L.A. Mayor And City Attorney Urged To Replace DWP Ratepayer Advocate And To Explain Fairness Of New DWP Settlement At Lunch With Overcharged Ratepayers

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Santa Monica, CA — Consumer Watchdog today wrote LA Mayor Eric Garcetti and City Attorney Mike Feuer asking the public officials to fire DWP’s “ratepayer advocate,” an energy consultant and Enron apologist, and to attend a lunch with overbilled DWP ratepayers to explain how their latest version of a settlement with the LADWP is fair and reasonable for them.

“The ratepayer advocate’s office has been silent as this and other scandals unfolded, making it an accomplice,” Consumer Watchdog’s letter said. “If you cannot stand before ratepayers to justify the deal, how can you expect Angelenos to sign onto it?”

Read the letter at:

Tens of thousands of customers were overcharged by tens of millions of dollars when a new DWP billing system malfunctioned.  A judge rejected a class action settlement agreement for the second time on November 3.

That settlement agreement relieved the City of legal liability, but didn’t provide overbilled customers a neutral forum to resolve their bills, or a system to ensure what they are paid back is fair, reasonable, or adequate.

The judge requested a new settlement to be submitted on November 17th.  The Consumer Watchdog letter called on Garcetti and Feuer to ensure the settlement included a more transparent and easily understood claims process.  The nonprofit consumer group asked as well for a full accounting of debts owed by ratepayers, refunds issued to them, and for an end to all back billing of debts owed by consumers.

“First, we ask that you address some fundamental problems that will remain for ratepayers unless you alter the agreement,” Consumer Watchdog wrote.

“Second, we invite you to a lunch with overbilled LADWP ratepayers, after the revised settlement is completed, so that you can personally explain to them how the newly modified negotiated settlement will work in their favor.” Consumer Watchdog set the lunch for Wednesday, November 18th pending the public officials’ availability, but offered to meet at their convenience.

Consumer Watchdog wrote them that DWP should:

•    End back-billing for all underpayments by ratepayers, effectively forgiving all ratepayer debts because the city was not timely in its billing and is suing the maker of the computer system for the losses.

•    Replace ratepayer advocate Fred Pickel, a former energy and Enron consultant who touted the benefits of electricity deregulation, with a true consumer advocate who defends ratepayers in an overhaul of the Office of Public Accountability.  Consumer Watchdog unearthed documents showing how Pickel worked on behalf of energy producers, including Enron, who defrauded the state under electricity deregulation.

•    Produce a full accounting of how much ratepayers owe in underpayments as well as how much ratepayers will receive in refunds.

•    Refund up to four years’ worth of back bills, rather than set a nine-month back billing refund limit that will only apply prospectively.

•    Begin issuing refund checks immediately just as back bills for underpayments currently are being sent.
“Under the last settlement agreement that the court rejected, ratepayers would have to give up their legal right to dispute back bills without being told how much DWP says they underpaid,” the letter continued. “This is unacceptable, as consumers will opt in and be forced to pay a debt without retaining the legal right to dispute it. In fact, there should be no back billing at all. All underpayments should be forgiven.”

While the LADWP claims to have determined the amount of refunds consumers are due, it has issued no refund checks, only back bills for underpayments, the letter continued. “It’s time the refunds start to flow, with or without a signed settlement. That’s what an entity that overcharges its customers, particularly a public agency, is supposed to do – correct bills.”

In its letter, Consumer Watchdog said that ratepayers are entitled to be walked through any settlement agreement.  “If you decline to attend a lunch, we will hold the meeting with ratepayers and the media anyway to go through the revised agreement. We ask that you not bring your lawyers, as ratepayers who will be asked to sign this agreement will not have the benefit of attorneys.”

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Jamie Court
Jamie Court
Consumer Watchdog's President and Chairman of the Board is an award-winning and nationally recognized consumer advocate. The author of three books, he has led dozens of campaigns to reform insurance companies, financial institutions, energy companies, political accountability and health care companies.

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