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Government Affairs Albany Update

March 16, 2007

Governor Directs Agency Heads On Workers' Comp Next Steps

Governor Spitzer, in a letter to three Agency heads, has specified a number of projects which represent the next phase of workers' compensation reform. The letter dated March 13, 2007 directs the Superintendent of Insurance to lead the effort, and directs the Chair of the Workers' Compensation Board and the Commissioner of Labor to provide help and assistance. The projects include:

The details of each of these projects, along with reporting and action deadlines is in the enclosed letter. We will be discussing these projects in more detail at the March 20 meeting of the Government Affairs Council.

Health Care Quality and Cost Containment Commission legislation advances

Legislation to create a new Health Care Quality and Cost Containment Commission has advanced in both houses of the legislature. The bill (S.3020-A Seward / A.6159 Grannis) would create a nine member commission to analyze the impact on health insurance costs and quality of proposed legislation which would mandate that health benefits be offered in group health insurance policies. Many states have similar commissions. The bill moved to the Senate Calendar and was reported from to the Assembly Ways & Means Committee this week. The Business Council is strongly supportive.

FERC Approves License for Niagara Power Project

Yesterday the Federal Energy Regulatory Commission approved a new 50-year license for NYPA's Niagara Power Project. This assures continued operation of this very important generating facility, whose low-cost electricity is directly linked to 43,000 jobs in Western New York. The license includes an agreement, consistent with the Niagara Redevelopment Act of 1957, which addresses allocation of the project's power. These allocations are as follows:

ALLOCATION
DESCRIPTION
MW
Preference Power
New York State Municipal Electric Systems and Rural Electric Cooperatives
752
Preference Power
Neighboring States
188
Replacement Power
Western New York Business & Industry
445
Expansion Power
Western New York Business & Industry
250
Rural and Domestic Power
Residential Customers of National Grid, New York State Electric & Gas, Rochester Gas & Electric
301

New license conditions also will protect and enhance fish and wildlife, water quality, recreational resources and historic properties. The FERC press release is available here:
www.ferc.gov/press-room/press-releases/2007/2007-1/03-15-07-H-1.asp

Assembly, Senate each pass a State Budget Revenue Bill

The Assembly and Senate each amended the Governor's Executive Budget revenue bill, now A.4310B and S.2110B, respectively, and passed their respective "B" versions.

The Assembly accepted each of the Governor's proposed business tax increases with the following three exceptions: (1) none of the corresponding business tax increases to New York City's tax code were included; (2) the elimination of Article 32's 20% reduction for in-State wages was not included; and (3) the fifth trigger for forced conversion of an Article 32 taxpayer's investment subsidiary from Article 9-A status to Article 32 status was not included, namely, an IRC 368(a)(1)(A), (B), (C), (D), or (E) reorganization.

The Senate included none of the Governor's proposed business tax increases and included all the business tax decreases in its previously passed S.1456.

As is the case with all Budget issues, the differences in the bills will be subject to resolution by a joint Assembly-Senate conference committee.