Huntington Town Board Hires LIPA Lobbyist to Run its PR on LIPA

On July 21st, the Huntington Town Board voted 4-0 (with Councilman Cook abstaining) on a resolution to hire Mercury Public Affairs, LLC, one of the most powerful lobbying and public relations firms in the country, to “perform community outreach and provide public information regarding the status of the LIPA litigation, the details of the term sheet and the potential impact of an adverse court decision.”

According to this resolution, the Town Board selected Mercury Public Affairs on account of its “necessary expertise and experience in public outreach strategies” and because the firm is “knowledgeable about the Northport Power Plant and the pending litigation.”

The vote was cast without any discussion or debate. At no point was the public apprised of who Mercury Public Affairs is, how exactly they came to be so “knowledgeable” about the litigation surrounding the Northport Power Plant, or why the Town Board felt it necessary to spend $40,000 during a pandemic and a recession to hire such a firm.

Nor was the public informed about why the Town Board had decided to effectively outsource their responsibilities on this matter to a private contractor—after all, if elected officials are responsible for anything, surely they are responsible for “performing community outreach” and “providing the public with information” on matters of critical importance to those they serve. And yet, on the most important issue facing this community in a generation, our Town Board apparently decided to offload those responsibilities elsewhere.

Perhaps members of the Town Board didn’t discuss or debate the resolution because they didn’t know who it was they were hiring. Had they instructed the Town Attorney to conduct even a cursory Google search on the prospective client, however, they would know that Mercury Public Affairs is arguably the largest, most powerful LIPA lobbyist in New York, acting principally through PSEG Long Island.

According to the public filings available on the New York State Joint Commission on Public Ethics (JCOPE) website, Mercury Public Affairs LLC has been a registered lobbyist for PSEG Long Island since 2013, when PSEG Long Island was awarded the $3,874,014,255.00 contract to manage LIPA’s day-to-day operations in the aftermath of Hurricane Sandy, including its “government relations” operations, as provided under Section 4.2 of the 2013 Operations Service Agreement.

Since then, PSEG Long Island as effectively served as LIPA’s lobbying arm in Albany, hiring Mercury Public Affairs to influence every LIPA-related bill introduced in the New York State Senate and Assembly for over a decade.

In the 2019 to 2020 legislative sessions alone, Mercury lobbied on behalf of PSEG Long Island on over 151 pieces of LIPA-related legislation, killing even the most modest LIPA reforms. For those interested in what could have been but never was, here is some of LIPA’s 2019-2020 legislative graveyard:

• S2983/A5503 – the “Long Island Power Authority Ratepayers Protection Act,” designed to provide ratepayers a greater voice with respect to the activities of LIPA and PSEG-LI, requiring the establishment of an elected LIPA Board as was originally envisioned when LIPA was created in 1986.
• S4172/A6457 – a bill that would require that LIPA’s payments in lieu of taxes (PILOTS) subject to the two percent limit under the LIPA Reform Act to be calculated based upon the real property acquired by the authority in the aggregate in each municipality or school district and not on parcel by parcel basis, which allows LIPA to skirt paying the full amount owed in PILOTS;
• S2853/A2485 – a bill that would require that any reduction in property taxes paid by the Long Island Power Authority be passed on to its ratepayers;
• S4452/A7243A – a bill is to establish a source of funding for local governmental entities and school districts substantially impacted by tax certiorari challenges or settlements and to allow school districts to establish tax certiorari stabilization reserve funds;
• S1914/A146 – a bill requiring businesses that make payments in lieu of taxes (PILOTs) to local governments and school districts to spread the negative impact of a reassessment over a ten year period;
• S4317/A6363 – the “Long Island Power Authority Rate Reform Act,” requiring that the board of trustees of LIPA not approve a final rate plan until it holds a public hearing in each county within the service area upon at least thirty days’ notice to the public and that the department of public service shall not recommend a rate increase to offset revenue loss due to energy conservation efforts by consumers; and
• S5122A/A7786 – a bill that would limit LIPA’s recovery of any back taxes already assessed against any power plant, substation or transmission line.

The last bill on this list, S5122A/A7786, was the bill that I authored and spent countless hours working on with Senator Gaughran. Known around here as the “Gaughran Amendment,” thanks to Senator Jim Gaughran’s Herculean efforts passing the bill twice in the State Senate over the last two consecutive years, this bill would eliminate LIPA’s ability to recover a cent in back taxes levied by any town, county or municipality against any former-LILCO or current LIPA power plant, substation or transmission line.

I came up with the idea for the bill two years ago in anticipation of precisely this moment in the LIPA litigation—the very moment at which LIPA would use the threat of back taxes to coerce us to settle so as to avoid, as they claim, a “$10,000 to $25,000” property tax bill. Had Mercury not lobbied against my legislation over the last few months—including as recently as last month—perhaps the bill would have passed and LIPA would not now be in a position to issue such threats.

Now, apparently, Mercury is employed by the Town of Huntington to educate us on LIPA’s settlement offer.

The JCOPE public filings confirm that Mercury Public Affairs has been actively lobbying for PSEG Long Island since 2013—which, incidentally, overlaps with Supervisor Chad Lupinacci’s tenure in the New York State Assembly. As you might recall, Mr. Lupinacci served as an Assemblyman for the 10th Assembly District for five years, from 2013 to 2018. During that time, Mercury Public Affairs lobbied on hundreds of Assembly bills relating to LIPA. Does anyone really believe that after five straight years in the Assembly, Mr. Lupinacci of Huntington, Long Island—the town where the most important LIPA tax certiorari battle in New York is being waged—didn’t happen to run into one of LIPA’s top lobbyists from Mercury Public Affairs, at least once? Is it even possible that Mr. Lupinacci really didn’t know that Mercury Public Affairs is LIPA’s top lobbyist through PSEG Long Island? And if he did know that Mercury Public Affairs is a LIPA lobbyist, why didn’t he tell anyone else on the Town Board about this conflict? And if he did tell anyone else on the Board, what does that tell us about the Town Board’s decision to hire them for $40,000.00 to facilitate public outreach over the next two months?

Unlike politicians, thankfully lobbyists are required to file annual and semi-annual public disclosures on the bills they lobby, so we have some idea of the scope of Mercury’s lobbying activities. What we don’t know, however, is the scope of Mercury’s public relations activities, because such activities are not subject to any public disclosure requirements. For all we know, Mercury could also be currently working for LIPA in a public relations capacity, overseeing their entire public relations campaign (the “Tax Fairness” campaign) against Huntington. We just don’t know.

What we do know about Mercury’s public relations activities are what they’ve chosen to tell us. And what they’ve told us, at least according to their website, is that they represent National Grid, or at least they did. On Mercury’s website, front and center under “capabilities,” boasts Mercury’s role in having “led the strategic effort for British utility National Grid [in its] acquisition of Keyspan.”

For those who don’t remember this, Keyspan once owned the Northport Power Station until Keyspan was bought out in 2007 by National Grid, a British multinational energy conglomerate. Unlike National Grid, however, Keyspan was actually a pretty good neighbor (at least as far as utility companies go), spending millions every year to give back to Long Island. Under CEO Robert Catell’s leadership, Keyspan made sure no invitation to a community event was ever refused. Keyspan had the reputation of sponsoring everything, taking pride in the fact that if you asked Keyspan to buy a few tickets to a charity event, Keyspan would buy the table. Most importantly, of course, Keyspan never broke its “Promise” to us.

That all changed in 2007 when, under the trusted stewardship of Mercury, National Grid took over Keyspan and, with it, the Northport Power Station. And while LIPA’s betrayal of this community was not solely a result of National Grid—there were many other factors, including the appointment of Kevin Law as the head of LIPA in 2007—it’s no coincidence that with new ownership came a new philosophy: one defined not by generosity and giving back to the community, but by corporate greed, corporate regulatory capture of a government agency, and utter contempt for the public. Within a few years of National Grid’s fated “strategic acquisition,” The Promise was broken and the nightmare we’ve been living in for a decade began.

Prior to the Town Board hiring Mercury Public Affairs, we had no reasonable basis to suspect any impropriety concerning the Town Board’s mad rush to settle during the COVID-19 pandemic. We may have disagreed with some members’ positions on the LIPA settlement, but we could assume it was an earnest disagreement about the best direction for our community.

Now it’s at best unclear, for the same Town Board that hired a LIPA lobbyist to run its communications over the next two months will be negotiating the fine print on our settlement agreement. The same PR firm that lobbied against every single piece of LIPA reform legislation will be busy lulling us to sleep with reassuring words about the settlement—all while the lawyers are busy at work.

Well, most of the lawyers will be busy at work—our Town Attorney will continue to do absolutely nothing, as is his custom. The same Town Attorney (and, apparently, the Supervisor’s best friend) who actually suggested to the Northport Observer last week that he vetted Mercury Public Affairs, but couldn’t seem to uncover what I found in less than five minutes on the JCOPE website. That guy, of all people, will be in charge of reviewing the fine print in LIPA’s settlement offer presented to the Town Board September 29th.

Apparently, however, the Town Attorney has “no issue” with Mercury Public Affairs being both a LIPA lobbyist for nearly a decade and on the Huntington Town Board’s payroll. That’s because, according to Town Attorney Ciappetta, the “[Town’s] agreement [with Mercury] has strict conflict of interest protections that specifically references National Grid.”

It’s hard to overstate how troubling stupid this statement is, especially coming from the chief legal officer of the Town. In fact, I don’t know what’s worse: the Town Attorney’s “take them at their word” and “ask questions later” vetting process, or the fact that he doesn’t understand the basics of conflict of interest policy.

If he did understand the basics of conflict of interest policy, he would know that the risk inherent to the Town—who, let’s not forget, is a party to ongoing litigation—in hiring a LIPA/PSEG lobbyist to oversee public outreach on the LIPA tax certiorari settlement is one of a perceived conflict of interest, which cannot be contracted around, as he suggested. That’s because unlike an actual or potential conflict of interest, a perceived conflict of interest exists between the conflicted party and multiple stakeholders, including the public, not simply between two parties in privity of contract.

The only way to mitigate a perceived conflict of interest, which can be as dangerous to the integrity of an organization as any actual or potential conflict of interest, is to end the conflict and provide full disclosure to all stakeholders. As of right now, the Town Attorney has irresponsibly done neither of these things. I have, however, FOIL’ed the Mercury contract with Huntington, and look forward to reviewing the supposed “strict” conflict of interest protections contained therein.

In the interim, however, I’ll keep on this story and make sure that at least someone in this Town is providing critical oversight over our public officials and its contractors.