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Government Affairs Albany Update

March 28, 2003

New State Smoking Ban Signed Into Law

On Wednesday, March 26, 2003, legislation was passed by the Senate & Assembly and then quickly signed into law by the Governor restricting smoking in almost all public places. A summary of the new law is as follows:

The law specifically restricts smoking in the following indoor areas:

However, smoking restrictions are inapplicable in the following circumstances:

This law will take effect on July 24, 2003.

Acid Rain Rules Finalized

The State Environmental Board has given final approval to Governor Pataki's "acid deposition reduction initiative." This Tuesday, the Board approved two new regulations, 6 NYCRR Parts 237 and 238 which, respectively, address NOx and SO2 emissions from large electric generating stations.

Part 237 applies to generator units with capacity of 25MW or greater that "sells any amount of electricity." Sources whose NOx emissions are capped at 25 tons or less during the ozone season (October 1 through April 30) are generally exempt. Part 238 applies to generator units that are regulated as "affected units" under Title IV of the federal Clean Air Act.

These rules will affect about 70 large, base-line electric power generating facilities that use fossil fuel (i.e., natural gas, oil and coal) as a fuel source. In summary, Part 237 would require that summer-time restrictions on NOx emissions - imposed to combat ozone pollution - be extended year-round; and Part 238 would limit SO2 emissions to one-half of the levels allowed under Title IV of the federal Clean Air Act.

The Business Council, and many businesses directly affected by the proposed rule, believe that these rules will have a significant, adverse impact on the price, reliability and future supply of electric energy in New York State. The Department of Environmental Conservation's own economic impact statement projected capital costs of $430 million, and average increases in the wholesale cost of electric power of 5.4 percent, or $370 million per year, with significantly higher cost increases in Rochester (9 percent) and Long Island (16 percent.) It projects job losses of up to 6,000 positions. Many industry experts believed these impacts were significantly underestimated, since they were based on overly optimistic projections of new generating capacity coming on-line.

Despite significant concern raised by the business community regarding the cost and limited benefits of this program, the final rule was not significantly modified from earlier versions.

Hard copies of the final rule are available upon request from The Business Council. You can also obtain the complete rulemaking package from DEC's web site at:

Legislature in Talks to Boost Corporate Taxes

With the Legislature pushing for a mid-April resolution of the state budget impasse, key leaders are seriously considering a proposal that could nearly double the state's corporate income taxes.

The plan is reminiscent of the corporate tax increase adopted by New Jersey last summer, in an (unsuccessful) effort to end that state's budget difficulties. Like the New Jersey plan, it is being spun as an effort to close "loopholes"; but like the New Jersey plan, it would impose a new gross receipts tax and many other new tax burdens on the state's corporations.

The plan was initially drafted by the Fiscal Policy Institute, a union-funded "think tank" that annually recommends higher taxes for New York.

New York Day in Washington

Save the date and book your hotel now! The Chamber Alliance's New York Day in Washington, D.C. is May 14. This is your chance to lobby on Capitol Hill for issues important to your local business community. The event kicks off with a Legislative Reception May 13th on "The Hill" with our New York delegation. Confirmed speakers for our Congressional Breakfast May 14th include Senators Charles Schumer and Hillary Clinton. The entire New York delegation of Representatives is also invited to join us. Then you'll hear the latest developments on issues of importance to New York businesses from experts in the field, during our Issues Briefing. Confirmed speakers include Doug Holtz-Eakin, Director of the Congressional Budget Office; John Faso, Governor Pataki's new appointee for transportation issues; and Jim Mazzarella, Governor Pataki's Washington representative. The afternoon provides ample opportunity for your group to meet one-on-one with your own Members of Congress and their legislative staffs.