City Hall

DWP to pay back all overbilling in class-action settlement


The Department of Water and Power admits to $44 million in overcharges to customers during its screwed-up rollout of a screwed-up new billing system a couple of years ago. Now, facing lawsuits and litigating at least one of its own, the giant city utility has agreed to pay back around $36 million in outstanding overbilling plus about $12 million in lawyer fees and perhaps more. “It’s a home run,” said Jack Landskroner, the lawyer for one of the plaintiffs who sued the city. “It’s not often you get 100% recovery for customers.”

Per his law firm, some of the details:

Under terms of the settlement, LADWP addresses the errors created by the PwC billing system, its impact on its customers and agrees to:

· Review and audit the accounts of every single customer. Approximately 1.6 million accounts will be reviewed/audited.
· Customers who were overcharged will either receive a full credit (100 cents on the dollar) to their account if they were overcharged or they will receive refunds if their account is closed.
· It will not be necessary for the majority of ratepayers who were overbilled to file a claim. Credits or refunds will be generated automatically and noted on customer’s bills.
· Customers that incurred incidental expenses related to these billing errors are able to submit a claim for reimbursement of costs, with supporting documentation.
· If an audit shows that residential customers owed money for services but had not received a timely bill, the LADWP will only be allowed to bill for the prior to 9 months (270 days) of services. The LADWP legally can currently charge up to four years.
· Commercial accounts would be responsible for paying for services for up to four years;
· Customers that owe for back services that had not been timely billed will have up to 4 years to pay back any verified balance - interest and penalty free with qualifying small businesses permitted to apply for an extension beyond 4 years if under a hardship.

The city has a lawsuit pending against PricewaterhouseCoopers for the bungled system. The firm says it is not to blame for the problems the DWP encountered. From the LA Times story:

The rollout of the new billing system nearly two years ago led to a deluge of complaints, including inflated, erroneous or delayed bills. When customers called the utility for help, they faced lengthy waits exceeding half an hour on average.

The agency was still reeling from those problems when Edwards was tapped by Mayor Eric Garcetti to head the utility last year. DWP officials say the agency has made big strides since the billing fiasco first erupted: Wright said most problems had been fixed roughly a year ago and typical waits for customer service have been whittled down to a few minutes.

More by Kevin Roderick:
'In on merit' at USC
Read the memo: LA Times hires again
Read the memo: LA Times losing big on search traffic
Google taking over LA's deadest shopping mall
Gustavo Arellano, many others join LA Times staff
Recent City Hall stories on LA Observed:
Inequality and city hall in Los Angeles
Politicians, pay your bill
Wesson cautious on city hall probe
City hall's poisoned PLUM
Put Jamal Khashoggi Square outside the Saudi consulate on Sawtelle
Ryu says Korean Americans must step up
UCLA study calls for rent control tightening
Ignored in downtown L.A.'s new glitter?