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Government Affairs Albany Update

March 7, 2003

Business Council co-sponsor of public forum featuring Ross Sandler

The Business Council is joining with the American Legislative Exchange Conference to host a public forum featuring Ross Sandler, Manhattan Institute Scholar and New York Law School Professor. Mr. Sandler will be discussing the book he co-authored entitled: Democracy by Decree: What Happens When Courts Run Government. The event will be held March 17 at 6:00 p.m. at Albany Law School -- East Wing, New Scotland Avenue, Albany, New York.

A summary of Democracy by Decree, bios of authors, and book reviews are available at www.democracybydecree.com

Public Service Commission Begins Renewable Portfolio Case

On March 4th the Department of Public Service (DPS), at the direction of the Public Service Commission (PSC), began the process which will culminate in the adoption of a renewable portfolio standard (RPS) for the State of New York. In his State of the State Address, Governor Pataki asserted that within ten years, at least 25 percent of all energy electricity bought in New York State should come from renewable energy resources. In light of this, the PSC at its February 19th meeting established Case 03-E-0188, the Proceeding on Motion of the Commission Regarding a Retail Renewable Portfolio Standard. The procedural conference for the case was held on March 4th in the PSC offices in Albany. The Business Council attended the conference as a party to the case and will follow the proceedings as they develop. The opening steps in the proceeding entailed the identification of legal, policy and factual issues and the facilitation of discussion among the parties to seek out opportunities for negotiated outcomes. Overall, there were more than three dozen parties for the case representing the environmental, business, electricity, utility and other energy interests. Preliminary schedules and a summation of the procedural conference is due out shortly. The outcome of the case will be based on initial comments due in March and collaborative meetings scheduled for early April. A status report will be transmitted to PSC Chairman William Flynn in early May. The hearings will identify a variety of issues, but tantamount to the case will be the issue of what constitutes renewable sources of electricity and how the state will reach the directed level of 25% within the time allotted. The Business Council will be reaching out to its members for input and will be actively collaborating with member companies and associations in this case. This will be a topic of discussion at The Business Council's March 18th Energy Committee meeting.

Assemblyman Morelle to Address Construction Council on March 11th

The New York State Construction Industry Council (NYSCIC) will meet on Tuesday, March 11th at 1:30 p.m. in The Business Council's lower level conference room. Assemblyman Joseph Morelle (D-Rochester) will address the committee on the issue of 240/241 repeal. Assemblyman Morelle has introduced legislation to repeal the law under bills A.135 and A.136. In addition to "Safe-place-to-work" legislation, the committee will discuss the workers' compensation, the wicks law repeal and a number of other legislative issues.

Assembly Energy Committee Discusses ISO Regulation Changes

On Thursday, March 6th, The Assembly Energy Committee held a hearing in Albany on "A proposal before the New York Independent System Operator (NYISO) to address perceived flaws in the deregulated electricity market in New York State." The committee heard from seven (7) industry segments; the Public Service Commission (PSC), the Independent System Operator (ISO). the Independent Power Producers of New York (IPPNY), the Consumer Protection Board, New York City's Economic Development Office, Consolidated Edison and Strategic Energy. In February a participants committee at the ISO passed a proposal to alter the operating procedures for the Installed Capacity Markets (ICAP). This proposal is now scheduled to be addressed by the full ISO Board at its next meeting. The proposal, being supported by some regulators and market participants while being opposed by some utilities and consumers, would alter the way the ISO administers the ICAP market. Under New York State Reliability Council rules, which govern the amount of installed capacity needed to maintain reliability in New York State, the ISO must insure an 18% level of generation above peak demand (118% statewide). The ICAP market insures the reliability by administering excess generation needed above the peak demand. The installed capacity market is a market for a product that has been created administratively to ensure the reliability of the electric system. Capacity can be supplied by internal generating sources, outside suppliers, or demand reduction mechanisms. For more information access the ISO's web page at: www.nyiso.com/

Wicks Law Repeal Passes out of Assembly Local Government Committee

The Assembly's Local Government Committee passed bill A.3176 (Wicks repeal) by a vote of 10-9 on February 24th after two of the bill's sponsors were temporarily appointed to the committee. The bill was reported to the Assembly Ways & Means Committee. Governor George Pataki has proposed eliminating the Wicks Law, which requires school districts and local governments to hire separate contractors for plumbing, heating and air-conditioning, and electrical wiring and gas fitting. The Business Council has been a long time supporter of Wicks Reform.

The bill does not eliminate all provisions of the Wicks mandate but would grant school boards the option of hiring a single contractor to oversee the subcontractors on behalf of the school district. Reform advocates and government watchdogs believe that a single contractor would enhance accountability and coordination on the work site, reduce costs and speed up construction. School districts wishing to continue bidding projects under current Wicks rules would remain free to do so. The lack of coordination stemming from multiple contractors with equal standing on the worksite results in lawsuits and delays project completions to the detriment of students and staff. According to the New York State School Boards Association (NYSSBA), the State Education Department approved $3.7 billion in Wicks-related construction in 2001. Conservative estimates by researchers and district officials claim that 10 percent could be saved from repeal of the Wicks mandate, resulting in $370 million savings for 2001 alone.

A Senate version of the bill, S.1607 by Senator Nicholas Spano (R-Yonkers) has been referred to the Senate Committee on Local Government. The coalition to reform the Wicks law, spearhead by NYSSBA, has set up a series of web sites designed to educate those interested in the issue; www.wicksreform.net/