Mayor calls on L.A. council to approve first of four electricity rate increases

Days after City Council members balked at his plan for boosting Department of Water and Power electricity rates, Los Angeles Mayor Antonio Villaraigosa on Monday threw his weight behind Councilman Richard Alarcon’s plan to approve the first of four hikes while putting the next three under greater scrutiny.

With another council vote scheduled for Tuesday, Villaraigosa said Alarcon’s plan was a compromise that would preserve his “lock box” for renewable energy and conservation programs.

Last week, the council rejected the DWP’s March 18 decision to approve the first of the four increases, which would add an estimated 6% to the average residential bill and up to 7% to the average business bill, according to the mayor.

Still, Councilwoman Jan Perry questioned whether there was a substantive difference between the DWP board’s vote and Alarcon’s plan. “I think it’s essentially the same as what the mayor proposed before,” she said.

Alarcon’s proposal asks the DWP board to develop a plan for reducing the financial burden on businesses. Those increases would total 21% to 22% once all are in effect. The councilman also asked the board to consider spreading the four increases, which range from 9% to 28% for residential ratepayers, over two years instead of one.

Villaraigosa agreed, calling on his DWP appointees to consider an extended timetable. "I would urge the board to evaluate that option and implement it if it’s financially feasible,” he said. “If it’s not, we would go back to the council and explain why we cannot do it.”

The mayor has been seeking the additional funds to help the DWP pay for such expenditures as the fluctuating cost of coal, existing renewable energy contracts and new conservation programs.

The first increase would add 0.8 cents to the cost of each kilowatt hour of electricity consumed by ratepayers. Of that total, 0.3 cents would go toward new conservation and renewable energy programs.

Villaraigosa has insisted that the money be preserved so it can eventually be used to help wean the utility off of coal. Some critics say all the money should be used to address the DWP’s finances and keep its credit rating secure.

Over the last week, Villaraigosa has ratcheted up his campaign against resistant council members, saying they have not done their homework on the DWP’s financial situation.

Standing next to Villaraigosa, the head of the powerful county Federation of Labor called out Councilman Ed Reyes specifically, accusing him of branding the mayor’s plan as irresponsible.

“I say it’s irresponsible not to go forward with this plan,” Maria Elena Durazo, the federation’s executive secretary-treasurer, said.

Reyes actually said last week that he believed the mayor was irresponsible for warning that the city would go bankrupt if the rate increases were not approved.

Villaraigosa later disavowed the use of the word “bankruptcy” but continued to warn that the city would run out of money unless the DWP got its rate hike. The extra money would allow the DWP to transfer $73 million to the city’s general fund by June 30, he said.

-- David Zahniser at Los Angeles City Hall

Photo: L.A. Times file

Comments

[jay]

Villa is out to ruin the city!

What a loser!

[Jose]

I knew Alarcon, was helping the Mayor when voiced his plan. Alarcon, really thinks the citizens of LA are stupid. Durazo, is just another corrupt union official that owes the Mayor a favor. The rubber stamp city council will give into the Mayor as always.

[Two Cents]

If they need to raise rates, why were raises and bonuses to DWP employees approved by the Mayor and City Council?

[Tornadoes28]

No, No, No.

I'm all for environmental protection but this is too much. Too much for individuals and too much for businesses. Think about. Why would a business pay up to 40% more for electricity when they can move to another city such as industry or the Inland Empire and may much less. This will drive businesses out of Los Angeles.

[Jose]

It is only what the Mayor wants, and the unions it is not about what the citizens want. The Mayor is saying we cannot think for ourselves, and he knows what is best for us. We are smart enough to know we are being taken for a ride. I hope there will be a recall on him soon, or we go into bankruptcy because he is inept along with the city council. Maybe it would better if the FEDS step in as they did in South Gate.

[Hoot]

If the DWP is in such dire straits then why did they receive pay raises in December. The only solution here is pay cuts and layoffs. Why are these options not being discussed?

Why should I (and many others like me) suffer the burden of paying someone's salary that is 5 times the size of mine? This is all so wrong.

[Sean]

This is a SHAM! What a joke. Let's remember that Villar was first a union organizer before he stumbled into politics. He's scared to take on the unions and reduce their over sized compensation and retirement benefits so he's looking for anyway to fill the financial hole he helped dig. This guy is a pimple on the behind on LA and should be dragged out of office by his heels.

[el senor]

Shame on Antonio, the city council and DWP, including all of it's employees who I'm sure don't even live within the city limits so they dont feel the rate hikes!

Let the city go bankrupt it is the fault of all the city employees who are in charge of keeping us out of this trouble.

And you wounder why business is leaving the city also, I'm done.

[Jimmy Stewart]

You get what you vote for Los Angeles!!