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CLARIFICATION ON FINANCIAL INFORMATION INCLUDED IN STATE AUDIT AND INITIAL MEDIA REPORTS ON LADWP CUSTOMER BILLING SYSTEM

The following statement from LADWP updates and puts into proper context information included in today's State Legislative Audit Report on LADWP's Customer Billing System:

“Revenues from all accounts receivable, both current and past due, were cited in the State Audit Report as $681 million. However, total accounts receivable were $436 million in July 2013, BEFORE the new customer billing system was implemented. Therefore, the amount attributable specifically to the billing system implementation identified thus far, which LADWP continues to attempt to collect, is $245 million. This represents approximately 4% of total annual billed revenues of $5.6 billion, which includes water, electric, sanitation, solid waste disposal and utility users tax.

Many of our customers with past due accounts are now on payment plans and we continue our collection activities.   

LADWP has also previously publicly stated that an undetermined amount of bad debt will ultimately be written off in excess of typical historical levels. However, LADWP maintains strong reserves. The fact that LADWP’s current finances remain sound was also attested to by the auditors in their report.

We want to assure our customers that since the rollout of the new customer billing system, we have routinely corrected incorrectly estimated bills found not to be accurate by cancelling and rebilling those customers according to actual meter data. Still, the problems we experienced were significant, and we understand the anger and frustration experienced by those who were affected. 

We have been forthright about the problems with our new customer billing system and we have taken significant steps to fix them.  We have made progress and appreciate the recommendations of the State Auditor.  This progress includes:

  1. Hiring over 200 customer service representatives and meter readers to reduce call hold times and to better serve our customers;
  2. Completing 100% of meter read routes daily and achieving 95% or higher meter read performance, leaving only inaccessible meters unread;
  3. Decreasing average call wait times from over 35 minutes to under 5 minutes;
  4. Decreasing estimated bills from over 20% to 5%;
  5. Improving timely billing from 95% to over 98.5% - exceeding utility industry standards;
  6. Completing an internal audit to validate the accuracy of customer billings;
  7. Retaining a 3rd party expert consultant to review and validate that bills are calculated correctly and presented accurately on our customers’ bills;
  8. Offering a Late Payment Forgiveness Program;
  9. Offering online, self-service payment arrangement/plan options for customers; and
  10. Improving our responsiveness to email customers.

We are committed to continuing this improvement and to providing better service to our customers as we work to offer budget billing/level pay plans, more convenient payment options and lower call hold times, among other ongoing initiatives.

We know that a small percentage of our customers continue to have problems with bills they are receiving.  Most of these cases involve bills that have been corrected over multiple billing periods, and are clearly labeled as such on the bill.  We are in the process of proactively reaching out to these customers to explain the corrected charges and answer any questions they may have.  We also encourage any customer who has a question about their bill to contact us at 800-DIAL-DWP (800-342-5397).  Any customer who has tried to have their billing problems addressed and are still not satisfied are encouraged to contact me directly online at www.TellMeDWP.com."

More information about our billing system, its status and the steps we have taken to improve can be found online at www.ladwp.com/BillingInfo.  

A statement by General Manager Marcie Edwards responding to the State Audit Report, can be read in full here."

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