DWP, mired in scandal, has its first inspector general. He vows to bring a ‘zeal for independence’

Weeks after FBI agents raided the headquarters of the Los Angeles Department of Water and Power in the summer of 2019, Mayor Eric Garcetti touted the creation of an inspector general’s office to launch internal investigations, oversee audits and bolster the sagging ethics at the nation’s largest municipal utility.

On Monday, Garcetti’s office announced that the department had tapped civil rights attorney Sergio Perez as the inaugural internal watchdog. Perez, 37, starts in the role May 9.

The job had remained unfilled even as the agency became mired in a sprawling corruption scandal that also involves the city attorney’s office, stemming from a faulty billing system that overcharged tens of thousands of customers. Federal prosecutors say city lawyers helped engineer a class-action lawsuit against L.A. over the errant charges in an attempt to control the terms of the settlement.

A string of plea deals involving former DWP executives and city lawyers have revealed malfeasance at the highest levels. Former general manager David Wright admitted in court papers to soliciting bribes, destroying evidence and otherwise joining in several “corrupt schemes” at the utility.

Asked about the 30 months it took to fill the job, Harrison Wollman, a spokesman for Garcetti, said the position “was created from scratch” and “required an exhaustive and national search.”

“Shortly after the process began, the pandemic forced many of our departments to press pause on new programs and policies to focus on providing aid and assistance to those most directly impacted by the crisis,” Wollman said.

Perez, who has worked since 2020 as the executive director of Orange County’s law enforcement watchdog, the Office of Independent Review, said in an interview that he put his name in after seeing a public posting for the job, adding, “No one encouraged me to apply.”

Acknowledging the scandals that have frayed public trust, Perez promised to bring to the new office a “zeal for independence” and a desire to “get to the roots of issues.”

“The goal is to create the kinds of early warning systems that will help you capture bad acts before they bloom into full-scale disasters,” Perez said.

Perez will have a staff of 18 to 24 people. Among his office’s duties will be auditing DWP programs and contracts; investigating complaints of fraud or abuse; referring misconduct to law enforcement; and liaising with other city departments, including the mayor, Los Angeles Police Department and Ethics Commission. His starting compensation is $268,683, and the post does not have a set term, a DWP spokesperson confirmed.

Though many inspector general roles are independent of the agencies they monitor, Perez will report to the utility’s general manager, Marty Adams — an arrangement that was required because of the City Charter, a DWP spokesperson said. Perez said he will also have a “dotted line” reporting relationship with the Board of Water and Power Commissioners, whose five members are appointed by the mayor.

“Independence comes in a lot of different forms, and oversight is not a one-size-fits-all kind of solution. Those reporting lines don’t amount to much. What really matters is an institutional commitment to make sure that robust oversight exists,” Perez said. “I wouldn’t have taken on this role if I didn’t see this commitment.”

The son of undocumented immigrants who came to L.A. as teenagers from Mexico, Perez attended L.A. Unified schools until the third grade, when his family moved to Fresno, he said. He was the first in his family to finish high school; he then graduated from UC Berkeley before earning a law degree at Yale Law School.

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He started his career in the U.S. Department of Justice as a trial attorney in the Office of Civil Rights and was part of the team that sued Sheriff Joe Arpaio in Arizona, accusing him of a “pattern of unconstitutional conduct” against Latinos, especially immigrants. In 2014, Perez became director of enforcement for L.A.’s Ethics Commission, which investigates those who violate city campaign finance and lobbying laws.

“I don’t think he’s going to soft-pedal,” said Jessica Levinson, a professor at Loyola Law School and the former president of the Ethics Commission. “He will take the facts, look at the law, and he’ll not be subject to a successful political pressure campaign.”

Federal authorities have made clear that their investigation into corruption at DWP is ongoing. In February, David Alexander, former chief cyber risk officer for the DWP, pleaded guilty to lying to the FBI about a job offer that he “secretly solicited” in return for helping pass contract money to a lawyer, Paul Paradis, who was hired by City Atty. Mike Feuer’s office.

Wright, the former DWP general manager, also pleaded guilty to accepting bribes from Paradis in exchange for supporting a $30-million, no-bid DWP contract, officials said.

The current general manager, Adams, said in a statement that Perez’s “sole focus is to uphold the integrity of the Department.”

For the last four years, Perez has held roles overseeing and evaluating law enforcement, including as one of two California Department of Justice lawyers who scrutinized the Sacramento Police Department in the wake of the fatal police shooting of Stephon Clark, an unarmed Black man who was in his grandmother’s backyard.

“I have been in complicated spaces before — working in law enforcement and in public corruption,” Perez said. “What always works is keeping your eye on the facts.”