National Grid to credit LIPA for $1.18M

LIPA will receive credits for more than $1 million in National Grid-issued bills from last year's Hurricane Earl, including $52.95 for underwear from Walmart, $2,821.13 for worker meals at Frank's Steakhouse in Jericho, and hundreds of thousands in equipment and contractor costs unrelated to the storm.

After months of review at LIPA's request, National Grid, in a report issued Oct. 14 and recently uploaded to LIPA's website, said it will credit back to LIPA $1.18 million in misallocated, improper or unsubstantiated expenses for the hurricane.

Hurricane Earl, which largely skirted Long Island, cost ratepayers $35 million. Only around 1,400 customers were affected by the storm, for which more than 4,300 workers were activated, including 1,600 contractors from out of state.

The largest credit back to LIPA involved materials costs. The credited amount, $635,803, included items such as worker repair kits, cable and wire, and transformers, which had been deemed "disproportionately high" based on the small number of customers who lost power during Earl.

National Grid spokeswoman Wendy Ladd said, "It took a while for us to get it [the equipment] back from all the staging sites and put it back in inventory."

Another large refund, $423,967, resulted from the review of contractor work. In many cases, the charges were for work that occurred before or after the anticipated storm, such as a $44,776.07 from Asplundh Construction.

Ladd said all contractors performed work for LIPA. "We brought them in anticipation of the storm, and then we didn't want them to sit idle so we gave them work to do," she explained. "National Grid performs a thorough review of all charges billed to LIPA and makes adjustments as appropriate," she added.

Among other refunded expenses:

$3,259.53 for auto parts, bought for "anticipated vehicle failures," which in the end "were not used."

$36,367.37 for sales or "use" taxes that were either unsubstantiated or not LIPA's responsibility.

Two group meals at Frank's Steakhouse in Jericho billed at $2,820, rejected in part due to a retroactively applied per diem meal policy.

$257.27 at Outdoors of Amagansett for boots, pants and a coat, listed as "rain gear," that are "not considered a storm expense."

LIPA spokeswoman Vanessa Baird-Streeter said LIPA has audited National Grid's expenses "and agrees with the credit of $1.19 million. At this time, all remaining disputes with National Grid for these invoices have been closed."

But critics suggested the audit will bear further scrutiny.

"LIPA has an obligation to ensure full accountability for the costs their ratepayers are asked to bear," said Eric Sumberg, a spokesman for state Comptroller Thomas DiNapoli, who is auditing the storm costs. DiNapoli, he said, "continues to have concerns about the lack of regulatory oversight over LIPA's financial operations."

State Sen. Kenneth LaValle (R-Port Jefferson) applauded the audit, saying, "the system worked," but said he wished ratepayers individually were getting a refund.