Wed, Feb

LA WATCHDOG--While the Ratepayers Advocate opined that the five year, 25% increase in our power rates proposed by our Department of Water and Power is “just and reasonable,” the accompanying $160 million increase in our utility taxes that flow to City Hall is not just and reasonable.  Rather, it is continuation of a pattern where Mayor Eric Garcetti, City Council President Herb Wesson, and the rest of City Council treat Ratepayers as an ATM to finance their pet projects and to pay for the $125 million a year in higher labor costs as a result of the new union contract for the City’s civilian employees. 

Read more ...

LA WATCHDOG--On Saturday, the Neighborhood Council DWP Memorandum of Understanding Oversight Committee unanimously approved the following resolution: 

The DWP Oversight Committee calls on the City Council to follow the recommendation of the charter mandated Industrial, Economic, and Administrative Survey to form “a committee to examine governance reforms for the Department with the explicit task of reporting its findings and recommending a measure for the 2017 ballot.” 

Read more ...

LA WATCHDOG--According to a December 31 Facebook posting by Mayor Eric Garcetti, “2015 was a big year. We laughed together, cried together and worked together to make our city better. Just in time for the New Year, check out this short video we made to celebrate all that Los Angeles has accomplished over the last 12 months. Can't wait to see how we'll outdo ourselves in 2016!” 

But rather than go through the 21 modest accomplishments (see below) presented in “Looking Back at the Past Year in LA,” we should review what was not highlighted in this professionally produced two minute video. 

There was no substantive discussion about our Department of Water and Power and the massive $1.4 billion, 30% increase in our utility rates over the next five years.   

There was no mention of reforming DWP’s chaotic governance despite Garcetti’s 2013 campaign pledge and the recommendations of both the LA 2020 Commission and the charter mandated Industrial, Economic, and Industrial Survey.  

Nor was our cash strapped City’s budget a topic of conversation even though the City is expected to have a budget deficit of more than $400 million over the next four years.  

Nor was the budget busting new labor contract for the City’s civilian workforce mentioned even though it will add over $125 million in annual costs and roll back pension reform.  It will also make it more difficult for the City to outsource work (such as road repairs) to more efficient, better managed private contractors. 

Nor was the $13.5 billion unfunded pension liability (71% funded) of the City’s two pension plans discussed or that pension contributions are devouring over 20% of the General Fund budget.  

Nor was the state of our lunar cratered streets, our broken sidewalks, and the rest of our deteriorating infrastructure mentioned.  

But rather than dwelling on 2015, we need a better understanding of what Garcetti is planning for 2016 and beyond.  And this does not mean platitudes and aspirations, but definitive policies and goals so that we can render a judgment on his leadership when he is up for reelection in 2017. 

Will Garcetti pursue the recommendation of the LA 2020 Commission to establish an Office of Transparency and Accountability to oversee our City’s strained finances and its budget shenanigans? 

Will Garcetti follow the blue ribbon Commission’s advice to form a Committee for Retirement Security to review the City’s retirement obligations and to make “concrete recommendations on how to achieve equilibrium on retirement costs by 2020?” 

Will Garcetti lead the reform the governance of our Department of Water and Power as was recommended by both the LA 2020 Commission and the Industrial, Economic, and Administrative Survey? 

Will Garcetti follow up on the LA 2020 Commission’s recommendation to update the City’s Community Plans “to enhance neighborhood input and establish a thoughtful growth strategy?”  

Will Garcetti develop an operational and financial plan to repair and maintain our lunar cratered streets, our broken sidewalks, and the rest of our failing infrastructure? 

There are many other issues that need to be addressed, including, but certainly not limited to, balancing the budget without raiding the Reserve Fund, fixing the City’s poorly managed and inefficient work force, updating its management information systems, and funding the Los Angeles River and the 2024 Summer Olympics. 

Eric, Angelenos elected you to lead the City, not to kick the can down the road.  And to judge your leadership, we need results and not a lot of political hot air.  Otherwise, how can you expect us to vote for you when you are up for reelection in March of 2017 or when you run for higher office in 2018?


Looking Back at the Past Year in LA


1.  Mayor Garcetti signs LA’s first-ever Sustainability City pLAn.


2.  Angelenos work together to Save a Drop and conserve water.


3.  Shadeballs help conserve and preserve water quality in our reservoirs.


4.  CicLAvia turns 5.


5.  LA commits to acquiring the largest Electric Vehicle Fleet in the country.


6.  The US Army Corps of Engineers signs off on a plan to restore the Los Angeles River.


7.  Los Angeles hosts first-ever US-China Climate Leaders Summit.


8.  Mayor Garcetti represents Angelenos and Climate Mayors at UN Climate Conference in Paris.


9.  Los Angeles becomes the host city for the 2015 Special Olympics World Games.


10. Los Angeles becomes the official US bid City to host the 2024 Summer Olympics.


11. Mayor Garcetti signs historic minimum wage increase into law.


12. An $8.5 billion modernization and a record number of passengers at LAX.


13. California new Film Tax generates an estimated $1.07 billion in economic activity.


14. LA makes new investments in smart infrastructure, including ultra-high speed internet, smart poles, and solar powered small benches and bus stops.


15. City and County leaders begin an unprecedented collaboration to combat homelessness in Los Angeles.


16. #HomesforHeroes helps house homeless veterans and their families.


17. Mayor Garcetti signs a groundbreaking seismic retrofit bill into law.


18. Los Angeles prepares for El Nino.


19. LA first responders adopt new tactics to reduce emergency response time.


20. Metro’s Silver Line Express expands to San Pedro.


21. Construction on the new Crenshaw line and expansion of Metro’s Gold and Expo lines will transform LA’s transportation network in the coming year.


(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and a member of the Greater Wilshire Neighborhood Council.  Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at:  lajack@gmail.com)






Vol 14 Issue 2

Pub: Jan 5, 2016

LA WATCHDOG--On Tuesday, the Los Angeles Unified School District’s Board of Education engaged in some last minute grandstanding by issuing a press release calling for LAUSD to engage in discussions with the Los Angeles City Council because its DWP bill will be increasing by 27%, or $22.4 million, over the next five years.  

LAUSD is also overreaching by requesting that the City provide it with $11 million of services, financed with a portion of the $267 million Transfer Fee from DWP’s Power System to the City’s General Fund.  These services would include paying for street crossing guards near elementary schools, providing free refuse removal, and performing tree trimming services. 

While LAUSD is a very important governmental entity, the Department of Water and Power and its Ratepayers are not allowed to subsidize its operations, a point that was hammered home by a recent court decision involving the City of San Juan Capistrano and its tiered water rates.   

Nevertheless, the Department has worked with LAUSD, explaining on multiple occasions the reasons for the rate increases.  The Department even agreed in September to invest a staggering $43 million of our money in energy efficiency and water conservation projects which are intended to offset the proposed increases in its power and water rates. 

The Energy and Environment Committee can also expect to hear from Recreation and Parks whose utility bill is expected to double over the next five years to $30 million because of the recent court ruling involving San Juan Capistrano, Proposition 218, the cost of service, and why subsidized rates are illegal.  But again, the Department has been working cooperatively with this large customer, investing millions of Ratepayer money in water conservation and energy efficiency projects.  

The Department also has to contend with lame duck Councilman Felipe Fuentes, the Chair of the Energy and Environment Committee.  He is rumored to be considering limiting the rate increase to only three years since the five year proposal will involve rate hearings in 2020, an election year. 

But why is he considering a last minute change when he has known about the five year plan for over a year, especially since he will be leaving the Council in 2017 after only one term? 

Fuentes is also considering holding the much needed rate increases hostage to his plan to reform the governance of the Department.  This would involve the creation of a full time paid Board of Commissioners, a new personnel department free from the City’s civil service rules, and a lower Transfer Fee that would need to be approved by the voters.  

Based on the details in the four page motion (most are only one page), it is probably safe to assume that Fuentes’ proposed ballot measure and the supporting documentation have already been written, most likely ghostwritten under the watchful eye of IBEW Union Bo$$ d’Arcy.  This is a stunt that Fuentes mastered in Sacramento where he was considered “The Worst Legislator in California.” 

But why is Fuentes rushing this already controversial DWP reform plan to the ballot without engaging in a robust and transparent discussion and debate that involves Ratepayer participation?  After all, he needs our votes to approve the necessary charter amendments and $221 million Transfer Fee. 

According to speculation by City Hall insiders, Fuentes is either angling to be a full time, paid Commissioner (would you call that reform!) or a high ranking executive in IBEW Local 18, the DWP’s domineering union, so that he is in line to succeed Union Bo$$ d’Arcy as the union’s highly compensated  Business Manager.  

The issues involving the five year rate increase, deemed “reasonable” by the Ratepayers Advocate in light of the need to repair DWP’s infrastructure and meet unfunded environmental mandates, and its impact on LAUSD, Recreation and Parks, and single family residences deserves a full airing, separate and distinct from Fuentes controversial plan to reform our Department of Water and Power.  

Reform of our Department of Water and Power and its long term implications are too important to be rushed to the ballot. 

(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and a member of the Greater Wilshire Neighborhood Council.  Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at:  lajack@gmail.com)


LA WATCHDOG--The City of Los Angeles is embarking on an ambitious, $470 million plan to modernize and expand the Convention Center so that it can compete with other first tier, West Coast cities such as San Francisco, San Diego, and Anaheim in attracting large scale conventions. This undertaking is expected to be completed by 2020 and is designed to promote tourism, one of the main drivers of our economy, and to stimulate the private development of hotels, restaurants, residences, and office and retail space in the South Park neighborhood and the rest of DTLA. 

This expansion will increase the Convention Center offering to almost 1.25 million square feet, up 43% from the current level of 870,000 square feet.  At the same time, the new and improved Convention Center campus is designed to be an integral part of the community, linking seamlessly with the neighborhood, LA Live, and Staples. 

The City will also encourage the development of several thousand new hotel rooms in DTLA to accommodate highly desired, big spending, out of town conventioneers who will not only stimulate our economy, but will also contribute generously to the City’s coffers through the 14% Transit Occupancy Tax on their hotel bill.  

This also includes a privately financed, upscale Convention Headquarters Hotel of at least 1,000 rooms that will be strategically located on City owned property, most likely near Staples and LA Live on the north end of the campus.    

The City intends to finance this $470 million expansion with debt, which, when combined with existing Convention Center debt of almost $300 million, will total a staggering $770 million. This debt will be serviced by the Convention Center’s 25% share of the Transit Occupancy Tax which is expected to yield the Convention Center $54 million this fiscal year.  By 2020, this tax is projected to increase by over 20% to $261.8 million, resulting in $65 million to service Convention Center debt. 

However, our cash strapped City does not have the financial flexibility to finance this expansion and other immediate worthwhile projects, including the $1 billion to replace its aging and neglected equipment (including police cars, fire engines, and ambulances) without blowing a gaping hole in its Debt Management Policy which limits debt service for Non-Voted Indebtedness to less than 6% of General Fund revenues.  This violation would send the wrong message to the investment community, resulting in a downgrading of the City’s credit rating and higher interest rates.  

The City Administrative Officer has recommended that the City enter into a Public Private Partnership (a “P3”) where the City would select a turnkey development partner to design, build, finance, operate and maintain the expansion of the Convention Center and the development of the surrounding real estate.  Under this recommended alternative, the 44 year old West Hall would be demolished and rebuilt (not retrofitted as currently envisioned).  The partner would also develop 9 to 14 acres of the 54 acre campus by creating “an integrated mixed-use real estate development” that would help to offset the costs of associated with the Convention Center, a loss leader that cannot even begin to pay the interest on $770 million of debt.  Needless to say, any development plans need to be consistent with the Community Plan.  

A P3 also protects the City from any cost overruns associated with the expansion of the Convention Center and the construction of the Headquarters Hotel and isolates it from any operating losses.  The partner is also responsible for maintaining the campus in excellent condition, a task that the City has demonstrated that it is incapable of doing on a sustained basis. 

While the terms of the P3 need to be worked out, including any “availability service payments” by the City to service the debt, the net result will result in more cash for our City’s deficit prone budget by creating a more vibrant Convention Center, more out of town visitors resulting in higher increased Transit Occupancy Tax revenue, and lower contributions to the Convention Center. 

The expansion of the Convention Center in conjunction with a well-capitalized partner is a win-win for our financially challenged City.  Don’t blow it. 


(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and a member of the Greater Wilshire Neighborhood Council.  Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at:  lajack@gmail.com)


LA WATCHDOG--On Friday, Councilmember Felipe Fuentes “introduced a motion calling for a 2016 ballot measure to reform and restructure” our Department of Water and Power.  

Read more ...

More Articles ...