DWP to Use $10 Million for Affordable Housing

The Los Angeles Department of Water and Power will provide $10 million to pay for affordable housing, officials said Wednesday, drawing fire from homeowner leaders who noted that the agency is also seeking a large increase in residential water rates.

The money, approved Wednesday by the City Council, will finance construction of at least 3,500 apartments and condominiums over the next nine years by the city’s Housing Department, officials said.

Mayor James K. Hahn, who supports the transfer, believes more than 3,500 units would be built if the city funding is used to match private financing of new housing, an aide said.

“One of the keys to keeping jobs in Los Angeles is providing housing that our working families can afford,” Hahn said.

“These funds will finance thousands of housing units that will provide shelter and stimulate economic growth in neighborhoods throughout the city,” he said.

Polly Ward, president of the Federation of Hillside and Canyon Property Assns., questioned the timing of the transfer, which follows the DWP’s request in November for an 18% increase in water rates over the next two years.

The agency said at the time that it did not have enough money to guarantee the security and quality of its water supply. The proposed rate increase, which would generate $89 million for the DWP over two years, is still subject to City Council approval.

“There is no reason for the rate increase if they can afford to give millions of dollars to other city departments,” Ward said. “The DWP has been a cash cow for the city general fund for years.”

Yusef K. Robb, a spokesman for Hahn, said the DWP maintains separate accounts for water and power service, and the $10 million is coming from the power budget, which cannot be used for water expenses.

“The proposed surcharge to improve the security of the water system and the funds allocated today are unrelated,” Robb said.