Town Asks for Extension on LIPA Deal

The Town of Huntington approved a resolution to send a letter to Long Island Power Authority last week, asking for an extension to consider a deal in which, the power authority would drop its tax challenges in exchange for reducing its payments to the district over 10 years. 

The Northport-East Northport School District sent a similar letter, but so far, neither entity has heard back from LIPA on the offer that is set to expire Sunday. 

The real estate taxes on the Northport plant are $74,442,383 for the 2012-13 year. In its tax challenge, LIPA claims that its plant is over-assessed by 90 percent. 

LIPA made an offer in June to drop its challenges on the tax assessments of the Northport power plant, if its payments to the local municipalities were reduced by about 60 percent. The power authority gave the School Board and the Town of Huntington until Oct. 20 to take the deal, however neither has decided if it will move forward with the offer.

In letters to LIPA, the Huntington Town Board and the Northport-East Northport School District, asked the power authority to extend the deadline until mid-January.

If the settlement offer had been accepted, it would reduce the district's annual tax base by $2.9 million, starting in 2015-16 and taxes paid by LIPA would be reduced by more than $4 million every year for 10 years. The total reduction in tax revenue to the school district would be $43.6 million over 10 years.

The main reason for not making a decision on the offer yet, is based upon one main question: Where did LIPA get its numbers? 

“The Town asked LIPA for information, and LIPA has not given an answer. The Town needs to know how LIPA got their 60 percent,” AJ Carter, spokesperson for the Town of Huntington, said.

According to LIPA’s letter offer, if the municipalities do not take the offer by Sunday, the deal is off of the table and both the school district, and town will move forward with its court proceedings, John Gross, from Ingerman Smith LLP, who serves as the district's counsel on the matter, said.