Los Angeles Department of Water and Power ratepayers may not get refunds until mid-2017

An August 2015, $44- million proposed class-action settlement between the Los Angeles Department of Water and Power (LADWP) and its ratepayers stated that customers would be receiving a refund or credit by June 2016. But, payments have been repeatedly delayed and Consumer Watchdog, a non-profit consumer advocacy group, has now appealed for Los Angeles Mayor Eric Garcetti’s involvement and that he mandates the DWP issue refunds to ratepayers immediately.

In 2010, LADWP contracted with PricewaterhouseCoopers to restructure its 40-year-old billing system. But, the debut of the new system in 2013 was a fiasco and tens of thousands of ratepayers were either overcharged or not billed at all for months at a time. When concerned customers attempted to call and either complain or inquiry about the status of their missing bill they were met with on-hold times that exceeded 30 minutes.

Since last fall, attorneys for the city have repeatedly asked the court for more time to work on the settlement. An independent court-appointed monitor, appointed last December, is now combing through some 1.6 million accounts to uncover who is owed money. Thus far, an additional $5.4 million is owed to the utility’s customers, per the attorneys representing the ratepayers.

“In working with our legal team, the court-appointed monitor is conducting an exhaustive review of every possible defect in LADWP’s billing system. As our efforts continue, we expect the total amount owed to customers will continue to rise,” said Jack Landskroner, the attorney who is representing DWP customers in the lawsuit.

Now, however it appears that attorneys for the DWP have again delayed a court date until November to get a preliminary settlement of the DWP misbilling issue. This means that ratepayers’ refund checks would not be issued before mid-summer of 2017.

In its letter to Mayor Garcetti, Consumer Watchdog wrote, “You betrayed us when you promised in August 2015 that ratepayers would soon see $44 million in refunds for overbilling by this deeply dysfunctional utility. Instead, Los Angeles DWP ratepayers who have been overbilled, failed to receive bills for years, and been denied refunds and an honest review of their accounts, are still waiting. Ratepayers report they are continuing to get enormous back-bills they didn’t know were coming, and unreasonable threats of disconnection of electricity and water or even outright termination in situations where the error was entirely DWP’s because it forgot to bill for service.”

But LADWP claims the system is working as it should be. “The cornerstone of the settlement was the appointment of an independent monitor to ensure every consumer receives a 100% refund. That is exactly what is occurring,” said DWP spokesman Joe Ramallo.

Though Consumer Watchdog has requested Mayor Garcetti to involve himself in this dispute, Garcetti has refused to meet with ratepayers to discuss the settlement. Instead his office responded through a spokeswoman.

“The mayor is committed to making sure every single ratepayer is paid in full for everything they are owed,” said Connie Llanos, a spokeswoman for the mayor. “This additional time, while inconvenient, is a result of a thorough process, overseen by a court appointed monitor and a respected jurist. They are doing their due diligence to ensure every dollar owed is identified.”

Other issues surrounding the LADWP debacle includes both a separate action whereby the DWP is suing PricewaterhouseCoopers for misrepresenting how the firm would overhaul and roll-out the new system. The initial PricewaterhouseCoopers’ contract with DWP was $60 million but that was subsequently increased by $9.2 million.

Also, the nonpartisan Consumer Watchdog group has asked voters to deny Measure RRR on the November ballot. The measure would restructure DWP’s governance and has been placed on the ballot by the Los Angeles City Council and the Mayor at DWP’s request and, according to Consumer Watchdog would “remove public oversight of rate hikes, contracts and other key decisions.”

“Measure RRR is a DWP power grab that allows for more misconduct and misbilling at DWP without any public oversight at this mismanaged utility,” said Consumer Watchdog president Jamie Court. “The DWP billing scandal and DWP’s failure to pay ratepayers back is Exhibit A for why voters should reject Measure RRR. Angelenos cannot trust DWP.”