Cuomo to meet with lawmakers on LIPA reform

State legislative staff and Gov. Andrew M. Cuomo's administration are expected to meet in Albany again this week to clarify elements of his proposal to reform LIPA, including finding a way to make certain the restructured utility has more oversight than exists today.

Assemb. Robert Sweeney (D-Lindenhurst) said the major issue to tackle is the bill's "advise and recommend" role for the Public Service Commission over LIPA and its new contractor, PSEG. Other utilities in the state are subject to stiffer penalties and a beefed-up enforcement arm from the PSC, but under the proposed legislation a shrunken LIPA board of trustees will have ultimate authority over PSC recommendations.

Cuomo administration officials have said that changing LIPA bond covenants to allow for full PSC authority over rates and management would result in hundreds of millions of dollars in new costs and lead to double-digit rate increases.

A Cuomo spokesman confirmed a meeting Thursday with Senate and Assembly staff, but declined to comment. It's the most recent of several meetings that aim to hash out a bill before the end of the legislative session.

It's unclear how lawmakers will address the bond covenant issue. Cuomo administration officials note that LIPA rates, management and other elements of its business would still undergo rigorous PSC scrutiny.

"I can't say they're not making some very good points on that," Sweeney said of the reasons LIPA can't be subject to full PSC authority. But, he added, "That doesn't mean there can't be some additional elements of oversight and accountability."

Fred Thiele (I-Sag Harbor), said the sticking points in the bill remain "substantial."

"There's concern about the lack of oversight," he said, adding that he wants more, including keeping the state comptroller's scrutiny of LIPA contracts. Thiele said he'd like to see a more concrete guarantee about the three-year plan to keep rates stable.

Activist groups, while supporting the governor's willingness to reform LIPA, also are giving the proposed bill more scrutiny. Long Island Congregations, Associations and Neighborhoods said while Cuomo's bill represents an "earnest effort" to fix LIPA, issues remain, including oversight.

"There needs to be an agency endowed with the power to enforce compliance, prevent skyrocketing rate increases and exact significant penalties for gross incompetence or malfeasance," the 35,000-member group said in a position paper released last week.

Another major issue for lawmakers is when public hearings or meetings to discuss the bill and give the public a chance to comment on it will be scheduled. The current legislative session ends June 20, leaving just three weeks to schedule and hold the meetings, which the governor's staff has said would happen.