Though litigation between North Shore towns and LIPA have ended, the story of the stacks is not yet over, not by a long shot.
The Town of Huntington, with one hour to spare on deadline, approved the settlement with the Long Island Power Authority on its tax certiorari case over its Northport power plant Sept. 4. The agreement cuts LIPA’s power plant property taxes from $86 to $46 million in a 7-year glidepath. The settlement also included an extra $3 million sweetener on top of the deal to be paid in $1 million installments in the next three years. This settlement addition came just a few weeks before the deadline neared.
Though Huntington residents and the local school district will have to deal with the financial impact over the next seven years, Port Jefferson and its residents are in the middle of its own glidepath from its 2018 settlement over the Port Jefferson power plant. Village officials said LIPA is contractually obligated, based in their own settlement, to also grant any beneficial deals to the Town of Brookhaven and Village of Port Jefferson.
Mayor Margot Garant said during the Sept. 8 village board meeting that Port Jeff’s attorney is in contact with LIPA’s counsel to get those same “sweeteners” by repassing their settlement.
Port Jefferson’s case was finally settled in December 2018, reducing the plant’s assessment from $32.6 million to $16.8 million over 9 years. Port Jefferson is currently in year 3 of the glidepath, with the first two years of the settlement effectively rolled into one.
Port Jefferson is in the midst of dealing with the loss of property tax revenue from the Port Jefferson Generating Station. This year’s budget reflects a $50,000 increase from last year in the total amount that Port Jeff has to raise from resident taxes, partially due to the LIPA settlement.
Village Attorney Brian Egan said he has been in contact with LIPA’s lawyers and is just waiting for the power authority to finalize the details of the Huntington settlement. He expects there could be the benefits of an extended payment and the potential to extend payments out over a longer time, adding that he hopes to have greater details of what Port Jeff should be able to get later this month.
In a statement, LIPA officials said that the power authority, Town of Brookhaven and the Village of Port Jefferson “have started discussions to consider amendments to the 2018 settlement agreement for the Port Jefferson Power Station. LIPA intends to provide comparable settlement terms for Port Jefferson residents once the Northport settlement is finalized. Terms will be based on the size of the plant and existing tax payments.”
Egan also touted the village board’s decision to settle their plant’s case earlier than Huntington’s, adding that this means Port Jeff has a more gradual route to weather the drop in property taxes from the plant.
“The mayor and this board bore this settlement on their backs,” Egan said. “It was an early exit on this and Huntington is never going to recoup the costs they did.”
Trustee Bruce Miller said it’s important that Port Jeff receive that extra $3 million that Huntington will also be getting in their settlement over three years. In the past, LIPA has also argued that the plants in both townships may close in the near future. Meanwhile, Port Jeff has argued for keeping the plants running and retrofitting the property with newer technologies.
“We have been speaking with National Grid [which operates the Port Jeff plant] and they have been a little close-lipped,” Miller said. “LIPA, whether they have just been trying to get a settlement from Huntington, has been a little bit intimidating with talking about closing plants and not dealing with us in terms of what a better future will be.”
This post was amended Sept. 10 to add a statement from LIPA.