Eric Garcetti Loses A Round in Cage Match with DWP Union Boss

The beef dates back to the mayor's campaign, when D'Arcy spent a whopping $4 million to defeat Garcetti. Garcetti won, and D'Arcy's been paying the price ever since. In August, D'Arcy was forced to accept a three-year wage freeze. Garcetti 1, D'Arcy 0.

This week, he effectively prevented the mayor from prying into the $40 million DWP has spent on two union-backed training institutes. Garcetti 1, D'Arcy 1.

The Joint Training Institute and the Joint Safety Institute have been around for more than a decade, but they became controversial recently when the L.A. Times reported that their finances are kept secret — even though they are funded with public money. (The Weekly reported the same thing in 2005.)

Garcetti had so much fun running against D'Arcy during the campaign that he has continued to do it while in office. During the contract negotiations, he launched a public campaign to “Fix DWP.” When the Times story appeared, Garcetti quickly announced that he would seek to open up the finances of the two institutes to public scrutiny. 

“I think that ratepayers deserve to have transparency — to know where ratepayer money is going,” Garcetti told the Times.

Unfortunately, that's easier said than done. As the Weekly was the first to report (toot toot), the training institutes are 50-50 partnerships between the DWP and the union — which means that the DWP cannot make their finances public without the union's consent. And D'Arcy is not the sort to open up the books if he doesn't have to.

At their meeting last month, Garcetti's appointees to the DWP Commission demanded a bunch of information about the institutes, and gave a two-week deadline. D'Arcy showed who's really in charge by simply ignoring that request, and no information has been disclosed.

Instead, D'Arcy offered in a letter on Tuesday to have the institutes' own accountant prepare an audit. The institutes have been audited annually for many years, so this would not be something new.

The previous audits have not been public, and D'Arcy is not offering to make the new one public either. The DWP commissioners want it to be public, but D'Arcy has already displayed his indifference to their calls for transparency. 

But even if it is made public, an audit from the institutes' own accountant wouldn't provide an independent analysis. Ron Galperin, the city controller, has also been demanding detailed financial records so he can do his own audit. But it seems — for now — that D'Arcy has no intention of turning anything over to Galperin, and it's not clear what recourse Galperin would have.

To sum up, then: Garcetti and his allies have found a righteous cause, but also a losing one. D'Arcy has every legal advantage, and that's what matters to the outcome. Blame the DWP for setting up two organizations that it is required to pay for, but can't control.

Being shrewd, Garcetti probably would not have chosen this fight on his own. In his initial statements on the issue, he hedged his call for transparency a bit, acknowledging that it might be tougher than it at first appeared. “Obviously there's some legal rights that the other side of this agreement has,” he told the Times when they first asked him about it.

At the time, Garcetti was still basking in the victory he had won with the wage freeze. He probably would have preferred not to immediately go charging up this particular hill. But with Galperin and others clamoring for transparency in the wake of the Times' story, Garcetti couldn't help being dragged into a fight with D'Arcy that he probably knew he would not win.

The Garcetti forces are still putting up a brave front, vowing to use “all legal options” if the in-house audit doesn't prove satisfactory. Best of luck with that, but for now it goes down as a defeat.

If Garcetti really wants to do something about these institutes, he could press the council to join him in re-opening the new DWP contract. The contract includes a re-opener clause, which was one of the concessions Garcetti fought for. The purpose would be to eliminate the institutes through negotiation, or at least re-write the bylaws so their records are public.

Maybe that could be Round 3?

Update: Here's D'Arcy's “screw you” letter to DWP: