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Long IslandColumnistsJoye Brown

Nassau and LIPA tangled in dispute on tax payments yet again

Nassau County Executive Edward Mangano said about $50

Nassau County Executive Edward Mangano said about $50 million in overdue property tax payments from the Long Island Power Authority is headed for Nassau school districts Photo Credit: Jim McIsaac

County Executive Edward Mangano had a message for some Nassau school districts last week: The check — some $50 million in overdue property tax payments from the Long Island Power Authority — is on the way.

The payments went out Friday, he said in an interview.

But Nassau’s transmission of the partial payment LIPA made on its assessment hardly will end a dustup between the authority and municipalities across Long Island who are chafing at LIPA’s decision, as permitted by the 2013 LIPA Reform Act, not to pay any increases above 2 percent annually.

In Nassau, that meant paying about $3.7 million less in payments in lieu of taxes than the county billed, a deficit that, in turn, left holes amounting to tens of thousands of dollars in some school district budgets.

Nassau blames LIPA, saying that the amount LIPA turned over actually amounted to less than 2 percent because the authority underestimated its bill by mixing the lower second-half payment of the 2014-15 school levy with the higher first-half payment of the 2015-16 levy before applying the 2 percent cap.

LIPA, while not commenting specifically on Nassau, cites state statute as justification for lower-than-assessed payments.

Nassau school districts, meanwhile, blame LIPA, while also holding Nassau accountable for making up the shortfall under a county law that mandates that districts be held harmless for errors in the assessment rolls.

But Nassau — stay with me, now — in turn says that LIPA’s lower-than-anticipated payment, not assessment errors, left school districts holding the bag.

It sounds like another round-robin day in Nassau.

But consider this: In May, eight Suffolk towns also had complained about LIPA’s decision to pay increases of no more than 2 percent in payments.

What’s going on? Actually, it’s the latest chapter in a decades-long tug-of-war over assessments between LIPA and other utilities and towns, counties and school districts across the region. For years, LIPA was overassessed.

There’s no debate about it — in fact, officials acknowledge, the authority early pretty much agreed to overpayments to pave the way for the demise of the Shoreham nuclear power plant, and the substitution of a public authority for the hated Long Island Lighting Co.

Since then, LIPA has attempted, sometimes successfully in a series of court challenges — many of which are pending — to lower its payments. So, incidentally, have other utilities.

Fast forward to 2013, and the LIPA Reform Act.

Which, in the fine print, limits any increases in local PILOTs on LIPA-owned land to 2 percent annually.

Nassau, LIPA and county school districts are scheduled for a court hearing on the matter this week.

No matter the outcome in this one case, however, the tug-of-war — with ratepayers and property owners in the middle — could go on for years more.

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