Archive for the ‘Richie Kessel NYPA Watch’ category

The Richie Kessel NYPA Watch, December 1, 2008 – By George J. Marlin

December 1, 2008

Newsday’s Rick Brand reported on November 17, 2008 that Suffolk County had paid $100,000 in order to market the County’s non-emergency call number to Zimmerman-Edelson, a Long Island PR firm headed by Robert Zimmerman, a member of the Democratic National Committee and a “Democratic Strategist” who frequently appears on CNN.   Brand also disclosed that since 2006 Zimmerman-Edelson has received another $336,000 from the County’s DWI program. Newsday detailed Zimmerman’s work including $28,500 for billboards, $21,462 for radio ads, and $5,400 for 5,000 promotional pens and 10,000 magnets (overpriced kitchen magnets are a critical part of any political messaging effort).

A review of LIPA’s spending shows that under long-time Chair and CEO Richie Kessel, LIPA paid over $1,000,000 to Zimmerman-Edelson for PR and marketing work over a period of years to burnish LIPA and Richie Kessel’s reputation. Of course, we over-taxed and over-burdened ratepayers paid for this critical work.

Who says bipartisanship in Albany is dead?  Not only did Kessel hire Democratic rent-seekers and hangers-on, he hired Republican hacks as well when Pataki was Governor. Thus, the Citizens Budget Commission reported these two instances of LIPA procurement controversies on his watch:

“State Comptroller’s audit finds that LIPA bypassed its own bidding requirements when it paid [the Republican lobbying organization] Strategic Planning Systems $45,000 to conduct “political polls,” LIPA is required to put contracts of $5,000 or more up for competitive bid “to the maximum extent possible.” . . .

An investigation by Assembly member Richard Brodsky revealed that LIPA awarded a $120,000 a year no-bid contract to former top advisors to Governor Pataki, Kieran Mahoney and Michael McKeon.  McKeon and Mahoney recently left the Pataki administration to become private political consultants.” (Then there was the time Richie did “customer service” polling on Long Island and improperly charged electric customers for polling about candidates for office and other clearly political matters. More about that on another day.)  To his credit, new LIPA CEO, Kevin Law, terminated these and other suspect lobbying and PR contracts.

Street Corner Conservative will be watching NYPA’s procurement going forward to see whether Zimmerman-Edelson ends up back at the NYPA trough.

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The Richie Kessel NYPA Watch, November 18, 2008 – By George J. Marlin

November 18, 2008

The new CEO of NYPA, the largest publicly-owned electric utility in the nation with 18 generating plants around the State and 1,400 miles of transmission and distribution lines throughout the State chose, surprise, Long Island to announce NYPA’s new free weatherization blitz program. Yes, NYPA technically serves electric customers on Long Island in three villages—Rockville Centre and Freeport in Nassau and Greenport on the North Folk in Suffolk—villages with a combined 23,000 electric customers out of Long Island’s 3 million people and the State’s over 18 million residents.

Last year, NYPA’s board approved a $5 million grant to fund the weatherization kits which will undoubtedly help some low-income families to cut their fuel bills. That’s a good thing and Street Corner Conservative doesn’t quarrel with the intent of the program. But Richie Kessel dreams of finally being elected to office, specifically that of Nassau County Executive when the current occupant departs for greener political pastures. Thus, NYPA with its headquarters in White Plains and a primarily upstate mission chose Freeport, Long Island to announce this new initiative which NYPA’s press release said will assist 20,000 to 30,000 customers State-wide of which 875 or roughly 3% are on Long Island.

Street Corner Conservative wonders how long before upstate business and political leaders and media wonder why Buffalo or Rochester or Massena wasn’t the site of yesterday’s press event and, more pertinently, what Kessel’s appointment means for the struggling upstate economy. One also wonders what the reaction is at LIPA, which Richie Kessel formerly ran for over a decade, and which serves over 95% of Long Island electric customers. Local political historians may one day deem yesterday’s news conference the start of the latest Kessel campaign for Nassau County Executive.

The Richie Kessel NYPA Watch, November 12, 2008 – By George J. Marlin

November 12, 2008

The November 7-12 issue of Long Island Business News (libn.com) contains Richie Kessel’s typically anodyne op-ed piece on wind power (“Blowing Toward Energy Independence”) in which he lets slip that NYPA has been approached by “dozens of [wind farm] developers” to develop projects as large as 500 or more megawatts. Richie says he looks forward to the day when “New York can be the wind capital of the world.” Once again, as is his wont, there is no mention of the billions required to build these projects or the effect on our electric bills.

Following his ill-fated exploration of a 40 turbine wind farm off Jones Beach while he ran LIPA, rational, independent analysis confirmed that these proposed wind farms in the Atlantic off the coast of Long Island would be grossly uneconomic and inflate already onerous LI electric rates. Long Islanders will remember that Kessel’s successor at LIPA, Kevin Law, insisted on releasing publicly the cost estimates and economics of the failed Kessel wind plan which showed that Kessel had hidden the true costs. LIPA’s disclosure in 2007 indicated that the Jones Beach plan would have cost over $800 million or multiples of the low-ball number Kessel had floated for a proposed 140MW wind farm. Simple extrapolation of that cost estimate to a 500 MW wind farm even farther off the coast of Long Island (and therefore disproportionally more expensive) would require investment of over $4 billion and would drive downstate electric rates to the heavens. Enough said for now.

The Richie Kessel NYPA Watch, November 9, 2008 – By George J. Marlin

November 9, 2008

Richie Kessel, having been installed by Governor Paterson as CEO of NYPA only three weeks ago, leaked to Newsday’s Mark Harrington, as reported in the November 7 issue, that he plans a wind farm “of significant size” off the Atlantic Coast and a new sub-Atlantic power cable. As is his practice, Kessel didn’t disclose the potential cost, effect on customer rates or how after three weeks at NYPA he could pronounce these steps as the right diagnosis for the State’s energy ills. In true Carnac the Magnificent custom, let me proffer three answers: Billions of dollars, dramatically higher customer rates for affected areas and Kessel doesn’t have a clue but after two weeks was hungry for some press.

Kessel told Harrington that he envisions a NYPA wind farm built under a “downstate partnership” among NYPA, the City of New York, the MTA, LIPA and the Port Authority. Belying the purely promotional nature of the leak, Kessel noted that he had spoken on the phone to Mayor Bloomberg about the concept; a mayoral spokesman confirming the extremely tentative nature of this trial balloon noted that Bloomberg and Richie would meet in the future.

Observers of Kessel’s reign at LIPA will remember that Kessel heavily promoted a wind farm off of Jones Beach which despite Kessel’s promise of cheap wind power ballooned to $800 million in cost and was abandoned by LIPA and Governors Spitzer and Paterson due to its adverse effect on beleaguered Long Island ratepayers and complaints about ruining the pristine Long Island viewscape off the South Shore. That exercise cost Long Island electric customers many millions of dollars. Long Islanders will also remember (certainly Newsday does) that Kessel, the leading Long Island practitioner of government by press release, stonewalled Newsday’s repeated requests for data about the wind farm’s costs, effect on rates and technical issues. Newsday was forced to resort to multiple freedom of information requests for this information.

Governor Paterson announced in September of this year that LIPA would carefully study a wind farm off the coast of the Rockaways in partnership with Con Edison. It is too early to draw any conclusions about the feasibility of that project although the presence of Con Edison, a stockholder-owned concern with many issues of its own, should bring some rationality to economic analysis of any wind facility. LIPA’s coolness to this latest Kessel proposal was evident in its tautological response quoted by Newsday’s Harrington: “LIPA is interested in working with NYPA on any project that makes sense for Long Island.” Hard to argue with that.

Finally, observers of Kessel’s time on Long Island will also remember that politically-connected lobbyists close to Richie were advancing the cause of Florida Power & Light, one of the nation’s leading wind companies, which had been chosen by LIPA to build the now-abandoned Long Island wind farm. Let’s watch the lobbying issue going forward.

Thanks to the present and former NYPA employees who have reached out since we first published on Kessel and NYPA. Among other things one wonders what NYPA’s professional staff think about this initial Kessel trial balloon. Please email to streetcornercons@aol.com.

P.S. Kessel’s decision to leak to Newsday, Long Island’s dominant paper, raises anew questions about whether he yet realizes that NYPA is an upstate-focused government entity and whether his real interest is ultimately in running for Nassau County Executive when the current occupant, Tom Suozzi, moves on.

The Richie Kessel NYPA Watch – By George J. Marlin

October 5, 2008

Succumbing to pressure from Long Island pols and lobbyists, Governor Paterson made his greatest mistake since assuming the office of Governor:  insisting the board of the New York Power Authority appoint Richard Kessel Chief Executive Officer.

Richard Kessel, who served for a decade as Chairman and CEO of the Long Island Power Authority, is the Island’s most notorious political hack.

For those unfamiliar with Kessel, here’s a little background:

In 1994, just weeks before the gubernatorial election, Governor Mario Cuomo announced an incredible $9 billion proposal for the state government to take over the Long Island Lighting Company.

LILCO, whose fiscal woes can be attributed directly to years of government interference exacerbated by management incompetence, would now be operated by a government authority, who had had no experience running a retail electrical company, let alone one that is heavily dependent on expensive oil to generate its power.

Reacting to Cuomo’s takeover plan, candidate Pataki told Long Islanders: “[Cuomo’s] trying to buy our votes. . . . We’ve taken a look at [the plan]. We think it’s not going to result in the savings Mario Cuomo has been talking about. . . . There are better alternatives, like allowing in low-cost power from the outside . . . private power that is available at significantly lower rates that Cuomo’s [Public Service Commission] is keeping out right now.”

Two days after his victory at the polls, Pataki confirmed his opposition to the Cuomo plan for the state to purchase LILCO.  Pataki said, “I think they’ve [LILCO] been poorly run. But on the other hand, I think if there is anybody who could run it worse, it would be Richie Kessel.”

However, in late 1995, to achieve short-term political gains, Governor Pataki turned around and dropped his opposition to a LILCO takeover. He endorsed a dismantling proposal that further extended the arm of government into people’s daily lives. “To return a tiny rebate to Long Island voters,” said Change-NY’s Tom Carroll, “Pataki used a new state authority to take over the Long Island Lighting Company.  The move required a jaw-dropping $7 billion municipal debt offering – the largest in U.S. history.  Moreover, as other states move toward efficient market-based provision of energy – low energy costs being a key consideration of business when they decide where to locate – Pataki has extended inefficient government control over energy.”

And whom did Pataki appoint as LIPA chairman and CEO to oversee this expansion of government?  None other than Richie Kessel.

A political ne’er-do-well who regaled anyone who would listen with tales about his experiences at summer camp as a boy, the then-48-year-old Kessel was a classic example of the kind of has-been Democrat that Pataki found attractive.  The New York Times described Kessel as a “gadfly,” “a talkative upstart in a rumpled suit” who “invented himself as a consumer advocate, shamelessly pulling stunts like posing in a Ninja Turtle mask at a news conference criticizing the cost of Halloween candy.”

After “selling his soul in return for Mr. Pataki’s appointing him as the Authority’s chairman,” one pol said, “[Kessel] degenerated into a disingenuous snake-oil salesman.”  In 2003 Mario Cuomo told Newsday, “I lost contact with Richie Kessel, who somehow was able to swim the political rapids from the Democratic side to the Republican side.”

Pataki and then Senator D’Amato understood that Kessel, desperate to be perceived as a Long Island player, would always do as he was told in order to keep his LIPA job.

Kessel lived up to his reputation as a political lackey.  A Citizens Budget Commission report highlighted these two instances of LIPA procurement controversies on his watch:

State Comptroller’s audit finds that LIPA bypassed its own bidding requirements when it paid [the Republican lobbying organization] Strategic Planning Systems $45,000 to conduct “political polls,” LIPA is required to put contracts of $5,000 or more up for competitive bid “to the maximum extent possible.” . . .

An investigation by Assembly member Richard Brodsky revealed that LIPA awarded a $120,000 a year no-bid contract to former top advisors to Governor Pataki, Kieran Mahoney and Michael McKeon. McKeon and Mahoney recently left the Pataki administration to become private political consultants.

Kessel, who ran LIPA into the ground now has the opportunity to destroy NYPA.

Streetcornerconservative.com intends to publish regular reports on Kessel’s NYPA tenure. NYPA employees should contact streetcornerconservative.com with any information concerning Kessel’s follies.

Upstate can’t afford new NYPA director – By George J. Marlin

October 1, 2008

This article I wrote appears in the Watertown Daily Times on October 1, 2008.