Especially galling to Long Islanders is that while they will pay significantly to subsidize the upstate plants, they were required to fully bailout their own Shoreham plant with no assistance from any other taxpayer or ratepayer in other parts of the state.
When Mario Cuomo closed the Shoreham Nuclear Power Plant four decades ago, he bailed out the utility bondholders to the tune of $6 billion. And now, we see that Andrew Cuomo has effectuated his own nuclear bailout, funneling $7 billion in taxpayer funds to shield bondholders from the massive losses materializing at several upstate nuclear plants on the verge of closure.
While Mario’s shuttering of Shoreham made hundreds of headlines, Andrew’s bailout has pretty much gone under the radar.
Mario’s deal was born out of promises he made to ardent activists he encountered on the campaign trail in the 80s. Long Island was the swing electoral region in the state at the time. It was not inconceivable back then that a Democrat could actually lose a statewide election.
Candidate Mario Cuomo came upon a firebrand civic leader, Laura Manzi, who was rallying her troops to demand the closure of a prison the state had propped up in the Brentwood community. Sensing this was a tipping point issue, Cuomo made the commitment to close the prison if elected. He was and he did.
As Mario was heading toward his re-election effort, he was confronted with an even stronger force – the anti-Shoreham movement. They were fiercely engaged, well-funded and backed by a very influential local weekly newspaper publisher, David Willmott of Suffolk Life. As importantly, they were aligned with the local government itself – the Suffolk County Legislature, of which I was a member at the time.
Shoreham dominated everything in the late 80s. Long Island was becoming even more of a crucial swing region by this point, so Cuomo made the promise to close the plant. But rather than forcing closure for safety reasons or by letting the Long Island Lighting Company implode due to its mismanagement, the then-governor surprised most everyone by enticing the bondholders and financial regulators to sign on to the plan by over-inflating the value of their assets. The utility and its’ bondholders, who were saddled with a $6 billion debt, would now have their albatross of arrears passed off totally to the ratepayers. Forty years later, we are still paying for that bailout.
But why would Andrew go down the same path? This, too, had to do with campaign promises. Andrew promised the greens that New York is going to have 50 percent of its power generated by renewable energy sources by 2030. But this is impossible to accomplish through solar and wind power alone.
But nuclear energy is expensive too, especially when compared to plentiful natural gas. In fact, it is the stratospheric influx of cheap natural gas on the market that has made these nuclear plants seem even less attractive economically.
But rather than let the less expensive alternatives take root, the governor proposed a massive $7 billion taxpayer bailout to ensure the inefficient nuclear plants can keep the uranium flowing. The governor gets to tell about 1,000 workers upstate that he has saved their jobs – at a cost of an incredible $7,000,000 per job.
Especially galling to Long Islanders is that while they will pay significantly to subsidize the upstate plants, they were required to fully bailout their own Shoreham plant with no assistance from any other taxpayer or ratepayer in other parts of the state.
Here’s an idea: If Long Island legislators are going to allow for the upstate nuclear bailout, shouldn’t they at least first insist that the rest of the state help relieve Long Island ratepayers from carrying the full load of Shoreham?
The nuclear bailout also allows the governor to brag to the greens that he is attacking the fossil fuel scourge.
But it’s not coal that’s undercutting the nukes; it’s natural gas. The same natural gas, that is so much cleaner than coal or oil, is a significant reason U.S. carbon emissions have been cut so dramatically over the last decade.
Thanks to these two new nuclear plant bailouts from two different administrations, taxpayers and ratepayers in New York, and Long Island in particular, will be wearing this nuclear albatross for more decades to come.
Steve Levy is President of Common Sense Strategies, a political consulting firm. He served as Suffolk County Executive, as a New York State Assemblyman, and host of “The Steve Levy Radio Show.”
Getting efficiencies out of the department is very difficult. Nevertheless, my administration was able to make substantial progress — though much of it has been reversed — by having civilians fill positions when possible, by scheduling more efficiently and by placing less expensive sheriff’s deputies on the highways.
September 19, 2016When is a tax cap not a tax cap. The answer is when, as with our New York State cap, bonded interest is exempt from the parameters of the cap.
November 16, 2016Steve Levy: A tale of two Cuomos and two nuke bailouts
By: Steve Levy October 4, 2016
When Mario Cuomo closed the Shoreham Nuclear Power Plant four decades ago, he bailed out the utility bondholders to the tune of $6 billion. And now, we see that Andrew Cuomo has effectuated his own nuclear bailout, funneling $7 billion in taxpayer funds to shield bondholders from the massive losses materializing at several upstate nuclear plants on the verge of closure.
While Mario’s shuttering of Shoreham made hundreds of headlines, Andrew’s bailout has pretty much gone under the radar.
Mario’s deal was born out of promises he made to ardent activists he encountered on the campaign trail in the 80s. Long Island was the swing electoral region in the state at the time. It was not inconceivable back then that a Democrat could actually lose a statewide election.
Candidate Mario Cuomo came upon a firebrand civic leader, Laura Manzi, who was rallying her troops to demand the closure of a prison the state had propped up in the Brentwood community. Sensing this was a tipping point issue, Cuomo made the commitment to close the prison if elected. He was and he did.
As Mario was heading toward his re-election effort, he was confronted with an even stronger force – the anti-Shoreham movement. They were fiercely engaged, well-funded and backed by a very influential local weekly newspaper publisher, David Willmott of Suffolk Life. As importantly, they were aligned with the local government itself – the Suffolk County Legislature, of which I was a member at the time.
Shoreham dominated everything in the late 80s. Long Island was becoming even more of a crucial swing region by this point, so Cuomo made the promise to close the plant. But rather than forcing closure for safety reasons or by letting the Long Island Lighting Company implode due to its mismanagement, the then-governor surprised most everyone by enticing the bondholders and financial regulators to sign on to the plan by over-inflating the value of their assets. The utility and its’ bondholders, who were saddled with a $6 billion debt, would now have their albatross of arrears passed off totally to the ratepayers. Forty years later, we are still paying for that bailout.
But why would Andrew go down the same path? This, too, had to do with campaign promises. Andrew promised the greens that New York is going to have 50 percent of its power generated by renewable energy sources by 2030. But this is impossible to accomplish through solar and wind power alone.
But nuclear energy is expensive too, especially when compared to plentiful natural gas. In fact, it is the stratospheric influx of cheap natural gas on the market that has made these nuclear plants seem even less attractive economically.
But rather than let the less expensive alternatives take root, the governor proposed a massive $7 billion taxpayer bailout to ensure the inefficient nuclear plants can keep the uranium flowing. The governor gets to tell about 1,000 workers upstate that he has saved their jobs – at a cost of an incredible $7,000,000 per job.
Especially galling to Long Islanders is that while they will pay significantly to subsidize the upstate plants, they were required to fully bailout their own Shoreham plant with no assistance from any other taxpayer or ratepayer in other parts of the state.
Here’s an idea: If Long Island legislators are going to allow for the upstate nuclear bailout, shouldn’t they at least first insist that the rest of the state help relieve Long Island ratepayers from carrying the full load of Shoreham?
The nuclear bailout also allows the governor to brag to the greens that he is attacking the fossil fuel scourge.
But it’s not coal that’s undercutting the nukes; it’s natural gas. The same natural gas, that is so much cleaner than coal or oil, is a significant reason U.S. carbon emissions have been cut so dramatically over the last decade.
Thanks to these two new nuclear plant bailouts from two different administrations, taxpayers and ratepayers in New York, and Long Island in particular, will be wearing this nuclear albatross for more decades to come.
Steve Levy is President of Common Sense Strategies, a political consulting firm. He served as Suffolk County Executive, as a New York State Assemblyman, and host of “The Steve Levy Radio Show.”
Steve Levy
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