Residents Demand Action to Head Off LIPA Tax Crunch

Residents rallied in Northport Sunday to protest LIPA’s efforts to chop its tax bill and to demand that Gov. Cuomo do more to protect them from the potentially hard hit taxpayers could face if LIPA succeeds.

The rally occurred on the eve of the resumption of a trial in LIPA’s lawsuit against the Town of Huntington to force a reduction in the taxes it pays. The utility argues that the Northport plant’s taxes are too high, given its  decreased use and reduced life span.

Opponents of LIPA say the lawsuit could drastically affect taxpayers, particularly those in the Northport-East Northport school district, which gets as much as $54 million from the $82 million LIPA payment.

Others say the utility agreed in 1997 not to challenge taxes if municipalities agreed not to raise them.

The Northport-East Northport would take the hardest hit if the LIPA wins the lawsuit, since it gets as much as $54 million from the $82 million LIPA payment. But taxpayers across the Town of Huntington could also expect tax increases.

“It shouldn’t have gotten to this point,” Northport Deputy Mayor Tom Kehoe said. “We’ve got to be able to believe our elected officials. We believed what Richard Kessel and Gov. Pataki told us,” he said. Kessel was  LIPA chairman who told local officials that had made a binding promise in 1997 that “neither LIPA nor LILCO will initiate any further tax cases” on the plant properties.

Kehoe said he believes the assessment  on the property LIPA is challenging is fair or even a little low, noting that the plant sits on 250 acres of waterfront property.

State Sen. Jim Gaughran, a resident of Northport, said, “The town made an agreement (with LIPA),” he said. “We will take your stacks, your pollution, and we’ll be a host community” in return for LIPA accepting the tax agreement.

“We’re going to do something about this out-of-control authority,” Gaughran said,  who favors adding residents to the LIPA board.

State Assemblyman Andrew Raia said he and others had tweaked the school tax portion of the budget that passed last week to help resolve the problem, but that Cuomo had chosen to delete the plan from the final budget.

Town Councilman Gene Cook, who has advocated for taking over the site through the eminent domain process, urged people to attend the trial this week in Riverhead.

Councilman  Ed Smyth emphasized that the problem goes beyond Northport. “This is a townwide problem,” he said. “This problem is now on their doorstep,” he said, referring to all hamlets and sections of the town. “The political solution has to come out of Albany.”

One of the major concerns of speakers and residents is the possibility that, should the town lose, taxpayers might face not only tax increases in future assessments but also retroactive costs going back to earlier stages of the lawsuit.

LIPA filed its challenge in 2010.

Paul Darrido, who was the lead organizer of the rally, encouraged residents to talk with neighbors and friends to understand the impact of the challenge. He said “It’s being sold to us that that plant is useless, and so are we.”

Leave a Reply