The new contract with Bartle Wells was necessary because the consultant has to completely scrap the former water rates, which had numerous errors, and conduct a new cost-of-service analysis, said Steve Zurn, director of Glendale Water & Power, during a council meeting Tuesday.
The flawed rates, which were approved by the City Council in 2012, caused Glendale to overcharge some commercial customers and undercharge some residential customers, resulting in a roughly $9 million loss in expected revenue to date.
The loss is expected to grow unless the rates are fixed, according to a city report.
The water rates whipped up controversy when they were approved in 2012 as some businesses complained about extreme increases in fire-line charges and some residential ratepayers raised concerns that the changes were too costly following tough economic years.
The four years of rate increases were supposed to increase Glendale Water & Power revenue by less than 1% the first year, 2% the next and then 4% and 5% in the next two years, charging customers differently depending on how much water they use and the size of their meters.
The city paid Willdan Financial Services of Temecula $107,000 to prepare the 2012 water rates. City officials said they are looking into legally forcing Willdan Financial Services to pay for the new consultant fees.
Before the council approved the water rates, Glendale resident Harry Zavos pointed out that Willdan Financial Services’ use of numbers to calculate the water rates could not be trusted.
Zavos, a retired law professor, has long criticized the city’s utility as well as a longtime transfer of funds from Glendale Water & Power to the city’s general fund, which pays for police, parks and other public services.
Zavos is a board member of the Glendale Coalition for Better Government, an organization that filed a lawsuit against the city asking a Los Angeles County Superior Court judge to stop the utility transfer.
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