DWP to make $400 million in cuts, not seeking rate increase at this time

Los Angeles officials unveiled on Tuesday more than $400 million in cuts for the Department of Water and Power but vowed no service reductions and said the giant utility was not now seeking a rate increase from its customers.

“This will enable us to maintain our customer-service quality as it is today,” said Ron Nichols, general manager of the DWP, which provides water and power service to more than 4 million city residents.

The DWP, like all city agencies and departments, is facing severe budget pressures, including rising fuel expenses, the costs of legal mandates to reduce greenhouse-gas emissions and other pollution, and the price tag of replacing aging infrastructure and updating technology.

The utility’s budget is separate, however, from the general revenue fund, which pays for police, fire and other basic services. The general fund faces an estimated $350-million shortfall in the coming fiscal year.

The DWP cuts in labor and operations -- including a hiring freeze, reductions in nonessential travel and training and the elimination of take-home vehicles for executives -- will be focused on administrative jobs and not result in slashed services for the utility's customers, officials said. Nor do the cuts represent a rollback of energy efficiency and other goals, said Nichols and Mayor Antonio Villaraigosa, who appeared at a City Hall news conference. The reductions are to be implemented over a three-year period.

“We’re keeping the level of people we need in the customer-service side of things,” said Nichols, who in January took the helm of the agency and its $4-billion-a-year budget. The DWP is the nation’s largest municipally owned utility. “We’re making certain we’re keeping our people in the field.”

The utility is not seeking a rate increase at this point, Nichols said. But when asked if he would rule out a rate increase this year, Nichols responded: “No, I can’t rule that out.”

Among the items eliminated, officials said, is the popular Holiday Light Festival, the annual light show in Griffith Park between Thanksgiving and New Year’s. The DWP has funded the festival for 14 of the last 15 years. Also to be cut are two smaller holiday light festivals, one in Leimert Park and the other on the 1st  Street Bridge. The DWP will save $1 million a year eliminating the holiday light shows, said Joseph Ramallo, a DWP spokesman.

RELATED:

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New DWP manager announces that No. 2 executive will step down immediately

-- Patrick J. McDonnell at Los Angeles City Hall

Photo: A DWP worker shuts off a valve to control a leak along the Los Angeles River in Burbank in May 2010. Credit: Gary Friedman / Los Angeles Times

Comments

[lolo]

that;s good

[Los Feliz resident]

I won't miss the light festival at all. It was a traffic ridden nuisance which increased the levels of smog (car exhaust). The lights weren't even that spectacular. Too bad it took a budget crunch to finally kill it. The aesthetic police should have done it a long time ago!

[citybird]

DWP doesn't have a budget crunch. The City does. Making all the cuts trying to save $440 millions in 3 years; but already transfering $258.8 millions surplus this FY alone! So anyone want to guess how much will be the transfer next FY? These are water and power ratepayers' monies paying for other city services. Shouldn't the ratepayers have some input on this?

[My opinon means nothing]

Am I supposed to be thanking the Great and Almighty LADWP because their NOT raising rates? In case Mr. Nichols missed it, Gov. Brown just declared the drought OVER! he should be looking to us to LOWER our rates and THANKING us for our help in getting through the drought.

[mce101087]

For a company that requests so many cut backs from there customers, should have have taken a page of that statement regarding there over time hours. There outside staff spends four hours of actual work and four hours of cell time and deciding were to go to lunch (follow them and you will confirm). If they were more efficient, they will not have to deal with current job freezes, no raises, and forgot, the execs loosing there cars. Damn...why do they need these cars for? Now I know were the hike increases go to.

[Public Advocate]

The light festivals were drive through horror shows. Smog, congestion, etc.

[Susan Baker]

"Among the items eliminated, officials said, is the popular Holiday Light Festival, the annual light show in Griffith Park between Thanksgiving and New Year’s." POPULAR? I guess this is the last we will hear about this!

[Paleta Fresca]

Any opportunity to cut back the waste and scope of government services should be taken with relish. I loathe the thought of burdening the public (including myself, naturally) with more and more taxes at a time that this state needs to grow and attract businesses back to our slice of a disappearing paradise.

[Judy]

This is a beginning. They need to do a lot more before they think about raising rates!

[dee gee]

the abuse is OUTRAGEOUS! we know a guy who works for dwp... lives in the outskirts of riverside county and drives his company truck to and from work EVERYDAY....guess who pay for the gasoline? and to top it off, he FREQUENTLY goes to lakers games with his kids (even weekends)...yes, you guessed it...in his company truck....then, to avoid pay parking at staples center, he parks it right on the street IN FRONT of staples center...puts a few of those orange cones down and no one questions it... all this gets me sick

[Dave]

Joe ramallo makes 250k a year. Cut his salary