Palmesano: Extending Temporary Electricity Tax Sends Wrong Message To Businesses And Consumers

Assemblyman Phil Palmesano (R,C,I-Corning), who is the Ranking Minority Member on the Energy Committee, today stood with Assembly Minority Leader Brian M. Kolb (R,C,I-Canandaigua), fellow Assembly Members and business leaders from the Business Council of New York State, Unshackle Upstate, Manufacturers Association of Central New York, New York Farm Bureau and National Federation of Independent Business (NFIB) to reinforce their opposition to the proposed five-year extension of the Temporary 18-A Utility Assessment.

“The private sector and job creators are not looking at what we’re saying in commercials about being ‘Open for Business,” they’re looking at what we’re doing,” said Palmesano. “A five-year extension of this electricity tax is not the type of action that will instill confidence in our job creators to invest in New York State.

“The private sector is looking for credibility and certainty from the state. Unfortunately, this proposal continues to hurt that credibility with the very people we want to invest and create jobs. This proposal provides the wrong kind of certainty that will perpetuate New York using manufacturers, small businesses and consumers as the ATM machine for government spending.”

When looking at any electricity bill in New York State you will see the “Temporary State Assessment Surcharge,” also known as the “18-A energy tax.” This assessment was scheduled to be reduced this year, saving consumers over $500 this year and $2.8 billion over the next six years.

In a report issued by the Public Policy Institute of New York in 2010, it found that state and local taxes and assessments on electric power impose a $6.4 billion burden on the state’s economy. It also was shown that 26.68 percent of New Yorkers’ electric bills go to local taxes and fees, which is an average of $614.48 per household. Additionally, in 2011, lower-income households allocated 23 percent of their after-tax income to energy in New York, more than twice the national average. The statistics demonstrate a crushing burden for consumers, manufacturers and small businesses.

Karyn Burns, Vice President of Communications and Government Relations for the Manufacturers Association of Central New York, said, “During difficult economic times, it is critical to do whatever is needed to foster a healthy business climate that can enable businesses to sustain and grow. In an energy-intensive sector such as manufacturing, an extension of a fee such as 18-A will do the opposite: it is, instead, forcing businesses to utilize their dollars as a tax to the state, rather than providing capital investment or improvements, investing in their communities, or sustaining and growing much-needed family-supporting jobs throughout the state. Simply put, it is a regressive tax that was originally intended to be a temporary measure, and was described as such to New York State taxpayers when it was adopted, and needs to remain that way. I stand here today urging Albany to do what is right for our New York State businesses and residents and oppose the reauthorization of the 18-A assessment.”