S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7698
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               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:
 
   Section 1. Legislative intent. The legislature finds and declares that
 the Long Island power authority  ("LIPA")  took  over  the  Long  Island
 lighting  company ("LILCO") in 1998. As part of that takeover, represen-
 tatives from both LILCO and LIPA made  repeated  public  representations
 that LIPA would drop all outstanding tax certiorari challenges previous-
 ly  initiated  by  LILCO, and would not challenge the assessments on its
 four "legacy" power plants ("plants") in the future. For over  a  decade
 LIPA  adhered  to  its commitment.   In 2010, however, LIPA brought suit
 against the county of Nassau, the towns of  Brookhaven  and  Huntington,
 and  the  village  of  Port  Jefferson ("the assessing municipalities"),
 alleging that the assessing municipalities have over valued  the  plants
 thereby  seeking  a reduction in their assessed value and a repayment of
 the over-taxes they paid.
   The legislature further finds that according to  LIPA,  if  these  tax
 certiorari  challenges  are  successful  against  the  assessing munici-
 palities, in addition to a significant reduction in the  assessed  value
 of  each  plant  going  forward,  the  "back-taxes" owed to it would be:
 $500,000,000 from  Huntington;  $200,000,000  from  Nassau  County;  and
 $300,000,000  from Brookhaven/Port Jefferson. That refund would be borne
 by all taxpayers across the respective municipality, and  would  be  due
 immediately.  If the assessing municipalities lose at trial, in order to
 refund that exorbitant amount of money would require a massive  increase
 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.
              

                                                            LBD11137-01-9

 A. 7698                             2
 
 tion, the drastic reduction in the value of each plant would immediately
 wipe out a significant amount of school taxes generated by such plant to
 the  school  district  in  which the respective plant is located. In the
 Northport-East  Northport  school  district, if the Northport plant were
 found to be valued at what LIPA alleges its  value  to  be,  the  school
 district would immediately lose one-third of its tax base.
   Therefore, the legislature finds LIPA made a number of promises to the
 Long  Island  community,  federal,  state  and  local elected officials,
 school districts, and taxpayers in the assessing municipalities that  it
 would  not  challenge  its  taxes.  That  promise was relied upon by the
 community and upheld by LIPA for years.  LIPA  broke  that  promise  and
 therefore  the  legislature  finds it necessary to codify in statute the
 promises LIPA agreed to before significant  financial  harm  is  brought
 upon the assessing municipalities.
   § 2. Section 1020-f of the public authorities law is amended by adding
 a new subdivision (a-1) to read as follows:
   (A-1) 1. NOTWITHSTANDING SUBDIVISION (A) OF THIS SECTION, THE AUTHORI-
 TY  SHALL NOT AND IS PROHIBITED FROM BRINGING A TAX CERTIORARI CHALLENGE
 AGAINST ANY MUNICIPALITY IN WHICH ONE OR MORE OF ITS ELECTRIC GENERATING
 FACILITIES ARE LOCATED, UNLESS THE MUNICIPALITY ABUSIVELY INCREASES  THE
 ASSESSMENT ON THE AUTHORITY'S PROPERTY IN WHICH SUCH ELECTRIC GENERATING
 FACILITY IS LOCATED.
   2.  ANY TAX CERTIORARI CHALLENGES THE AUTHORITY, OR ITS PREDECESSOR IN
 INTEREST, INITIATED PRIOR TO OR AFTER THE ENACTMENT OF  THE  CHAPTER  OF
 THE  LAWS  OF  TWO THOUSAND NINETEEN THAT ADDED THIS SUBDIVISION AGAINST
 ANY MUNICIPALITY THAT WAS  NOT  THE  RESULT  OF  AN  ABUSIVE  ASSESSMENT
 INCREASE ARE DEEMED VOID AND NON-JUSTICIABLE.
   §  3.  This act shall take effect immediately; provided, that this act
 shall be deemed to have been in full force and effect on and after Janu-
 ary 1, 2009; provided further, that any memorandum of  understanding  or
 settlement  agreement previously entered into between a municipality and
 the authority as a result of a tax  certiorari  challenge  reducing  the
 assessed  value of one of the authority's electric generating facilities
 shall be deemed void; and provided further, that paragraph 2 of subdivi-
 sion (a-1) of section 1020-f of the  public  authorities  law  added  by
 section  two  of  this  act shall expire and be deemed repealed one year
 after the effective date of this act.