Letter: Huntington wants fair LIPA deal
We are compelled to respond to Newsday's editorial "Huntington's risky strategy" [July 23], which discusses the offer Huntington has received to settle the Long Island Power Authority's tax challenge over the Northport power plant. Newsday argues that the settlement offer is good and that we are imprudent to question it.
The governor and State Legislature are to be commended for the work they have done to restructure LIPA and bring accountability and reliability to Long Island's power supply infrastructure. Nothing would make us happier than being able to advise our state representatives that a settlement is at hand.
Our problem is calculation of property value. Huntington places the fair market value of the 1,500-megawatt Northport power station at roughly $3.4 billion. The settlement offer LIPA sent us translates to a value of about $1.4 billion. The two are implausibly far apart.
Legal experts retained as part of the town's due diligence have advised us that improvements at Northport over the last 17 years, the location of the plant and its proximity to vital energy infrastructure combine to represent considerably more value than LIPA is admitting. We also take issue with LIPA's refusal to provide us with the detailed information our experts need to make a reasoned estimate of the plant's true value. Withholding information is a poor way to convince us that this is a settlement we should accept.
In addition, Huntington and the Northport School District just won a preliminary round in the courtroom, when State Supreme Court Justice Elizabeth Emerson agreed to hear our countersuit to enforce the terms of the original LIPA-National Grid power supply agreement guaranteeing LIPA's tax payments. A win here would sweep the issue of retroactive tax refunds -- the only real carrot in the settlement offer -- off the table.
LIPA's general counsel has agreed to meet with the town, which is progress. Huntington and its supporters in the affected taxing jurisdictions in Northport-East Northport, Asharoken, and their respective school and library districts remain ready, willing and able to discuss our mutual concerns.
Frank P. Petrone
Editor's note: The writers are the town supervisor and a town councilman, respectively.