Bill Text: NY A07698 | 2019-2020 | General Assembly | Introduced

Bill Title: Prohibits the Long Island power authority from bringing a tax certiorari challenge against a municipality.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Introduced) 2019-05-16 - referred to corporations, authorities and commissions [A07698 Detail]

Download: New_York-2019-A07698-Introduced.html

                STATE OF NEW YORK


                               2019-2020 Regular Sessions

                   IN ASSEMBLY

                                      May 16, 2019

        Introduced  by  M. of A. RAIA -- read once and referred to the Committee
          on Corporations, Authorities and Commissions

        AN ACT to amend the public authorities law, in relation  to  prohibiting
          the  Long  Island power authority from bringing a tax certiorari chal-
          lenge against a municipality; and providing for the repeal of  certain
          provisions upon expiration thereof

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Legislative intent. The legislature finds and declares that
     2  the Long Island power authority  ("LIPA")  took  over  the  Long  Island
     3  lighting  company ("LILCO") in 1998. As part of that takeover, represen-
     4  tatives from both LILCO and LIPA made  repeated  public  representations
     5  that LIPA would drop all outstanding tax certiorari challenges previous-
     6  ly  initiated  by  LILCO, and would not challenge the assessments on its
     7  four "legacy" power plants ("plants") in the future. For over  a  decade
     8  LIPA  adhered  to  its commitment.   In 2010, however, LIPA brought suit
     9  against the county of Nassau, the towns of  Brookhaven  and  Huntington,
    10  and  the  village  of  Port  Jefferson ("the assessing municipalities"),
    11  alleging that the assessing municipalities have over valued  the  plants
    12  thereby  seeking  a reduction in their assessed value and a repayment of
    13  the over-taxes they paid.
    14    The legislature further finds that according to  LIPA,  if  these  tax
    15  certiorari  challenges  are  successful  against  the  assessing munici-
    16  palities, in addition to a significant reduction in the  assessed  value
    17  of  each  plant  going  forward,  the  "back-taxes" owed to it would be:
    18  $500,000,000 from  Huntington;  $200,000,000  from  Nassau  County;  and
    19  $300,000,000  from Brookhaven/Port Jefferson. That refund would be borne
    20  by all taxpayers across the respective municipality, and  would  be  due
    21  immediately.  If the assessing municipalities lose at trial, in order to
    22  refund that exorbitant amount of money would require a massive  increase
    23  in property taxes for residents in the respective municipality. In addi-

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 7698                             2

     1  tion, the drastic reduction in the value of each plant would immediately
     2  wipe out a significant amount of school taxes generated by such plant to
     3  the  school  district  in  which the respective plant is located. In the
     4  Northport-East  Northport  school  district, if the Northport plant were
     5  found to be valued at what LIPA alleges its  value  to  be,  the  school
     6  district would immediately lose one-third of its tax base.
     7    Therefore, the legislature finds LIPA made a number of promises to the
     8  Long  Island  community,  federal,  state  and  local elected officials,
     9  school districts, and taxpayers in the assessing municipalities that  it
    10  would  not  challenge  its  taxes.  That  promise was relied upon by the
    11  community and upheld by LIPA for years.  LIPA  broke  that  promise  and
    12  therefore  the  legislature  finds it necessary to codify in statute the
    13  promises LIPA agreed to before significant  financial  harm  is  brought
    14  upon the assessing municipalities.
    15    § 2. Section 1020-f of the public authorities law is amended by adding
    16  a new subdivision (a-1) to read as follows:
    17    (a-1) 1. Notwithstanding subdivision (a) of this section, the authori-
    18  ty  shall not and is prohibited from bringing a tax certiorari challenge
    19  against any municipality in which one or more of its electric generating
    20  facilities are located, unless the municipality abusively increases  the
    21  assessment on the authority's property in which such electric generating
    22  facility is located.
    23    2.  Any tax certiorari challenges the authority, or its predecessor in
    24  interest, initiated prior to or after the enactment of  the  chapter  of
    25  the  laws  of  two thousand nineteen that added this subdivision against
    26  any municipality that was  not  the  result  of  an  abusive  assessment
    27  increase are deemed void and non-justiciable.
    28    §  3.  This act shall take effect immediately; provided, that this act
    29  shall be deemed to have been in full force and effect on and after Janu-
    30  ary 1, 2009; provided further, that any memorandum of  understanding  or
    31  settlement  agreement previously entered into between a municipality and
    32  the authority as a result of a tax  certiorari  challenge  reducing  the
    33  assessed  value of one of the authority's electric generating facilities
    34  shall be deemed void; and provided further, that paragraph 2 of subdivi-
    35  sion (a-1) of section 1020-f of the  public  authorities  law  added  by
    36  section  two  of  this  act shall expire and be deemed repealed one year
    37  after the effective date of this act.