Hi John: I just wanted to share with you an op-ed of mine that was published Monday by The Los Angeles Times which highlighted my findings on excessive DWP pay. Obviously a placement in the Times is a huge deal and has already made a big impact.
Outraged residents have been e-mailing us through the TransparentCalifornia.com site (link) to express their thanks for the op-ed, but shock and disgust at its findings. Local advocacy groups and insiders have told me the op-ed has created a Public Relations nightmare for the DWP, particularly because they were planning to roll out a proposed 5-8% rate hike a year, for each of the next 5 years!
Even residents outside of LA have reached out to share their experiences with excessive public pay in their area – a few may have even given me an idea or two for my next piece.
I’ve also done two talk radio shows – CBS LA and ABC LA – to help bring attention to this issue. This is what we always hoped Transparent California would accomplish; present people with the facts so that they can make informed decisions for themselves. Now California residents cannot be so easily hoodwinked by every rate or tax increase that is claimed to be absolutely necessary to keep government functioning when, in reality, most of it is going to pay packages that dwarf their own.
Until next time!
Project Manager, Transparent California
(Mod: Tell the truth and you can make a difference. Give taxpayers a place to look that truth up for themselves and you might very well ignite a prairie fire. Here is the L.A. Times column.)
Los Angeles Times: DWP ratepayers may get soaked again
As detailed in a recent paper by TransparentCalifornia.com, DWP employee pay is up to three times greater than that of its private-sector counterparts. The average full-time, year-round DWP employee made $114,941 in 2013. This is despite providing a level of service that in 2011 had it ranked the 13th most hated company in the nation in one survey.
Inflated pay at DWP is not new. The L.A. Times, Bloomberg and the Los Angeles Daily News have reported on it for years, the latter going so far as to include a prominent editor's note: “If you read only one story today, I hope it will be this one. The DWP's bloated salaries, poor management and soaring rates are the most glaring example of what's wrong with Los Angeles.” That was in 2007. As the Daily News reported then, 13% of the utility's 8,880 employees were paid at least $100,000. Now, 53% of its 10,299 employees are paid at least that amount.
DWP custodians made an average $55,691 in base pay in 2013, compared with the Los Angeles market average for janitors and cleaners of $26,810, as reported by the Bureau of Labor and Statistics. DWP plumbers earned an average of $102,587, compared with the BLS average wage for Los Angeles plumbers, pipefitters and steamfitters of $65,350. DWP security officers earned $65,778 — more than double the $26,640 BLS average for Los Angeles security guards.
Of course, living in the L.A. area on an annual income below $30,000 is difficult to impossible. But this is just another reason why imposing rate hikes on low-income workers to help fund pay packages up to triple their own should be addressed.
DWP spokesman Joe Ramallo, who received $232,000 total pay in 2013, responded to such pay discrepancies by saying the comparisons don't take into account all the factors that can lead to differences. In some past analyses, he may have had a point.
But the Transparent California study matched DWP employees by job title, responsibility and requirements with their Los Angeles-area counterparts as determined by the BLS.
Additionally, the study compared the value of benefit contributions, not just pay. DWP employees contribute 6% of their salaries to their pensions — about the same as the 6.2% that private-sector employees contribute to Social Security.
But that's where the pension similarities end. DWP employees receive pensions that are at least triple the value of what typical private-sector employees can expect from Social Security.
And if the widespread criticism of systemic billing errors, horrific customer service, overcharges and lack of accountability for millions of dollars in two controversial nonprofit trusts is any indication, DWP employees are not outperforming their private-sector counterparts to earn such inflated pay and pensions.
Meanwhile, residents of Los Angeles face yet another rate hike, only a couple of years after an 11.1% increase in electricity rates. DWP officials have recently suggested that they plan to seek recurring rate hikes of at least 2% per year beginning this year to fix infrastructure. But CityWatch is reporting that Angelenos should expect rate hikes of 5% to 8% a year, for each of the next five years. Residents in January paid 20% more for electricity than the national average, according to the U.S. Energy Information Administration.
These higher prices act as a regressive tax on the poor, who are forced to spend a proportionally larger share of their income on energy than their wealthy neighbors. With the growing concern about income inequality, policymakers should think twice before stacking the deck further against the poor through more rate increases.
Instead, the inflated pay of DWP employees should be brought into the same universe as comparable private-sector salaries to help pay for new department costs.
Robert Fellner is research director at TransparentCalifornia.com, a project of the Nevada Policy Research Institute and California Policy Center.