LADWP loses another legal fight with APCD

drylake12-17Court rules against Los Angeles Department of Water and Power in Owens Lake fee case

Press Release from Great Basin Air Pollution Control District

Date: December 17, 2012

Today, in another setback for the Los Angeles Department of Water and Power, the Kern County Superior Court ruled that LADWP must pay more than one million dollars in fees that it deliberately withheld related to air pollution control measures for the dried Owens Lake bed.  LADWP’s water diversions from the Owens Valley cause the air pollution at Owens Lake.  In December 2011 and May 2012, the Great Basin Unified Air Pollution Control District ordered LADWP to pay fees associated with the development of dust control measures and legal costs to enforce Owens Lake air pollution control requirements. Great Basin is incurring these legal expenses in its defense against the City’s continued efforts to avoid constructing the control measures required to meet air quality standards. LADWP adopted a budget of over $2.5 million to pay two law firms to represent its Owens Lake matters.  The two law firms are in addition to a number of City attorneys working on these issues. In 1997, the California Air Resources Board held that Great Basin was also entitled to retain lawyers to respond to the City’s challenges, and that those legal costs were properly assessed to the City as part of the development of the air pollution control measures.  The duty of the City to pay those fees prior to appealing District orders was established in 1997 by Court Orders against the City.

“Today’s decision is important to protect the environment and public health,” said Ted Schade, Great Basin’s Air Pollution Control Officer. “Hopefully it sends a message to leaders in the City of Los Angeles that its Department of Water and Power must comply with the law and its past agreements, that they must obey regulatory orders and, most importantly, that they must finish controlling the air pollution caused by their water diversions from the Eastern Sierra. We encourage Los Angeles’ leadership to begin serious discussions with Great Basin as to how it will meet its legal obligations and protect the air quality and public health of the residents of the Owens Valley.”

In addition to refusing to pay fees, the LADWP is opposing existing federal, state and local air pollution control laws that require additional air pollution controls at Owens Lake.  LADWP’s drying of Owens Lake created the largest single source of particulate matter air pollution in the country.  Particulate air emissions are a danger to human health and the environment; the particulates lodge deep in the lungs, causing respiratory injuries and additional risks to children and the elderly. Over the past year, LADWP’s water diversions have created dust storms that exceeded the federal standard on 25 separate days resulting in the issuance of local health alerts.

Last month, the State Air Board issued its decision that carefully considered and rejected all of LADWP’s challenges to the air pollution measures.  Today, Kern County’s Judge Sidney P. Chapin ordered the LADWP to immediately pay the fees of over $1.1 million.  For its failure to comply with the Court Orders and pay the fees, the City now faces a trial to determine a civil penalty of up to $30,000 per day for each day of its violation.  The penalties associated with this willful violation of court orders could exceed $6 million.

Theodore D. Schade

Air Pollution Control Officer

Great Basin APCD

(760) 872-8211 – office

(760) 937-3360 – cell

email: [email protected]

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12 Responses to LADWP loses another legal fight with APCD

  1. Philip Anaya December 19, 2012 at 9:53 am #

    Ah Mr. Ramallo,
    Just the man .I have never even heard your name before, but being the friendly guy that I am, I thought to try and get my mind around the impossible job you have and see if there was anything in there that might be helpful. My process of thinking leads me to the only conclusion. Trouble is correct. We all need to apply our collective thoughts and find you a new job Title and most probably a correlating increase in your compensation package. I as a rate payer see this as a necessary expense and as I’m sure you would agree you are at the forefront of a very dissagreeable and dysfucntional organization. I have tried to get the image out of my mind of the strings and wires that connect DWP Mismanagers to your self . I hate nightmares especially when they are as vivid as the dance that you must unwillingly have to do. I hope one day that you will be able to cast aside the current tasks,at least the wires and either be allowed to begin addressing issues of improving public relations of the DWP or you find another organization that has a better track record , I’m thinking UNESCO or something like that. Please do not take all this to heart or personal . It’s a dirty job and someone has to do it.

  2. Joe Ramallo December 18, 2012 at 12:48 pm #

    Please note that the judge did not rule on the merits of LADWP’s claim that the fees that Great Basin charges LADWP’s customers are unreasonable. The judge ruled only that LADWP must pay about $1.1 million in legal and other fees first and then contest them at trial. Great Basin has already stockpiled more than $2 million in LA ratepayer funds for services that were charged for, but never performed. At trial, LADWP will challenge Great Basin’s levies on Los Angeles water customers, pointing to Great Basin’s hiring of outside attorneys at the rate of $750 an hour, Great Basin’s collection of more than $85 million in fees from LADWP over the last 17 years, and Great Basin’s use of LA water ratepayer money to fully fund its pension system and to pay for more than 90% of Great Basin’s annual budget.

    • Benett Kessler December 18, 2012 at 5:22 pm #

      Thanks for the comment. In response to some of your statements – It is true that the court determined that the City of Los Angeles failed to perform its legal duty to comply with APCD orders to pay air pollution control fees. As I understand it, it is true that DWP does get to contest the reasonableness of the fees in front of the Air Resources Board and later in court.

      According to APCD, it is not true that they have stockpiled “more than $2 million in LA ratepayer funds for services that were charged for, but never performed.” In past conversations, I learned that APCD has a reserve fund, as most agency budgets do, and that DWP’s refusal to pay fees meant use of reserves over the last year. At last check, the APCD reserve fund was $800,000.

      Not sure why you are criticizing APCD for hiring lawyers. LADWP has use of in-house City attorneys, and, as I recall, LADWP contracts with two outside law firms for something just under $3 million. APCD, at last check, contracted for legal services in the amount of $1.85 million as disputes go on.

      As for APCD using LA ratepayer money to fund its pensions and budget – As I get it, those identified as polluters pay the cost of pollution control. LADWP is the cause of a reported 90% of the pollution in the Eastern Sierra. So, it would make sense that LA would fund most of the APCD efforts. That’s the way it works.

      Benett Kessler

      • NewDay December 18, 2012 at 7:56 pm #

        Bennett, you do know who Joe Ramallo is, right? That would answer your “Why are you criticizing APCD” question…

        • Benett Kessler December 18, 2012 at 8:39 pm #

          Yes, I know Joe Ramallo. He is the Public Relations Director for LADWP at headquarters. In view of the way LADWP spends money on lawyers, yes, I will ask why anyone in that position would criticize someone else for doing the same thing – only not to the same extent.

    • Trouble December 18, 2012 at 9:34 pm #

      Joe- you sound more like spin doctor than a public relations director. Tell me something, do you really care what the public thinks of DWP?

  3. Desert Tortoise December 17, 2012 at 4:40 pm #

    You are missing an important point. Constitutionally no court in the nation can order the expenditure of public funds. Under our system of government and under both the state and Federal constitutions, only an elected legislative body has the authority to spend the public’s money. If the LA City Council refuses to pay the court, the courts hands are well and truly tied. A court has no constitutional authority to seize public monies and spend them. The LA City Council could very well call the court’s bluff and I expect they will.

    • Benett Kessler December 17, 2012 at 7:05 pm #

      You may be missing that this is a contractual matter to which LA agreed. The State Air Board also order this payment

      • Desert Tortoise December 18, 2012 at 7:55 am #

        Only the LA City Council can approve the expenditure of LA’s tax money on a court or agency fine. If they refuse, the APCDs hands are tied. The APCD cannot order an elected legislative body to spend public money. The APCD has no authority to take the money either. They can negotiate a settlement with Los Angeles, but ultimately there has to be a majority vote of the city council in favor of that expenditure for it to happen. That is how it works under our constitution.

        • Benett Kessler December 18, 2012 at 9:08 am #

          You do not know all of the facts here. There is a state law, agreements signed by LADWP and APCD and orders from the State Air Board that govern
          whether DWP pays attorneys fees in its fight to avoid legal requirements. This does not require a vote of the City Council.
          Benett Kessler

  4. Philip Anaya December 17, 2012 at 2:18 pm #

    Therodore Schade
    Great Basin APCD

    Dear Sir, I am hopeful that you do not consider the news of the Kern County Superior Court Ruling as a victory. There is the benefit of the ruling ,supporting the necessary work that the APCD is doing. The ruling is larger than victory.It is justice and this justice comes at a huge expense being, what will end up the total costs of the lessons DWP should be learning to become a more responsible manager of the Los Angeles Aqueduct . The cost of water per acre foot has just increased for the rate payers of Los Angeles. The cost of the inane and foolish decisions by the DWP Mismanagers not to address issues untill forced by rule of law is furthur incalculable in the loss of public opinion and trust and the incompetence of their stewardship.Thank You for your work and that of the Great Basin APCD.

  5. Trouble December 17, 2012 at 1:37 pm #

    DWP will continue to lose in court based on their reputation alone.


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