Town of Huntington officials are moving toward making a power play against Long Island Power Authority and National Grid to take over control of the Northport power plant.
Councilman Gene Cook (R) has called for town residents to participate in a letter-writing campaign asking Huntington’s elected officials to consider utilizing eminent domain to take control of Northport power plant.
His proposal comes days after LIPA allegedly submitted documents to Suffolk County Supreme Court for its pending lawsuit against the town, in which it disputes the tax value of the plant, claiming the structure only has a fair market value of $193 million, according to Cook.
“Their estimate is so far out of wack on it, they are almost like giving us the plant,” the councilman said. “If they want to give it to us, I want to take it.”
Cook said he thinks the Northport facility is one of the biggest power plants in the Northeast, which will become more valuable with future improvements. He estimated the power station could produce $5 billion in revenue per year for the town if it took over operation of the facility. He suggested the name “Huntington Power Service Company.”
“We want to serve our residents, not be an authority over them like LIPA has done,” Cook said. “They have taken LI Power Authority as ‘we have authority over everyone.’”
“Their estimate is so far out of wack on it, they are almost like giving us the plant.”
— Eugene Cook
The councilman drafted a resolution he said he plans to present at the May 17 town board meeting for Huntington to hold a public hearing. If approved, a hearing will be held June 5 at 2 p.m. for residents to voice their thoughts and concerns on the acquisition of the plant from National Grid, which is the owner of the power station.
“The basis of this acquisition will be for the purpose of delivery to the public of electrical power in a safe and cost-efficient manner,” reads the draft resolution.
Under New York State law, the town must publish its findings and determinations on the proposed acquisition from the public hearing within 90 days. The Town of Huntington is due in court to face LIPA less than a week later June 11.
“We are looking at every facet of possibility here when looking at the LIPA situation because it’s a very serious situation,” Supervisor Chad Lupinacci (R) said. “Any possibility that comes up we will review with our attorney — we will review it with experts to see if it’s feasible.”
Even if the town initiated the process of obtaining the power plan via eminent domain, it would not resolve the town’s lawsuit with LIPA. In addition to seeking a 90 percent reduction of taxes on the power plant, LIPA is asking for the town to reimburse it for alleged overpayment of taxes each year since it filed the claim in 2010 — totaling more than $500 million.
“Let’s save the consulting and legal expenses of evaluating this idea, which would be fiscally disastrous to the town, its taxpayers and wouldn’t resolve the pending tax certiorari litigation,” LIPA spokesman Sid Nathan said in a statement.
“Let’s save the consulting and legal expenses of evaluating this idea, which would be fiscally disastrous to the town, its taxpayers and wouldn’t resolve the pending tax certiorari litigation.”
– Sid Nathan
LIPA disputes that the Town of Huntington could turn a profit operating the station, claiming Northport power plant is operated at a loss. The power company said its contract with National Grid requires it to pay all costs to run the plant — including $80 million in annual property taxes leveraged by the Town of Huntington — which exceeds its revenue. LIPA also stressed that if Huntington took control of the plant, all beneficial tax revenue would cease, leaving residents to pay more for their government services.
“We hope the town will join with other local communities on Long Island that are working with LIPA to reach a fair settlement offer that puts an unsustainable property tax situation at the Northport plant back on a sustainable path,” Nathan said.
The Town of Brookhaven and Village of Port Jefferson both announced they had reached settlements over the tax assessed value of the Port Jeff plant with LIPA in early April.
If the lawsuit is decided in LIPA’s favor, the utility company estimates that Town of Huntington residents would see their taxes increase by $62 a month, with Northport-East Northport school district residents responsible for an additional $210 to $220 per month.
Lupinacci has said the town remains open to bargaining with LIPA, while Cook said the only negotiation he is for is LIPA agreeing to withdraw its lawsuit.
“I will fight to the death on this one,” Cook said. “Either they want to be good neighbors or they don’t. If they don’t, they can hit the road.”