Everything You Wanted To Know About The DWP - But Were Afraid To Ask!

Did DWP Cave in? GM Deaton Provides Some Answers

Accused of caving in to their union and violating the Brown Act, DWP’s GM Ron Deaton and Public Affairs Director Joe Romallo, met with members of the NC/DWP MOU Oversight Committee to clear the air and get the DWP facts on the table.

The meeting topic was (primarily) the DWP’s hiring of a third crew to build trunk lines even though it costs the DWP almost twice as much to use in-house crews rather than privately contracted crews and it can take up to twice as long for them to do the job.

Also discussed was the lack of adequate public notice about this issue and whether the DWP Board violated the Brown Act when they passed this motion – and these are two different, but related issues. The positive result of the meeting was that the DWP agreed to improve and expand notifications to Neighborhood Councils.

The controversy began when the Daily News’ Kerry Cavanaugh wrote that it would cost up to a half-billion dollars more for DWP crews to build thirteen proposed new water trunk lines than if private contactors were to build them. She reported that the union (IBEW) required a third in-house crew be hired to rebuild other trunk lines at substantially higher costs, as a condition of allowing the hiring of those private contractors for the half-billion dollar saving.

Cavanaugh based her article on facts the DWP provided her and both Deaton and Romallo acknowledged that her article was correct. Unfortunately, some people misinterpreted the article as saying that this proposal was going to cost the DWP an extra half-billion dollars, rather than it saving that amount on those thirteen trunk lines.

The Neighborhood Councils’ first problem with this issue is that there was zero advance public notice. Then when NC representatives arrived at the board meeting, the DWP held the vote on this subject – without any discussion or public comment.

Deaton explained: since public comment is only for non-agenda items, that was not the time for the public to comment on this issue. He then gave us copies of the public speaker requests, and it showed that the person who had signed up to speak had not specified which item which he wished to speak on.

That means, says Deaton, they did not violate the technical requirements on the Brown Act regarding public comment. As for the agenda, since they only have to identify the general subject matter – the item did mention trunk lines – but not the hiring of the crew – and even though they did put n/a on the fiscal impact – even though there is one – they also did not violate the technical requirements of the Brown Act since fiscal impacts do not have to be given in the agenda.

Still it was clear: a much better job of notifying both the Neighborhood Councils, and the public, about this issue could have been done. Romallo promised a more pro-active monitoring of issues for the NCs in the future. He also agreed to send the Councils copies of all communications (that are not confidential such as labor negotiations) the DWP sends to the City Council and the Mayor.

The GM explained the reasoning behind hiring the third trunk-line crew. Besides keeping labor peace, the DWP felt it prudent to have a third trunk line crew to repair the lines in the event of a major disaster. A major earthquake would break not only the local water lines, but the main lines and the trunk lines.

Also, he said, the trunk lines are the lines that deliver the water from the aqueduct to the more localized main lines throughout the city. Rebuilding these trunk lines will take another 15 years, so hiring a third crew will not result in redundant workers.

The committee wanted to know why it should take so much more money for DWP to put in new trunk lines? Because, Deaton responded, when it comes to water mains – the DWP crews are competitive with private contractors. The more existing crews work on them, the more efficient they will become … and the cost differential should, he says, come down.

Now that this issue has become public, it would seem to be in the union’s best interest to allow for work rules changes - if needed - to produce more in-house trunk line work and to help get costs in line with those of private contractors.

Also addressed was the question of why DWP workers pay scales for the same job are substantially higher than in the private sector and all other departments in the city of Los Angeles. The suggested likely answer turned out to be a simple one. With water and power revenues being relatively stable year to year, there are no sudden drops in revenues at the DWP. In contrast, the city of Los Angeles depends on sales and business taxes, federal and state grants, property transfer fees and other revenue sources that can change from year to year. So while other city employees – and private sector employees, often face wage freezes for several years during recessions – and private sector employees can also face lay-offs, DWP workers always get their raises from the DWP’s more stable revenue stream.

It’s worth noting, of course, that public sector unions continue to spend considerable money on getting workers out to vote for the elected officials who then vote on their pay raises. Plus, the DWP negotiations in particular have been held in almost totally secrecy, compared with negotiations between other unions and other city. After the last DWP pay hike, you will recall, a task force was asked to set up new guidelines for the DWP union negotiations to make the process more transparent. City Controller Laura Chick is among those working to shine some light on the DWP union negotiations.

Neighborhood Councils should join her by making transparent union negotiations one more priority on their monitoring list.