Who's Next For Beleaguered Long Island Power Authority? Gerstner? Suozzi? Zarb? Petraeus?

  @DavidZie on November 14 2012 9:41 AM
Former IBM CEO Louis V. Gerstner Jr.
Former IBM CEO Louis V. Gerstner Jr. © Reuters Photographer / Reute

As a customer of Long Island Power Authority -- now known to all as the worst-run utility in the U.S. -- I was thrilled to see acting CEO Michael Hervey has quit. LIPA probably needs to be blown up before it can be saved.

Still, let's hope New York Gov. Andrew Cuomo doesn't botch the opportunity to make some changes at both LIPA as well as in the 80-year-old laws concocted by Gov. Alfred E. Smith and his Park Commissioner, Robert Moses, to create “authorities” that govern the life of many New Yorkers.

Fly into La Guardia Airport? That's a piece of the Port Authority of New York and New Jersey, which also owns Ground Zero and the World Trade Center. Head to Jones Beach? That's the Jones Beach State Park Authority. The major bridges, parks and state university dormitories are all owned by authorities.

Besides having the right to sell bonds, these authorities are dumping grounds for politicians of both parties. LIPA, in Hicksville, N.Y., merely assumed the assets of the collapsed Long Island Lighting Co. in 1985, including the never-opened Shoreham nuclear plant.

The 15-member board selected a failed Democratic officeseeker, Richard Kessel, as CEO, who ran LIPA for years, before stepping down. LIPA's employees include my former Nassau County legislator, a Democrat, and the daughter of the late Nassau County district attorney, a Republican.

More than two weeks after Superstorm Sandy, LIPA still can't turn on the lights for as many as 40,000 ratepayers, including thousands in low-lying communities like Freeport, Baldwin and Long Beach that were flooded.

LIPA needs a proven executive with experience. Here are some suggestions:

Louis V. Gerstner Jr., who grew up in Nassau County and graduated Chaminade H.S. in Mineola, would be a great choice. He saved International Business Machines Corp. (NYSE: IBM), when he was parachuted in 19 years ago to save it from bankruptcy and collapse.

Gerstner, now 70, is adviser to Carlyle Group (Nasdaq: CG). He's not a computer guy but as he said when he joined IBM, “I was a customer,” and he knew what customers needed.

Could he be asked to conduct a “Last Hurrah”?

Thomas R. Suozzi, of Glen Cove, where he and his father were mayors, saved Nassau County from bankruptcy and collapse after coming in as Nassau County Executive in 2002. Suozzi, 50, a Democrat, lost his bid for a third term in 2009 in a squeaker to Republican Ed Mangano.

But he might be a good player to knock heads together at LIPA. A lawyer and accountant, Suozzi is now raking in big bucks from a law firm, advising Lazard Freres (NYSE: LAZ) as well as Cablevision (Nasdaq: CBL), but he has proven turnaround skills. He's also liked by Cuomo.

Frank Zarb, another L.I. resident, might be another candidate. He was the first “energy czar” under President Gerald Ford, then ran various financial companies including Alexander & Alexander.

Zarb, 73, did yeoman work for Hofstra University, where the business school is named for him. He's also a member of the Nassau Interim Finance Authority that oversees Nassau's precarious finances.

David Petraeus, who needs no introduction, was Director of Central Intelligence until last Friday. The general, 60, has a Ph.D. from Princeton, helped get the U.S. out of Iraq, was getting it out of Afghanistan and had done a stellar job at the CIA.

To be sure, he is at the center of controversy now and deservedly so. The noted military writer Thomas Ricks, who's known Petraeus for decades, suggests his indiscretion and lack of judgment in his extramarital affair could have been caused by stress. Other famous generals, including Dwight D. Eisenhower, were known to have had affairs, too.

Before the power came on the other day, many of us LIPA ratepayers thought someone like Petraeus might be the right person to fix our utility. Could that be his path to redemption?

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