NY reaches $72M settlement with Altice over response to Tropical Storm Isaias
- More than 1 million New Yorkers were out of power after Tropical Storm Isaias lashed the East Coast in August.
- A state investigation found that internet company Altice failed to adhere to its severe weather preparedness plans.
- The $72 settlement includes investments in the company's infrastructure and credits to customers.
Internet and cable provider Altice will spend more than $68 million improving its system as part of a $72 million settlement with New York regulators over its handling of outages during Tropical Storm Isaias in August.
The state Public Service Commission announced the settlement Thursday.
The storm lashed the East Coast on Aug. 4, knocking out power for over 1 million New Yorkers, mostly in the New York City, Long Island and Hudson Valley areas. That included 400,000 Altice customers in New York — some of whom were without service for nearly two weeks.
Altice, known for its Optimum branded service, provides cable and internet in much of downstate New York, including much of the Hudson Valley.
Shortly after the storm, the state Department of Public Service and the Public Service Commission, which regulate utilities and internet service providers, launched an investigation into the level of storm preparedness at utility, cable and internet companies in the area.
The investigation, detailed in a Feb. 11 report to the Commission, found that Altice had failed to adhere to its own response plan and associated severe weather preparedness plan, which contributed to its inability to timely restore service and effectively communicate to customers experiencing outages.
The violations included failure to make sufficient readiness plans and post-storm restoration, poor customer service and communications and inadequate coordination with government officials and electric utilities.
“Altice USA has been working with the (Public Service Commission) since Storm Isaias last summer to jointly examine opportunities for enhancements in how we communicate and engage with our customers, communities, and public officials during severe weather events,” read a statement from the company Thursday.
“We appreciate the dialogue with the NY PSC as we look to ensure that the long-term service investments we're making continue to improve the customer experience and benefit all our tri-state area customers.”
The settlement is the largest ever reached in the state for a company that is under Public Service Commission jurisdiction and failed to follow procedures related to an emergency response.
But it wasn't the only company to catch heat for its response after the storm. NYSEG, which saw 183,000 outages among its customers in northern Westchester, Putnam and Dutchess counties, was fined $1.5 million for its failure to contact or respond to some customers during the emergency situation.
In January, a consortium of Westchester County public officials issued a report that called for upgrades at local utility and telecommunications companies in the wake of the storm, and urged the state to levy heavy fines on companies that failed to address outages in a timely manner.
“The outages were exacerbated by a poor response from electric and telecommunications companies,” said Assemblywoman Amy Paulin, D-Scarsdale, in January, noting that the storm hit when millions of people were working and learning from home due to the COVID-19 pandemic. “It’s more critical than ever that we have reliable service.”
Con Edison, Orange & Rockland, and Central Hudson are also facing fines of up to $137 million, and possible license revocation for Con Edison and O&R.
"This (Altice) settlement makes it clear that telecommunication companies in New York have an obligation to prepare for severe weather and to develop robust storm-response programs,” Gov. Andrew Cuomo said in a statement Thursday. “If they fail to adequately do that job we will hold them accountable and force them to change the way they do business."
Cuomo introduced legislation in February that would strengthen the state's enforcement of utilities after extreme weather events by eliminating caps on state utility fines and setting up a new penalty system.
Under the terms of the Altice settlement agreement, Altice is required to do the following in the next two years:
- Spend $68.54 million to improve the storm resiliency of their system and make other upgrades, without billing customers for those upgrades
- Provide $3.4 million in credits to New York customers impacted by Tropical Storm Isaias
- The company will also invest $4.6 million in a new state-of-the-art outage communication platform, the hiring of six additional storm recovery and service coordinators and a full-time, post-storm remediation coordinator and upgrades to Altice's Outage Notification Board.
- Additionally, Altice committed to spend $63.94 million to further improve the company's planning for and response to future severe weather events, including customer care infrastructure, additional staffing and amendments to its contracts with third-party contractors, which will allow for greater certainty on contractor resources available during storm recovery
Outages after Isaias:Cell tower outages add to post-storm challenges for Lower Hudson Valley
Sarah Taddeo is the consumer watchdog reporter for USA Today Network's New York State Team. Got a story tip or comment? Contact Sarah at STADDEO@Gannett.com or (585) 258-2774. Follow her on Twitter @Sjtaddeo. This coverage is only possible with support from our readers. Please consider becoming a digital subscriber.