The Los Angeles Department of Water and Power building. Photo by John Schreiber.
The Los Angeles Department of Water and Power building. Photo by John Schreiber.

The Los Angeles City Council moved a step closer Tuesday toward resolving a legal dispute with the Department of Water and Power’s employee union and learning more about how a pair of employee training and safety trusts spent at least $40 million in ratepayer money.

The council agreed to send a tentative agreement reached between city officials and Brian D’Arcy, the head of the union representing DWP employees, to the Board of Department of Water and Power Commissioners, the panel that oversees the utility.

The commission is expected to consider the proposed deal at its Oct. 7 meeting. If approved by the commission, the agreement would require final ratification by the City Council.

The agreement would settle a legal standoff between city officials, including Controller Ron Galperin, who is conducting an audit of the two trusts, and D’Arcy, who refused to allow financial documents from the Joint Training Institute and the Joint Safety Institute to be audited by Galperin’s office.

The controller has in turn refused to release the utility’s annual $4 million payment to the trusts, which were formed more than a decade ago to smooth relations between the city and the union.

The terms of the agreement sent to the DWP Commission today are under wraps, with council members meeting in closed session to review the deal. But city officials went into talks with D’Arcy armed with 13 conditions they wanted met before the city would release the $4 million.

One of the conditions was to allow the city to thoroughly audit the past five years of financial activity at the trusts.

Other proposed terms called for the trusts’ management board to include DWP General Manager Marcie Edwards and other utility executives, and for the trustee boards to begin meeting regularly again. The boards have not met in the past eight months, with the union objecting to a pair of management trustees appointed by Mayor Eric Garcetti, though a judge recently ruled that the appointees were properly made and ordered the union to recognize them as legitimate board members.

City officials who pushed for the deal were also concerned that by not releasing the $4 million payment, the city would be accused of violating terms of a recently reached labor agreement with the union. The labor agreement, signed last summer, defers cost-of-living increases for three years and institutes a new pension tier.

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