LOS ANGELES (AP) — The Los Angeles Department of Water and Power has agreed to return $44 million to thousands of customers who were overbilled under a botched billing system upgrade two years ago, it was announced Monday.
The proposed lawsuit settlement would grant credits or refunds to overbilled customers, with most receiving $10 or less, a DWP statement said.
Some of the money already has been returned, leaving about $36 million to be credited or refunded, which should be completed by the end of next June, according to the agency.
Under the settlement, the DWP also will invest $20 million to overhaul the billing system, and all of its 1.6 million customer accounts will be audited.
A judge must still approve the settlement.
DWP General Manager Marcie Edwards apologized to customers affected by billing problems and said reforms are being made.
“Through this settlement, we have also entered into a binding commitment to stay on the path of improvement by setting benchmarks and key performance indicators and by appointing an independent monitor who will report to the court on our progress every six months,” Edwards said in the statement.
Jack Landskroner, whose Cleveland-based law firm sued on behalf of a DWP customer, said the utility took the overbilling problem seriously and understood “the legal and moral obligation to right this injustice and resolve this matter in the best interests of the ratepayers.”
The utility’s new system was supposed to integrate billings, service calls and other operations. But after the September 2013 rollout, the utility was flooded with complaints about inaccurate and inflated bills, jamming phone lines.
Authorities have said the DWP spent $70 million on the billing system and another $41 million to deal with its problems.
The city hopes to recover its losses in a lawsuit it filed against PricewaterhouseCoopers, which helped set up the billing system. That suit alleges the vendor falsely claimed it had the skills and knowledge to revamp a 40-year-old DWP billing system in order to obtain the city contract.
The company has called the lawsuit meritless.