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Column: FBI raids show that at L.A. City Hall, incompetence and corruption are close cousins

David Wright, formerly of the Los Angeles Department of Water and Power
David Wright stepped down on Tuesday as general manager of the Los Angeles Department of Water and Power.
(Al Seib / Los Angeles Times)

The timing is perfect, isn’t it?

Here come the most searing, sweaty, sun-blasted days of the year, when the temperature and utility bills rise in unison. And right on cue, everyone’s favorite public agency in Los Angeles has stormed back into the news.

The L.A. Department of Water and Power, infamous for a 2013 billing scandal and other shenanigans, got raided Monday by FBI agents who marched in and carted away records in a corruption probe that also brought raids at other city offices. At the DWP building, nine agents went to one floor alone, and at the end of the day, witnesses saw uniformed personnel pushing carts away. I don’t think they were the caterers.

On Tuesday, DWP chief David Wright stepped down and was replaced by an underling I’ve known to be a pretty good guy. But can we trust someone who didn’t have the sense to run for the hills rather than take the helm?

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It’s worth noting that nobody was perp-walked out of the building in handcuffs. But the FBI warrant indicated there’s a buffet of possible crimes being investigated, including bribery, kickbacks, extortion, mail fraud and money laundering.

The FBI is definitely learning its way around city buildings. Monday’s excitement follows by several months a fed raid on City Councilman Jose Huizar’s home and office, so please update your score cards and keep checking the news scroll for the latest developments.

Among the questions that have to be asked:

Did city officials orchestrate Monday’s raids to get our minds off the growing homelessness and trash crisis?

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Why doesn’t the FBI just open a substation at City Hall to save on commute times?

And doesn’t the FBI have summer outfits? Those dark jackets in mid-July were a definite fashion faux pas.

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FBI agents leave the downtown headquarters of the Los Angeles Department of Water and Power after serving a search warrant Monday.
(Al Seib/Los Angeles Times)

But back to the DWP, which has a long, hard-earned history of scandal, as many of its ratepayers know all too well. Officials there and at City Hall are always telling us they’re getting on top of things — usually just before things take another nosedive.

As Times journalists Dakota Smith, David Zahniser and Emily Alpert Reyes have reported, the FBI searches on Monday were part of its investigation into DWP’s fabulously botched rollout of a new billing system in 2013 and the chaos that followed as numerous customers were sent wildly inaccurate bills.

As if the old billing problems weren’t trouble enough, more worms crawled out of the can in March. That’s when The Times reported on a potential conflict of interest for a lawyer hired by City Atty. Mike Feuer to be special counsel in the city’s lawsuit against the company that implemented the faulty billing system. At the same time, it turned out, the attorney was representing a DWP customer involved in a class-action lawsuit against the city.

Jamie Court of Consumer Watchdog, who has fumed and fulminated over the DWP for years, was unsurprised by any of the week’s developments. He blasted one and all — the mayor and the DWP commissioners he appoints, the City Council, the ratepayer advocate and the city attorney — for not doing their jobs.

“It’s an insider’s club and this whole debacle shows that if you’re a Democrat in L.A., other people in power aren’t going to watch you and criticize you for things that are clearly wrong and potentially even criminal,” Court said.

Let’s not go any further, though, without revisiting the highlights of the billing debacle. As you may recall, thousands of ratepayers were overcharged, some were undercharged, some got no bills at all, and you had a better chance of winning at Powerball than getting through to the customer service desk at DWP.

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My favorite story was the one about an elderly Van Nuys couple, Savely and Stella Goreshter, who opened their mail from DWP and found a $51,000 bill. This sent the Goreshters into a panic, even though the bill was so obviously inaccurate.

Did the DWP admit its mistake? Heck no. The Goreshters were told they must have a leaky toilet or were watering their one or two plants with a heavy hand. I searched the Goreshters’ condo with them, and we couldn’t find a leak anywhere except in the logic of the DWP. And only a public shaming, in print, got the DWP to flush the bill.

“I check their bills and what I have seen is that DWP has been behaving,” the Goreshters’ daughter, Felicia, told me on Tuesday. “The DWP rates are high, but there’s been nothing outrageous, like $50,000.”

You have to keep checking, though, because you never know.

I still get emails regularly from DWP customers who say their bills have suddenly doubled or tripled without explanation. Tim Blood, a San Diego attorney who represented scads of overcharged DWP ratepayers, told me he still gets from a dozen to several dozen queries every month.

Speaking of Blood, he had an interesting take on the raids this week.

“I find it kind of shocking,” he said. “The FBI doesn’t conduct raids unless they think there’s a reason to believe evidence is going to be destroyed.”

Blood was one of the first people to question the terms of the class-action settlement in the overbilling scandal. He thought it shortchanged ratepayers.

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“It didn’t say that people would get 100% relief. It said they’d get 100% of whatever DWP determined they should get,” Blood said. “But DWP would come up with the number. There was no reason to believe it would be correct. Maybe it would or maybe it wouldn’t, but there was no way to know.”

What we do know, with certainty, is that the dead of summer is upon us. So as you pump your air conditioner, be sure to take a hard look at every line of your utility bill.

And stay tuned for further developments from downtown Los Angeles, where incompetence and corruption are close cousins, and sometimes hard to tell apart.


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