DWP’s first inspector general leaves after seven months

Los Angeles Mayor Eric Garcetti’s first inspector general for the Los Angeles Department of Water and Power, who was hired in the wake of a massive contracting and legal scandal at the utility, is leaving after just seven months.

Sergio Perez is stepping down next week to join the L.A. city controller’s office, Perez confirmed Thursday.

Garcetti’s office announced the creation of the inspector general position in the wake of the 2019 FBI raid at the utility. However, it took 2½ years to fill the job, with Garcetti aides blaming the pandemic for the delays.

Following the FBI raid, two former DWP officials, including the general manager, struck plea deals and are serving prison sentences for their roles in the schemes. Two former attorneys who worked for the city are awaiting sentencing.

The entire scandal cost the DWP at least $100 million, according to a preliminary estimate done by the utility.

Perez said in an interview Thursday that the first report from the inspector general’s office, which looked at overtime at the utility’s security services division, will be released next month. He also described how he helped create the office, which so far hasn’t hired any new employees but instead reorganized existing divisions.

“I am proud of the impact that I have had,” Perez said.

Perez earned a $268,683 annual salary at the DWP after joining in the department in May. He was hired to audit DWP programs and contracts; investigate complaints of fraud or abuse; refer misconduct to law enforcement; and be a liaison with other city departments.

At an October meeting at the Board of Water and Power commissioners, Perez described a broken complaint system in which DWP fraud and waste complaints that are received by the city controller’s office — which runs a fraud hotline — are referred by the controller’s office back to the DWP to investigate, rather than probed by a neutral party.

A former city controller employee also complained in 2019 to The Times about how that system allowed DWP officials to cover up complaints.

Perez’s salary at the city controller’s office will be $252,627 plus an undetermined bonus, said Jane Nguyen, who will serve as chief of staff for City Controller-elect Kenneth Mejia. His title will be chief of accountability and oversight.

Perez, who endorsed Mejia, said that he was joining the controller’s office because he was seeking to have the “greatest impact for the greatest good.”

Before joining the DWP, Perez worked as executive director of Orange County’s law enforcement watchdog. He also previously worked as director of enforcement for L.A.’s Ethics Commission, which investigates city campaign finance and lobbying law violations.

Mejia’s office also announced this week that former Santa Monica city manager and former Garcetti budget advisor Rick Cole will be joining the controller’s office as chief deputy controller.

Garcetti spokesman Harrison Wollman said the mayor expects the DWP to fill the new inspector general position “quickly” so the “office can continue and accelerate the vital work that has already begun.”