Add Art 7-A SS197-a - 197-c, Ec Dev L; amd S1005, Pub Auth L
Enacts the "Northern New York power proceeds allocation act"; establishes the five member northern New York power proceeds allocation board to review and recommend applications for fund benefits pursuant to certain criteria set forth; makes related provisions.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A10093A
SPONSOR: Rules (Russell) TITLE OF BILL: An act to amend the economic development law and the
public authorities law, in relation to enacting the northern New York
power proceeds allocation act
PURPOSE: The bill would create a program funded by the sale of
certain unallocated hydropower produced by the Power Authority of the
State of New York ("NYPA") at its St. Lawrence-FDR Power Project to
support economic development in St. Lawrence County.
SUMMARY OF PROVISIONS:
Section 1 of the bill provides that the bill would be known as the
"Northern New York Power Proceeds Allocation Act" ("Act")
Section 2 of the bill would add Article 7-A to the Economic Development
Law ("EDL") consisting of EDL §§ 197-a, 197-b, and 197-c. EDL § 197-a
would define terms for purposes of EDL Article 7-A. EDL § 197-b would
create the Northern New York Power Proceeds Allocation Board ("Allo-
cation Board"), which would consist of five members, three of whom must
reside in St. Lawrence County. EDL § 197-c would establish the powers
and duties of the Allocation Board and NYPA and describe the procedures
governing applications for fund benefits, the evaluation of applica-
tions, and the award of fund benefits.
Section 3 of the bill would add subdivision 24 to Section 1005 of the
Public Authorities Law ("PAL"), which would provide for the creation of
the "Northern New York Economic Development Fund," as well as NYPA's
duties and responsibilities regarding the Fund and other aspects of the
program created in EDL Article 7-A.
Section 4 of the bill provides that the bill would be effective imme-
diately.
EXISTING LAW: PAL § 1005 establishes NYPA's existing powers and
duties.
STATEMENT IN SUPPORT: Chapter 58 of the Laws of 2012 (Part GG),
enacted the Western New York Power Proceeds Allocation Act and created a
program to support eligible economic development projects located or
proposed to be located in western New York funded by the sale of certain
unallocated hydropower produced by NYPA at its Niagara Power Project.
This bill would create a similar program to support eligible economic
development projects located or proposed to be located in St. Lawrence
County by eligible applicants. As more specifically provided for in the
bill, this program would be funded by the sale of certain unallocated
hydropower produced by NYPA at its St. Lawrence-FDR Power Project which
has been made available to the Town of Massena Electric Department under
a contract with NYPA entered into 2012 entitled "Agreement Governing the
Sale of St. Lawrence-FDR Project Power and Energy" to the Town of Masse-
na Electric Department for Economic Development Purposes."
BUDGET IMPLICATIONS: None.
EFFECTIVE DATE: This bill would take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
10093--A
IN ASSEMBLY
June 13, 2014
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Russell) --
(at request of the Governor) -- read once and referred to the Commit-
tee on Energy -- committee discharged, bill amended, ordered reprinted
as amended and recommitted to said committee
AN ACT to amend the economic development law and the public authorities
law, in relation to enacting the northern New York power proceeds
allocation act
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "northern New York power proceeds allocation act".
3 § 2. The economic development law is amended by adding a new article
4 7-A to read as follows:
5 ARTICLE 7-A
6 NORTHERN NEW YORK POWER PROCEEDS ALLOCATION ACT
7 Section 197-a. Definitions.
8 197-b. The northern New York power proceeds allocation board.
9 197-c. General powers and duties of the board.
10 § 197-a. Definitions. For the purposes of this article, the following
11 terms shall have the following meanings:
12 1. "Authority" is the power authority of the state of New York.
13 2. "Authority-TMED contract" refers to a certain contract between the
14 authority and the town of Massena electric department, entitled "Agree-
15 ment Governing the Sale of St. Lawrence-FDR Project Power and Energy to
16 the Town of Massena Electric Department for Economic Development
17 Purposes," executed and dated by the authority on October eighteenth,
18 two thousand twelve, and the associated authority service tariff issued
19 and effective August twenty-first, two thousand twelve.
20 3. "Board" is the northern New York power proceeds allocation board
21 created by this article.
22 4. "Benefits" or "fund benefits" are payments to eligible applicants
23 selected by the authority for the purpose of funding eligible projects
24 with monies derived from net earnings that have been deposited into the
25 northern New York economic development fund by the authority in accord-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD12090-02-4
A. 10093--A 2
1 ance with subdivision twenty-four of section one thousand five of the
2 public authorities law.
3 5. "Eligible applicant" means a private business, including a not-for-
4 profit corporation.
5 6. "Eligible projects" are economic development projects that are or
6 would be physically located within the state of New York in St. Lawrence
7 county that will support the growth of business in St. Lawrence county
8 and thereby lead to the creation or maintenance of jobs and tax revenues
9 for the state and local governments. Eligible projects may include capi-
10 tal investments in buildings, equipment, and associated infrastructure
11 (collectively, "infrastructure") owned by an eligible applicant for fund
12 benefits; transportation projects under state or federally approved
13 plans; the acquisition of land needed for infrastructure; research and
14 development where the results of such research and development will
15 directly benefit New York state; support for tourism and marketing and
16 advertising efforts for St. Lawrence county tourism and business; and
17 energy-related projects. Eligible projects do not include, and fund
18 benefits may not be used for, public interest advertising or advocacy;
19 lobbying; the support or opposition of any candidate for public office;
20 the support or opposition to any public issue; legal fees related to
21 litigation of any kind; expenses related to administrative proceedings
22 before state or local agencies; or retail businesses as defined by the
23 board, including without limitation, sports venues, gaming and gambling
24 or entertainment-related establishments, residential properties, or
25 places of overnight accommodation.
26 7. "Energy-related projects, programs and services" shall have the
27 same meaning as such term is defined in subparagraph two of paragraph
28 (b) of subdivision seventeen of section one thousand five of the public
29 authorities law.
30 8. "Net earnings" is the aggregate excess of revenues received by the
31 authority from the sale of energy associated with St. Lawrence county
32 economic development power sold by the authority in the wholesale energy
33 market over what revenues would have been received had such energy been
34 sold on a firm basis under the terms of the authority-TMED contract.
35 9. "Northern New York economic development fund" or "fund" is a fund
36 of the authority into which net earnings are deposited by the authority
37 in accordance with subdivision twenty-four of section one thousand five
38 of the public authorities law and from which allocations of fund bene-
39 fits to eligible projects may be made by the authority.
40 10. "St. Lawrence county economic development power" means firm hydro-
41 electric energy produced by the authority's St. Lawrence power project
42 that the authority has made available for allocation and sale to the
43 town of Massena electric department for resale and sub-allocation to
44 qualified end users pursuant to the authority-TMED contract.
45 § 197-b. The northern New York power proceeds allocation board. 1.
46 There is hereby created the northern New York power proceeds allocation
47 board, which shall possess the powers and duties herein specified. The
48 board shall consist of five members who shall be appointed by the gover-
49 nor as follows: one of whom shall be appointed upon the recommendation
50 of the temporary president of the senate and reside within St. Lawrence
51 county, one of whom shall be appointed upon the recommendation of the
52 speaker of the assembly and reside within St. Lawrence county, and at
53 least one additional member who shall reside within St. Lawrence coun-
54 ty. The governor shall designate a chair from amongst the board's
55 members.
A. 10093--A 3
1 2. Each member shall serve a term of five years or until a successor
2 shall have been named and qualified. Members may be reappointed to
3 successive terms.
4 3. Notwithstanding any other provision of law to the contrary, three
5 members shall constitute a quorum for the purposes of organizing the
6 board and conducting the business thereof. No action of the board may be
7 taken except upon an affirmative vote of at least three-fifths of the
8 full board membership at any meeting at which at least three members are
9 present or participating by videoconferencing. Videoconferencing may be
10 used for attendance and participation by members of the board. If video-
11 conferencing is used, the board shall provide an opportunity for the
12 public to attend, listen and observe at any site at which a member
13 participates. The public notice for the meeting shall identify, if prac-
14 ticable, all locations where a member will participate in the meeting by
15 videoconference and shall state that the public has the right to attend
16 the meeting at any such location.
17 4. Members of the board, except those that are employees or officers
18 of the state, its authorities, or agencies, shall not receive a salary
19 or other compensation, but shall be allowed the necessary and actual
20 expenses incurred in the performance of duties under this article.
21 § 197-c. General powers and duties of the board. 1. The board shall
22 establish written procedures relating to the activities of the board.
23 The board shall also establish procedures through written policies or
24 standards for reviewing applications for fund benefits and which shall
25 provide for a review of applications for fund benefits no less frequent-
26 ly than twice each year. The board shall not make any recommendations
27 for an allocation of fund benefits prior to establishing the procedures
28 provided for in this subdivision.
29 2. The board, or a member designated by the board, shall receive all
30 applications from, or on behalf of, eligible applicants for fund bene-
31 fits. Applications shall be in a form and contain such information, data
32 and exhibits as the board may prescribe and to which the authority has
33 consented.
34 3. The board may request from the authority an analysis of any appli-
35 cation for fund benefits along with any recommendations, and any such
36 additional information and assistance as is reasonably necessary for the
37 board to perform its duties.
38 4. The board shall review applications submitted for fund benefits.
39 The board shall make an initial determination of whether the application
40 is made by an eligible applicant and proposes an eligible project. In
41 the case of an application by an eligible applicant that proposes an
42 eligible project, the board shall review the application using the
43 following criteria:
44 (i) whether the eligible project would occur in the absence of an
45 award of fund benefits;
46 (ii) the extent to which an award of fund benefits will result in new
47 capital investment in the state by the eligible applicant and the extent
48 of such investment;
49 (iii) other assistance the eligible applicant may receive to support
50 the eligible project;
51 (iv) the type and cost of buildings, equipment and facilities to be
52 constructed, enlarged or installed if the eligible applicant were to
53 receive an award of fund benefits;
54 (v) the eligible applicant's payroll, salaries, benefits and number of
55 jobs at the eligible project for which an award of fund benefits is
56 requested;
A. 10093--A 4
1 (vi) the number of jobs that will be created or retained within St.
2 Lawrence county and any other parts of the state in relation to the
3 requested award of fund benefits, and the extent to which the eligible
4 applicant will agree to commit to creating or retaining such jobs as a
5 condition to receiving an award of fund benefits;
6 (vii) whether the eligible applicant is at risk of closing or curtail-
7 ing facilities or operations in St. Lawrence county and other parts of
8 the state, relocating facilities or operations out of St. Lawrence
9 county and other parts of the state, or losing a significant number of
10 jobs in St. Lawrence county and other parts of the state, in the
11 absence of an award of fund benefits;
12 (viii) the significance of the eligible project that would receive an
13 award of fund benefits to the economy of the area in which such eligible
14 project is located; and
15 (ix) for new, expanded and/or rehabilitated facilities, the extent to
16 which the eligible applicant will commit to implement or otherwise make
17 tangible investments in energy efficiency measures as a condition to
18 receiving an award of fund benefits.
19 In addition, the board shall consider the extent to which an award of
20 fund benefits would be consistent with the strategies and priorities of
21 any regional economic development council having responsibility for the
22 region in which the eligible project would be located. The board is also
23 authorized to solicit the views of organizations that have an interest
24 in economic development in St. Lawrence county regarding such matters as
25 proposed funding strategies and priorities, and applications for fund
26 benefits.
27 5. The board shall issue a written statement of its findings and
28 recommendations for each application reviewed.
29 6. The board may recommend to the authority the allocation of fund
30 benefits to eligible applicants for eligible projects which the board
31 finds are consistent with the applicable criteria in subdivision four of
32 this section. The board may include within its recommendations recom-
33 mended terms and conditions, including, but not limited to, reasonable
34 provision for the allocation of fund benefits over time as the eligible
35 applicant achieves milestones towards project completion, the partial or
36 complete withdrawal or return of fund benefits where the recipient has
37 failed to achieve or maintain mutually agreed upon commitments, or such
38 other terms and conditions as the board deems advisable.
39 7. A recommendation by the board that an eligible applicant receive an
40 award of fund benefits shall be a prerequisite to an award of fund bene-
41 fits by the authority. The authority shall award fund benefits to an
42 applicant upon a recommendation of the board; provided, however, that
43 upon a showing of good cause, the authority shall have discretion as to
44 whether to adopt the board's recommendation, or to award benefits in a
45 different amount than recommended by the board. In addition, the author-
46 ity shall be authorized to establish the terms and conditions that will
47 apply to any award of fund benefits.
48 8. Allocations of fund benefits shall only be made on the basis of net
49 earnings that have been deposited in the northern New York economic
50 development fund. No award of fund benefits shall encumber future net
51 earnings or net earnings that have been received but not deposited in
52 the northern New York economic development fund.
53 9. Upon making an allocation of fund benefits, the authority shall be
54 authorized to enter into an agreement with the eligible applicant which
55 provides the terms and conditions that the authority determines will be
A. 10093--A 5
1 applicable to the award of fund benefits taking into account the recom-
2 mendations made by the board.
3 § 3. Section 1005 of the public authorities law is amended by adding a
4 new subdivision 24 to read as follows:
5 24. (a) For purposes of this subdivision, the terms "authority-TMED
6 contract", "eligible project", "net earnings", "northern New York power
7 proceeds allocation board" and "St. Lawrence county economic development
8 power" shall have the meanings ascribed to such terms in article seven-A
9 of the economic development law.
10 (b) The authority shall be authorized to cooperate with the northern
11 New York power proceeds allocation board, and provide such board with
12 such information and assistance, including reasonable staff services,
13 accounting, clerical and secretarial assistance, office space, and
14 equipment, as the board reasonably requests in order to fulfill its
15 duties under article seven-A of the economic development law.
16 (c) The authority shall establish an account to be known as the north-
17 ern New York economic development fund, which shall consist solely of
18 net earnings. The authority, as determined to be feasible and advisable
19 by the trustees, shall deposit net earnings into the fund no less than
20 quarterly, provided, however, that the amount of St. Lawrence county
21 economic development power that may be used by the authority to generate
22 net earnings shall not exceed the lesser of twenty megawatts or the
23 amount of St. Lawrence county economic development power that has not
24 been allocated by the authority under the authority-TMED contract for
25 sub-allocations, and provided further that beginning five years from the
26 effective date of this subdivision, the amount of St. Lawrence county
27 economic development power that may be used by the authority to generate
28 net earnings shall not exceed the lesser of ten megawatts or the amount
29 of St. Lawrence county economic development power that has not been
30 allocated by the authority under the authority-TMED contract for sub-al-
31 locations. At least fifteen percent of net earnings paid into the fund
32 shall be dedicated to eligible projects which are energy-related
33 projects, programs and services as such term is defined in subparagraph
34 two of paragraph (b) of subdivision seventeen of this section. In addi-
35 tion to funding eligible projects, the authority may use northern New
36 York economic development fund monies to cover reasonable costs and
37 expenses of the authority related to the management and administration
38 of the northern New York power proceeds allocation program created by
39 article seven-A of the economic development law.
40 (d) The authority is hereby authorized to establish processes for
41 application review and allocation of fund benefits, and to promulgate
42 such rules and regulations as it deems necessary to fulfill the purposes
43 of this subdivision and the duties assigned to it under article seven-A
44 of the economic development law.
45 (e) The authority shall include in the annual report prepared pursuant
46 to subdivision eighteen of this section, an accounting for the subject
47 year that provides the amount of St. Lawrence county economic develop-
48 ment power sold into the wholesale market by the authority, and the net
49 earnings paid into the northern New York economic development fund.
50 § 4. This act shall take effect immediately.
