1998 Post Budget Issues | The Business Council

STAFF CONTACT :

Ken Pokalsky

Dec

1998

Issue Areas:

To view the text of any bill mentioned below, click here and enter the bill number.

Unemployment Compensation

Unemployment Compensation Reform

The Business Council would like to see New York's arcane and antiquated UC system reformed. The UC tax structure has not been updated in nearly three decades and the system hasn't had any significant change in fifteen years. The tax structure which penalizes employers who have stable employment histories is a real negative for a vast majority of employers. This reverse logic needs to be changed to insure that New Yorks Unemployment Trust Fund can be strengthen and enhanced. Additionally, reforms to the requalification and disqualification standards are needed to assist New Yorks employers in complying with the system. These and other reforms that address various parts of the UC system need to be discussed so we can bring the system into the 21st century.

Pending legislation — S.4809 (Alesi) / A.6931 (Farrell)
S.5758 (Spano, Alesi), A.8664 (Nolan). All bills in their respective Labor Committees.

Business Council position — Strongly Support

Insurance

Mutual Holding Companies

Allows domestic mutual life insurers to reorganize into domestic stock companies. Makes several provisions which will better enable New York's domestic mutual life insurers to compete for market share.

Pending legislation — S.5628 (Vellela) / A.7057A (Grannis). Both bills currently in the Insurance Committees.

Business Council position — Strongly Support

Energy

Power for Jobs Program

Last year the Governor signed legislation approving a three year "Power for Jobs" program which set aside 400 megawatts of low cost power for qualified not-for-profit organizations and businesses promising to retain or create jobs in New York. The Senate will be introducing legislation to add 400 megawatts to the program. The Assembly has approved legislation that would accelerate year two of the Power for Jobs program and allocate the 133 megawatts set aside for 1999 during the remainder of 1998. The Assembly proposal would also subtract a portion of the power designated for large and medium-sized businesses and use that power to increase the reserve for small businesses and not for profit organizations.
Pending legislation — A.9958 (Rules) passed Assembly, currently in Senate Finance. The Senate proposal is forthcoming.

Business Council position — All of the 133 megawatts reserved for year one of the Power for Jobs program were allocated within the first five months. This overwhelming response to Power for Jobs and the unexpected number of applications received by the New York State Power Authority highlights the need for an acceleration of the program and additional megawatts to reduce energy costs for businesses during the transition to a competitive wholesale electric market. The Business Council believes that the best way to improve on the highly successful Power for Jobs program is to accelerate year two and approve an additional portion of megawatts for large and small businesses and not-for-profit corporations.

Elimination of the Excess Dividends Tax on Energy Subsidiary Assets Transferred to a Parent Holding Company

This proposal would avoid an unanticipated and double tax of 4.5% on any transfer of funds, dividends or assets between a subsidiary energy utility and its parent holding company.
Pending legislation — Draft pending in Senate and Assembly.

Business Council position — Electricity costs in New York are being reduced but are still, overall, higher than other states. To achieve true competition, energy utilities (currently subject to regulation by the Public Service Commission) will be restructured into an unregulated holding company, a regulated transmission and distribution company and one or more unregulated subsidiary companies. In restructuring, the current language of § 186 of the New York State Tax Law may be construed to levy a 4.5% dividends tax on the transfer of assets from an energy company's subsidiary to the holding company, creating an unforseen windfall to the state and nullifying a portion of energy savings achieved by deregulation. The Business Council believes that to achieve true energy cost savings and avoid an additional unforseen tax that drives up the cost of energy in New York State, this legislation must be passed to update § 186 of the tax law and exempt future asset transfers between an energy subsidiary to it's parent holding company. This proposal is revenue neutral and does not carry a fiscal impact to the state.

Exemption of the Natural Gas Importation Privilege Tax (GIPT) for New York State Energy Producers

Public utilities currently receive an exemption from the GIPT. Independent power producers (IPP) are exempted from paying the tax for the portion of gas they burn to produce steam / electricity for their steam hosts. IPPs pay the tax for the gas they burn to produce electricity that is sold to utilities, however, they are reimbursed for the cost by those utilities. This measure would continue the GIPT exemption currently received by New York utilities following deregulation and restructuring, and extend that same exemption to independent power producers that have a presence in New York State.

Pending legislation — Draft pending in Senate and Assembly.

Business Council position — As with the elimination of the excess dividends tax, the unintended consequences of deregulating the electric industry, in this case, would be to levy an additional 4.25% tax on energy produced in the state by spun off utility plants and IPPs who relinquish their six cent contracts. The Business Council strongly recommends passage of this legislation to reduce energy costs and avoid an unforseen additional 4.25% state tax on energy. The fiscal impact of not implementing the GIPT exemption to utilities and IPPs is to increase taxes by $18 million a year on electricity. The fiscal impact of changing the law to exempt spun-off utility generators and IPPs terminating their six cent contracts would mean an $8 million decrease in the tax collected annually by the state.

Elimination of the Tax on Sales for Resale of Electricity

Forestalls an unintended state tax increase on electricity that is sold for resale and which would not otherwise be created except by introducing competition into the electric generating business.

Pending legislation — Draft pending in Senate and Assembly.

Business Council position — Absent this legislation, every time electricity changes hands from generator to the end user, there will be a three-quarter percent tax levied. Deregulating generation and introducing competition will cause many new aggregators and marketers of electricity to enter the market, substantially increasing the number of times that electricity changes ownership from generator to the ultimate customer. With these additional taxes ultimately passed on to the customer, The Business Council believes that this will raise, not reduce, the cost of electricity. We urge passage of this legislation to forestall the unintended state tax increase. It is estimated that sales for resales of electricity and gas by the regulated energy utilities currently produce tax revenues of less than $5 million annually.

Motor Fuel Franchise Agreements

The Senate and Assembly have introduced legislation that would amend § 199-a of the General Business Law and add a new § 199-o to permit motor fuel franchisees and dealers to make alterations on retail premises without prior approval by the property owner.

Pending legislation — S.6786 (Nozzolio) Senate Consumer Protection Committee. A.10270 (Abbate) Assembly Economic Development Committee.

Business Council position — Passage of this legislation would completely circumvent the property rights of motor fuel producers / refiners. Such a violation is disconcerting, not only in this particular scenario, but also when it would appear to be precedent setting for other types of franchise agreements. The Business Council believes that such over-arching interference by the in such business decisions would be inappropriate and we must oppose this legislation and strongly urge its defeat.

Manufacturing

Civil Justice Reform

Establishment of a statute of repose. (Currently in New York, a manufacturer can be held liable for the safety and performance of products they manufacturer as long as the product is in use. This provision would establish a time period after which the manufacturer could not be sued for injuries resulting from the use of its products)

Capping all non economic damage awards at $250,000

Loser pay rule.

The Business Council is working with New Yorkers for Civil Justice Reform, a broad based coalition comprised of more than 400 small and large businesses, local governments, and not-for-profit organizations, to pass legislation that would provide balance to the state system for resolving and compensating personal injury law suits.
Pending legislation — Legislation, S.6661 (Volker), has been introduced that was drafted by the coalition. It will be introduced soon in the Assembly by Assemblyman Morelle.

Business Council position — There are several provisions in this legislation which the Business Council believes should be enacted to address many of the inequities in the current civil justice system. Those that are most important are summarized below.
Repeal of joint and several liability (Currently, businesses found to be 1 percent responsible for an injury can be held responsible for 100 percent of the damages. This provision would prohibit businesses from being held responsible for more than their proportionate share of damages).
Repeal of strict liability for employers and property owners at construction work sites (If an injury to an employee occurs at a New York construction site the employer and property owner are automatically deemed to be liable even if the injury occurred as a result of the negligence of the employee. This provision would establish a negligence standard and allow damages to be apportioned based on degree of responsibility).

Digital Signature

The Business Council supports legislation that would allow transactions between and among individuals, state agencies, businesses, local governments and the legal system to be be made using electronic technology.
Currently, most such transactions must be conducted either in person or through the mail. Allowing them to be made via the internet or through the use of other electronic technology would significantly increase their efficiency. Inherent in any such proposals is the need to establish a system of digital signitures whereby the signiture of parties to a transaction can be reliably authenticated. Pending legislation — Legislation has been introduced in the Senate by Senator Hannon and the Governor is expected to introduce a program bill in this area in the near future.

Business Council position — Furthermore, The Business Council supports the development and implementation of such policies to made with a broad grant of statuatory authority to a regulating body so that as technology changes, the state's policy in this area can be changed without the need for statutory amendments.

Environment

Brownfields

The Business Council has drafted legislation that will provide environmental and economic incentives for the remediation and redevelopment of contaminated properties. In part, this legislation will help promote the redevelopment of "brownfield" properties. However, the legislation will also expedite the cleanup of contaminated sites by responsible parties. Key environmental provisions of the bill include: the use of risk-based cleanup standards; post-remediation liability releases; and liability reform for "innocent landholders," secured creditors, municipalities and IDAs. The bill also offers an economic incentive package — modeled on the state's existing economic development zone program — to encourage non-responsible parties to develop contaminated properties after they are cleaned up.

Pending legislation — The Business Council's proposal has been introduced in the Assembly by Jeffrion Aubry (A.8470), and will be introduced in the Senate by EnCon Committee chair Carl Marcellino. Other proposals include:

S.5067 (Marcellino), the "voluntary cleanup act" S.5286 (Rules), introduced on behalf of the Attorney General
A.4375 (Destito), the "environmental opportunity zone act."

Of these bills, A.4375 has passed the lower house in each of the past two sessions. A.4375 is currently in the Assembly Ways and Means Committee. The Senate has yet to pass any version of a voluntary cleanup/brownfield bill.

Business Council position — The Business Council is putting together a coalition that will include the economic development community, municipalities, and financial interests, to push for passage of our Site Remediation and Redevelopment Act. While the Business Council has not formally opposed the Destito bill, we do not believe it would prove effective in promoting cleanup and redevelopment projects. It establishes an extensive administrative process for the approval of cleanup projects, and creates significant new oversight and approval authority to municipal governments. The other two Senate bills are similar in structure to our proposal, but are more limited in scope.

Title V Emission Fees

The federal Clean Air Act amendments of 1990 established a new operating permit program for major air emission sources, and required states to finance implementation of this new program exclusively through fees imposed on permitted facilities. In 1993, the state adopted legislation that capped Title V fees at $25 per ton of regulated emissions, but allowed the cap to increase at the same rate of the consumer price index. The legislature also limited the imposition of these fees on the first 6,000 tons of emissions within each category of regulated contaminated released from a facility. The "presumptive minimum" fee established by Congress was $25 per ton, plus CPI, on the first 4,000 tons of emisssion.
Pending legislation — The Executive Budget included a proposal to increase the Title V fee cap to $45 per ton, plus CPI increases after 1998. This would have allowed a nearly 60 percent fee over the current $27.85 level. While the legislature approved the proposed $16.3 million in spending for DEC's Title V program, it rejected the proposed increase in the Title V fee cap to $45 per ton. Now that the budget bills have been acted on, there are no legislative proposals on the table to increase the cap on Title V permit fees. However, even with an incoming balance of more than $5 million, the Title V program account will not have enough funds in Fiscal 1999 to support the full $16 million appropriation. It is yet to be seen whether the Administration will seek a more modest increase in the fee cap as a post-budget issue, or if it will rely on cost control measures, in order to balance the account. The only fee-related bill on the table is A.5881 (Brodsky). This bill would produce additional revenues — and redistribute the incidence of fees within the regulated community — by removing provisions that limit the imposition of fees on the first 6,000 tons of emissions within each category of regulated air pollutant. This bill has yet to be reported from the Assembly EnCon Committee.

Business Council position — The Business Council opposed the $45 fee cap proposal as excessive. We raised concerns regarding a number of specific spending items in the DEC's Title V program budget, and we identified excessive spending on some program elements, and pointed out others that were inappropriately charged to the Title V fee account.

Health

Child Health Insurance

The U.S. Congress created and the President signed the State Health Insurance Program (S-CHIP) as part of the Balanced Budget Act of 1997. The Program provides the states with significant resources to meet children's health insurance needs. Each state can make determinations as to whether they use the money to expand Medicaid or to establish a private children's health insurance plan.
New York will be receiving $256 million from the federal government in each of the next five years. The legislature and the Governor must decide how to use the money, what benefits children will receive, etc. The Governor has already publicly stated that he would like to use it to expand New York's existing Child Health Insurance Program which is a private program established in 1991. The Assembly has stated their desire to expand Medicaid with the money. Key players in the debate will be Senator Hannon, Assemblymen Gottfried and Grannis and Commissioner Barbara DeBuono, M.D. Pending legislation — There are currently no bills pending on this issue. It is expected that the Governor will be issuing a comprehensive Governor's Program Bill shortly.

Business Council position — The Business Council supports using the existing Child Health Insurance Program (CHIP) as the vehicle for expanding children's health insurance and supports the Governor's call to make the benefit structure generous, yet not inclusive of everything offered in Medicaid.

Excess Medical Malpractice Insurance

In 1985 the legislature passed a measure requiring that hospitals provide an extra layer of medical malpractice insurance — called excess medical malpractice insurance — to all eligible attending physicians and dentists. The hospitals were then allowed to include a charge on their hospital bills to cover the cost. Since that time, employers have paid hundreds of millions of dollars into these funds — funds that have paid out only about $100 million.

Each year the excess insurance program has a statutory sunset of June 30th. Last year the business community was successful in having the legislature impose a one year freeze on payments into the fund. That saved about $170 million. The excess program was kept on the books, however, and is scheduled to expire on June 30, 1998. Pending legislation — There are currently no bills pending on this issue.

Business Council position — The Business Council's position is that the excess medical malpractice program should be eliminated and physicians should be responsible for paying for their own liability coverage. With this, we continue to support the physician's call to impose a cap on non-economic damages to make the civil justice system more equitable.

Health Insurance Mandates

The legislature is under pressure every year to add new health insurance mandates to the Insurance Law. One of the most expensive in history — a bill to allow unlimited access to chiropractors — was signed into law last year. There are literally dozens of bills pending that would add everything from acupuncture to massage therapy. Below is a listing of the ones being openly discussed.
Pending legislation — 1) Mental health parity (S.5484 Libous / A.8315-B Rules at the request of Brennan); 2) Prostate cancer screening (S.313 Skelos / A.4678 DiNapoli); 3) Fertility treatment and contraceptives (A.8877 Griffith); 4) Acupuncture treatment (S.3635 Libous / A.6206 Hoyt).

Business Council position — The Business Council opposes increasing the number of statutory health insurance benefit mandates as counter-productive to making health insurance more affordable. We advocate the passage of a bill to allow an employer to buy a more affordable foundation health insurance policy. We have joined with a coalition calling for a moratorium on health insurance mandates. Members of the coalition include: NFIB, New York State Conference of Mayors, New York State Association of Counties, New York State Conference of Blue Cross and Blue Shield Plans and the New York State HMO Council.

External Review / Experimental Treatments

External review is a system that allows a patient to seek an independent medical review when their health maintenance organization denies them medical treatment. Bills as drafted would have the independent medical review decision binding on the HMO. This issue is sweeping through state Capitols across the country and has been signed into law in places like Connecticut and Rhode Island.
The experimental treatment issue is narrower than full external review. Experimental treatment legislation is designed to allow independent medical review in cases where a patient is undergoing experimental treatment or is part of a clinical trial. Often these patients are facing life-threatening illnesses like breast cancer and AIDS. Pending legislation — 1) External Review (A.6585-A Gottfried / S.5316-A Gentile); 2) Experimental Treatment (A.1020 Grannis) and (S.5489 Stafford, Bruno)

Business Council position — The Business Council is opposed to the external review bill as overly rigid and costly. We oppose the Grannis experimental treatment bill as overly broad. We have discussed the experimental treatment bill with the sponsors of the Senate bill and have asked for some minor modifications. The above bills will be actively debated by the legislature between now and July 4th and there will likely be two-house action on them.

Health Plan Liability

Proposals are pending in both houses to dramatically expand the liability of HMO's, insurers and self-insured employers, regardless of fault, for "any personal injury, death of damages" caused by the health care plan's delay, failure or refusal to approve, provide, arrange for or pay for any health care service in a timely manner.
What it all means is that a trial lawyer, on behalf of a client, can collect from a health care plan even if the plan's denial of a request for approval or payment was a rational decision based on ample and convincing medical evidence, and was thus not negligent in any way. This issue is being pushed by the Medical Society who long have expounded on the absurdities of the civil justice system. Pending legislation — (A.1816-A Grannis, Gottfried / S.2544-A Velella)

Business Council position — The additional fear of lawsuits would surely force health care organizations to authorize nearly all procedures, including unnecessary ones that could harm New Yorkers. What is perverse about this so-called consumer bill is that it will increase costs to all businesses and consumers and may even endanger patients' lives by giving them treatments they may not even need. We are adamantly opposed.

Taxation

ITC - Successor Employers

At present, if a company breaks up and sells off the parts of its operations, then the purchaser of a part is entitled to take Investment Tax Credit for the eligible property purchased. However, if a company itself is purchased and the purchaser continues the operation as before, then the purchaser may not take new ITC on the purchase and the carryforward ITC of the purchased company, if any, is reduced to zero.
Pending legislation — Legislation drafted and sponsor's memorandum written. The legislation would transfer the carryforward ITC, if any, of the purchased company to the purchaser-company as is the case with the other assets of the purchased company

Business Council position — Support

Prevention of Newly-created Taxation under Electricity Competition

The introduction of competition in the sale of electricity requires a breakup and restructuring of the utility industry. Under this PSC-required restructuring, separate entities will be producing and transmitting electricity. Article 9 — the Dividends Tax and the Section 186 Utility Gross Receipts Tax — was written in the context of the then-existent monopolistic, vertically integrated electricity industry. Absent amendment of the Tax Law, additional double tax revenue will occur when asset values are transferred between the books of what-had-been one utility entity (Dividends Tax) and ownership of electricity changes hands prior to, but, for subsequent, resale to New York customers.
Pending legislation — Legislation (2 bills) has been drafted and sponsors' supporting memoranda (two) has been written. Assemblyman Farrell and Senator Stafford (requested) are the sponsors. Article 9 would be amended to: (1) limit application of the Dividends Tax to its current application of dividends to shareholders (as opposed to subsidiary to parent holding company) and (2) limit application of the Section 186 Utility Gross Receipts Tax to sales other than sales for resale

Business Council position — Support

SUT - Article 29 (local portion) Application on Repair/Installation/Maintenance of Exempt Manufacturing Equipment and Cost Basis of Self-Manufactured/Self-Used Property

(1) Equipment used in the manufacturing is exempt from Sales and Use Taxation (both State and local); a separately stated purchase price for the Repair/Installation/Maintenance of the equipment is exempt from Sales and Use Taxation (State and local - New York City only). (2) If a manufacturer uses one of its manufactured products itself, it is required to calculate and pay a use tax on the product; New York is 1 of only 3 states that calculate the use tax on the basis of sale price.
Pending legislation — Legislation covering both proposals has been drafted. The legislation would (1) state that the exemption of RIM services on exempt manufacturing equipment applies to all local sales and use taxes, not just New York City's and (2) the cost basis for determination of use tax on self-manufactured/self-used equipment is the material cost basis of the product.

Business Council position — Support

Article 7 Certiorari Proceedings at the Tax Appeals Tribunal

Article 7 Certiorari proceedings would commence in the State Tax Appeals Tribunal at the administrative law judge level, proceed to the Tribunal, and then, if appealed, move to the Appellate Division of the State Supreme Court. This would eliminate the current practice of trial before a plethora of Supreme Court justices and, instead, concentrate the cases before one body with expertise in the subject matter.
Pending legislation — The issue is being researched and investigated for the purpose of design of a conversion of forum from State Supreme Court to the Tax Appeals Tribunal. The issue is scheduled to be addressed on the program of the annual Conference on State Taxation.

Business Council position — Support

Assessor Testimony in Article 7 Proceedings

The starting point for all certiorari proceedings is the assessed value placed on a parcel by the town/city/village assessor. At present, litigators for municipalities object to petitioners calling assessors to the stand to testify in a certiorari proceeding.
Pending legislation — S.5383-B, Rath in Local Government Committee; A.7956-B, Harenberg, Ramierez, et. al. in Real Property Tax Committee. The legislation would allow the calling and deposition of the assessor that entered the assessment on a tax roll as an adverse witness by petitioners in Article 7 certiorari proceedings and allow the question as to how the assessment was arrived at. The petitioner would have the right to review the documentation, if any, used by the assessor in arriving at the assessment.

Business Council position — Support

Homestead Rollback

Legislation is drafted to cap the disparity between the Homestead and non-Homestead tax rates at twenty-five percent. Also, jurisdictions that currently exceed the twenty-five percent differential would have five years to eliminate the greater than twenty-five percent differential.
Pending legislation — The legislation would limit the discriminatory difference between Homestead and non-Homestead tax rates to 25%; for jurisdictions that currently have a discriminatory difference between Homestead and non-Homestead tax rates greater than 25%, the difference would be "grandfathered out" in five years at one-fifth of the greater than 25% difference per year.

Business Council position — Support

Education

Charter Schools

Such legislation would provide opportunities for teachers, parents and community members to establish and operate public charter schools in New York State. Twenty-three other states have them and seven additional states are starting such schools. Charter schools offer parents educational choices — while at the same time holding these schools themselves to higher levels of accountability — based on student results — than "regular" public schools. Charter schools bring the important element of competition to bear on education. It will serve as a real "wake-up call" by empowering all parents (not just the wealthy) to be true customers of the system.
Pending legislation — Governor's Program bill 52R — not yet introduced in the Senate or Assembly as of 4/23/98.

Business Council position — The Business Council supports this legislation.

Construction

Civil Justice Reform Act

This is a comprehensive and omnibus act that is intended to effect an all encompassing yet fair approach of modification throughout the general provisions of law for the purpose of accomplishing seriously necessary and overdue reform in the various areas of tort law.
Pending legislation — S.6661 Volker — Senate Codes Committee/Morelle-not yet introduced.

Business Council position — NYSCIC strongly supports this legislation as it encompasses amendments to 240 and 241 of the Labor Law and adopts a "statute of repose" for actions against design professionals and construction contractors.

Prevailing Wage Reform

The bill provides that prime contractors provide greater notice of sub-contractors' employees' rights under prevailing wage laws and provide that contractors who are notified within 120 days that a sub-contractor has not paid prevailing wage or supplements become liable only for wages and interest lower than current rates.
Pending legislation — This bill is being sponsored by Ron Stafford in the Senate and Robin Schimminger in the Assembly. A bill number has not yet been assigned in either house.

Business Council position — Under current law, contractors are often not aware that their sub-contractors have not made required prevailing wage or supplement payments until a claim is filed on behalf of the employee. This legislation provides a balanced approach to this problem through a business to business relationship. The New York State Construction Industry Council supports this bill.

No Damage For Delay

This bill requires public owners to compensate contractors for monetary damages due to certain delays imposed by the public owner.
Pending legislation — S.6711 Hannon — Finance Committee/A.10093 Vitaliano — Ways and Means.

Business Council position — Costs associated with delay go well beyond the owner-contractor relationship. Delays have substantial impact on the community as well, for this reason, the New York State Construction Industry Council supports this legislation.

Small Business

Year 2000 Tax Credit

Grants a tax credit equal to twenty-five percent of the amount expended in the taxable year to ensure "Year 2000 compliance". The credit is for the amount expended in the taxable year which commences in 1998, 1999, or 2000. The maximum credit in any single taxable year is five thousand dollars.
Pending legislation — A.9952 (Schimminger) — Ways and Means /S.6881 (Balboni) — Investigations, taxation and government operations.

Business Council position — Support. Businesses will need to spend large amounts of capital in order to have their computers function correctly in the year 2000.

Medical Savings Accounts

The Health Insurance Portability and Accountability Act of 1996 added a new section to the Internal Revenue Code which permits employees of a small business (50 or fewer employees) or a self-employed individual to establish a medical savings account. This type of account allows an individual to purchase a high deductible health insurance policy which is coupled with an IRA-like savings account from which they may draw from to cover their routine medical expenses.
This legislation provides a state income tax credit of ten percent of the individual's allowed federal income tax deduction. Pending legislation — S.4556B (Johnson) — Amended & Recommitted to Finance / A. 8292A (Robach) — Amended & Recommitted to Ways and Means. Business Council position — Support. Over the past decade medical care and health insurance costs have skyrocketed. Many small businesses cannot afford to offer their employees health insurance. The federal MSA program allows a federal income tax deduction of 65% to 75% of an individual's allowed contribution to their MSA. This legislation, if enacted, would permit a New York income tax credit of ten percent of the allowed federal deduction. Thus offering an additional tax savings to New York residents.

The Small and Independent Business Council has written a memo in support of this legislation.

Workers' Compensation

Hours Worked - Workers' Compensation Rates

This legislation would change the method of calculating workers' compensation rates for the construction trades from one based on payroll to one based on the number of hours worked.
Pending legislation — The Assembly has passed their version of the hours-worked bill (Nolan A.8905). Spano S.6356 is in the Senate Labor Committee.

Business Council position — The Business Council believes that the transition from payroll-based to hours worked-based workers' compensation rate making holds great potential to increase costs for all insured entities while failing to provide the equitable workers' compensation premiums it is designed to create. The Business Council has a memo in opposition to this proposal.

Workers' Compensation Hearing Reform

Creates a new Section 2347-A in the Insurance Law requiring the Workers' Compensation Board to have an appeal process for employers who object to a rating classification.
Pending legislation — S.5554-A Libous — Senate Insurance Committee/A.8981 Bragman — Assembly Insurance Committee.

Business Council position — There is no existing requirement in law providing a classification appeals process. The absence of formal appeal process leaves employers without a clear and enforceable means of challenging unfair classifications. The Business Council supports this proposal.

No Liability for Injuries Sustained during Illegal Acts

This bill amends the Workers' Compensation Law to provide that there shall be no liability for workers' compensation benefits where the injury was sustained in the perpetration of an illegal act, unless the action was committed at the direction of the employer, or condoned by the employer.
Pending legislation — This is a Workers' Compensation Board proposal sponsored by Spano in the Senate (S.6942) and is currently in the Labor Committee. There is no sponsor in the Assembly.

Business Council position — Although WCL §205(3) was enacted to expressly bar disability benefits under Article 9 for injuries resulting from illegal acts, the Legislature did not amend §10 to make a similar exception for workers' compensation benefits. This bill is one of the legislative priorities of the Business Council's Workers' Compensation Committee.

Tolling of Limitation Period

Provides a tolling of the limitation period in which a disability claimant must provide notice and proof of claim, where the claimant is physically incapable of providing such notice and proof, such as in cases where the claimant is in a coma or otherwise physically incapacitated.
Pending legislation — A.10136 Nolan — Assembly Labor Committee/S.6940 — Senate Labor Committee.

Business Council position — The Business Council supports this proposal.

Labor and Human Resources

Mandatory Programs to Prevent Workplace Violence-This bill would require employers with 50 or more employees "...to ensure that the risk of workplace assaults and homicides is evaluated by affected employers and employees and that such employers design and implement workplace violence protection programs to prevent and minimize the hazard of workplace violence to employees." In short, employers would have to initiate a study of whether each workplace location contains factors which might place employees at risk of occupational assaults and homicides. Then, the employer would develop and implement a written workplace violence prevention program for each work location. Finally, all employees would receive initial and annual refresher training on the risks of occupational assaults and homicides found in the workplace. This bill also contains provisions requiring the Department of Labor to respond to requests by employees for inspections of the workplace, if a violation of a health or safety standard is believed to exist but does not limit the scope of the inspection to the specific complaint. It also permits the Department of Labor to have a plan for inspections of locker rooms and other areas involving personal property and privacy rights of employees.
Pending legislation — S.5945 (Spano) / A.2666 (Nolan) A.2666 has been passed in the Assembly. S.5945 is awaiting action in the Senate Labor Committee.

Business Council position — The Business Council opposes this legislation and has sent an opposition memo to the members of the Senate Labor Committee. The Business Council opposes this uniform mandate on all employers in New York State, would prefer to see efforts toward a cooperative solution before a mandate is considered and suggests that employee bargaining agents and businesses work together if this is an issue at work sites.