Cost of Full-Scale Municipal Utility Not a Pension Burden to the State


One of the big arguments being used to turn people off about transforming LIPA into a full-scale public utility is that the state cannot afford to absorb 1800 more employees into the system.

In the first case, it is not necessary for LIPA to hire all of the 1800 as public employees. Instead it is possible for the utility to contract with the union for their services. The existing contract is in effect until February 2015. In this manner the employees would remain as private workers with the same compensation and benefits they presently have.

Even if the workers all would become LIPA employees, the state budget along with tax payers would still not be impacted. Under the present LIPA structure, the full cost for the compensation and benefits of all of the utility’s contract personnel is paid for by the ratepayer. This would continue no matter what structure LIPA adopted.

The bottom line, therefore, is that the status of present contract employees is really not a major factor favoring LIPA retaining a slightly modified version of its existing structure over becoming a full-scale municipal utility. Sure, adopting a municipal structure similar to almost all other public utilities in the nation does not guarantee LIPA’s present staff a job, but it does provide LI ratepayers with the best hope of a better future.

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About lipaoversight

LIPA Oversight Committee was created to analyze the rates and practices to determine if it is working in the best interests of the Suffolk County ratepayers
This entry was posted in brattle, lipa, long island power authority, msa, municipalization, privatization. Bookmark the permalink.

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