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Huntington Town, Northport-East Northport schools, utilities agree to mediation on LIPA taxes

A view of the LIPA power plant in

A view of the LIPA power plant in Northport on October 28, 2010. Credit: Newsday /John Paraskevas

The Huntington Town Board voted to join $1,150-per-hour mediation efforts with the Northport-East Northport Union Free School District, Long Island Power Authority and National Grid in litigation over tax assessments on the Northport power plant.

The board also approved sharing the cost of the mediator with the other entities.

The town board voted 4-1 at its meeting Tuesday to enter into a mediation agreement with Port Washington-based Marty F. Scheinman. The resolution authorized Town Supervisor Chad Lupinacci to join with the other entities to split the cost.

“It’s time we get everybody in the room and see what we come up with,” said town board member Gene Cook, who sponsored the resolution. “It’s nonbinding mediation, so if it doesn’t work out, we can proceed further.”

The school board voted July 12 to join the mediation effort and share the cost, according to a resolution from the meeting and a spokesman for the district.

National Grid spokeswoman Wendy Ladd said the company would not comment on the mediation.

LIPA spokesman Sid Nathan said the company will work with the mediator.

“Our goal remains putting an unsustainable situation back on a sustainable path for both the local community and the rest of Long Island customers,” Nathan said.

The school district and town filed a lawsuit in state Supreme Court in Suffolk County in 2011, challenging LIPA’s 2010 attempt to lower the tax assessment on its Northport power plant. The district and town cited a 1998 letter by LIPA’s then-chief Richard Kessel agreeing to never challenge taxes on the power plants. LIPA has questioned whether the letter is enforceable.

The utility is requesting a 90 percent reduction in the Northport plant’s assessed value. In April, Brookhaven Town officials announced they had reached a tentative settlement with LIPA over tax assessments on the Port Jefferson power plant.

LIPA pays the Town of Huntington and the Northport school district about $82.5 million in taxes, making up 38 percent of the school district's annual tax levy. School officials said the reduced assessment would double property taxes for homeowners in the school district.

The case has been in pretrial hearings since June before state Supreme Court Justice Elizabeth Emerson in Suffolk.

On Wednesday, she delayed the trial until Dec. 3 to allow time for mediation efforts, Nathan said.

Huntington Town Board member Mark Cuthbertson abstained from voting on the resolution, saying while he commends and understands the concept of mediation, he did not think Scheinman has the proper experience for the case.

“This particular litigation is specialized litigation involving very complex tax certiorari formulas for assessing a power plant, and as far as I can see, this mediator's experience really is with labor and employment relations," Cuthbertson said during the Tuesday meeting.

Town officials said Scheinman has arbitrated more than 18,000 disputes across the country in various industries. Scheinman also will be paid a one-time $400 administrative fee, plus all out-of-pocket expenses, including transportation costs he incurs in connection with the mediation.

Cook said he hopes all sides can sit down for mediation some time in the next 30 days.

With Mark Harrington

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