What Are We Doing?

20140806 Is the trouble at DWP a lesson for Apple Valley? (August 6, 2014)

It is distressing, is it not, to discover — via a Wall Street Journal editorial Tuesday — that the Los Angeles Department of Water and Power’s workers in 2012 earned on average $101,237, which is 50 percent more than other city employees and 25 percent more than those at comparable public and private utilities.

That fact came to light when the Journal commented on the 20 million gallons of water the city lost when a 30-inch main ruptured, spilling the precious liquid all over parts of the campus of the University of California at Los Angeles. The water main ruptured probably because it — like so much of LA’s water delivery system — is ancient, with some pipes having been installed a century ago, and have mostly gone unmaintained since.

Is privatization the answer?

The Journal also noted that during the first six months of 2013, DWP workers grossed $77 million in bonuses and overtime.

The Journal concluded that, given the out-of-control costs of the DWP and the fact that instead of funding repair and replacement of its vast network of pipes, it might be a good idea to sell the utility off to the private sector because No one do could any worse than the Department of Water and Power.

We’re not so sure. The Town of Apple Valley is presently investigating the purchase of the Ranchos Water Company, apparently in the belief that acquiring the private utility and making the town’s citizens the owners would make the water company not only more responsive to users’ needs but control water costs as well.

Looking for trouble?

The Journal’s point in calling for privatization of the LADWP is exactly the opposite of what the Apple Valley Town Council is apparently convinced of, that going public would result in a better-maintained facility than what now exists under Ranchos management.

But would it? Or would the Town eventually find itself in the same predicament the citizens of Los Angeles now find themselves in, owning a water system that has been ill-maintained over the years because the money that should have been spent on that maintenance has been diverted to employee benefits and wages.

Buying Ranchos and removing it from a least a semblance of adhering to the exigencies of the free market — making it an absolute government monopoly, in other words — may be asking for trouble, and the Town’s citizens ought to take a long look at the DWP before giving the council the go-ahead.

Source: Steve Williams, Daily Press