Repeal Remaining 18-a: We supports the elimination of the yet-to- be collected Temporary State Energy and Utility Service Conservation Assessment (often referred to as 18-a). In 2009, when this temporary fee was imposed, there was an explicit promise to the people of the state that this assessment would not be permanent, but it has already been extended by 3 years.

The Manufacturers Alliance and The Business Council appreciate the Senate Majority’s continued commitment to end this burdensome assessment.

Repeal of 18-a would reduce assessments by about $130 million in FY 2017, reducing costs for all utility customer including schools, hospitals, universities, residents, farms, small businesses, and manufactures currently pays 18-a.

For businesses, the high cost of energy 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, the current energy assessment costs some large businesses upwards of $1 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. Therefore, The Manufactuerrs Alliance and the Business Council of the State of New York supports the proposed elimination of 18-a.

Oppose “Mini-18- a”: We also oppose the provisions in S.6408/A.9008 (Budget), Part J, which would authorize the Public Service Commission to establish an assessment 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, planning and the NY Fuel Program; Department of Environmental Conservation (DEC) climate change program; and the University of Rochester laboratory for laser energetics.

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.

The State Energy Plan has committed the State to a goal of achieving energy consumer cost savings, but continuation of State energy assessments will remain a barrier to achieving this goal. Part J is one of manyof New York State’s hidden energy taxes which increases the real cost of energy in New York State. It 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. Furthermore these hidden taxes have become more prevalent because, regardless of an entity’s tax status, these taxes are unavoidable for energy consumers.