Panel calls for elimination of LIPA - Los Angeles News | FOX 11 LA KTTV

Superstorm Sandy

Panel calls for elimination of LIPA

Posted: Updated:

By MICHAEL GORMLEY | AP

ALBANY, N.Y. (AP) — The powerful commission overseeing the response of New York utilities to Superstorm Sandy recommended eliminating the state's Long Island Power Authority and replacing it with a private company, an idea that was immediately questioned Monday as a threat to create even higher rates.

The Moreland Commission created by Gov. Andrew Cuomo criticized LIPA as unprepared for Superstorm Sandy then inept in its response, leaving many of its 1.1 million customers without power for as long as 21 days.

The commission also recommended the state's utility regulator since 1907, the Public Service Commission, be scrapped or strengthened so that it can mete out penalties that aren't passed onto to ratepayers or even terminate a utility's ability to operate in New York.

"The six utilities operating in New York and LIPA are operating at monopolies in their own exclusive service areas with no chance of losing all or part of their territory because of ineffective, weak or toothless government oversight," said Robert Abrams, the former attorney general who is a leader of the Moreland Commission.

State Financial Services Superintendent Benjamin Lawsky said LIPA's management was "fundamentally dysfunctional." He said a "PSC on steroids" is needed to protect customers.

The commission considered other options for LIPA, including eliminating its contract or transferring operations to the upstate New York Power Authority, but ultimately backed privatization.

That recommendation drew immediate criticism.

"It's very unrealistic," said Matthew Cordaro, a professor and scientist in the energy field and former utility executive who is now co-chairman of the Suffolk Legislature's LIPA Oversight Committee.

He said dropping LIPA for a private company would further drive up some of the nation's highest rates and leave the state holding an estimated $3 billion in debt. A better option would be to convert LIPA from a state authority to a local or county authority with local representatives in control, the most common structure nationally.

"Public power works because it's cheaper," agreed Richard Brodsky, a former Democratic assemblyman whose committee oversaw authorities and is now with the Wagner School at New York University. "It's efficient to use tax-exempt financing." He said LIPA instead should be made more efficient.

LIPA —which has more than 1.1 million customers on Long Island and the Rockaways in Queens — is "reviewing the report and will continue to cooperate with the state and the Moreland Commission to do what is in the best interest of Long Island's ratepayers," said the authority's spokesman, Mark Gross.

Cuomo said LIPA, created in 1985 under the administration of his father, Gov. Mario Cuomo, has outlived its original intent and never "made any sense" as a retailer of energy.

LIPA has often been criticized for slow restoration of power after several storms over three decades. That criticism has only intensified in the wake of Sandy, which followed Tropical Storms Lee and Irene last year.

Cuomo said past governors lacked the "political will" to force change. He denied sharing any blame for LIPA's shortcomings despite not filling the utility's CEO job or vacant board positions.

"LIPA was flawed from inception, there is nothing you can do with the existing structure," Cuomo said.

Cordaro said Cuomo has a role in LIPA's failure.

"He could have paid more attention to LIPA," Cordaro said "Obviously, there were vacancies, the CEO position had been vacant for two years ... that made a bad situation worse. LIPA was a loser from Day One."

The commission said it had no basis from other storms in other states to determine whether utilities could be proven to have acted too slowly to restore power from Sandy.

AP Writer Frank Eltman contributed to this report from Mineola, N.Y.   

  • Long Island NewsLong Island NewsMore>>

  • Hunt for forklift robber

    Hunt for forklift robber

    Wednesday, August 27 2014 9:07 AM EDT2014-08-27 13:07:18 GMT
    Authorities on Long Island are asking for the public's help in finding a forklift thief.  The bright yellow vehicle went missing Monday between 2 p.m. and 5 p.m. from its parking spot near a building in Riverhead. One or more people used a flatbed tow truck with a white cab to remove the Caterpillar forklift. Suffolk County Crime Stoppers is offering a reward of up to $5,000 for information leading to an arrest.
    Authorities on Long Island are asking for the public's help in finding a forklift thief.  The bright yellow vehicle went missing Monday between 2 p.m. and 5 p.m. from its parking spot near a building in Riverhead. One or more people used a flatbed tow truck with a white cab to remove the Caterpillar forklift. Suffolk County Crime Stoppers is offering a reward of up to $5,000 for information leading to an arrest.

  • Teen sentenced for deadly crash

    Teen sentenced for deadly crash

    Tuesday, August 26 2014 2:10 PM EDT2014-08-26 18:10:11 GMT
    A Queens teenager who admitted smoking marijuana and speeding before crashing into a tree in 2012, killing four of his friends on Long Island, was sentenced to 5 to 15 years in prison on Tuesday.  The judge decided against a four-year youthful offender sentence for Joseph Beer, who was 17 at the time of the crash.
    A Queens teenager who admitted smoking marijuana and speeding before crashing into a tree in 2012, killing four of his friends on Long Island, was sentenced to 5 to 15 years in prison on Tuesday.  The judge decided against a four-year youthful offender sentence for Joseph Beer, who was 17 at the time of the crash.
  • 2 charged with stealing used cooking oil

    2 charged with stealing used cooking oil

    Monday, August 25 2014 1:15 PM EDT2014-08-25 17:15:56 GMT
    Police on Long Island say two people are charged with stealing about 650 gallons of used cooking oil from restaurants.
    Police on Long Island say two people are charged with stealing about 650 gallons of used cooking oil from restaurants.
Powered by WorldNow

KTTV FOX 11
1999 S. Bundy Dr.
Los Angeles CA 90025

Main: (310) 584-2000
News Tips? (310) 584-2025

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices