LIPA Commission Approves Final Report to the Legislature Detailing “Public Power” Action Plan  

Allowing LIPA to Run its Electric Grid Without Paying a $78 Million Annual Fee to a Private For-Profit Utility Will Save Ratepayers at Least Half a Billion Dollars Over Ten Years, Improve Efficiency and Accountability, and Increase Local Control and Community Input

Commission Proposes 13-Member Board of Trustees, Including Members Appointed by Governor, State Legislative Leaders, County Executives and NYC Mayor, and Representatives of Labor and a Newly Established 26-Member ‘Community Stakeholder Board’

Proposed Legislation Effectuating Public Power Fully Protects the Wages, Benefits, Retirement Security, Private-Sector Employee Status, and Collective Bargaining Rights of the Hardest Working Electric Grid Operators in the Country – IBEW Local 1049 Members

Plan Preserves Department of Public Service Oversight of LIPA and Empowers NYS Comptroller to Establish Guidelines and Thresholds for Pre-Approval of LIPA’s Contracts

Testimony and Input from Hundreds of Ratepayers, Businesses, Community Leaders, Advocates, Experts, and Local Elected Officials Helped Shape the Commission’s Conclusions Through Nine Public Hearings, Four Advisory Committee Meetings, and Comments Submitted Online

            The New York State Legislative Commission on the Future of the Long Island Power Authority today voted to approve its Final Report for submission to the legislature detailing its action plan for implementing a true public power model for residents of Long Island and the Rockaways, meaning that LIPA would directly provide electric service to the more than three million residents and thousands of businesses in its service area without contracting out that responsibility to a private, for-profit utility.

“I want to thank the dedicated individuals whose tireless efforts and commitment to affordable and efficient utility services have culminated in this final report. The Commission’s findings stand as a testament to the hard work of those who provided testimony, expertise, and input over the last year.” -- Senator Kevin Thomas, Commission Co-Chair

 “The LIPA Commission was created by the New York State Legislature because of the repeated failures of the cumbersome ‘third party manager’ model (the only one in the country) to deliver cost effective and dependable service for its customers. LIPA has among the highest rates and lowest customer satisfaction in the country. The Commission’s report returns to the original vision of public power when LIPA was created by the Legislature in 1986. The report demonstrates the potential to save over $500 million over the next decade while reforming the LIPA Board through the appointment of 5 members by local governments and the creation of a Community Stakeholder Board. Accountability, oversight and transparency will be enhanced while eliminating costly outside management fees. These public benefits can be realized while still protecting the rights and benefits of our respected local workforce.” -- Assemblyman Fred W. Thiele, Jr., Commission Co-Chair

"On behalf of IBEW Local 1049, I thank the Legislative Commission and its staff for the opportunity provided for us to share our perspective on the future of LIPA. Your work gathering diverse input while examining complex issues involving energy, labor, and consumers is appreciated. Sustaining good union jobs while ensuring reliable, affordable service requires continued constructive dialogue and we look forward to a continuation of involvement in these discussions.” -- Pat Guidice, Business Manager for IBEW Local 1049

              Key features of the report and plan include:

• LIPA assumes operational control of its grid from PSEG at the expiration of PSEG’s existing contract, on January 1, 2026;
  • LIPA Saves between $50 million and $80 million annually by eliminating the fee paid to PSEG, allowing LIPA’s board of trustees to lower rates or mitigate future rate increases, upgrade grid infrastructure, invest in climate-friendly green initiatives, or support struggling residents and businesses;
  • LIPA’s existing tax, PILOT, and bond obligations are maintained;
• LIPA will be governed by a 13-member board of trustees serving staggered five-year terms who can be reappointed but cannot be “held over” without reappointment, appointed as follows;
  • 11 members will be appointed by a combination of the governor, state legislative leaders on the recommendation of local state legislators, the county executives of Suffolk and Nassau with the consent of each county’s legislature, and the Mayor of New York City on the recommendation of the Queens borough president, and;
  • 2 members will represent the union workforce and the newly established Community Stakeholder Board;
  • Trustees would be compensated $25,000 per year in order to attract high-quality professionals willing to devote the substantial time necessary to provide true oversight of LIPA’s management, operations, and long-term planning;
• Community engagement will flow through a 26-member Community Stakeholder Board (CSB) appointed by state legislative leaders on the recommendation of local state legislators;
  • CSB members would be compensated $250 per diem for attending CSB meetings, in order to attract the widest array of community involvement;
  • The CSB will be staffed by two employees paid by LIPA to support the CSB’s research, planning, and community engagement efforts;
• Oversight of LIPA is further assured by maintaining the Department of Public Service’s existing regulatory authority and empowering the state comptroller to establish pre-approval guidelines and thresholds for all LIPA contracts;
• Ownership of ServCo LLC, the entity established solely to employ the grid’s workforce, including approximately 1,500 IBEW Local 1049 members, will transfer from PSEG to LIPA;
  • The legislation enshrines in state law the private-sector employee status and collective bargaining rights, governed by the National Labor Relations Board, of IBEW Local 1049 workers, as well as the wages, benefits, and retirement security they have earned and bargained for.

            Pursuant to statute, the eight-member Commission formed a fifteen-member Advisory Committee comprising distinguished leaders from Suffolk, Nassau, and the Rockaways representing diverse interests and views, which held four public meetings. The Commission itself conducted nine public hearings, from Long Island’s East End to the Rockaways, and received testimony from LIPA, PSEG, the Department of Public Service, ratepayers (residential, commercial, and industrial), experts, academics, advocates, other public power entities, and elected officials at all levels of government. The Commission also interviewed officials from LIPA, PSEGLI, the Department of Public Service, and IBEW Local 1049.

              The legislation necessary to effectuate the Commission’s plan is included in the Final Report and will be formally introduced by the Commission’s co-chairs in their respective houses at the start of the legislative session in January 2024, for each chamber’s consideration.

"The Final Report of the Legislative Commission on the Future of the Long Island Power Authority makes it clear that the current LIPA operations could be more effective to ensure that LIPA, which includes Southeast Queens within its service territory, maintains reliable electrical service during storms and quickly repairs service after storms. The current approach is unacceptable. Something needs to change to make sure LIPA customers receive quality service at an efficient cost, that we rapidly transition to renewable energy to protect the environment, that ratepayers' voices are heard, that accountability is improved, and that current unionized employees' benefits are protected. The final report and accompanying legislation are an effective roadmap if the Legislature and the Governor decide that the public power model is the best approach going forward for the benefit of the LIPA ratepayer." -- Senator James Sanders Jr. (Commissioner)

“I am proud to have served on a commission dedicated to shaping the future of Long Island's energy landscape. I want to express my gratitude to our legislative leaders, the commission co-chairs, and the staff for their dedicated efforts. Through strategic modifications to statutory, fiduciary, and financial obligations, we pave the way for LIPA to independently manage its electric grid, avoiding challenges associated with private, investor-owned utilities. I look forward to continuing the process, creating a resilient and cost-effective energy future for Long Island, ultimately leading to savings for the ratepayer." -- Assembly Member Michaelle C. Solages (Commissioner)

“Long Islanders pay some of the highest electric rates in the country. We as elected officials must do all we can to protect ratepayers while at the same time ensuring that our system is storm hardened and help is accessible to customers. This investigative process has allowed us to learn more about the issues we face with the current model and the challenges that lie ahead.  My focus throughout this process has been to formulate a proposal that will lower costs for Long Island families and businesses, ensure reliable service, protect workers, and provide a governing model with local control and accountability. Now, we must continue to work together to achieve these critical goals.” – Senator Anthony Palumbo (Commissioner)

"The people of Far Rockaway and Long Island have spoken. We listened intently as hardworking families, advocates, and stakeholders from across the region all resoundingly said 'NO' to the status quo. As a Far Rockaway resident and Superstorm Sandy survivor, I know firsthand how woefully inadequate and unreliable PSEG/LIPA has been when we needed them most. Ratepayers deserve better than skyrocketing bills for poor-quality service -- and this historic new framework paves the way for a fresh start. With historic community participation, protection of union labor, and stronger statewide oversight keeping greedy companies from monopolizing New York's power grid -- this agreement is a strong step in the right direction. I thank the Commission and everyone who made their voices heard as we continue to ensure that New York's power grid truly works for the working class." -- Assembly Member Khaleel M. Anderson (Commissioner)

“Over the last year we have taken a hard look into potential decisions that could be made to change the way our utility is governed. Unlike past legislative action, this was not done as a knee-jerk response to a big storm, but instead as a proactive exercise. Today is not the end, but the beginning of these important conversations.” -- Assembly Member Doug Smith (Commissioner)

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