This Week in Government Affairs
March 3, 2014
- Legislative Revenue Forecasts – This week, both legislative houses released their economic and revenue forecasts for the new fiscal year, which will serve as the basis for negotiations on a final budget agreement. The joint Senate Republican/IDC report projects current year revenues to be $88 million above the administration’s expectations. For the FY 2015 budget, the Senate is projecting total revenues at $265 million more than the Executive’s estimate. It also projects a two-year General Fund revenue surplus of $353 million The Assembly Revenue report projects that for the current year, “all funds” revenues will be about equal to the Administration’s projections; for the new budget year, FY 1015, the Assembly study projects all funds revenues at $142.3 billion, an increase of $1.6 billion from the current year and $410 million higher than the Executive's forecast. The Assembly issued a separate Economic Report that served as the basis for its revenue projects.
- Job order contracting - The Senate Labor Committee will take up legislation this week that would impose restrictions on job-order contracting in public works contracts (S.6618/A.8757). Job order contracting (JOC) is a procurement system that enables public agencies to engage in small- and medium-sized maintenance, repair projects and minor new construction projects with a single competitively bid contract. It saves taxpayer money and agency time by reducing the time and expense of completing the traditional contracting method for each small project. The Business Council supports the current JOC system for use by municipalities and businesses engaged in fulfilling these contracts, and opposes the proposed restrictions.
- PLA requirement – Included in the Executive Budget 30-day amendments is a proposal that adds a requirement for the use of Project Labor Agreements (PLAs) on all public design-build capital project contracts exceeding $10 million. A PLA is a pre-hire collective bargaining agreement between a contractor and a building and construction trade union establishing the union as the collective bargaining representative for all workers performing work on a public work project. Only contractors and subcontractors who sign a pre-negotiated agreement with the union can perform project work. This proposal would effectively block open shop contractors from participating on these projects.
- Brownfield Legislation - Members of The Business Council’s brownfield working group have developed a draft response to the brownfield program amendments included in the Executive Budget, which would: extend the Brownfield Cleanup Program for ten years; bifurcate the remedial and the tangible property credits; create a no-credit fast track approval process; and expand the program to include additional sites. The proposal also provides that, to be eligible for the tangible property credits, a property must: be vacant for at least 15 years or vacant and tax delinquent for 10 or more years; have a value of less than the cleanup costs; and be an economic development project. It also removes already accepted projects from the program if cleanups are not completed on a “timely” basis. While the Council supports components of the Governor’s proposal, the exclusion of current projects and the new eligibility criteria are of concern. Members interested in the development of the response should contact The Business Council.
- 18-a assessment – The Business Council supports a provision in the Executive Budget that would reduce the Public Service Law § 18-a(6) Temporary State Energy and Utility Service Conservation Assessment (Temporary Assessment) by $600 million over the next three years, eliminating the assessment on industrial utility customers and accelerate the phase out for all other customers (Part S of S.6357-A/A.8557-A).
Bill memos - The legislative memo section on The Business Council’s website includes updated information on bills of interest and/or concern to members.
- IRS rules on 501(c) organizations – The Business Council joined with the U.S. Chamber and numerous other state and local chambers in opposing the potential application of “candidate-related” political activity restrictions on 501(c)(6) organizations, including business and membership organizations. The Treasury Department had proposed a rule imposing new restrictions on Section 501(c)(4) “social welfare” organizations, and as part of the rulemaking, asked for comments on the potential application of this rule on other 501(c) categories. While the proposed rule would have no material impact on the Council’s (c)(4), New York Jobs Now Inc., it would impose significant restrictions on The Business Council and other trade associations that regularly engage in legislative and political advocacy. Our comments, and the proposed IRS rule, are available here.
Staff contact: Ken Pokalsky
- MWBE rule changes – The Business Council is still seeking feedback from our members on the Empire State Development’s proposed rule-making changes to the Division of Minority and Women’s Business Development and the minority- and women-owned business enterprise program. The proposed changes include removing references to the outdated 2010 Disparity Study and amending agency goals for contracting with MWBEs in four categories: services, commodities, construction and construction-related services. Public comments are due March 17, 2014.
- More information on The Business Council’s Regulatory Agenda.
Visit The Business Council’s Political Action Committee (PAC) page for information on upcoming PAC events.
Please note the following additional items of interest:
- Out-of-network mandate - Last week, the New York State Department of Health (DOH) held a Regional Advisory Committee webinar to discuss its 2015 Health Plan Invitation. Of the most concern to the business community was the declaration that the Exchange would mandate some form of an out-of-network benefit beyond the 2014 requirements. The DOH is seeking stakeholder input to determine its parameters on out-of-network coverage. Options discussed include mandated products at different metal tiers as well as inclusion of out-of-network benefit as a rider to policies.
- The Business Council has advocated strongly for the need for robust health care networks as the cornerstone to controlling healthcare costs and promoting health and wellness. Mandates on all health insurers to offer coverage for all services performed by out-of-network providers remove leverage from health plans in negotiating with providers to participate as part of cost-saving networks. There is little doubt that an out-of-network mandate would significantly increase the cost of health care and premiums on the Exchange. The Business Council will be offering comments on the plan and encourages members to reach with any questions and/or comments.