DWP to Give City More of Its Funds

Although complaining that Los Angeles elected officials have repeatedly raided the Department of Water and Power, the agency’s board reluctantly agreed Tuesday to transfer a $60-million surplus to help pay for police and fire services.

That amount is in addition to $178 million in surplus money that the semi-independent DWP, which is grappling with rising health insurance and pension costs, previously transferred this year as its required annual contribution.

“We all understand that we need police officers for our community, but we need to communicate to the city that the gravy train is coming to an end,” said DWP Commissioner Gerard McCallum II.

The board of commissioners agreed to send the City Council and mayor a letter objecting to their dependence on the DWP to bail the city out of budget problems without clearly explaining why the money is needed.

“I think it’s an abuse of this department’s generosity, and I think it is unfair,” said Commissioner Silvia Saucedo.

The letter will also be sent to the city’s advisory neighborhood councils, which have begun objecting to the practice of shifting surplus DWP funds because the agency has raised water rates to help cover part of the transfer.

“In the future, I think the neighborhood councils will make a big issue of all transfers,” said Frank Salas, the DWP’s acting general manager.

Saucedo said rising costs at the department may require additional rate increases.

DWP officials separately told a City Council committee Tuesday that they did not expect any electricity rate increases in the next five years but that, after that, operating costs would overtake revenue. When that happens, agency officials said, they may need an annual electricity rate increase of 1% to 1.5% for the six years beginning in 2011 to keep the budget balanced.

In addition, the agency has proposed raising the percentage of energy generated from renewable sources, including solar, wind and geothermal power. That proportion -- now less than 3% -- would rise to 20% by 2017 under the proposal.

That goal was endorsed Tuesday by the council’s Commerce, Energy and Natural Resources Committee, which voted to ask the DWP to approve a plan for green power by the end of this year.

To pay for more environmentally friendly power, the DWP has proposed a phased-in surcharge. Officials said Tuesday that the surcharge would be capped so the average residential electric bill of about $53 per month would not go up more than $3.20 by 2017.