MORE DIVERSION OF GWP FUNDS

Speech before Glendale City Council

 

Mayor Weaver, as the longest serving member of our city council you have known for years of the crumbling and ageing of the Grayson Power Plant. Stand- in Councilman Quintero and recently re-elected council members Friedman and Najarian have also known about the ageing power plant long before the April election, beefore the recently approved 2013 budget made possible by millions of dollars in borrowed money in the form of municipal bonds, increased fees and taxes.

And long before transferring another $21 million from Glendale Water and Power to the General Fund into the pockets of our city union employees.  Transferred money is primarily being used to pay for our inflated unsustainable salaries, pensions and benefits of our city union workers.  

IN 2001 GWP ELECTRICAL FUND had over $198million and the WATER FUND had about $46million totaling about $244million. Today, these funds are virtually gone. Where did this money go?

Previous GWP Mgr, Glen Steiger, was fired under the pretext of double dipping his expenses. This was a misleading public statement by management. The truth was Mr. Steiger, the best employee that money could buy, was fired because he had a stake in the Commodity Market with GWP’s money. That is, the rate payers money.  Under his leadership, Mr. Steiger, lost over $120 million of GWP money trading futures in electricity and gas. No public announcement was made of his actual dishonesty. It was all swept under the rug just like the missing $244 million that was in the GWP back in 2001.

Today’s leadership of GWP is being run by two individuals who have no background in running a utility company. Mr. Steve Zurn who has a political science degree and no engineering background.  Then, Mr. Steve Lynn, no engineer, but a lawyer who previously worked under former City Attorney, Scott Howard. At community forums Mr. Lynn would answer questions like an attorney, not as an engineer. 

In 2013, at a GWP community meeting being held at our local Police Station our City Attorney, Mike Garcia, and the people’s attorney, Harry Zavos, debated City Charter changes A, B and C. People were angry that night when they asked our new City Manger, Scott Ochoa, where did the $244 million GWP money go? 

Council members continue to act surprised, but they have been cannibalizing GWP for years and passing so called balanced budgets from borrowed money, new and increased fees and taxes. Recently, at the 11^th hour, our city manager and council members had the audacity to tell the public we needed to set aside $5million for emergency plant repairs without any competitive bidding.    

Before the April election, even the representatives from the International Brotherhood of Electrical Workers (IBEW) came before the council while negotiating and reported the Grayson Plant needed repairs and they were against the large transfers of money from the GWP to the General Fund.

Because of diversion of funds from GWP and the miss-management of city resources, council now wants to increase our electrical rates approximately 30-70% over the next five years. Plus, another $60 million bond is in the planning stage to keep the utility afloat.  

In a recent staff report according to the Federal Energy Regulatory Commission, a penalty of up to a million dollars per day, per penalty will be assessed if our utility company does not fulfill its responsibility.     

Our city fathers would be turning over in their graves as they never envisioned the GWP becoming a “cash cow” for the city unions’ salaries and pensions.  As usual lawyers, Ara Najarian, will do his Dog and Pony Show and suggest council sell GWP to Southern California Edison for councils many management mistakes.

    

 Mike Mohill