LOS ANGELES (CBSLA.com) — The Los Angeles Department of Water and Power reached a tentative settlement on Monday in regards to a customer billing class-action litigation.
The settlement would amount to LADWP crediting or refunding up to tens of millions of dollars to customers who experienced over-billing as a result of the problematic initiation of the department’s new billing system.
In all, the department says, $44 million was wrongly billed as excessive charges after the system took effect. Recent refunds and credits, according to Chief Administrative Officer David Wright, have decreased that sum to $36 million.
LADWP General Manager Marcie Edwards released a statement Monday, addressing the settlement.
“The proposed settlement makes good on a commitment I made to our customers when I was appointed to review every account and make whole any customer who was overcharged by our new billing system, no matter how small the error,” Edwards said.
“With this agreement, every customer who was affected will receive 100 cents on the dollar.”
Edwards goes on to note that the proposed settlement results in the majority of credits and refunds being “quite small”, and that they will amount to under $10 for customers who were overcharged by the new billing system.
“…the total remaining credits and refunds owed to customers amount to approximately three tenths of one percent of total billings since we began using the new billing system,” Edwards stated.
In her statement, Edwards went on to acknowledge that the issue caused inconvenience for customers, and that further efforts would keep the same problem from occurring again.
“…we know that the problems associated with our billing system caused problems and headaches for far too many of our customers and we apologize to each and every customer who was affected,” Edwards stated. “We are continuing our legal action to seek recovery of all costs associated with the proposed settlement as part of ongoing litigation against Pricewaterhouse Coopers (PWC), the firm hired to perform the system integration and replacement of LADWP’s customer information and billing system.”
While most cases will result in $10 of refunds or less, others are due a much larger sum.
Roger Espinosa, one such over-billed LADWP customer, says the prices of his bills grew steadily, and then rapidly.
“It started off at let’s say five hundred, and then it was always even numbers, it would go to a thousand, and then it got up to something crazy (like) fourteen or seventeen thousand dollars was the bill,” Espinosa said.
Espinosa says he paid as much as $1200 on some bills, just to keep the DWP at bay.
Under the settlement, customers would be notified in October, and refunds and credits would be received by June 2016. A new audit of 1.6 million customer accounts would also be required.
Additionally, DWP would be required to spend roughly $20 million to fix the faulty billing system.
“Finding out that the DWP would actually care enough to make a proposal or settlement is progress, because in the past, in my dealings, I’ve found that it can be extremely difficult to navigate through their systems as it is,” Espinosa said.
The final disposition on the proposal will be up to the court, which may announce whether or not it agrees to the proposal by October.