he cemented his relationship with D’Arcy and eventually became a supporter of Villaraigosa’s in his first mayoral campaign in 2001.
In his job, Raj quickly became embroiled in one of the darkest chapters in DWP history, a long pattern of discriminatory treatment of minorities and women.
The LA Weekly’s Jeffrey Anderson wrote a devastating story in 2005 tracing the long sordid history of discrimination and millions of dollars in secret settlements with employees.
Some of the incidents involved misconduct by Raj and led to a 2003 lawsuit
LA Superior Court Case Number BC
290779: Brenda Barr, et al v. City of
Los Angeles and DWP and Raman Raj, et al.
The heart of the allegation was that the working environment at DWP was permeated with
discriminatory animus” against women and blacks, specifically that “the individual Defendants schemed to
and did create a system which resulted in promotions and pay upgrades to men,
while preventing women from advancing.”
In 2008 when Raj was brought as COO, far higher than any position he had ever held before, the LA Times reported the Barr cass was settled for $3.3 million
article cited a report by DWP’s outside consultant,the
law firm of Kemp Smith, that concluded Raj moved the utility’s
anti-discrimination office from a satellite building — valued for providing a
level of anonymity — into DWP headquarters to discourage complaints, since
anyone who entered would have to do so in public view.
The report said Raj
manipulated severance packages to remove managers who disagreed with him. And
it warned that Raj had given “too much influence in management of the
organization” to D’Arcy and shielded
union employees from disciplinary action
Recommending he should be let go for the good of the agency, it said Raj could not
be trusted to “act in the department’s interests when they may conflict
with his own agenda.”
managerial insiders still don’t trust Raj, regarding him as devious and
In part, the shadow hanging over Raj derives from what he did for a living between stints at the DWP.
He formed a consultant company,
Resources Roundtable, and used his access to DWP
officials to help win contracts for energy-related companies like Itron, Smartsynch and Enspiria that had won nearly $60 million in DWP contracts without the Board of Commissioners knowing of the connection to Raj.
Every decision, every contract that Raj is involved in sparks suspicion about insider dealing, about the inordinate influence of D’Arcy yet Beutner relies on him to run the DWP and talks admiringly of the knowledge and intelligence of the union boss.
How can anyone wonder why it has proven impossible for years to hire a capable and experienced general manager, why rates keep going up and up, why the water and power systems are deteriorating, why the DWP has lost all credibility with its customers, why it is the center of endless controversy.
What is impossible to understand is how Austin Beutner and the mayor can possibly think the DWP is going to be the engine of development and job creation that restores the city’s economy.
Structural reforms and political spin are useless unless there is a massive shakeup in the management of the DWP and the city’s elected officials find the courage to put D’Arcy in his place.