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HomeMy WebLinkAboutTB-06/16/1998-S JmE 1F,. 1998 359 SOUTHOLD TOWN BOARD JUNE 16, 1998 A Special Meeting of the Southold Town Board was held on June 16, 1998, at the Southold Town Hall, Main Road, Southold, New York. Supervisor Cochran opened the meeting at 1 :00 P.M. Present: Supervisor Jean W. Cochran Councilwoman Alice J. Hussie Councilman William D. Moore Councilman John M. Romanelli Councilman Brian G. Murphy Town Clerk Elizabeth A. Neville . Town Attorney Gregory F. Yakaboski Absent: Justice Louisa P. Evans SUPERVISOR COCHRAN: I would like to call to order the Special Town Board meeting of the Southold Town Board being held at 1 :00 P.M., Tuesday, June 16, 1998, at the Meeting Hall at the Southold Town Hall, Southold, New York. I would like to read the Waiver of Notice of the Town Board. We, the undersigned, being members of the Town Board. of the Town of Southold, Suffolk County, New York do hereby severally waive notice of time, place and purpose of the meeting of the Town Board to be held at 1 :00 P.M. at the Southold Town Hall, 53095 Main Road, Southold, New York, on Tuesday, June 16, 1998 do hereby consent that the same shall be held on said date for the transaction of any business which may properly come before said meeting. Dated, June 16, 1998. Signed by Members of the Town Board. The reason A requested a Special Meeting was, as you are aware at the last Town Board we discussed intervening in a lawsuit in relation to LIPA. Greg had instructions to begin to gather as much information, and documents, and documentation as possible, so that the Town Board could go in a direction. Upon talking to Mr. Like, Attorney Like, the Judge has set July 2nd as the deadline for intervening. Greg has spent the last three days, and then some, communicating with everyone we could humanly possibly communicate with to get information on this issue. I am going to ask Greg to fill you in on the strategies that the Town Board has options, there are options, and strategy that we can take. So, I am going to be asking Greg to fill you in on this. We will be going into Executive Session. It is strategy in relation to litigation. At the end of the discussion we will come out of Executive Session, and we will take the action that the Board decides to take. So, at this point I need a resolution to go into Executive Session for the purpose of strategy and litigation. It is at the direction of the Town Attorney. TOWN ATTORNEY YAKABOSKI: It is proposed litigation. It does fall under on the subject matters, which is permitted to go into Executive Session. All I would be talking about is . proposed litigation, also reveals any possible litigation strategy. It is up to the Town Board. COUNCILWOMAN HUSSIE: We discussed this last week, and we were not in Executive. Session. I can't imagine that we have strategies involved. 360 JUNE 16, 1998 TOWN ATTORNEY YAKABOSKI: We would be recommending strategies. There are different ways of possibly handling this, and it would be put forth to the Town Board, and the Town Board has the right to hear it in Executive Session as proposed litigation under one the subject matters, which is permitted under the Open Meetings Law. It is up to the Board itself. It clearly, in my opinion, falls under that subject area, which is proposed litigation. Just so the Board realizes that this is a option for the Board. This is an option for the Board to go into Executive Session. It does give that right under the Open Meetings Law. It is simply a recommendation. SUPERVISOR COCHRAN: Since the Board does not seem anxious to take the recommendation of the Town Attorney, we will continue. COUNCILWOMAN HUSSIE: You have been doing this for two or three days. Do you have any papers that we can read? SUPERVISOR COCHRAN: That is the problem. There is nothing. TOWN ATTORNEY YAKABOSKI: If I could just take a step back on it. There has been an allegation reviewed of what Irving Like faxed over as his complaint. In addition there was an exhibit, which I am now going to pass out. There was an exhibit that was supposed to be attached to that complaint that came over. When I spoke to Irving Like I focussed on the fact of, how is the Town itself, or the citizens of the town, be injured? What is the injury? What they are complaining about, what their action was? He referenced this exhibit. I said, we have never seen this exhibit. He faxed it over. COUNCILWOMAN HUSSIE: This has been in the paper. COUNCILMAN MOORE: We are saying the litigation papers that we had last Tuesday. TOWN ATTORNEY YAKABOSKI: I had no idea that this existed. SUPERVISOR COCHRAN: It came in, and we understand it was supposed to have been attached. It wasn't. TOWN ATTORNEY YAKABOSKI : In summing it all up, everything that I have looked at, is that the issue is, is the Town, the Town is a ratepayer, the Town according to the Town Comptroller pays approximately $100,000 a year in electric rates. It was a ratepayer of LILCO. Now, it is going to be a ratepayer of LIPA. The Town has not yet received an electric bill from LIPA. The issue ' is that, is the Town as a ratepayer, and the citizens of the Town, ' are they being charged via the rate structure, or incorporated within the rate structure for monies that they don't owe. What the Kulka lawsuit focuses on is it is not attacking LIPA, the overall LIPA deal. What it is focussing on is one particular aspect, and that is the Shoreham tax certiorari judgement. That Shoreham judgement was for over a billion dollars. - I haven't seen it myself. That is what I am told. The question is, is that enforceable? What we are being told, I don't think in reading the LIPA Enabling Statute that LIPA has the right to enforce or collect that judgement. So, if you take this handout I just gave you, you could put another column here. What this handout assumes, this breakdown, it assumes that that judgement is enforceable, is correctable, and it give two possible methods of collection. The first possible method is under the Suffolk County Tax Act, which' is how tax certiorari judgements are paid, and what it shows is that each of the ten towns in the County of Suffolk would owe, if this Shoreham judgement was paid, the Suffolk County Tax Act. COUNCILMAN MOORE: I just have one quick question as to the full 1 .2 billion dollar judgement, obviously because the number is there, unless this Includes interest. TOWN ATTORNEY YAKABOSKI: I don't know the answer. I am guessing that that is what it is. I didn't total the numbers. JUKE-16, 1998 361 COUNCILMAN MOORE: One by itself is not $115,000,000. That is more than half. I just don't know where the interest fits into this thing. TOWN ATTORNEY YAKABOSKI: I am talking about the billion dollars at the moment. I will get to that settlement number. So that first column that is on the page deals with what it would cost on the Suffolk .County Tax Act in the Town of Southold. The second column deals with what it would cost to the Town of Southold, again that is the Town itself, and all the ratepayers in the Town, under this proposed LIPA deal. There actually should be a third column, in my opinion, right before everything else, which is what it would cost if it is not enforceable, which is zero, to everybody. That is not there, so you have to first start that first hurdle, that you read the LIPA statute it seems clear to me. I have to put a caveat on that. It happens in court cases. I have not in a short time period have a chance to read, to review and read, to see what is happening. It is simply reading the language of the statute itself, the first hurdle should be zero. The second Suffolk Tax Act, the third the LIPA deal. Allegedly what is happening is LIPA is acting as if this judgement is enforceable. What they are then doing, or then set up, is incorporate within the rate structure is a surcharge. They are collecting from all the citizens in the County of Suffolk. .l am going profess this up, because I am saying, I don't have any documents in my. hand to prove how the rate structure is set up, and how they are treating it. This is all what the allegations are. That is last time I am going to preface everything am saying. I am a little skeptical. I like to have black and white in my hands before we put things down. Anyway, the allegation is that currently with the rate between Suffolk and Nassau the reason it is higher in Suffolk is there is less of a rate break in Suffolk,; is what they are doing inside the rate structure they have a separate surcharge. All of us here, anyone in the room, any ratepayer in the County of Suffolk, will pull a couple of dollars from everybody to create a revenue stream to pay themselves this judgement. Then I am hearing .what they are going to do is, the ratepayers in the service areas, not in Suffolk, which is Nassau, and the Rockaways, one they are considering giving them actual rebate checks, and . in addition they are going to give to everybody credits on future electric bills. What LILCO would have done is LILCO would have taken this refund and funnel it back, they are supposed to funnel it back to it's ratepayers, because they are ones that pay taxes in the first place, so to get a tax refund, then you funnel it back to your ratepayers. That is what LIPA allegedly is doing. There is a. couple of problems with that. One I don't think they can do it, that judgement is enforceable, so then the rates are too high. Second, if they follow the LIPA deal they are treating everybody in Suffolk County equally. Well, everybody in Suffolk County didn'.t benefit from the overassessment. If you are going to funnel it back to your rate structure, use your rate structure to recoup money, it almost should be in a sense a four tier rate structure. The ratepayers in the Town of Brookhaven, which benefited the most, would be the highest rates. The ratepayers outside of Brookhaven, but within the County of Suffolk, excuse me, in the west end towns would be the second highest rates. That is because they benefit from the police district, which encompasses the west end, and the five east end towns do not benefit from the police district. Third, the east end towns, because the east end towns, and the citizens out 'here benefited somewhat from the overassessment, but not as much as the first tiers, and lastly it would Nassau and the Rockaways because they did not benefit at all from the overassessment. Again, that is apparently not what is happening. So, in short it comes down to the question, are we all being over-billed via the rate structure? Are we paying money we don't owe? Is somebody collecting those kind of figures from us for money we don't owe? COUNCILMAN ROMANELLI: That is in essence the purpose of the lawsuit. TOWN ATTORNEY YAKABOSKI: I am focussing on one issue. Their lawsuit encompasses some other issues. They focus on, there was a RECO settlement that LILCO lost. They were supposed to funnel that money back to the ratepayers. COUNCILMAN ROMANELLI: They are going after that, too. TOWN ATTORNEY YAKABOSKI: That allegeable was never funneled back. Does anybody have any question on that so far? 362 JUNE 16, 19998 COUNCILMAN MOORE: Do we know from the rate structure of LIPA is going after the reduced, the settlement amount, or the full. . TOWN ATTORNEY YAKABOSKI: There has been another allegation in Irving Like's papers, that there is a proposed settlement between LIPA and the tax and jurisdictions, who would settle. That would be the County of Suffolk, the- Town of Brookhaven, school district, and fire district, and I thing, the library district in Brookhaven, the Shoreham-Wading River Library. District. That would reduce the judgement from a billion down to $625,000,000, and . that is what LIPA would then collect. If I could just back up again, just to give an overall fact on something, which is that normally tax certiorari judgement, what happens is the County, if somebody collects, let's say that Brookhaven overassessed and the LILCO won a $100,000 cash to get it back, the overassessment, in the Suffolk County Tax Act Suffolk County would pay the $100,000 right over to LILCO, and let's say that tax bill, you know how there is three portions on the tax bill, there is County, the Town, school districts, the County would then charge back to the town, in this case Brookhaven, their portion plus the school's portion of the tax bill. Let's for example say the County's portion of that bills was 20%, and the Town's was 80%, so for $100,000 the County would be responsible for $20,000, and what they would do is they would spread that amongst the people they tax, which is all ten towns. They would absorb that cost in the new tax bills. The Town of Brookhaven would receive a charge back to them of $80,000, and they would handle that. So that is just a normal background of how a tax certiorari judgement would normally go. What is happening right now with the lawsuits, and one of things was the Town Board was asked to intervene, or consider intervening in Irving Like's lawsuit. One of the other things about that lawsuit was. .is you recall how I said the County created a revenue stream with this rate structure to fund itself to repay itself assuming LIPA is doing this, then they give these rebate checks. Well, to speed up the process, I guess, what they doing is they are actually selling bonds. So far I am told $143,000,000 and 'up to $500,000,000 over the term of five years. So, they are selling bonds, and I am guessing based on this projected revenue stream that is coming in, so that they have it all at once, and now they can give out these rebate checks. . I don't have all the papers. I would feel much more comfortable speaking about all of this. This is all allegations. I don't have any facts. I don't have any documents in my hands that say all this, but this is what it is starting to look like. If it all pans out: What I am being told if it all pans out this is roughly what is happening. We have been asked to see if we wanted to intervene in this motion. One of the reasons the Supervisor called a special meeting is, I talked to Irving Like on Friday the day after he had been in conference with the Judge, and he said, look, there is a short time period. Riverhead has made a motion to intervene, and I guess the Judge called from Chambers, and said, we are speeding up all your return dates, . 'because he' wants some closure by July 2nd. Another option that is available to the town is the town does not have to intervene in this particular lawsuit, but could commence it's own lawsuit, either individually as a ratepayer, or with effected ratepayers within Suffolk County, such as the other towns perhaps, aside from Brookhaven. COUNCILWOMAN HUSSIE: One does not necessarily preclude the other. TOWN ATTORNEY YAKABOSKI: The way I am looking at it right now, no. I also have a question procedurally, when you intervene in an action you have to submit a proposed complaint. Generally you have to have common questions of law or fact. The Town of Southold when it intervenes I believe has additional causes of action other than the ones that are listed in the COCA lawsuit. - For one the Town is a ratepayer. If the Town is paying too much in rates, money that it owes, the Town is being hurt, but in addition the citizens of the Town of Southold, they are also rate payers, they are paying too much, plus the way the Town pays it's electric bill At it charges taxes to everybody. So, now, this is being hit with almost a double whammy. You are overpaying, paying too much in your bill, if it all turns out to be true, plus they are paying too much on the Town's bill. In addition the beneficiary of all this, Brookhaven received, I believe the numbers are 760 of the benefit of this overassessment. Now, if you live in the Town of Brookhaven you receive a lot of benefit. If you lived in the Town of Brookhaven, plus the school district, you receive more. Then if you lived in the school district plus the fire district, and the library J U E .161 1998 363 district, your benefit goes higher, and higher. If it is found out that these allegations are true, and the town, not just this town, but the other towns, the other citizens, are paying money which they don't really owe, but what is properly charged to Brookhaven, that could be made that that is a gift to Brookhaven, and the. Town under the constitution can not give gifts. Again, we have not yet received a LIPA bill. I have had phone calls out to LIPA. I. have not yet received any return phone calls to ask somebody, hey, is this how your rate structure is set up? It is an easy way if they just tell me. We have not been told that yet. In the Coca lawsuit back on May 28th there was a stipulation entered into. What it said was that the attorney for LIPA said, statements for utility services will be sent on the regular billing schedule. One of the things that Coca and LIPA were stopped was, one, they wanted this rate, if it turns out to be wrong, not to initiated, don't start that billing then. In addition what they want to have happen -was to have LIPA not sell those bonds that I was talking about. Once they sell the bonds they have incurred a cost, which even if they give the bonds back there are costs and fees. involved, and they are going to have to pay that back to the bondholders, and the cost is going to float to the ratepayers, which again drives up the rates. The whole goal being, LIPA's whole purpose is to lower the electric rates in the service area that LILCO used to service, again, Suffolk County, Nassau County, and the Rockaways. So, again, they were trying to stop. that. That is a little background, and what they said here is that the attorney for LIPA said, statements for utility services will be sent under the regular billing schedule. Allegeable they told the Court that they couldn't change the billing schedule on such short notice, it was already in the computers. Such estimate may reflect a rate schedule, so they hedged. Then you got the court that validates a portion of the rate schedule. The Long Island Power Authority. will provide prompt credits to . it's customers to reflect the court's decision. No rebate checks will be issued prior to August 15, 1998. Any funds appropriated for such purposes will be prudently invested prior to the distribution of said funds. I believe what they were referring to there was these bonds I was just talking about. Then they simply set up a schedule. COUNCILMAN ROMANELLI: Your opinion is, join this lawsuit. SUPERVISOR COCHRAN: A combination. We have drafted a resolution, the reasons why, and the resolved, and I would like to see us go to different options. . Greg is still investigating. He is trying to get more information. I am calling together the five east end town Supervisors, and their attorneys, so that we can share information, but the way the resolved reads is, resolved the Town Board authorizes Southold Town Attorney on behalf of the Town of Southold to take any and all actions to investigate and correct LIPA's improper rate schedule, including but not limited to either, commence, either individually or jointly with other effected ratepayers, which could be the other towns, of the Long Island Power Authority, a legal proceeding against the Long Island Power Authority or moved to intervene as a party plaintiff in the lawsuit currently pending in Supreme Court entitled, "The Initiative for Competitive Energy E Jack Kukla against the Long Island Power Authority". So it would give Greg options for the best way to go on behalf of the town. COUNCILWOMAN HUSSIE: I don't think he should be given that. We ought to make that decision. That is not something for you to decide. TOWN ATTORNEY YAKABOSKI: Again, it is simply a recommendation. COUNCILWOMAN HUSSIE: I understand that but you can't intervene for us without us saying, this is what we want you.to do. COUNCILMAN HUSSIE: Is the deadline still tomorrow? TOWN ATTORNEY YAKABOSKI: There is no deadline, but the Judge wants everything closed by July 7th. He said, if you are going to hop in, hop in quick, otherwise you might be shut out. COUNCILWOMAN HUSSIE: The only thing that kept this thing alive was the fact that Riverhead had joined the lawsuit, because the Judge had said that the other people had no standing, therefore forget it. 364 JUNE 16, 1998 SUPERVISOR COCHRAN: They had to have a municipality, so Riverhead went ahead knowing everything that is going on, all the facts. COUNCILWOMAN HUSSIE: 1 heard immediately after last Thursday's hearing. TOWN ATTORNEY YAKABOSKI: I talked to Irving Like a couple of times on it. COUNCILMAN ROMANELLI: The lawsuit seems like it has logic and thought behind what they are going after, and the rate structure, which has been an issue since the LILCO/LIPA deal started to be put together the way Brookhaven was being taxed, and the other towns weren't being taxed. It has been an issue since this whole process started, and that is what they are going after. You mentioned the REGO settlement. They are going to go after that, too. Sure, they are going to go after every little bit of penny that they can get back, is what they are going to go after. So, don't see a reason for not joining in on this lawsuit is where I am coming from. I don't see a harmful side of it, and if there is, point it out, but if some reason the Judge throws it out, or for some reason they don't find a good argument what did we lose? COUNCILMAN MURPHY: We still have the options, I am assuming, that we can take other actions. SUPERVISOR COCHRAN: We could continue to look at options, and then call another Special Meeting to determine when there is some more information, but everything is on hearsay right now. We have nothing, like Greg says, black and white in our hands. So, if you want to take that chance and go ahead. I have no problem with it. We have a responsibility. COUNCILMAN ROMANELLI: To assume, and then to get a bill and find out that that they changed the rate structure, and we are wrong. COUNCILWOMAN HUSSIE: The big thing is this tax certiorari thing. It was put this way so Brookhaven wouldn't go bankrupt. COUNCILMAN ROMANELLI : It is one of' the only issues that you can fight on, right? SUPERVISOR COCHRAN: They would go bankrupt. TOWN ATTORNEY YAKABOSKI: Can I first address one thing that Brian. brought up a second ago that if we joined this lawsuit, and then can we commence a different one? If we join this lawsuit, this is a quick time frame going on right now. If you join this lawsuit right now you are in the motion. First of all, it is not guaranteed that you can join the lawsuit. You have to make a motion to intervene. If the motion to intervene is granted, and the Court rules unfavorable, you are in, and you are arguing on the rate structure, that's a ruling, you are done.. You can appeal, but you can't then commence a separate action. That is your format. That is your arena for making your argument. Actually even a different argument. If you are focussing your issue attacking the rate structure you have to bring all your arguments with you. If you want to chose as a part of strategy to leave a few behind, because you 'think the ones you are bringing up are stronger. You don't want weaken_ to the case with some that don't sound as good, you can do that, but you can't bring three here, and two over here. That is your format. You are in a quick format on it. Again, I do have a concern. COUNCILWOMAN HUSSIE: It would seem to me that the best thing for us to do is to intervene, or make a motion to intervene in this one, which is not going to ,cost us anything, and then, also, have you look into the possibility of . us going in with other towns. There is no way that Southold is going to have pockets deep enough to fight LIPA. They have got seven and a half billion dollars. We have how much? SUPERVISOR COCHRAN: We don't have seven and half billion, that's for sure. You have to be realistic. J U N 16, 19.98 365 COUNCILWOMAN HUSSIE: Irving Like, who is the attorney here, knows this LIPA bill in and out. He practically wrote it before the amendments. TOWN ATTORNEY YAKABOSKI: Yes, he seems very knowledgeable. He seems extremely knowledgeable, and a very intelligent individual , in speaking about all these things. I "agree. I do want to question the Board about the thought process of joining one suit, and simply commencing others. COUNCILWOMAN HUSSIE: I don't know if we can even afford to commence another one. COUNCILMAN ROMANELLI: One step at a time. COUNCILMAN MOORE: To me, I am just curious, I am not saying how to go at the moment, but if we don't have a litigation budget to fight this thing, he made the comment that, well, if you want to help me pay my fee; think Mr. Kulka threw in some money to get him started, yet there are some-experts he needs to hire, who are going to ride coattails on that. You are going to get that fee, whether we do it in share capacity with one individual, and some. . Think about it. There is an expense involved even in intervening if we are asked to share expert fees, if somehow an expert has to analyze it. His argument, as I understand it, is first statutory. You have no legal right to commence the collection of the judgement. TOWN ATTORNEY YAKABOSKI: It is an unenforceable judgement. COUNCILMAN MOORE: So if the Judge will rule upon that, you don't need any experts. That is a statutory argument. TOWN ATTORNEY YAKABOSKI: They are black and white issues in the matter. COUNCILMAN ROMANELLI: That is step one, too. You take that, and then go after the collection of money. TOWN ATTORNEY YAKABOSKI: The Judge controls. COUNCILMAN ROMANELLI: You need that judgement .before you can go further. ' COUNCILMAN MOORE: It is a non-issue if they don't. . COUNCILMAN ROMANELLI: If they turn it done, then it's over. If they go for it, then you have that argument to take to the next step. Without this argument you can't go anywhere. TOWN ATTORNEY YAKABOSKI: One of the other issues, which if it turns out to true, that even if LIPA gives credits back, they collect them today, and they want to do credits in sixty to ninety days. In essence it is a free loan. Everybody should kick in a free loan to LIPA. They took $10.00 on day one. They give you $10.00 back on day ninety. It's a free loan. My ten bucks is not much, but people can start seeing you add ten bucks it can add up. I would pursue it both in a legal manner, legal that you are commencing a legal action, also, perhaps not commencing an action, but trying to seek some help from other places, legislative. We have County and State Legislatures, and the Governor to seek some help from. SUPERVISOR COCHRAN: And the Attorney General. TOWN ATTORNEY YAKABOSKI: If this occurs, this situation, which I don't think anybody envisions, because it is against what LIPA is supposed to be about, which is lowering the electric rates in the service area. COUNCILWOMAN HUSSIE: The reason that their rates are only twenty percent lower is that they had all of this stuff in there. I have been following this since March of '97. All of this is in their rates. That is why it is only down twenty percent. . 3 6 6 JUNE 16, 1998 TOWN ATTORNEY YAKABOSKI: Again, further hesitancy on my part on commencing it immediately, actually intervening, is while I do believe Mr. Like is extremely knowledgeable. I do hear from other people, people are confused exactly what happened whether or not these bonds got sold, what exactly happened. There are some other thoughts out there from different people, whether or not they are just not up to date on things, or they know something we don't know. That's out- there. I have to let everybody know that. I have heard conflicting reports whether or not the bonds were even issued or not. Pretty much people are on board with that the rate structure does include some type of, something to create a revenue stream, can't think of the right word, for the Shoreham judgement. So, whether or not the bonds have been sold or not I am not sure, and I am cautious by nature in that I do like to have before somebody signs an affidavit here from the Town Board. If possible something that says, hey, this is what happened. COUNCILWOMAN HUSSIE: One of the problems is we will 'never find out, and I have to account an incident that happened last Friday, I think it was. I went ,to a meeting, and asked Richard Kessel about exit fees, and he said at that time, well, they haven't figured them out yet. I asked them distinctly if there were any. He said he didn't figure them out yet, and then because there was some papers that I had that said something else I heard him about the cost of transmission and distribution, the wheeling of electricity to us, and I said, . if somebody does establish an electric company, how will that. effect your rates? He said, it wouldn't effect the rates, because they would put the additional money on the transmission and distribution fees, the wheeling charge. I said to him, that the Energy Act of 1992 did not allow that to happen, that you could not charge anybody using your line anymore than you charge yourself. He said, oh, no, that is not true. Later his attorney came up to me, and said, that I was right. That perhaps he had misunderstood. TOWN ATTORNEY YAKABOSKI:. Stan Clifford? COUNCILWOMAN HUSSIE: No. Nelson I think the name was, Ron Nelson. The thing is, I am not sure if you are getting your information from Mr. Kessel, that he really has everything down pat. TOWN ATTORNEY YAKABOSKI: I haven't received anything yet, but if somebody from LIPA did make a statement when I called and asked about the rates, and did say, yes, it does include. That is a lot to go on. If you have the company, or the authority, which is sending it's bills stating, yes, the reason for the rate is because of the Shoreham judgement. I would love to have that right here in hand, somebody saying that. COUNCILMAN ROMANELLI: They want that to be hard to find. TOWN ATTORNEY YAKABOSKI: It probably was said somewhere already, but we only have a. couple of days to try to put it all together, it is one of those things, most times with legal actions it takes some time to investigate and gather your facts. We have got a lot of facts. We got a lot of information already, but I would feel more comfortable with some statements from LIPA, or some black and white documents. COUNCILMAN MURPHY: These rates are not included in the rates that they filed now. Then the suit is really mute, right? TOWN ATTORNEY YAKABOSKI : Correct. There is no cause of action, based strictly on the rates. COUNCILMAN MURPHY: If it is in there, then there is cause for action. So, no matter what we do it is a whole month. COUNCILWOMAN HUSSIE: There is also cause for action for us not having to pay as much as we are supposedly paying. COUNCILMAN ROMANELLI: So, the .motion is to intervene or to intervene? SUPERVISOR COCHRAN: It is up to you people. TOWN ATTORNEY YAKABOSKI: It is up to you whether or not. JUNE 16, 1998 367 SUPERVISOR COCHRAN: Do you want to go in the direction of intervening only, or would you like to leave it open ended? TOWN ATTORNEY YAKABOSKI: The legal proceeding the option is to make a motion to intervene. Again, if that one was decided you could not intervene, then you could commence your own legal action. If you do get in, the Judge doesn't grant that motion, then you are in. That is your arena to fight position. You most likely are not going to have an opportunity after that once the Judge makes his decision except for an appeal, because that becomes unfavorable to use another format, to seek another arena, you know a different legal action. COUNCILWOMAN HUSSIE: I go back to say, I think that we should make the move to make the motion to intervene, and at the same time I think a motion should say that you should pursue. to the best of your time restraints, what we could do in addition if anything, and also how the other towns feel about this, because I don't think we can do it alone. SUPERVISOR COCHRAN: That is why I am calling together the East End Supervisors. COUNCILWOMAN HUSSIE: When are they meeting, Jean? SUPERVISOR COCHRAN: We have a meeting in the next week or so, but I can call them together sooner than that. We would make the calls tomorrow. I wanted to wait until after this, or even today, with the attorneys, and I have spoken with Vinny from Riverhead. Greg has spoken with Vinc, and he would like to see a meeting called. In a sense it affects all of the ten towns. We did send information to Petrone, and I let him know that we will be looking at it as the east end towns, and he should look at it as the west end towns, or bring everyone together. We do have a ten town supervisors meeting coming up .very shortly within the next few weeks also. But it is a priority as far as we are concerned. TOWN ATTORNEY YAKABOSKI: Going back to one of the issues which Bill raised, which is this potential summit, which has been voiced I don't know how. .l don't know at what stage that, if it is just somebody's idea, or what stage it might be at. I don't believe the County has signed off on any such settlement to date. I don't think it is even pending before the County.. I think the Supervisor also already forwarded something to the County Executive to see what is happening. COUNCILWOMAN HUSSIE: Are we interested in the County, a particular, bill with the County, business or for all of us in the County, because you know they have reactivated, they have their own electric company, and they have reactivated that now, so they are going to be buying their electric for their own facilities. TOWN ATTORNEY YAKABOSKI: It is also gone to 'mini-turbines. With the short time frame, I didn't realize this was out there until Friday. When you look at something like this, it is a very serious concern. It is a very serious concern, that if this is what is happening, again, with the motion to intervene. 1 .- Moved by Councilwoman Hussie, seconded by Councilman Romanelli, it was RESOLVED that the Town Board of the Town of Southold hereby authorizes and directs the Southold Town Attorney, on behalf of the Town of Southold to move to intervene as a party plaintiff in the lawsuit currently pending in Supreme Court entitled "The Initiative for Competitive Energy & Jack Kulka against The Long Island Power Authority" Index Number 98-12125, and to take further action as is necessary to investigate and correct the Long Island Power Authority's improper rate structure. COUNCILMAN MOORE: Is it any better having individual ratepayers in the Town of Southold added? 368 JUNE 16, 1998 SUPERVISOR COCHRAN: Do you want to go in the direction of intervening only, or would you like to leave it open ended? TOWN ATTORNEY YAKABOSKI: The legal proceeding the option is to make a motion to intervene. Again, if that one was decided you could not intervene, then you could commence your own legal action. If you do get in, the Judge doesn't grant that motion, then you are in. That is your arena to fight position. You most likely are not going to have an opportunity after that once the Judge makes his decision except for an appeal, because that becomes unfavorable to use another format, to seek another arena, you know a different legal action. COUNCILWOMAN HUSSIE: I go back to say, I think that we should make the move to make the motion to intervene, and at the same time I think a motion should say that you should pursue to the best of your time restraints, what we could do in addition if anything, and also how the other towns feel about this, because I don't think we can do it alone. SUPERVISOR COCHRAN: That is why I am calling together the East End Supervisors. COUNCILWOMAN HUSSIE: When are they meeting, Jean? SUPERVISOR COCHRAN: We have a meeting in the next week or so, but I can call them together sooner than that. We would make the calls tomorrow. I wanted to wait until after this, or even today, with the attorneys, and I have spoken with Vinny from Riverhead. Greg has spoken with Vinc, and he would like to see a meeting called. In a sense it affects all of the ten towns. We did send information to Petrone, and I let him know that we will be looking at it as the east end towns, and he should look at it as the west end towns, or bring everyone together. We do have 'a ten town supervisors meeting coming up very shortly within the next few weeks also. But it is a priority as far as we are concerned. TOWN. ATTORNEY YAKABOSKI: Going back to one of the issues which Bill raised, which is this potential summit, which has been voiced I don't know how. .l don't know at what stage that, if it is just somebody's idea, or what stage it might be at. I don't believe the County has signed off on any such settlement to date. I don't think it is even pending before the County. I think the Supervisor also already forwarded something to the County Executive to see what is happening. COUNCILWOMAN HUSSIE: Are we interested' in the County, a particular bill with the County, business or for all of us . in the County, because you know they have reactivated, they have their own electric company, and they have reactivated that now, so they are going to be buying their electric for their own facilities. . TOWN ATTORNEY YAKABOSKI: It is also gone to mini-turbines. With the short time frame, I didn't realize this was out there until Friday. When you look at something like this, it is a very serious concern. It is a very serious concern, that if this is what is happening, again, with the motion to intervene. Moved by Councilwoman Hussie, seconded by Councilman Romanelli, it was RESOLVED that the Town Board of the Town of Southold hereby authorizes and directs the Southold Town Attorney, on behalf of the Town of Southold to move to intervene as a party plaintiff in the lawsuit currently pending in Supreme Court entitled "The Initiative for Competitive Energy E Jack Kulka against The Long Island Power Authority" Index Number 98-12125, and to take further action as is necessary to investigate and correct the Long Island Power Authority's improper rate structure: COUNCILMAN MOORE: Is it any better having individual ratepayers in the Town of Southold added? TOWN. ATTORNEY YAKABOSKI: :I personally think that if anybody is being injured, and it is true, it is true people are being injured, and I think it is always hopeful. I know what you are thinking about. It is also helpful to have the major ratepayers, such as the other towns, the other ratepayers come in. The schools are ratepayers. You can see, if you start counting - - it 1 •.;r;4:'- ,,a JUKE 16, 1998 369 S out, if it all comes true you can see the ramifications as you start expanding it out. I don't like to be rushed, which is one of the things about the short time frame on the motion to intervene. SUPERVISOR COCHRAN: There is a motion on the floor. TOWN ATTORNEY YAKABOSKI: Again, it is putting all the pieces together, there was a legal action, I forget which one it was now, the County again was trying to stop the deal, and this rate problem came up, and the Court did make a comment. (tape change) Determination by LIPA to impose a surcharge to Suffolk County ratepayers. Thus this claim is not right for judicial review. The petition claims that LIPA violate Section 10201Q3 of the LIPA statute, as far as they are going to compensate LILCO towards yet unenforced tax certiorari judgement that LIPA improperly decides to impose a rate surcharge of Suffolk ratepayers. That is what the Judge said. That is not right yet. COUNCILMAN MURPHY: When was this in position? TOWN ATTORNEY YAKABOSKI: The motion date was in March of '98. 1 was only forwarded partial. . COUNCILMAN MURPHY: That was before LIPA physically took over. TOWN ATTORNEY YAKABOSKI: Correct, and this other one was commenced prior to LIPA taking over. COUNCILMAN ROMANELLI: Also, the worse case scenario is the Judge could give us the same ruling, but it is too early yet. TOWN ATTORNEY YAKABOSKI: The worse case scenario is the Judge rules against you. He says, no, you don't have a valid cause of action, and then if you feel it is valid you appeal. The Judge can say it is not right, the Judge may defend the ruling, pro or con. I am just trying to give the Board the facts. SUPERVISOR COCHRAN: Any other discussion before we move on the motion? COUNCILWOMAN HUSSIE: This definitely says that we are intervening, even though we are letting Greg carry the ball. SUPERVISOR COCHRAN: Yes, any and all action to intervene in the lawsuit. TOWN ATTORNEY YAKABOSKI : I can intervene, and to do non-legal proceedings. COUNCILWOMAN HUSSIE: Not or, and, because I think and it says. . I mean talk about not having enough information, and in your opinion not to even go with this, what would we do? TOWN ATTORNEY YAKABOSKI: The same critique goes to both. It is neither more or less for either one. The second one gives you more time, the time frame is not the same. You have more time. 1 .-Vote of the Town Board: Ayes: Councilman Murphy, Councilman Romanelli, Councilman Moore, Councilwoman Hussie, Supervisor Cochran. This resolution was duly ADOPTED. 3. / o JUNE 1998 SUPERVISOR COCHRAN: That being the only business to come before the Town Board at this Special Meeting, may I have a motion to adjourn? Moved by Councilman Moore, seconded by Councilman Romanelli, it was RESOLVED that this Town Board meeting be and hereby is adjourned at 1 :55 P.M. Vote of the Town Board: Ayes: Councilman Murphy, Councilman Romanelli, Councilman Moore, Councilwoman Hussie, Supervisor Cochran. This resolution was duly ADOPTED. Elizabeth A. Nevill Southold Town Clerk