By Ted AYALA

The four-year plan that the City of Glendale adopted in 2012 to shore up Glendale Water & Power finances is being taken back to the drawing board.

Glendale City Council voted Tuesday night to award a contract for $103,000 to Bartle Wells Associates of Berkeley to devise a new water rate structure after it was discovered that the figures laid out by the previous consultant, Willdan Financial Services of Temecula, were not adding up.

Willdan’s plan was expressed to the city as being absolutely necessary to keep GWP solvent. In 2011, Peter Kavounas, then assistant general manager of the agency, stated to council that GWP was facing a budget gap of $11.5 million for the fiscal year 2011-12. He stressed the need to implement the Willdan plan was dire.

Kavounas retired from GWP in 2012. He was hired shortly thereafter as the new general manager of the Chino Basin Watermaster.

The findings have dealt a harsh blow to the supporters of Willdan’s plans, which already proved to be unpopular with many GWP customers. Public outreach the GWP conducted that year across the city to familiarize residents and businesses with the rate increases often met with negative response. Council was left deeply divided with the increases only narrowly approved on a 3-2 vote in March 2012. Councilmember Frank Quintero and former Councilmember Rafi Manoukian voted against the plan.

Willdan’s rate structure plan imposed a set of water rate increases over four years that was intended to plug GWP’s $21 million budget gap, which was mostly incurred from investments in capital projects. Instead, city staff late last year found that their numbers resulted in some customers being undercharged while others were overcharged. The cost of their miscalculation: a shortfall of $9 million.

“Bottom line is we had to redo the whole process,” said GWP General Manager Steve Zurn. “We thought we didn’t have to do that. But as we got deeper into this, we found out that we needed to do a whole new cost service analysis.”

City Atty. Michael J. Garcia will be pursuing legal options to seek recompense from damages incurred by Willdan’s faulty plans, though he opted not to voice his office’s plans on the record.

“We will extract our pound of flesh and make sure that [Willdan] is held responsible for their errors,” said Councilmember Laura Friedman. “It’s to the credit of our staff that they found [the errors], admitted them  and obtained a new consultant.”

Bartle Wells is expected to have its plan for water rate increases ready for the council’s examination by later this spring.

  Ted Ayala