State Comptroller Thomas DiNapoli’s office has weighed in with “concerns” about a proposed $930 million financing request by LIPA that was held up from approval this week by the Public Authorities Control Board.
DiNapoli, responding to questions Friday after an energy conference at Molloy College’s Sustainability Institute, said his office had “general concerns in terms of some of the disclosures that we felt were lacking” from LIPA before the PACB. There was also concern about LIPA’s rising debt levels.
The Public Authorities board approves bond measures for all state authorities. LIPA described the delay as “routine,” but Assemb. Steven Englebright (D-Setauket), who was briefed on the matter, said it was the first he had heard of the PACB delaying a LIPA financing request.
“They [LIPA staff] didn’t have some basic documents in order to answer some standard questions from the board,” Englebright said. “There was a presentation that left more questions.”
The planned financing includes $400 million in a revolving credit agreement and a $530 million bond offering that the Long Island Power Authority expects to take to market later this year.
LIPA spokesman Sid Nathan said the utility “has responded to each and every request and supplied all requested documents” in a “timely fashion.”
He said the delayed approval “has no impact on the customer or on rates,” and LIPA has “no issue with it.”
But Englebright said LIPA shouldn’t take the control board for granted.
“LIPA should really be on their game when they come and make a presentation and ask for authorization,” he said.
LIPA trustee Matthew Cordaro, an Assembly appointee, called the latest revelations “disturbing.”
“If it’s true, someone dropped the ball somewhere,” he said. “It’s disturbing to hear this, and it definitely warrants a follow-up with LIPA management to determine what actually happened.”
Jennifer Freeman, a DiNapoli spokeswoman, said the comptroller’s staff asked “numerous questions about the LIPA application in an effort to better understand it,” requesting “more specific information on LIPA’s plans for debt issuance and liquidity facilities, projected bond structure and potential use of derivative products.”
DiNapoli emphasized withholding approval of the debt offering was “not our decision.”
He has expressed concern about rising overall debt levels at LIPA, which are hovering around $7.7 billion and will hit $8.2 billion over the next three years. On Friday, DiNapoli said LIPA’s “very high debt burden and the impact on rates” has been an area of scrutiny.
LIPA’s Nathan said the utility was “lowering” debt and “costs to customers over time” while achieving improved outlooks from rating agencies.