Schumer seeks FEMA review of LIPA payouts

Sen. Charles Schumer said Monday he will request that the Federal Emergency Management Agency review millions of dollars it reimbursed to the Long Island Power Authority for storm costs last year.

In the wake of reports of excessive and improper billings, Schumer also is demanding that LIPA and National Grid implement strict new rules on spending by outside crews when they work for LIPA during storms. LIPA has acknowledged paying charges including $93-per-person dinners for crews responding to Hurricane Earl last year.

Schumer's demands come amid a state audit of LIPA's financial practices, including the record $223 million it spent on storms last year, and as legislators demand new levels of oversight. FEMA spokesmen didn't have a response to Schumer's request, which he said he would formalize later this week.

"The bottom line is that National Grid sets no limits on what out-of-area crews can charge, and given the tight money situation, and the fact that LIPA has been shown to have loose management and loose controls, they should do this right away," Schumer said in an interview.

National Grid and LIPA are already at work on revising their policy on reimbursing such costs. In a statement, National Grid said it was "working with LIPA to revise our policies to include per diem rates for meals and expenses for off-island crews.

"We appreciate Senator Schumer's interest in this issue and we will respond to his concerns in a timely fashion," National Grid spokeswoman Wendy Ladd said in a statement. She added that the company was working "actively with LIPA on the ongoing audit."

LIPA spokeswoman Vanessa Baird-Streeter said, "LIPA had previously demanded that National Grid perform a comprehensive review of all storm costs submitted to LIPA for 2010. Last week LIPA had directed National Grid to revise policies and procedures relating to storm expenses including industry benchmarking for per diem rates, as well as other pertinent policies and procedures."

LIPA received $50 million in reimbursements from FEMA for storms last year, primarily for a nor'easter last March that led to widespread damage and power outages. While LIPA applied for aid for Hurricane Earl, the storm that largely missed Long Island but cost LIPA $34 million for preparation, the authority did not receive federal reimbursement for that storm's expenses. LIPA has requested that National Grid review all 2010 storm costs, which totaled $223 million -- more than four times the annual norm for LIPA.

LIPA last month disclosed that it is challenging $5.5 million in Earl expenses, and charges for other storms. Among them: dual $698 bills for Signature Bagels and one for $1,390.57 for dinner at Frank's Steakhouse in Jericho, according to LIPA-supplied records.