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Government Affairs Albany Update

May 7, 2004

Chemical Facility Security

Legislation addressing the issue of security of "chemical facilities" is moving again in both houses.

In the Senate, S.4156 (Balboni) will be passed out of the Senate Veterans Affairs & Homeland Security Committee today, and will be reported to the floor. It is largely unchanged from the version that passed the Senate in 2003, with a vote of 60 to 0.

The bill's initial focus is on the approximately 125 facilities in New York that have been required to prepare risk management plans under Section 112(r) of federal Clean Air Act. The State Office of Public Security is required to review these facilities, and decide which, if any, pose sufficient threat of terrorism attack to require a security assessment and security improvement plan.

While the bill requires security upgrades where necessary, it does not seem to impose any across the board mandates for specific security measures. It also allows the state to recognize security assessment protocols adopted by industry groups. This bill was supported by the American Chemistry Council last year, The Business Council supported it with amendments.

New legislation is being considered in the Assembly. As part of a comprehensive anti-terrorism bill (A.10543), the Assembly is moving a significantly revised proposal on chemical facility security.

In this year's proposal, the Assembly is directing the Office of Public Security to identify facilities that, due to their use of hazardous materials, pose a potential significant threat due to terrorism attack, and mandate that such facilities undergo security assessments. Interestingly, while the bill would allow the OPS to review such assessments and make recommendations in response to them, the bill does not mandate implementation of security upgrades. Also, as was the case with A.8124 mentioned above, the starting point for this identification process is the CBS chemical list (Part 597).

The text of the chemical security provisions of A.10543

This bill is currently in Assembly Codes Committee, and we expect it to be reported to, and acted on, on the floor in the Assembly within the next several weeks.

Note that last year, the Assembly was considering A.8124 (Koon), which had an extremely broad initial focus (all chemical bulk storage facilities), and a more prescriptive approach to requiring plans and facility upgrades. The Business Council strongly opposed this proposal.

I would be interested in any comments you have on S.4156, and the provisions of A.10543.

Consumers Hit in the Pocketbook/Wallet

The Senate and Assembly reassessed the State's 4.25% Sales and Use Tax -- as well as the Metropolitan Commuter Transportation District's 0.25% Sales and Use Tax -- on clothing priced under $110 for the month of June 2004 in legislation passed this week. The Sales and Use Tax on clothing under $110 was instituted by the Legislature for a twelve-month period (ending May 31,2004) in last year's enacted Budget as a "temporary" tax increase to balance the State's Budget.

With the 2004-2005 State Budget still not settled, this week's action leads to the specter that the Legislature and Governor might make the "temporary" State Sales and Use Tax on clothing permanent as part of an agreed-upon 2004-2005 Budget. This week's legislation also usurped the rights of individual counties to have clothing priced under $110 not subject to their county sales tax. This usurpation is particularly harmful to border counties, such as Rensselaer, which have made sales tax free clothing priced under $110 as the linchpin of their economic retail plans.