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Government Affairs Albany Update

April 11, 2008

Budget Summary

The State Legislature completed action this week on a reported $121.7 billion state budget for Fiscal 2009.

According to the Division of Budget, the final agreement cuts $1 billion from state agency spending (resulting in a state operations increase of just 1 percent); $828 million of savings within the state's health care budget (including pharmaceuticals, insurance, nursing homes, home care and others) resulting in a 1.2 percent increase in state Medicaid spending, excluding the local cap; a 2 percent ($270 million) reduction in local assistance programs (excluding local school aid); and one year delay in extending  middle class STAR rebates (a savings of  $354 million).

The final budget also includes about $950 million in new revenue measures, including nearly $700 million in new business taxes and fees.

Major spending initiatives included a $1.75 billion increase in state funding for elementary and secondary schools; funding for the expansion of Child Health Plus to cover an additional 70,000 uninsured children; a total of $1.6 billion in “economic development” capital; and nearly $6 billion of capital funding for SUNY and CUNY senior colleges and community colleges.

The Business Council has prepared a narrative summary of budget provisions of interest to Business Council members, which is available from our web site by clicking here.  We encourage you to follow up with Business Council staff if you need any additional information, or if you would like to discuss any of these budget provisions in detail.

Executive Order on State Energy Plan

Governor Paterson has issued an Executive Order to re-establish the state's energy planning process. The text of the Executive Order is available here.

The Order creates an eleven member board, comprised mostly of state agency heads, to be chaired by Paul DeCotis, the Governor's Deputy Secretary for Energy.

The Board's directive is to develop long-term energy policy objectives; do demand forecasts for up to ten years for electricity, natural gas, coal and petroleum; assess existing energy infrastructure; project energy prices; assess the cost and benefits of alternative energy sources; consider the impact of energy markets on economic development; evaluate environmental justice aspects of the state's energy systems; and make recommendations for legislative and administrative measures to implement the state's energy policies.

The Board is directed to issue a draft plan by March 31, 2009 and a final plan by June 30, 2009. The Board is charged with doing updates every three years.

Setback for Broadwater Project

Governor David Paterson announced yesterday that the Broadwater project a floating liquid natural gas terminal proposed for Long Island Sound - violates the Coastal Zone Management Act and is therefore inconsistent with the values and uses of the Sound.  The Department of State found the proposed LNG terminal to be "inconsistent" with state coastal zone management policies.

Broadwater Energy had hoped to have the facility in operation in 2011, taking on super-cold liquefied natural gas from tankers, heating it to return it to a gaseous state, then shipping west via a new 25 mile-long pipeline to have been laid on the Sound floor.

This announcement came despite the Federal Energy Regulatory Commission's unanimous decision last month to approve the project and the Long Island Power Authority commissioned report finding that the billion cubic feet of additional gas from Broadwater would have saved New Yorkers a total of $14.8 billion in natural gas and electricity costs between 2010 and 2020.

Washington Update

H-1B Visa Cap Reached on Day 1, F-1 Visa Extensions Granted
As expected, the H-1B Visa cap was reached the first day visas were available. One small window of opportunity came from the Department of Homeland Security which released an interim final rule extending the period of Optional Practical Training (OPT) from 12 to 29 months for qualified F-1 non-immigrant students. The extension will be available to F-1 students with a degree in science, technology, engineering, or mathematics who is employed by businesses enrolled in the E-Verify program.
Another aspect of the rule responds to the situation in which an F-1 student's status and work authorization expires before he or she can begin employment under the H-1B visa program. The interim final rule addresses this problem by automatically extending the period of stay and work authorization for all F-1 students with pending H-1B petitions.

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