City Council May Delay or Cut DWP Rate Hike

A proposal to raise water rates in Los Angeles by 18% over the next two years is facing growing opposition in the City Council, where key members said Tuesday that they would move to reduce the size of the increase and possibly postpone it for two months or more.

City Councilman Greig Smith said he planned to introduce a motion today that would delay an increase until an audit shows that the city Department of Water and Power needs more money to cover expenses.

Such an audit could take months but is necessary to verify that the size of the increase is justified, Smith said.

“There is a lack of conviction on the council that the numbers are accurate,” said Smith, who doubts that there are enough votes on the council to approve the increase.

City Council President Alex Padilla said Tuesday that he would probably not schedule a vote on the rate increase until the DWP provided a five-year plan showing expenses and revenue and the potential need for additional rate increases.

“I’m waiting for the DWP to give me their five-year plan,” Padilla said. “I don’t have the incentive to put it on the agenda until they do.”

The DWP transfers surplus revenue to the city general fund annually to finance other services such as the Police and Fire departments. Part of the proposed increase would help cover that transfer, said Frank Salas, the department’s acting general manager. This year, that transfer is estimated at $27 million.

“Depending on when the rate increase is approved, we may or may not be able to make the entire transfer,” Salas said.

For that reason, Smith and others said they may approve an increase of less than 18% -- perhaps 11% or less -- pending the outcome of the audit, so there would be no threat to the DWP transfer.

The proposed rate increase, which was due to take effect this month, was proposed by the DWP to pay for measures to protect Los Angeles’ far-flung water system from terrorism and guarantee that it met water quality standards.

However, Councilman Tony Cardenas, who heads the council’s Commerce, Energy and Natural Resources Committee, has submitted a report recommending that only the 11% increase proposed for the first year be approved, and that the remaining 7% be delayed until the DWP provides information on its long-range finances.

Cardenas said Tuesday that he has also been moved by the fact that 28 neighborhood councils throughout the city oppose an 18% increase.

Northridge West Neighborhood Council member Jim Alger said the neighborhood groups are organizing to fight the increase, which would raise the bill for the average homeowner by $4.15 per month.

“We need to send a message loud and clear that the residents of Los Angeles are hurting financially also,” Alger said. “The tax base is not a bottomless well and the time is long overdue that City Hall gets that message.”

Councilman Jack Weiss said that DWP officials have not proved their case for a rate hike of 18% and that, if forced to vote now, he would oppose it.