Hahn Goes After Rivals’ Energy Votes

Opening a new assault on his top two challengers, Los Angeles Mayor James K. Hahn on Wednesday blamed former Assembly speakers Bob Hertzberg and Antonio Villaraigosa for the California energy crisis.

“The problem was created by Villaraigosa and ... Herzberg made it worse,” Hahn said, opening a much-anticipated drive to discredit his rivals as he battles to keep his job in Tuesday’s election.

The mayor -- in a dead heat with Villaraigosa and Hertzberg, according to a recent Times poll -- blamed Villaraigosa for voting to deregulate the state’s energy market, a step that set the stage for the energy crisis. And standing before blown-up e-mails from Enron Corp. officials, he linked Hertzberg to the notorious Texas energy company accused of bilking California of millions of dollars during the 2001 energy crisis.

Hahn is expected to begin a new television ad today that criticizes both Hertzberg and Villaraigosa for their records as state assemblymen, sources said Wednesday.

However, some consumer advocates, industry leaders and others who worked on the energy crisis in Sacramento four years ago said the mayor’s accusations were inaccurate and unfair.

“I have no evidence that Hertzberg was in any way in Enron or anyone else’s pocket,” said UC Berkeley economics professor Severin Borenstein, director of the UC Energy Institute who has read many of the Enron e-mails. “Almost everybody met with almost everybody to talk and get different points of view.”

Villaraigosa, for his part, was one of 116 legislators who approved the deregulation plan in 1996; no one voted against it.

The Hertzberg and Villaraigosa campaigns also dismissed Hahn’s charges as a desperate move.

“We knew the sucker punch was coming,” Hertzberg said at a news conference of his own Wednesday afternoon. “It’s six days before the election, and here it is.”

At a media event to tout a high-tech crosswalk, Villaraigosa said: “Mr. Hahn has been complaining a lot about throwing mud, and yet when you look at his campaigns over the years, they’ve been some of the sleaziest, the dirtiest you’ve seen.”

Hahn’s attacks made the evening television news Wednesday night, featuring photos of Hertzberg and Enron headquarters in Houston.

But political consultant Rick Taylor said he was puzzled by Hahn’s decision to attack on an issue that was resolved years ago and that didn’t directly affect Angelenos.

Los Angeles residents get their electricity from the municipally owned Department of Water and Power, which largely remained independent from the state’s troubled power grid.

“I don’t get it,” said Taylor, who is not working with any candidate in the race. “I don’t see that this has anything to do with being the mayor of Los Angeles.”

Hahn has been enduring attacks for months from his major opponents over his fundraising and leadership style. And many political observers wondered when the mayor would kick off a negative campaign of his own.

Hahn gave hints earlier this week that he was preparing to hit back, sounding a more combative tone in Monday’s mayoral debate and amping up his criticism of Hertzberg’s and Villaraigosa’s legislative records. Each served six years in the Assembly and each rose to become speaker, one of the most powerful posts in Sacramento.

On Wednesday, Hahn summoned reporters to his Miracle Mile campaign headquarters to charge that Villaraigosa’s and Hertzberg’s records on energy policy raised questions about their fitness for office.

“This election is about trust. It’s about who’s got the best judgment to lead this city,” Hahn said, his voice quavering as he read a prepared statement to television cameras.

“I didn’t raise money from Enron. They did. And then they laid the problems that Sacramento created -- the energy crisis -- on the backs of regular Californians and asked them to foot the bill for Sacramento’s mismanagement.”

Villaraigosa and Hertzberg raised $18,000 and $13,000, respectively, from Enron for campaign funds they controlled. In 1996, then-city attorney Hahn raised $900 from Enron, according to campaign finance records.

The deregulation plan, which was designed to open the state energy market to competition, was widely expected to drive down prices for consumers and was signed with much fanfare by then-Gov. Pete Wilson.

Several leading consumer groups had dropped their opposition to the plan by the time it came up for a vote in the Legislature.

Years later, deregulation became a multibillion-dollar nightmare as energy suppliers such as Enron manipulated the electricity market and reaped enormous profits. Lights went out across the state, and California’s major utilities slipped toward bankruptcy.

Hertzberg, then Assembly speaker, was among several state leaders who in 2000 and 2001 worked frantically to devise a solution to what was becoming a state crisis.

In January 2001, Hertzberg and then-Assemblyman Fred Keeley (D-Boulder Creek) pushed through legislation authorizing the state to buy electricity after the major utilities became financially crippled by high wholesale prices charged by power generators.

Hertzberg and Keeley also crafted legislation that would have given the state ownership of the hydroelectric plants belonging to Southern California Edison and Pacific Gas & Electric. In return, the state would have paid off the utilities’ more than $11 billion in debt.

The measure failed as some consumer advocates viewed it as a bailout.

E-mails released by Hahn on Wednesday showed that in April and May 2001, Hertzberg met and talked with Enron officials, including chief executive Kenneth Lay, who is now facing charges of fraud and conspiracy.

At the time, state officials were investigating allegations that Enron traders manipulated the energy market. Atty. Gen. Bill Lockyer suggested that Lay should be locked up with a “tattooed dude who says, ‘Hi, my name is Spike, honey.’ ”

The mayor accused his rival of working to help Enron at the expense of consumers. “Bob Hertzberg was in cahoots with Enron and Ken Lay,” Hahn said.

Hahn said he, on the other hand, worked as the elected city attorney to keep the DWP out of the deregulation scheme.

But S. David Freeman, who headed the DWP at the time and is now supporting Villaraigosa, said Hahn played no role in that decision. “Jim Hahn had nothing to do with that,” Freeman said.

And several people who worked closely with Hertzberg at the time, including leading consumer advocates, industry leaders and former Senate President Pro Tem John Burton (D-San Francisco), said Hahn’s charges were baseless.

Hertzberg and other state leaders may not have succeeded in solving the energy crisis. But the speaker was not working on behalf of energy companies like Enron, said Michael Shames, executive director of the Utility Consumers’ Action Network, one of the leading consumer groups involved in trying to resolve the energy crisis.

Lobbyist Lenny Goldberg, who represented the Utility Reform Network, a consumer group, during the energy crisis, recalled that Hertzberg would summon him to middle-of-the-night meetings to work on energy-related issues.

“There was no effort to keep consumers out,” Goldberg said. “We had our disagreements, but he was in no way doing Enron or generator or marketer bidding.”

To back up his claims, Hahn cited Harvey Rosenfield of the Santa Monica-based Foundation for Consumer and Taxpayer Rights.

Rosenfeld, in an interview, was critical of Hertzberg’s performance, saying he believed the e-mails show Hertzberg “championed Enron’s interests.”

Unlike Goldberg and Shames, however, Rosenfeld was not part of the Sacramento negotiations to resolve the energy crisis.

Largely left out of the escalating battles among the top three contenders, Councilman Bernard C. Parks and state Sen. Richard Alarcon continued their efforts Wednesday to rally enough support to win one of the two spots in the likely May runoff. election.

Parks took his campaign for mayor to the streets. The former police chief greeted commuters at the Wilshire-Western subway station in the morning and later walked from business to business in Koreatown.

Alarcon took his lagging campaign and its message of “building middle-class dreams” to Larry Mantle’s “AirTalk” program Wednesday on public radio station KPCC-FM (89.3).

Times staff writers Richard Fausset, Michael Finnegan, Jessica Garrison, Matea Gold, Patrick McGreevy and Jeffrey L. Rabin contributed to this report.