Los Angeles resident Lois Gass has a cautionary tale for people who pay their Department of Water and Power (DWP) bills using automated bank withdrawal. The utility’s brand new computer system sent her a bill last month for more than $3,900—12 times the amount she is normally charged.

The surprise bill overdrew her account and when the 69-year-old woman called the DWP to complain, she was put on hold for an hour before being disconnected.

It is suspected her story is not unique. DWP Assistant General Manager Sharon Grove told the Los Angeles Daily News that tens of thousands of customers have received incorrect bills. But not to worry. “We have 1.4 million customers, so it’s not a large percentage, but a lot of homes,” she said.

The DWP rolled out the new computer system two months ago and its customer service lines have been ringing off the hook ever since. Customers have been subjected to bogus late notices, incorrect bills, delayed bills, threats of disconnection and an assortment of other snafus that promise to make the holiday season one of challenging uncertainty.

Last week, a spokesman for the utility acknowledged to the Los Angeles Times that the cost of the new system is actually almost triple the $59-million price tag bandied about in public. The real price is $162 million when you factor in labor costs for employees dragged away from their regular duties to help with the rollout. That alone cost $63.1 million.

But the big cost was $98.9 million spent on software, equipment and vendors. The $59 million figure tossed about earlier was the cost of the deal with its primary contractor, PriceWaterhouseCoopers. The new system pulls together what had been 50 separate sources of data.

The mayor and city council have demanded that the utility fix the problem immediately, but that won’t happen. DWP's customer service director Campbell Hawkins told the Times it will take four to six months to straighten out the billing problems and two years to get the entire system functional. “This is fairly standard,” he said.

–Ken Broder

To Learn More:        

DWP Computer Glitches Result in Higher Utility Bills for Many (by Rick Orlov, Los Angeles Daily News)

Thousands of Customers Overcharged in LADWP Billing Error (by Ted Chen and Andrew Lopez, NBC Southern California)

Full Tab for Troubled Billing System Was $162 Million, DWP Confirms (by Catherine Saillant, Los Angeles Times)  

DWP Customers Frustrated by New Billing Software (by Catherine Saillant, Los Angeles Times)