Legislative Memos

Memorandum in Opposition - A.1261 (Bronson) / S.1947 (Ramos)

A.1261 (Bronson) / S.1947 (Ramos) - AN ACT to amend the labor law, in relation to hours, wages and supplements in contracts for public work

The Independent Power Producers of New York, Inc. (IPPNY) is a trade association representing companies involved in the development of electric generating facilities, the generation, sale, and marketing of electric power, and the development of natural gas facilities in the State of New York. IPPNY Member companies produce the majority of New York's electricity, utilizing almost every generation technology available today such as wind, solar, natural gas, oil, hydro, coal, biomass, and nuclear.

IPPNY opposes A.1261 (Bronson) / S.1947 (Ramos). The bills would increase the costs of developing and maintaining electric generating facilities by vastly expanding the requirement to pay higher cost prevailing wages for construction, and, as a result, raise costs for consumers. 

The legislation’s imposition of higher construction costs on the electric generating industry in New York will harm the ability of the State to meet its goals of reducing carbon dioxide emissions and securing electricity consumption with 50 percent renewable generation by 2030. The transition from fossil to net zero-emission resources will require the construction of thousands of megawatts of new electric generation, the cost of which will be passed through to electricity consumers. Now is the wrong time to burden ratepayers with another charge. 

The bills would define a public work as construction “paid for in whole or in part by public funds,” which includes the financing or reduction of property taxes for private electric generating facilities. Private owners and developers of generating facilities commonly utilize tax-exempt financing and Payment in Lieu of Taxes (PILOT) agreements from industrial development agencies (IDA) to reduce construction and operating costs. 

IDA financing and PILOT agreements have never been deemed to be “public work” under existing law, because these private generating facilities are not constructed for any public entity. If the legislation is enacted, these arrangements will no longer reduce construction costs, as the classification of electric generating projects as a public work will raise them. The bills will require private developers to pay prevailing wages for construction and ongoing maintenance for their generating facilities at higher cost than what they have traditionally paid, thereby increasing costs for consumers. 

For the reasons stated above, IPPNY opposes A.1261 (Bronson) / S.1947 (Ramos).