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.
So that is Los Angeles. But what about Pasadena, another city that owns its own Water & Power utilities (link)? Are that city's Water & Power employees making a lot more money than the average Pasadena resident? Have those salaries and benefits been a driving force behind the repeated utility rate hikes there?
Sadly, the answer to both questions appears to be yes.
Here is how Brian Charles described PW&P rate increases in a Pasadena Star News article that ran in June of 2012 (link).
Pasadena Water and Power electricity rates increase - Electricity rates are going up for residents in Pasadena as the City Council approved an increase this week.
The Pasadena Department of Water and Power is raising its distribution and customer charges in an effort to pump an additional $3.75 million in revenue into the agency. The increase is needed as PWP personnel costs, which includes pension obligations, are on the rise, according to a city staff report on the PWP rate increase. The rate increase will also maintain cash reserves necessary for utility agencies in the volatile energy market, Pasadena City Manager Michael Beck said.
"In the short term, you could take additional money out of reserves, but it's not a prudent way of managing money," Beck said.
The city-run PWP has been Pasadena's cash cow in recent years. City Hall has never hesitated to transfer money from the PWP's nearly $400 million in cash reserves to plug holes in Pasadena's general fund budget.
And here is how yet another series of PW&P rate increases was described by Lauren Gold in the Pasadena Star News in June of 2014 (link):
Electricity in Pasadena more expensive after council approves rate increase - Pasadena residents and businesses will pay more for electricity beginning in July after the City Council unanimously approved rate increases for the next three years.
Rates for average users will rise by about 8.3 percent on July 1, comprised of a 2.7 percent council-approved jump and 5.6 percent “pass through” increase that doesn’t require council approval. Users will be hit with a 2.4 percent increase in 2015 and 2.2 percent hike in 2016.
Officials said the money was needed to maintain Pasadena Water and Power’s infrastructure and to pay off debt.
“This is something that is necessary and it’s responsible and compared to our competitors it’s quite reasonable,” Councilwoman Margaret McAustin said. “This isn’t easy. This will have an impact on all of us, but it’s something we must do.”
So why have electricity rates gone up continually in Pasadena over the last four years, and will keep doing so into the future? Is it because of debt, or infrastructure repairs as certain City Council members have claimed? Or can it be that Pasadena Water & Power employees are compensated for their time and bother with outrageously high salaries and benefits?
For the real numbers we turn to Transparent California. It really is a remarkable tool and in this case literally blows the tall tales told above by Michael Beck, Margeret McAustin and others right out of the water.
First, some overall numbers. Here are the Transparent California numbers for all City of Pasadena employees, including those who work for the PW&P (link).
The big numbers here are those that highlight the disparity between what City of Pasadena employees are making versus the average pay of those Pasadena residents working in the private sector. The median pay and benefits for City employees totals $128,040.90 per year. Or way more than double the median pay of the average taxpaying Pasadena resident.
You also need to note that the yearly cost of city employee compensation per Pasadena resident is $1,551. That’s the 10th highest of any city in the entire State of California. The average cost (filtering for cities with a resident population of at least 10,000 and at least 100 city employees) is $683.
Here is the list of Top 20 employee costs dunned cities, based on the average cost per resident. Figure that a family of four in Pasadena is paying $6,000 or so yearly.
So what are PW&P employees making? A ton. Here is a compensation chart of the Top 20 most highly rewarded Pasadena Water & Power employees. Note the total compensation figures on the right.
|Click to enlarge|
If you want the entire list send me an email and I will forward it to you. It goes on for pages and is far too large a file to reproduce here. There aren't many other places where you will see cable splicers getting six figure total compensations.
So don't you think that is a much more logical explanation for all of those Pasadena Water & Power utility rate hikes?
Maybe somebody should ask Terry Tornek and Jacque Robinson about that at the Pasadena Mayoral Runoff Debate tonight. After all, these are two Councilmembers who voted for these serial rate hikes as members of the City Council, and have to know at least a little bit about the reasons for them.
They were there, after all.