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Legislative Memo

Darren Suarez
Director of Government Affairs
T 518.465.7511
www.bcnys.org

BILL:

A.27-A (Cahill)

Support

SUBJECT:

Establish Utility Intervenor Account

 

DATE:

March 12, 2012

 

The Business Council opposes this legislation that would  amend the Public Service Law, to create a new funding program to reimburse intervenors in utility rate cases.
 
We oppose this legislation as it is highly unlikely to result in lower utility rates. At best, this legislation would provide an additional voice in the process challenging rate requests. Most concerning is this legislation contains no protection from supporting special interest that is advancing an agenda inconsistent with the interest of the general public.

This legislation would require that utilities provide financial support for select groups of individuals to intervene in utility rate cases. The legislation stipulates that the group of persons represent the interests of a significant number of residential or small business customers, or a not-for-profit organization in this state.

There is no requirement that the Public Service Commission (PSC) determine that the intervenor represent substantial similar interest to the majority of rate payers. Furthermore, the legislation is drafted in such a manner to preclude small business with gross annual revenue of greater than two hundred fifty thousand dollars. Few small restaurants, dry cleaners, farmers, gross less than two hundred fifty thousand dollars. The few small business that would qualify would be owned by sole proprietors or would be side businesses.

Executive Law § 94-a (4) establishes that the Utility Intervention Unit at the Division of Consumer Protection shall represent consumers before the New York State Public Service Commission and the Federal Energy Regulatory Commission. The Utility Intervention Unit helps ensure that consumer concerns are heard in rate cases and on policy and service reliability matters. The Division, not select intervenors, should represent the general public before the PSC.

In New York State multiple not-for-profits choose not to expend their funds to represent their interests before the Public Service Commission, because they choose instead to expend their time before the Executive and Legislative branches of government. A 2010 report by the Public Policy Institute explains why this may be. The report determined that in 2009, electrical generators and utilities in New York State paid more than $6 billion in state and local taxes, assessments and fees, most of which were passed on in the form of rates. These high taxes and assessments make the state’s business climate uncompetitive when compared to other states. They are a direct obstacle to business growth, capital investment and job creation. As a result, New York loses essential jobs, opportunities for entrepreneurship and the ability to attract major new investments and employment.

For these reasons, The Business Council opposes this legislation and respectfully urges that it not be enacted by the New York State Legislature.