DWP Chief to Step Down at the End of January

By City News Service

The head of the Department of Water and Power, which is embroiled in a financial dispute with the city over a pair of union trusts, will resign at the end of the month, Mayor Eric Garcetti announced Thursday.

"I was brought in to lead DWP by the prior administration and I felt it important to stay on board afterward to provide time for the new administration's transition," wrote Nichols, who previously worked in the private sector as a water and energy consultant.

Nichols said he does not have "specific plans for a future leadership role in the industry elsewhere" to avoid potential conflict of interest.

Garcetti thanked Nichols and said he was "focused on continuing to reform the DWP to cut costs, improve customer service and increase transparency."

Nichols's resignation came amid a fight over what happened to about $40 million in ratepayer funds, with City Controller Ron Galperin eventually demanding records be subpoenaed.

DWP union boss Brian D'Arcy has refused to cooperate with city officials.

At the direction of Galperin, police Thursday served D'Arcy with a subpoena to force him to appear by Jan. 23 at an audit meeting with documentation about how the money from the two funds has been used.

Water and Power Commissioner Jill Banks Barad said she was "sorry to see" Nichols leave, and said she feels the "fallout" from D'Arcy's refusal to divulge financial details about the two trusts hurt the general manager.

"I thought he was a good general manager," she said. "Not only did he have the technical knowledge, he was very open and I liked working with him."

It will be a challenge to find a replacement "who has exceptional managerial skills, the technical knowledge of water and power, and also political skills to deal with the City Council and the public, the neighborhood councils and the union," she said.

Nichols also presided over a troubled overhaul of DWP's 39-year-old billing and customer information system. Glitches in the initial months of the $162 million changeover resulted in tens of thousands of incorrect bills being sent out, with some customers being charged several times more than they owed and receiving shutoff threats from the utility. Customer service call wait times also ballooned as people called in to fix their bills.