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Government Affairs Albany Update

June 14, 2002

"Anti-Jobs" Agenda will Dominate Last Week of Session

The Business Council has launched a final "e-advocacy" effort for the 2002 session, focusing on four anti-business issues that will receive serious attention next week in Albany. These include:

We are sending out a "call to action" to all Government Affairs Council members; our local chambers and regional manufacturing associations; Workers Compensation Trust members, and others, urging them to weigh in with their local legislators, legislative leaders and the Governor in response to these measures.

Yesterday, Dan Walsh sent a similar message to Governor Pataki, Senator Bruno and Speaker Silver, urging them to reject these measures that could literally cost New Yorkers billions of dollars and thousands of jobs. Our e-advocacy program can be accessed from The Business Council's main web site.

The New York State Rail Infrastructure Investment Act of 2002

"The New York State Rail Infrastructure Investment Act of 2002" - the railroad tax/investment legislation that was left out of the 2002-2003 New York State budget - has been reintroduced in both houses of the Legislature. The package has once again been sponsored by Assembly Majority Leader Paul Tokasz (A.11680) and Senate Finance Chair Ronald Stafford (S.7602).

The bill's goal is to change the way railroad taxation is calculated in New York State thus allowing for major capital improvements designed to greatly foster both passenger and freight rail service. The enactment of this legislation would also effectively end any federal legislation that has been pending as a result of the Conrail settlement expiration. That lawsuit, initiated by the three class one railroads (Canadian Pacific, Norfolk Southern and CSX), has already commenced and a trial is scheduled to begin during this fiscal year. Without this legislation, hundreds of localities who have railroad properties within their taxing jurisdictions would continue to be included in the lawsuit as defendants. Similarly, the railroad would be unable to initiate many of their planned upgrades and capital improvements.

The major provisions of the bill are as follows;

The Business Council has been a strong supporter of the railroad reform legislation. This spring, The Council's research affiliate, Public Policy Institute, published On The Wrong Track, a report outlining the need for rail tax reform and infrastructure improvements in order to help New York's railroads and manufacturers. Rail provides a vital and necessary means of conveyance for the chemical, agricultural, manufacturing, and coal businesses as well as numerous others. Rail is a primary shipper of coal needed for electricity generation and many long haul commodities such as salt and chemicals. However, under New York's arcane tax laws, rail is penalized for capital improvements to their lines and must also bear the burden of an out-of-date system by which real property taxes are calculated. The corresponding tax burden discourages railroads from operating and/or expanding in New York and adds an additional burden to manufacturers who depend on rail service.

The legislation has come close to passage several times. It was almost passed on the last day of session in 2000 when it was a governor's program bill; it was contained in the executive budget in 2001 but was excluded from the final budget package; and it was added to the executive budget in the 30-day amendments in 2002 but was not included in the final budget. With the 2002 Legislative session coming to a close, it is hoped that the bill will be acted upon prior to adjournment. The Business Council's Transportation Committee will discuss the "The New York State Rail Infrastructure Investment Act of 2002" at its June 17th meeting. An active lobbying campaign to bring the issue to the Leaders' attention is planned for next week. The bill was introduced in both houses (A.11680 / S.7602) on June 12th.

Final State Energy Plan Adopted

On June 3, 2002 The New York State Energy Planning Board adopted the final 2002 State Energy Plan (SEP). The board is comprised of the President of the New York State Energy Research and Development Authority (NYSERDA), the Chairman of the Public Service Commission (PSC), and the commissioners of Transportation (DOT), Economic Development (ESD), and Environmental Conservation (DEC). NYSERDA's president serves as the chairman of the State Energy Planning Board.

The adoption of the plan is in conformity with sections 6-104, 6-106 of the State's Energy Law which mandates the formulation of a state energy plan every four years.

Paul DeCotis of NYSERDA discussed the outcome of the State Energy Planning Board meeting at the June 11th meeting of The Business Council's Energy Committee. The major topics discussed at the Energy meeting, as they related to NYSERDA's presentation, were; energy infrastructure maintenance, innovative growth in the markets, energy diversity, environmental issues, and consumer issues. Some of the more specific issues included the reauthorization of Article X (the siting law for electricity generation) and Article 6 of the Energy Law (which governs the SEP process), security issues, bio-fuels, distributive generation, the proposed reduction of greenhouse gases, the proposed increases in renewable energy sources, and regional electricity markets. NYSERDA' s representative stated that the final SEP document will be available by approximately June 19-20th. It will also be posted on the NYSERDA web site. For more information on NYSERDA and the SEP access: http://www.nyserda.org/

Superfund/Brownfields under discussion

Now that the Governor has re-proposed his superfund/brownfield legislation as Program Bill #122, there has been renewed legislative discussion of remediation program reform and refinancing. However, there is no clear indication as to whether any compromises can be reached between now and the end of session.

The Governor's program bill is largely the same as the proposal included in the FY 2003 Executive Budget, with some minor adjustments to the sections dealing with financing and appropriations.

The Business Council continues to oppose many provisions included in the Program bill, including: onerous new enforcement provisions, including so-called "treble damages" for failure to agree to the state's proposed cleanup plans; new state-level mechanisms for recovering state expenditures and imposing natural resource damage claims; $18 million in new hazardous waste fees that largely impact upstate manufacturers; inadequate provisions regarding use-based remedy selection and post-cleanup liability releases; and others.

For a more detailed discussion of our concerns, see our memo in opposition (the original Executive Budget proposal).

The Business Council has provided the Administration and legislative leaders with an alternative proposal that would re-finance superfund using existing General Fund resources, adopt limited changes to the state's superfund program (e.g., adopt recent federal CERCLA liability changes), leave the state's oil spill program as-is, and focus on provisions encouraging the voluntary investigation, cleanup and redevelopment of contaminated properties.

Labor Chairs Introduce New Additional UC Program

The Chairs of the Senate and Assembly Standing Committees on Labor, Guy Velella and Cathy Nolan, respectively, introduced S.7593 / A.11624 this week.

The legislation creates a new and unfunded State Unemployment Compensation Program of an additional thirteen weeks of benefit checks for claimants that have collected both the 26 weeks of regular UC checks (fully funded by the State's employers) and the 13 weeks of extended UC checks (fully funded by the Federal government from the Federal UC tax on employers).

By not funding the new program, the legislation, by default, places the cost of the new UC program on New York's UC Trust Fund which is solely supported on the backs of New York employers -- a new cost which has been calculated at
$1.45 Billion.

Among the reasons for rejection of additional benefit checks funded, not by the Federal government but, rather, solely by employers in New York - a program heretofore unheard of in the over sixty-year history of UC in New York - are as follows: