N.Y. Legislative Law § 83-n: Legislative commission on the future of the Long Island Power Authority

* § 83-n. Legislative commission on the future of the Long Island

Power Authority. 1. The legislature hereby finds and declares that

chapter 517 of the laws of 1986 created the Long Island Power Authority

(LIPA). Said authority was created, in part, because the decisions by

LILCO, the private utility that provided electricity to Long Island and

part of Queens, "to commence construction of the Shoreham nuclear power

plant and thereafter to continue such construction were imprudent".

Further, the legislature found in chapter 517 of the laws of 1986 that

"a situation threatening the economy, health and safety exists in the

service area". One of the two express purposes of the act was the

closure of the Shoreham nuclear power plant. In 1992, LIPA bought the

Shoreham nuclear power plant. The plant was fully decommissioned in

1994.

The second purpose of such chapter 517 was to replace LILCO with a

publicly owned power authority. The legislature found that "There is a

lack of confidence that the needs of the residents and of commerce and

industry in the service area for electricity can be supplied in a

reliable, efficient and economic manner by the Long Island lighting

company (hereinafter referred to as "LILCO")" and "Such matters of state

concern best can be dealt with by replacing such investor owned utility

with a publicly owned power authority."

In 1995, LIPA replaced LILCO as the electric company for its service

area. However, LIPA was never established as a true "publicly owned

power authority" as originally envisioned by the State Legislature.

Rather, since 1995, LIPA has opted for a third-party management model

whereby LIPA contracts its responsibility to manage the utility to a

private, investor owned utility company.

LIPA is the only utility in the nation that is operated under a

third-party management model. This model has repeatedly failed its

customers. There has been a lack of transparency, oversight, and

accountability. This failure has been most dramatically evidenced in the

unacceptable storm response by LIPA and its third-party contractors

during Superstorm Sandy in 2012 and Tropical Storm Isaias in 2020.

After more than 25 years of unsatisfactory management under the

third-party management model, a better alternative must be implemented.

That inquiry must begin with the original intent of chapter 517 of the

laws of 1986, whereby LIPA was to directly manage and operate the

utility as a true public power utility. Initial investigations by LIPA

after Tropical Storm Isaias in 2020-2021 indicate that both ratepayer

savings and increased management efficiencies could be achieved through

the public power model.

Consequently, it is the purpose of this section to implement the

original vision for LIPA intended by chapter 517 of the laws of 1986, as

a publicly owned power company. The legislature hereby creates a

commission to provide the legislature with the specific actions,

legislation, and timeline necessary to restructure LIPA into a true

publicly owned power authority. The public must participate in that

process so that the new LIPA becomes transparent with proper oversight

and accountability. The legislative commission shall submit its final

report to the legislature no later than November thirtieth, two thousand

twenty-three.

2. A legislative commission is hereby established to investigate and

report to the legislature on the establishment of a public power model

for the operation of LIPA, whereby the authority would directly operate

the utility as a true public power authority. The commission shall

report to the legislature on the specific actions, legislation, and

timeline necessary to restructure LIPA into a true publicly owned power

authority. The commission shall consider: (a) the method of governance

of the public authority; (b) improved transparency, accountability, and

public involvement; (c) improved reliability of the system; (d) the

impact on electric rates; (e) improved storm response; (f) the powers

required by LIPA to more effectively operate the utility; (g) the

oversight role of the department of public service and the public

service commission over LIPA's operation; (h) the impact on existing

bonded indebtedness; (i) improved long term energy planning; (j)

compliance with the goals of the New York state climate leadership and

community protection act; (k) increased reliance on renewable energy

sources to produce electricity; (l) taxation and payments in lieu of

taxes; (m) the special needs of communities that are or have been

impacted by the siting of power generating facilities; and (n) any other

matter relevant to the establishment of a public power model for the

operation of LIPA. In its report to the legislature, the commission

shall provide for the implementation of the public power model by LIPA

no later than December thirty-first, two thousand twenty-five.

3. The commission shall consist of eight members to be appointed as

follows: three members of the senate shall be appointed by the temporary

president of the senate; three members of the assembly shall be

appointed by the speaker of the assembly; one member of the senate shall

be appointed by the minority leader of the senate; and one member of the

assembly shall be appointed by the minority leader of the assembly. Any

vacancy that occurs in the commission shall be filled in the same manner

in which the original appointment was made. Co-chairs of the commission

shall be designated by the temporary president of the senate and the

speaker of the assembly, respectively. No member, officer, or employee

of the commission shall be disqualified from holding any other public

office or employment, nor shall he or she forfeit any such office or

employment by reason of his or her appointment hereunder,

notwithstanding the provisions of any general, special, or local law,

ordinance, or city charter.

4. The commission shall establish an advisory committee to actively

assist and advise the commission in the preparation of the public power

report required to be prepared pursuant to this section. The committee

shall consist of not more than fifteen members which shall include but

not be limited to representatives of organizations and institutions

representing business, labor, local government, Indian nations and

tribes, economic development, environmental, energy, social justice,

consumer, civic, school districts or higher education interests. The

committee by a majority vote shall elect a chairperson. The commission

shall meet periodically with the advisory committee, make available

working draft and other documents, and shall provide services to the

advisory committee as are necessary and appropriate to carry out its

functions under this section. Members of the advisory committee shall be

residents of the service area.

5. The commission may employ and at pleasure remove such personnel as

it may deem necessary for the performance of the commission's functions

and fix their compensation within the amount appropriated therefor. The

commission may hold public and private hearings and otherwise have all

of the powers of a legislative committee under this chapter. The members

of the commission shall receive no compensation for their services,

except as provided pursuant to section five-a of this chapter, but shall

be allowed their actual and necessary expenses incurred in the

performance of their duties hereunder.

6. Employees of the commission shall be considered to be employees of

the legislature for all purposes.

7. The commission may request and shall receive from any subdivision,

department, board, bureau, commission, office, agency or other

instrumentality of the state or of any political subdivision thereof,

including but not limited to the department of public service and the

public service commission, such facilities, assistance and data as it

deems necessary or desirable for the proper execution of its powers and

duties. The office of the state comptroller may, at its discretion,

provide to the commission such facilities, assistance, and data as may

be requested by the commission.

8. The commission is hereby authorized and empowered to make and sign

any agreements, and to do and perform any acts that may be necessary,

desirable or proper to carry out the purposes and objectives set forth

in this section.

9. The commission shall hold at least one public hearing with a public

comment period in each of the counties comprising the service area of

the Long Island Power Authority on the establishment of public power by

September thirtieth, two thousand twenty-two and before issuing a draft

report.

10. No later than May first, two thousand twenty-three, the commission

shall issue a draft report to the members of the legislature regarding

the establishment of a public power model for the Long Island Power

Authority. The commission shall hold at least one public hearing with a

public comment period in each of the counties comprising the service

area of the Long Island Power Authority on the draft report no later

than October first, two thousand twenty-three and before issuing a final

report.

11. Within thirty days of the issuance of the commission's draft

report, the comptroller shall have the discretion to review the draft

report and issue to the legislature any recommendations relative to the

findings contained in the draft report which relates to the

establishment of a public power model for the Long Island Power

Authority.

12. No later than November thirtieth, two thousand twenty-three, the

commission shall issue a final report to the members of the legislature

regarding the establishment of a public power model for the Long Island

Power Authority. Such report shall provide any legislation required to

implement the public power model.

* NB This section survives the repeal of A5-A