S.7508/ A. 9508 TED Article VII Budget Bill Part GG


S.7508/ A. 9508 TED Article VII Budget Bill Part GG


Tax on Gas and Electric Customers



The Business Council of the State of New York opposes Part GG which would authorize the Public Service Commission to continue an assessment of up to $19.7 million on gas and electric customers.  The funds collected would be transferred to the New York State Energy Research Development Authority (NYSERDA) for research, development and demonstration, policy, and Department of Environmental Conservation (DEC) climate change program.

This special assessment is in addition to the special assessment under Section 18-a of the Public Service Law which authorizes the Department of Public Service to assess gas and electric corporations for expenses related to administering Public Service Law programs.

Part GG is part of a growing trend of hidden energy taxes and assessments that provide funding for programs that should be considered with other General Fund expenses.  The FY 2019 Executive Budget continues the trend with the following energy assessments and sweeps:

  • Regional Greenhouse Gas Initiative Sweep $23M
  • Expanding 18-a $3M
  • Extending Energy Sales Tax $128M
  • Power Authority Sweep $20M

Hidden taxes have become more popular because regardless of an entities tax status these taxes are unavoidable.  Additionally, it has been well documented that lower-income families are more vulnerable to energy costs than upper higher-income families because energy represents a larger portion of their household budgets.  Energy consumes one-fifth or more of the household incomes of lower- and middle-income families, an amount usually spent on food, housing, or health care.

For businesses, high costs make New York a more difficult place to do business. Reducing the cost of doing business is widely recognized as a key component to growing the state's economy and creating more private sector jobs. In fact, current energy assessment cost some large businesses upwards of $2 million per year– money that could be reinvested elsewhere for greater growth.

A 2010 report from the Public Policy Institute shows that state and local taxes and assessments on electric power alone impose a $6.4 billion burden on the state's economy. The study found that that “fully 26.68 percent of New Yorkers' electric bills support state and local taxes and fees.”

Energy is the basic driver of all major economies and in the interest of economic growth The Business Council of the State of New York opposes the proposed energy tax, and request that the State either finds funding in the General Fund for these programs and/or reduce unwarranted programs.