ny governor to request federal probe of long island utility – reuters

7/28/2019 NY governor to request federal probe of Long Island utility Reuters

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NY governor to request federal probe of Long Island utility

Reuters

NEW YORK, June 23 |

Sun Jun 23, 2013 11:52am EDT

NEW YORK, June 23 (Reuters) New York Governor Andrew Cuomo

said on Sunday he will ask federal prosecutors to review a

report that found breathtaking waste and inefficiency in the

state-owned Long Island Power Authoritys dealings with a

private consulting firm.

A scathing New York commission report released on Saturday

found questionable billing practices and a troubling revolving

door relationship between the state-owned utility and Navigant

Consulting Inc, which may have been a breach of state ethics

laws.

Cuomo said the state would refer its investigation to

federal prosecutors.

Last week, New York approved legislation to mostly dismantle

the utility, known as LIPA, which was criticized for an inept

response to Superstorm Sandy last October, when more than 90

percent of the 1.1 million LIPA customers on Long Island wereleft without power, some for more than two weeks.

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Public Service Enterprise Group Inc, a private

utility in neighboring New Jersey, will take over management of

LIPAs operations and LIPA will in effect be reduced to aholding company.

The findings released today raise a series of questions

regarding LIPAs management of a consulting contract that passed

unexplainable costs to ratepayers and involved exorbitant

expenditures that appear to have nothing to do with providing

power to Long Island residents, Cuomo said in a statement.

Navigant could not immediately be reached for comment.

The commission found breathtaking waste and inefficiency

in LIPAs operations and said the utility was woefully

unprepared to manage the threat posed by major storms.

The report also noted that, despite LIPAs limited charge -

it contracted NationalGrid to carry out its day-to-day

operations LIPA paid for a wide range of high-priced legal and

engineering consultants, but failed to monitor billing,

including unusually high hourly rates and billable hours.

In one case, a Navigant consultant charged LIPA for a trip

from Washington, D.C., to Puerto Rico, and for a seaplane flight

from San Juan to the remote resort island. No explanation for

the trip was provided, the commission found.

The practice of employees from LIPA and Navigant going to

work for the other also raised questions, the report said.

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For example, LIPAs former chief operating officer and

acting chief executive officer, Michael Hervey, joined Navigant

one month after leaving the utility in late 2012, and now serves

as Navigants energy consultant director.

This revolving door is particularly problematic since LIPA

lacked any central controls for reviewing consultant/contractor

charges and protecting against conflict of interests or

appearances of impropriety, the commission wrote.

Source Article from

http://www.reuters.com/article/2013/06/23/usa-lipa-pseg-idUSL2N0EZ02O20130623

Waddywood.com NY governor to request federal probe of Long Island utility Reuters

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ny governor to request federal probe of long island utility – reuters

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