June 24, 2005
Legislative session winds down; highlights include energy resolution
With strong support from The Business Council, state legislators approved legislation that would extend and modify several New York Power Authority (NYPA) programs that provide reduced-rate power to eligible employers across the state. The legislation is a highlight of the 2005 legislative session.
The legislation, which is expected to be signed by Governor Pataki, takes several steps to address New York's problems with high power costs, the Council said in a legislative memo supporting the bill. If signed into law, the bill would:
extend the state's "replacement power" program. This
program allocates 445 MW of Niagara hydropower to industrial customers
within 30 miles of NYPA's Niagara plant.
the extension of price and allocation contracts that expire before
the end of 2006. This would affect energy contracts under the
state's economic-development power program, "high-load factor"
contracts, and municipal development agency contracts.
a new "Preservation Power" program. Currently, 490 megawatts
of power from the NYPA St. Lawrence hydro plant is sold to business
customers. Under the new program, any of this power that is relinquished
by current customers would be made available for economic-development
purposes in St. Lawrence, Jefferson, and Franklin counties.
- Broaden the criteria on which extension of replacement power contracts can be based to include investments by the business, and extend broad "expansion power" program criteria—which includes capital investments and the effect a power allocation will have on a business' productivity—to new allocations of replacement and preservation power.
"Electric power costs continue to be a significant competitiveness issue for New York State businesses, and especially for manufacturers," the Council said in its memo. "Industrial facilities often face in-state power rates that are significantly higher than those paid by out-of-state competitors."
Here is a summary of the status of other legislative issues of interest to the Council and New York's business community:
'Mental-health parity:' The Senate has not passed the so-called "mental-health parity" bill (A.2915-Tonko). That bill would inflate costs of health insurance be requiring all policies to pay for enriched coverage of mental health treatments. The Council opposes this bill and all mandates, which drive costs of coverage up significantly and, in the process, make health insurance less affordable and rarer. The Senate has also not yet passed a separate bill (S.1672-Libous) that would impose a mental-health mandate with exemptions for some small businesses.
'Freedom Health Plans:' The Senate has approved a bill (S.1405-Seward/A.2688-Morelle) that would establish this new kind of health-insurance plan. These plans would have higher deductibles and would be coupled with new health savings accounts (HSAs), accounts in which individuals can contribute pre-tax income to cover health-care expenses. The Senate has estimated that these policies would cost about 40 percent less than existing policies. The Assembly has not passed the bill.
Mandatory reporting of hospital infection rates: Both the Senate and the Assembly have passed, and the governor is expected to sign, a bill (S.5086-Hannon/A.8698-Rules) that would require hospitals to track and report incidences of hospital-acquired infections. The Council supports the bill.
Restricting employer flexibility in offering presciption-drug benefits: Neither the Senate nor the Assembly has passed a bill that would deny employers a cost-effective way to offer coverage of prescription drugs. The bill would prevent employers from charging an added co-payment if employees choose a costlier option of obtaining covered drugs.
Breach of security: Both houses have approved a bill (S.3492-Fuschillo/A.4254A-Brennan) that would establish a process a company would be required to follow to notify consumers about the unauthorized acquisition of personal information, with penalties for noncompliance.
Vicarious liability: The Assembly has bottled up in its Transportation Committee a bill (S.1410-Johnson/A.2620-Canestrari) that would reform New York's notorious, one-of-a-kind "vicarious liability" law. Under that law, companies that lease cars are liable for damages in accidents involving those cars even if they are blameless.
'Portfolio-based standards' in schools: Lawmakers in the Assembly declined to vote on a controversial bill (S.3192/Saland A.6286/Brodsky) that would create “portfolio performance-based assessments,” under which student achievement would be assessed by a body of work rather than objective standardized tests. The Council opposes the bill.
Expanded 'bottle bill:' A bill to expand the state's "bottle law" has passed the state Assembly but has not been moved out of the Senate's Environmental Conservation Committee and is thus unlikely to be approved this year. The Business Council opposes the bill (A.2517-B/DiNapoli), arguing that it would effectively saddle New York's consumers with a new annual tax of $40 million or more, that it would disproportionately affect low- and middle-income taxpayers, that it would undermine existing municipal recycling efforts, that it would increase the costs and compliance burden placed on supermarkets, convenience stores and other beverage outlets, and that it would hurt the beverage industry, which now uses unclaimed deposits to partially finance costs imposed by the existing bottle bill.