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DWP slow to spend federal stimulus money, L.A. controller finds [Updated]

The DWP works to repair a water main break in Van Nuys.

Los Angeles City Controller Wendy Greuel found that the city’s utility had been slow to spend its $112.7-million share of federal stimulus dollars and that the department’s initial estimates of jobs created in the program may not have been accurate and lacked documentation.

The city received about $630 million in stimulus grants and loans, but Los Angeles officials have struggled to spend the money quickly because of extensive employee furloughs and the city’s lengthy processes for awarding grants and contracts.

Though President Obama signed the American Recovery and Reinvestment Act launching the program in February 2009, Greuel’s new audit found that Los Angeles had only spent about a third of its stimulus money by the end of 2010. The city’s spending rate has lagged behind that of other big cities such as New York, Chicago and Minneapolis, according to its own analysis.

The city’s Department of Water and Power, which is the largest publicly owned water and power utility in the nation, received about 18% of the city’s share for upgrades of major water pipelines, energy efficiency programs and a demonstration project to help modernize the city’s electrical grid.
Greuel found that delays in starting some of the Energy Efficiency and Conservation Block Grant projects -- which include energy retrofits of nonprofit organizations and renewable energy projects for residences -- have created a risk that the department will not be able to meet the guidelines set by the federal government for spending the money.

Utility officials said they would comment on Greuel’s report sometime Thursday.

[Updated at 4:27 p.m.: City officials said the Department of Water and Power had spent about $39.5 million of its stimulus money--about 35% of money allocated to department--by the end of January. DWP spokesman Joe Ramallo said the controller’s audit had helped the department streamline its procedures for handling federal grants.

“We worked closely with the controller on this review and found it helpful in establishing new procedures for handling the federal ARRA grant funds,”  Ramallo said. “We have corrected the deficiencies noted in the audit and we have made significant progress since the review period in spending additional funds.”]

The controller also found inconsistencies with stimulus job counts, as she has in other city departments. There was considerable confusion about how jobs should be counted early in the program and federal officials ultimately changed the guidelines — recovery act jobs are now based on totaling up the number of hours employees work on a stimulus project.

Greuel’s report said DWP officials initially counted the jobs created on the city’s Smart Grid Demonstration Project, a joint effort with several area universities, based on estimates instead of hours worked. Utility officials told Greuel they had addressed that problem by the second quarter of 2010, and have corrected other issues mentioned in the audit.

The report was Greuel’s fourth tracking progress on stimulus spending “and unfortunately all of the audits bring up similar problems,” she said.

“While I am hopeful that the new [stimulus] coordinator brought on by the Mayor’s office will help expedite this money being spent, actions speak louder than words,” Greuel wrote in her report.


Los Angeles' economic growth will be ‘slow and sluggish,’ City Controller Wendy Greuel predicts

-- Maeve Reston at Los Angeles City Hall

Photo: The DWP works to repair a water main break in Van Nuys that caused two families to be displaced on Feb. 27, 2011. Credit: Anne Cusack / Los Angeles Times

Comments () | Archives (22)

Oh how I hate it when my Government sends my tax dollars to incompetant cities like L.A. Let me keep my money and I will stimulate the economy and millions like me will do so too. Ugh!!

The DWP doesn't create jobs, it spends most of the money in house. Not much stimulus there, unless you are a city employee. This is why they can't spend the money, they can't justify hiring so it's hard to soak up the cash. Heaven forbid they contract out like other city agencies, that runs counter to their business model. Several years ago we did a small diameter watermain project for them. They had been under pressure to put jobs like that out so they did one and we got it. They had 20 people out there watching my 10 employees do the work. We did the job in half the time and half the cost of their own forces. They haven't put a job out like that since. They don't like the competition, makes them look bad.

Oh they're spending it alright ...it just ain't being spent on the things the're suppose to spend it on. In a couple of years we'll find out what it's really being spent on (company trips, lavish company affairs, new autos for higher management, new houses for even higher management folks, etc). Mark my words...in a couple of years we'll know.

Thanks for ripping your citizens off Los Angeles. The money is suppose to be spent not to pay off pensions.

This is the reason voters across the nation are fed up with government spending, is highly innefficient and wasteful.

What a surprise... L.A.'s Department of Water & Power hoarding money?! No way... they wouldn't do that! LOL

It seems like every week there's something in the news about the DWP that shows how arrogant and incompetent this organization is. So the question is... why are L.A. residents still putting up with them?

The L.A. Department of Water & Power needs to realize that they can be replaced. Companies such as Southern California Edison have employees who are well trained and can be utilized to outsource their employees. So Cal Edison's management is much better than the LA DWP's also.

Poor DWP - they can't win. First, they get cited for spending too freely. Then, they reel it in and get cited for not spending quick enough.

I have an idea: Why don't the politicians back off and let the DWP - the lone bright spot in a city of doom and gloom - do their jobs before the city screws that up, too?

So basically their is no such thing as "shovel ready jobs." Obama said just that after the shellacking he got in the November elections.
So basically Obama did not create jobs, he did not help the economy, but we are stuck paying for his boondoggle for generations to come.
Just wait until we start seeing the damages from ObamaCare. It's going to make the spending on the stimulus fiasco look like a bargain.

Government spending is the slowest way to pump money into the economy. Letting people keep more of their own money, through lower taxes, is the best way. People will take their money and spend it or invest it and it will circulate.
The time it takes for government to take the money and launder it through all their bureaucracies, losing much along the way to pay bureaucrats, is typical of central planners. It didn't work in the Soviet Union and certainly won't work here.

Oh, the money has been spent alright... it's been stolen by the unions and so-called "public officials." LA, as with the rest of California panders to illegals and lives high on the hog with huge salaries because of the illegal vote. When the final audit comes down, we will find the money was squandered and/or stolen. It's the Democrat way... if you can't waste it.... steal it!

Stimulus created no jobs. Money went to demo special interest groups.
Gallup says unemployment at 10% +. Was 8% when The Kenyan was elected. That was before the humongous spending. Insanity prevails.

How about giving the money back and stop taking charity from the Federal Govt? Take care of yourself. Thanks.

Gee, how surprising that they haven't bothered to spend any of the money that would help ratepayers become more energy independent.

Villaraigosa has been promising us a German -style feed in tariff for 5 years now, and even though it was proven to SAVE ratepayers money in only a few years, while meeting the DWP's renewable energy mandate without killing any wilderness or exercising eminent domain over residents, that policy is still on ice, along with AB811 loans for retrofitting for efficiency and rooftop solar.

It's almost like the DWP doesn't want ratepayers to save energy and produce their own clean energy right where it is needed but would rather monopolize it and own and control remote central-station power stations and hundreds more miles of profitable transmission lines. Why would that be? No doubt it's for the good of LA residents. Snort.

And you believe the dept. of W&P? My rate has increased to $345.00 . Yes it's for 2 months. I'm a senior, live alone, shower for 5 minutes...do little cooking and I turned off my sprinklers. It rained so much this year and there's more water than we need. It's cold so nno air conditioning is necessary. Yes I forgot to mention my house is tiny. These people made a deal with our wonderful mayor so they could rip us off. Now we all have to suffer

Government-owned company with governmenr employees union - can there be a more criminal enterprise?

Consider the obvious given the nature of the people in the White House. The stimulus money is a political slush fund awaiting the 2012 elections cycle. At that time, all sorts of contracts will be put together, funneling the money off for "projects" that involve little in the way of construction and a lot in the way of bundled donations to democrat candidates laundered through employees of contracted firms.

So, the DWP only functions reasonably well because of audits? And, what are the salaries and other perks of those responsible for poor and inefficient management?

And, why doesn't the article give any details of the number of jobs gained, maintained so far and what would the numbers possibly be if DWP ever gets around to spending its stimulus money?

Isn't it time for some management changes at DWP?

A city utility is having trouble spending free money? They've never received federal grant money before? Ha! Perhaps they don't really need it. Or perhaps it isn't there or has been improperly allocated. I guess it's hard to be concerned about growing jobs when you already have an apparently easy, low-pressure one.

You mean big gov bureaucracy ISNT efficient? Let’s throw some money at that problem too.

Another example of ridiculous judgement and indecision affecting the taxpayer. It's not "government" that the Tea Party resents and protests against... it's waste, incompetence, fraud, corruption, abuse of power, and violation of the public trust - things the founders of this nation repeatedly warned against, which are inherently part of government swelling bureaucracy.

Government is inefficient? The number of 'jobs saved or created' is not accurate? I'm shocked. Call Captain Renault.

The Obama admin and the Dems caught lying again? That's not news - Obama Admin and the Dems being truthful about their failures - that would be news.


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