February 11, 2011

Legislator Howard Kopel Sparks Debate

on Oversight Following LIPA Billing Fiasco

Nassau County Legislator Howard Kopel let sparks fly after LIPA officials’ recent admission that due to a faulty billing formula, Nassau County’s already cash-strapped residents have been socked with over $230 million in monthly overcharges.

LIPA’s quarter-billion dollar billing error charged customers for services they never received, and went undetected for nearly twenty years. LIPA officials say that most of overcharges occurred in the past few years.

“Taking responsibility for this grievous mistake is the first step to making up for their negligence,” Legislator Kopel exclaimed in a meeting with colleagues. “But LIPA’s grossly inadequate plan to undo two decades of indefensible errors raises questions of how sincere LIPA is about repairing the damage.”

After announcing the error last month, LIPA began a customer compensation program customers consisting of monthly rate cuts of about $2.85 a month for the remainder of 2011. Customers will receive $1.50 a month throughout 2012 and 2013,” equaling repayment of just over half the overcharges.

More of the money will be used to pay down loans, resulting in minute rate reductions due to decreased debt service. The remainder will be used for general operating expenses to offset higher than expected costs due to a particularly nasty winter.

These softball repayment terms are “an affront to millions of Nassau County residents and business owners struggling to pay their bills each month,” says Legislator Kopel. “Something is wrong when LIPA has the freedom to overcharge customers millions of dollars then compensate them for pennies on the dollar.”

“We need to make sure such egregious mistakes never happen again. We can’t allow a utility to arbitrarily snatch $231 million from taxpayers” said Legislator Kopel.

Referring to Nassau County’s crushing tax levy resulting from hundreds of millions of dollars in unfunded union contracts signed during the Democrat’s decade as the Legislative Majority, Legislator Kopel said, “Nassau County’s public sector already treats taxpayers like a bank with the best terms on earth. How much more abuse can Nassau County residents stand? We have to put a stop to it.”