Town Wins Decisions in Northport Power Plant Assessment Case

The Town of Huntington received two favorable court decisions in the case regarding the challenge to the assessment on the Northport Power Plant, according to the Town.

The first decision removed LIPA from the case. The second decision granted a stay in the assessment case until the court decides if National Grid should be held by LIPA’s 1997 pledge, which would not challenge the plant’s assessment.

State Supreme Court Justice John C. Bivona issued the decisions earlier this month. The decisions were received by the Town’s special counsel on Friday.

Read more about the Northport Power Plant issue:

• Huntington, Northport Officials Enlist Public’s Help in Fighting Power Plant Reassessment
• Doll: LIPA Challenge a ‘Poker Game’
• Northport School District Outlines LIPA Tax Battle

The first decision dismissed the Long Island Power Authority as a plaintiff.

• The court agreed that LIPA did not have standing to bring the assessment challenge since LIPA does not own the plant. Only National Grid, who owns the plant, can file the challenge.
• More from the Town of Huntington: “LIPA had claimed the standing to bring the challenge because of the three agreements it had to purchase from National Grid the power the plant produced, including reimbursing National Grid for the taxes paid. Justice Bivona said the agreement did not constitute direct payment of the taxes, which would have been an important factor in establishing LIPA’s standing in the case.”
• Bivona ruled: “Payment of the imposed property taxes are directly made to [the Town] as the taxing authority by National Grid, who then recaptures such payment as part of the computed part of the monthly capacity charge. Even viewed in the light most favorable to the petitioner [LIPA], its payment of the real property taxes is a reimbursement, rather than a direct payment to the taxing authority.”

“Removing LIPA from the case will simplify the proceedings by allowing the issues to be addressed by the two parties most directly affected by the issue: National Grid and the Town,” Councilman Mark Cuthbertson said in a statement.

The second decision grants a stay in the assessment case until the court decides if National Grid should be held by LIPA’s 1997 pledge, which would not challenge the plant’s assessment.

• The Appellate Division of State Supreme Court cited a letter and statements from then-LIPA chairman Richard Kessel that were sent to the Town and the Nassau-Suffolk School Boards Association. In the letter, Kessel reportedly said LIPA and LILCO would drop any pending tax certiorari cases and not initiate any further ones at any time in the future. The Town then promised to not increase the assessment on the plant.
• The Town has won all pretrial decisions in that case so far.

Huntington Supervisor Frank P. Petrone said both LIPA and the Town should be required to keep their promises.

“In the long run, resolving that question first should save taxpayers money by potentially obviating the need for a lengthy and expensive trial on the technical question of the assessment,” Petrone said in a statement.

Repower the Northport Plant

he second decision grants a stay in the assessment case until the court decides if National Grid should be held by LIPA’s 1997 pledge, which would not challenge the plant’s assessment. and Cuthbertson feel that a possible resolution to this issue would be to repower the Northport Plant. Both believe that this would meet Long Island’s future energy needs and it would be more cost-effective than building a new plant. Petrone and Cuthbertson have offered not to increase the assessment on the plant to reflect any improvements that are the result of repowering.

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