DWP Controversial nonprofits to keep $11-million 'rainy day' fund

Two controversial Department of Water and Power nonprofits trusts have decided to keep more than $11 million as a “rainy day” fund, despite a city auditor’s recommendation that they spend the cash before receiving any more ratepayer money.

The nonprofits, which are jointly run by DWP managers and leaders of the city-owned utility’s largest union, have been at the center of a two-year controversy over how they have spent more than $40 million in public funds since the early 2000s.

Judge holds off on approving DWP billing settlement amid legal feud
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The groups receive roughly $4 million per year, but have struggled to demonstrate to public officials what they achieve.“I believe rainy day funds are important, but this is more like a hurricane fund,” said City Controller Ron Galperin. “I don’t see what the point is of these trusts hoarding this money.”
In May, Galperin’s auditors found the nonprofits had paid millions to outside contractors without competitive bids, overpaid top administrators and allowed employees to charge hundreds of thousands of dollars to ratepayer-financed credit cards for travel, meals and auto expenses without filing reports to justify them.