The Northport power plant on Long Island could be worth $3.4 billion or $192 million, depending on whom you ask. A lawsuit is trying to determine which number is right, and the decision could impact taxes, property values and power rates for Long Islanders.
The Long Island Power Authority pays $84 million in taxes to Huntington for the Northport plant every year based on the town’s multi-billion dollar valuation. LIPA alleges in a lawsuit that the value of the plant is much lower, which would mean much lower taxes. Ed Smyth, a Huntington council member, said LIPA’s assessment is way too low.
“When I first heard about this, I thought it was almost preposterous. It’s so extreme, that to me it doesn’t make sense, and it’s not a credible appraisal.”
He says the town would owe up to $500 million in refunds if they lose the suit. LIPA has argued against its appraised value every year going back to 2010. LIPA CEO Tom Falcone said while the plant has depreciated in value, taxes have continued to increase.
“It’s actually the most taxed commercial property in the entire country – for a plant that is over 50 years old, and just is not as used as it once was and isn’t as valuable as it was.”
LIPA has offered Huntington a settlement that would forgive hundreds of millions of dollars in tax refunds and ease new, lower taxes in over time. But for some the settlement isn’t really an option.
“If you’re a buyer of a home and you want to buy a home in a district that you know is going to have its school taxes alone increase by 60 percent over the eight or nine years, you’re going to factor that into the offer you make on the house,” said Paul Darrigo, a Northport resident who has been organizing against LIPA.
Darrigo says Northport residents could see property value declines, cuts at their schools and higher tax rates. The case is set to go through April 25.