Provides for expiration of temporary state energy and utility service conservation assessment at end of state fiscal year unless governor asks for a continuance

2 Co-sponsors

• Bill Perkins
• William T. Stachowski

Title of bill

An act to amend the public service law, in relation to the imposition of the temporary state energy and utility service conservation assessment

Purpose or general idea of bill

To require the temporary state energy and utility service conservation assessment imposed by the 2009-2010 Executive Budget to sunset on an annual basis.

Summary of specific provisions

Section 1 provides the "temporary state energy and utility service conservation assessment" imposed by the 2009-2010 Executive Budget will sunset annually beginning on or after March 31, 2010, unless, on or before submission of the executive budget, the Governor requests the authority in such budget to continue to impose such assessment for an additional fiscal year.

Justification

In the 2009-2010 Executive Budget, the utility regulation assessment imposed by section 18-a of the Public Service Law was increased 500%.

Historically, the 18-a assessment was a de minimis fee that funded the PSC, which is an independent regulatory body that regulates the behavior of electric, gas, telecommunications and water utilities on behalf of the public interest. The 18-a surcharge was established by statute in an amount that was not to exceed one-third of one percent of the utilities' intrastate revenues.

The Governor's 2009-2010 Executive Budget increased that fee to one percent of intrastate revenues, and added an additional 1 percent fee that was labeled a "conservation assessment." The rationale for the increased "conservation assessment" was the increased utility prices would induce consumers to lessen their use of energy, while simultaneously raising hundreds of millions of dollars of new revenue for the State's general fund.

The 18-a fee is passed on by utilities to their customers via their energy bills. The practical effect on consumers is their utility bills have increased by at least 2%, and in some cases by more. The practical effect on the general fund is the expanded 18-a fee raised more than $400 million in revenues in 2009, which were placed in the general fund to balance the budget.

The 2009-2010 Executive Budget requested the increased 18-a fee from 2009 to 2014. This legislation would require the increased fee to expire ("sunset") at the end of each fiscal year, unless the Governor expressly requests legislative authority to renew the fee.

Creating legislative oversight over this fee will ensure the Governor will not continue to impose this new burden upon New York's energy consumers once the current budget crises are over. Moreover, requiring this increase to sunset will make certain the Governor's fee increase does not permanently increase consumer energy and, potentially, telecommunications prices.

Prior legislative history

None.

Fiscal implications

None.

Effective date

Immediately, provided however the amendments to subdivision 6 of section 18-a of the public service law, made by section one of this act, shall not affect the expiration and repeal of such subdivision and shall expire and be deemed repealed therewith.