Nassau close to settling LIPA tax challenges, Blakeman says

Nassau County is in the final stages of negotiating an agreement with LIPA to settle property-tax challenges over two National Grid-owned power stations, County Executive Bruce Blakeman confirmed Thursday.

The agreement, if finalized in the next day or two, could bring to a close contentious cases brought by LIPA that sought to reduce taxes on the plant properties by tens of millions of dollars annually. It also would avert Nassau's potential liability to pay hundreds of millions of dollars in past taxes that LIPA says the county and local districts owe for overassessing the plants in Island Park and Glenwood Landing for nearly a decade.

"The structure of the settlement is now with the lawyers and they are going over the [final] language," Blakeman said Thursday afternoon, adding that he expects the ink could be dry within a day or two. He added that he made the decision to settle "based on what I think is in the best interest of Nassau County as a whole."

A LIPA spokeswoman didn't immediately comment, but noted that a trial date for LIPA's tax challenges is set for May 31. LIPA has previously settled tax challenges over National Grid plants in Port Jefferson and Northport.

Blakeman declined to disclose final terms of the agreement or say how it would be different from one the county previously reached in 2019 under former County Executive Laura Curran.

That deal, largely opposed by Island Park residents and the Republican members of the Nassau County Legislature, would have over seven years cut the $43 million that LIPA pays in taxes by roughly half.

Newsday has reported that Island Park residents would pay more than $9,800 in additional taxes over seven years as a result of that prior proposal, which evoked outrage by taxpayers at a public forum.

Blakeman's "global, comprehensive" move to settle the tax dispute comes as the Town of Hempstead this week filed a motion to intervene in the tax dispute in a move town councilman Anthony D'Esposito, of Island Park, said was needed to give the town a "seat at the table" in the case

Part of the town's request, which still must be approved by the court, includes a new affidavit by former LIPA chairman Richard Kessel acknowledging his numerous public and private statements in the 1990s that the authority would not challenge power plant taxes as a condition to win approval for the law that established the new authority’s takeover of the Long Island Lighting Co.

Kessel, the Nassau IDA chairman who also serves as a consultant to NextEra, which has a proposal with National Grid to install energy storage batteries at the Island Park power plant, declined to comment.

Hempstead’s effort to join in the suit is based both on Kessel’s testimony and the assertion that LIPA’s tax challenges rely upon two power supply agreement with National Grid that did not receive approval from Public Authorities Control Board, a state oversight agency. Previous court cases, including by Huntington Town councilman Eugene Cook, have made a similar assertion, but were dismissed for "failure to demonstrate an injury" and for being filed too late.

All such claims have been "uniformly rejected time and time again when presented to the courts," LIPA said in a statement. "LIPA has the right to file tax challenges."

Blakeman said he was "very sympathetic" to Hempstead Town and the Island Park School District and the Village of Island Park in the case. "I understand their position, but I had to look at this based on what I felt was best for the county as a whole."

Hempstead Town, in a statement said it’s seeking to intervene to "protect town residents from significant tax increases" that would result from settling the suit.

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.