The August 22, 2011 Issue of The Capitol by The Capitol

Courtney Burke aims to rescue her troubled state agency.

Joe Martens drills down on hydrofracking.

Page 6

Page 15

Page 27

www.nycapitolnews.com

Manhattan Media 79 Madison Avenue, 16th Floor New York, NY 10016

VOL. 4, NO. 14

The energy-fromwaste movement picks up steam.

AUGUST 22, 2011

New York’s plan to grow jobs is a race for the middle Pg. 10 iStockphoto®/Joey Carolino

UPFRONT State Senate worker Shane Jones leads a double life as a ﬁction writer

hat if the man working at the desk next to you turned out to be not just another fellow in a suit but a celebrated experimental novelist? New York Senate staffers, meet Shane Jones, a special-events coordinator who is also a writer of fiction, most notably his 2009 novella Light Boxes, a surrealistic tome about a town confronting an interminable February. “He’s a really genuine person despite the fact he’s got semicelebrity status and some notoriety,” said Tracey Pierce-Smith, a Senate communications staffer who found out Jones was a writer when she hired him in 2008 and got to look at his résumé. Light Boxes was picked up by Penguin Press before being optioned by director Spike Jonze. A Bookforum review called it “an enchanting and witty fable.” The first run of the book sold out, and in the surest sign of literary success, bookish types accused Jones of selling out. But like many political workers in Albany, Jones also has his own controversy to contend with. In 2010 a Mexican author named Salvador Plascencia accused Jones’ book of borrowing heavily from Plascencia’s own novel, The People of Paper, published in 2005 by McSweeney’s.

Jones, Plascencia says, has admitted to being influenced by the work. “Light Boxes excessively borrows from The People of Paper and does so without any attribution,” Plascencia wrote in an email. “Any side-by-side reading of the two novels will expose the glaring similarities in characters, plot, topology, and imagery.” Jones’ agent, Bill Clegg—who is famous as both a literary agent and a memoirist detailing his former crack addiction—

seeking an answer to similarities between the two novels. “They responded by saying the claims had no merit but proceeded by reprinting a version that altered the text and some graphics in minor but telling ways,” Plascencia wrote. Jones declined to discuss his book or his day job, but next year plans to release a new book called Daniel Fights a Hurricane,, which he describes as “a novel of hallucinations.” —Laura Nahmias lnahmias@nycapitolnews.com

ivomiticecubessowhat.tumblr.com

Stranger Than Fiction

$1,354,850

By The Numbers The First Six Months

$1,000,000

January–July fund-raising by state party organizations Individual contributions: Corporate contributions: PAC and union contributions:

$900,0000

$800,0000

$722,500 $700,0000

$605,000 $600,0000

$500,0000

$430,332

$400,0000

$300,000 $203,000

State Democratic Party

$62,894

Cash on hand

$249,409

$259,223

$235,000

$37,611

State Republican Party

$208,576

Cash on hand

$148,600

$125,375 $75,350

$57,045 $8,150

Democratic Assembly Campaign

$664,186

Cash on hand

$125,850

Republican Assembly Campaign

$100,0000

$454,071

Cash on hand

Democratic Senate Campaign

Republican Senate Campaign

Independent Democratic Conference*

$12,091

$2,001,660

$1,008,157

Cash on hand Cash on hand Cash on hand * Combined fund-raising by four IDC members

Former Sen. Pedro Espada’s trial begins

Labor Day

Sen. Liz Krueger holds a karaoke-themed fund-raiser

Downtown–Lower Manhattan Association breakfast with Sheldon Silver

Assemblyman Jack McEneny’s birthday

$200,0000

$132,919

$48,645 $40,750

The Month Ahead (Aug. 22–Sept. 18) Senate hearing on hydrofracking in Katonah

$300,0000

Primary Election Day Rep. Kathy Hochul’s birthday

Sen. Eric Adams hosts mobile mammogram van at his office

22 23 24 25 26 27 28 29 30 31 M 2

W Th

AUGUST 22, 2011

Senate hearing on legalizing casino gambling

Fund-raiser for Assemblywoman Vanessa Gibson

“On Education” panel hosted by City Hall

Tenth anniversary of 9/11 terrorist attacks

Assemblyman Daniel Losquadro’s birthday

W Th

www.nycapitolnews.com

Sen. Greg Ball’s birthday

Assemblyman David Gantt’s birthday

W Th

THE CAPITOL

If They Can Make It Here…

How will GOP presidential contenders fare in New York?

our years ago, New York was abuzz over a potential presidential contest between Rudy Giuliani and Hillary Clinton. Four years from now, Gov. Andrew Cuomo and his New Jersey counterpart, Chris Christie, could be taking aim at each other over who could best lead the country. But even without a legitimate in-state contender at the moment, New York will still play a role in determining who ends up challenging President Barack Obama. Here’s a quick look at the top Republican contenders and how they could fare in the state. —Jon Lentz jlentz@nycapitolnews.com

Rick Perry

Rudy Giuliani The former mayor is projected to do the best against Obama in the state, though he trails by 6 percentage points, and at least one poll shows him beating the president nationally. Unsurprisingly, he’s the New York favorite early on, but he has yet to enter the race. One Republican insider speculated Giuliani might end up as Perry’s running mate, given their friendship, Giuliani’s Texasbased law firm and Perry’s support for Giuliani in 2008. “If Rudy’s going around the track and is polling well and you want someone who covers the bases you don’t cover, Rudy could be the choice,” the insider said. “It helps if you stay active.”

The Texas governor made a splash when he jumped into the race this month. He’s already getting New York party regulars excited and is tapping the state’s wealth of campaign dollars. But how much the big bucks flow may depend on Perry’s relationship with fellow Texan George W. Bush. “I think he’ll do all right as long as those Bush folks unlock the money,” GOP political consultant Lynn Krogh said. “A lot of those Bush folks are in New York.” Rick Perry may also appeal to the state’s “wildcat taxcutters,” said veteran Republican operative Roger Stone. “Romney is not really their cup of tea,” he said. “They might be comfortable with Perry as a tax-cutter, since there’s no other logical supply-side candidate here. That’s an important pocket of money.” One downside is Perry’s limited name recognition here, with a recent Siena poll showing that half of all New Yorkers don’t know him or have no opinion of him.

Sarah Palin

George Pataki The former New York governor, who has not entered the race, is registering little support nationally and is doing marginally better with the state’s voters. “Pataki continues to pull a small handful of people because of this federaldebt thing he’s trying to ride,” Roger Stone said. Lynn Krogh, who once worked for Pataki, warned against ruling him out too early. “Remember, George Pataki loves to be the dark horse, so don’t ever underestimate that,” she said.

www.nycapitolnews.com Publisher/Executive Director: Darren Bloch

THE CAPITOL

The former VP nominee would get the lowest support in a handful of potential head-tohead matchups with Obama in the state, the Siena poll found. Several New York Republicans said they didn’t expect Palin to get into the race, and that her moment had passed. “I see Sarah Palin having limited appeal in New York, other than Trump—Trump’s a big Palin fan, and he can be a significant fundraiser,” Roger Stone said.

EDITORIAL Editor: Adam Lisberg alisberg@nycapitolnews.com Managing Editor: Andrew J. Hawkins ahawkins@nycapitolnews.com Reporters: Chris Bragg cbragg@nycapitolnews.com Laura Nahmias lnahmias@nycapitolnews.com Jon Lentz jlentz@nycapitolnews.com Photography Editor: Andrew Schwartz Intern: Jeff Jacobson

ADVERTISING Associate Publishers: Jim Katocin, Seth Miller Advertising Manager: Marty Strongin Senior Account Executives: Ceil Ainsworth, Monica Conde Director of Events & Special Projects: Andrew A. Holt Executive Assistant of Sales: Jennie Valenti

www.nycapitolnews.com

Michele Bachmann The Tea Party insurgent has attracted large crowds on Long Island, but local party chairs are looking for someone with an executive record, said one party insider. Roger Stone added that Bachmann’s appeal would be limited here. “The New York primary electorate, unlike others, is more Catholic than evangelical Christian, and the Tea Party—while it’s not not a force in New York—it’s not a force in New York as much as it is in, say, Florida. That said, the nomination for Carl Paladino still proves it’s a conservative-based electorate.”

Mitt Romney New York’s most important role in many races is as a campaign ATM, and Romney has easily withdrawn the most cash so far. The former Massachusetts governor and early front-runner has raked in $2.12 million from New York donors, more than from any state except California. No other candidate has raised near that amount in New York. Romney has also put in time in the state, including a rare visit upstate to attend a Conservative Party dinner last year. “I think that’s because he’s got New York folks on his team, and because he sees the value of New York as a state for money, but they do know there are some good, real right-of-center votes that can come out of this state,” said Lynn Krogh.

PRODUCTION Art Director: Joey Carolino Production Manager: Ed Johnson Assistant Production Manager: Quarn Corley Web Design: Lesley Siegel

The Capitol is a division of Manhattan Media, LLC, publisher of City Hall, Our Town, The West Side Spirit, Chelsea Clinton News, The Westsider, New York Press, N.Y. Family, City Arts and AVENUE magazine.

MANHATTAN MEDIA CFO/COO: Joanne Harras Director of Interactive Marketing and Digital Strategy: Jay Gissen

Editorial (212) 894-5417 Advertising (646) 442-1623 advertising@nycapitolnews.com General (212) 268-8600

AUGUST 22, 2011

The Littlest Lobbyist How an 8-year-old boy helped pass the samesex marriage bill By Laura Nahmias

AUGUST 22, 2011

Andrew Schwartz

osh Zwerin is 8 years old. He is entering the third grade, reading Harry Potter and climbing trees in the gaslit glow outside his Tudor home in suburban Rockville Centre, Long Island. He also has two dads—Jeff Friedman and Andy Zwerin, the gay couple who adopted him the day he was born—the only family he’s ever known. But in the last six months of the same-sex marriage debate in Albany, as politicians and lobbyists jockeyed for position, Josh turned out to be improbably powerful in a way he seems barely to comprehend. Josh, a handsome little fellow in a dark suit and tie, could often be seen in the Senate gallery and Capitol hallways in the last few weeks of the session. Long before the rest of the world knew the legislation would even come to a vote, he had private meetings with senators that proved fruitful for the bill’s chances. Sandwiched between his two 43-yearold dads on the couch in their home in late July, barefoot and clad in a Mark Sanchez football jersey, Josh tallied up the senators he had met: “Senator Kennedy, Senator Skelos, Senator Huntley, oh, that really stupid guy…” “Josh!” shushed Friedman. “I don’t like him! I’m not going to say his name,” Josh said. Friedman and Zwerin coaxed Josh to talk about the marriage vote. “Why did we go to Albany?” Friedman asked. “For the vote,” Josh replied. Friedman: “What were we doing?” Josh: “We were working.” Friedman: “What kind of work, Josh?” Josh: “We were lobbying.” Friedman first became active in the same-sex marriage movement five years ago, after he suffered a heart attack on the day of Zwerin’s mother’s funeral. His partner and their son rushed to the hospital to fill out paperwork for cardiac surgery, only to find that Zwerin had no legal right to make decisions on Friedman’s behalf. “A nurse asks me, ‘What’s your relationship to him?’ ” Zwerin said. “We weren’t legally married by the state, so she said, ‘I’m sorry, but you can’t sign those.’ ” The danger passed, but the lesson lingered. “The person that you know your whole life may not survive, and then they’re saying, in front of Josh, that we’re not family,” Friedman said. “The following week I was still in cardiac intensive care,

Jeff Friedman, Josh and Andy Zwerin made trips to Albany to lobby senators, like Dean Skelos (below), on same-sex marriage and having Josh run in and ask, ‘Are we still a family?’—that’s not something that is appropriate for any child to feel.” When their family started lobbying senators, they brought Josh along. One of the senators they spoke with was Shirley Huntley, a Queens Democrat who voted against same-sex marriage in 2009 and told The New York Times, “If they gave me a million dollars, tax free, I just wouldn’t vote for it.” Last winter, though, she decided she was undecided. And when Friedman and

fornia, a marriage that would be recognized in New York if the law passed. Advocates had focused for years on the abstract notion of rights, afraid to talk about their families, Friedman said. But most of the conversations he had with the senators he tried to convince were about parenting. “I first talked to Shirley about the fact that me and Andy, we met in high school. I told her we’d been together for 26 years and that we live lives no different than anybody else,” Friedman said. “I am an

“I was still in cardiac intensive care, and having Josh run in and ask, ‘Are we still a family?’—that’s not something that is appropriate for any child to feel.” Zwerin brought Josh to Albany one day, the 73-year-old grandmother met with them with an open mind. “There was this cute little boy with a whole flock of curly hair,” Huntley said. “He’s a happy child… I guess it just got to my heart, because I could see this child was well-reared. Then they brought him up for me to meet the child, and I was just so happy to meet him.” Josh, who is biracial, reminded Huntley of one of her own relatives, Friedman said. He recalls telling Huntley how he met Zwerin in high school chemistry class in Merrick, Long Island, 26 years ago. He showed her the photo album from their 2008 marriage in Cali-

active member of the PTA, you know. I am part of the social-action committee of my temple here.” The meeting with Huntley was impromptu. She didn’t say why she didn’t vote for it in 2009, and Friedman didn’t ask. He recalled that her main concern was whether voting “No” would hurt Josh. “At the end of the conversation, after we were both crying for a while, that’s when she told me not to worry, to trust her,” Friedman said. “She was going to be voting for marriage.” Josh was the tipping point, Huntley said later. Though she kept her new position a secret for weeks, she made up her mind that spring day.

www.nycapitolnews.com

“You say, ‘What the hell,’ ” Huntley said, throwing up her hands. “It’s wonderful.” She expects to be invited to some weddings. She does not expect a primary challenge because of the vote and has received no angry phone calls from pastors in her district. She thinks she did the right thing. “If people are going to judge me by that vote, after all the other things I have done in my community…” She shook her head. “If they’re going to judge me for that one vote, then so be it.” Josh remembers Albany mostly for the thrills of playing with Senate Majority Leader Dean Skelos’ iPad and sitting in Assemblyman Danny O’Donnell’s chair on the chamber floor. But he has some sense of the import of his lobbying at the Capitol. His parents prodded him to say why marriage equality was needed. He leaned against Zwerin and said, “I just wanted you to be treated good.” lnahmias@nycapitolnews.com

THE CAPITOL

Our port...

NY Electric & Gas Companies Seek Lobbying Firm

n association of regulated electric and gas utility companies is seeking expressions of interest from experienced lobbyists and lobbying firms to represent the combined interests of the member companies on common legislative issues in New York State. The “association” is comprised of Central Hudson Gas & Electric Corporation, Consolidated Edison of New York, National Fuel Gas, National Grid, New York State Electric & Gas, Orange and Rockland Utilities and Rochester Gas and Electric Corporation.

The expected scope of work for the successful lobbyist/firm shall include:

The largest single contributor to the regional economy, delivering jobs and stimulating economic growth. e men and women of the Port of New York and New Jersey

• Identifying and developing political priorities and strategies for the association; • Establishing a trusted, respected, and recognized point of contact for the association within New York State; • Serving as the spokesperson on general industry issues of the association, including preparing and presenting testimony in public forums and hearings; • Tracking relevant legislation weekly and drafting memoranda in support and opposition on key legislation; • Coordinating legislative meetings, and advocating effectively on industry related issues; • Working with various media outlets to advance the association’s agenda; • Hosting and attending Legislative and Executive fundraisers. The successful lobbyist or lobbying firm should set forth its qualifications with special emphasis on expertise related to the energy arena or the regulated utility industry while highlighting any significant past lobbying campaigns. The successful lobbyist should also disclose any potential conflicts of interest with the association and the successful candidate should be prepared to remedy any such conflicts prior to representing the association of companies. Submittals should also set forth an estimated MONTLHY representation fee based on a 12 month contract plus any estimated monthly expenses. Interested parties should submit six (6) copies of their qualifications and interest to: Anthony Campagiorni, Esq. Central Hudson Gas & Electric Corporation 284 South Road Poughkeepsie, New York 12601

nysanet.org THE CAPITOL

Submittals must be received by September 9, 2011. An electronic copy of all submittals is also requested to: tromaine@cenhud.com.

www.nycapitolnews.com

AUGUST 22, 2011

Garbage trucks line up outside a waste-to-energy plant on Long Island (above), while a massive mechanical claw lifts the trash to be burned.

Trash And Burn Covanta seeks funds for waste-to-energy plants as environmentalists push back By Jon Lentz

ach day, the garbage trucks line up and rumble into a huge, boxlike building that towers over the surrounding housing subdivisions, shopping centers and fast-food joints. Once inside, the trucks dump their garbage, which is scooped into a vast concrete pit. A mechanical claw above the pit descends into the mounds of trash and collects enough to fill a single truck, lifts it up and ferries over to one side, then dumps it into a chute to be burned— and ultimately to provide electricity for the plant’s neighbors. If Covanta Energy gets its way, the state will help replicate the process by subsidizing more waste-to-energy plants like this one, which the company operates near Hempstead in Nassau County. But first, in order to qualify for millions of dollars in state energy subsidies, the technology must be designated as providing renewable energy. John Waffenschmidt, a Covanta vice president for environmental science and community affairs, said the company’s plants reduce landfill waste and generate much-needed energy while releasing

AUGUST 22, 2011

emissions well within state and federal standards. This alone should qualify the technology as renewable, he argued. “If you are going to get rid of waste, you’re going to reuse and recycle as much as possible,” Waffenschmidt said. “Once you finish that process, you come to a fork in the road. You’re either going to go to a landfill, or you’re going to go to an energy-from-waste plant. “If you choose to go to the energyfrom-waste plant instead of going to the landfill, you’re going to actually produce less net greenhouse-gas emissions, because there’s no methane emissions whatsoever.” Waffenschmidt’s argument is one of many the state Public Service Commission will sift through over the next few months as it weighs whether to put garbage on an equal footing with wind, solar and biomass as a renewable resource. New York’s energy law already defines “wastes” as renewable resources, but the Renewable Portfolio Standard (RPS), a fee-based program the state established in 2004, does not include it in its own list of renewables. Covanta will not have an easy task as it seeks to sway the commission. The

company has failed before to be included in the RPS, which awards hundreds of millions of dollars, from a small monthly fee of about 25 cents charged to utility ratepayers. Many environmentalists are also staunchly opposed to including waste incineration in the RPS. The idea that plants like Covanta’s can reduce landfill waste and produce energy at minimal cost is too good to be true, said Eddie Bautista, executive director of the New York City Environmental Justice Alliance. “When you run a waste stream through one of these facilities, you’re not, at the end, left with zero waste,” Bautista said. “You’re left with the residue of what’s the post-process material, and that’s no longer just waste that becomes landfilled.” A Covanta spokesman said the remaining ash, which is about 10 percent the size of the incoming waste, is tested for hazardous materials and disposed of in conventional landfills. Bautista added that any plants sited in New York City would likely end up in poorer communities like the South Bronx, further burdening residents already struggling with health and environmental problems. Relying on such facilities would also put less emphasis on recycling, he said, since a steady stream of trash is needed to fuel operations. Other environmentalists said waste-to-

www.nycapitolnews.com

Andrew Schwartz

energy facilities can be useful, but some still oppose diverting money from other renewable resources. Municipal garbage, while abundant, is neither emissions-free nor renewable, said Adrienne Esposito, executive director of Citizens Campaign for the Environment. “It isn’t this secret war against incineration,” Esposito said. “If Covanta wants subsidies, they should talk to the state about that. But they shouldn’t be stealing renewable money.” But Waffenschmidt argued waste-toenergy produces more energy with lower emissions than landfill gas and biomass, both of which are included in the RPS. Numerous filters and a scrubber in the plant reduce dioxins, mercury, lead and other particulate emissions to well within state and federal standards, he added, and the facility also salvages and resells useful metals. “If you really think about it—of all the products that we have in society, it’s probably metals that you want to keep in circulation more than anything else,” Waffenschmidt said. But environmentalists aren’t convinced trash is just as good as wind and solar, and they’re pushing back. “Nothing has changed from the first two times this was rejected, except now they’ve met with a multitude of state senators, the governor’s office, the attorney general’s office—they’ve really gone on a full-scale public relations campaign,” Esposito said. “I get it. They want the money. We’re saying, ‘No, not on our watch.’” jlentz@nycapitolnews.com

THE CAPITOL

EDUCATE

•

ADVOCATE

•

INFLUENCE

Look who’s reading The Capitol...

The way to reach elected officials.

www.capitolnews.com

For advertising information, please contact (646) 442-1623 or advertising@nycapitolnews.com

(From left to right) John Gilbert, Michael Gianaris, Ashok Gupta, Jerry Kremer, Kevin Lanahan, Ray Long and Sergej Mahnovski

Experts weigh in on New York’s energy outlook

ll the pieces are in place to develop a sustainable and efficient energy supply in New York State except one: leadership. That was the consensus from a panel of experts, advocates and government officials who said New York has the capacity to grow its wind, solar and natural-gas energy production, while also conserving more power and improving the electric grid—as long as there’s a plan for doing so. The six panelists spoke at an event this month moderated by John Gilbert, chief operating officer of Rudin Management, and sponsored by The Capitol, Baruch College, New York Affordable Reliable Electricity Alliance (NY AREA) and McKenna Long & Aldridge LLP. What follows is an edited transcript. proper fuel mix in the long term. We’re always going to need a mix, and the question we have to answer is: What is the right balance? What is the right balance of all of the various fuel sources? What is the right way to use them responsibly and in as safe a way as possible?

The Capitol: What should New York State do to boost its energy policy? Sen. Michael Gianaris of Queens: The most important thing we can do is develop a plan to come up with the AUGUST 22, 2011

policy blueprint for how you finance generation, infrastructure, energy efficiency, unless we solve that businessmodel problem that we’ve created for ourselves over the last 20 years. I think there’s a lot of technology, a lot of solutions, a lot of things that we can do, but we’re stuck because there is no financing for the repowering, or financing for

Jerry Kremer: Former Chairman, Assembly Ways & Means Committee; Chairman of Empire Government Strategies: On a go-forward basis it’s really time for the state to show some leadership on energy issues. It’s really time for the state to step up to the plate and become the major player, which will send the signals to the private investors it’s safe to come into New York and spend money here—and invest in capital construction, and send a message to the people who want to bring new technologies into this state. But the idea is, the job of the state of New York is far from done.

Kevin Lanahan, Director of Government Relations, Con Edison: We

Ashok Gupta, Director of Energy Policy, Natural Resources Defense Council: We don’t really still have a

Photos by Andrew Schwartz

can’t forget that the electric infrastructure and natural-gas infrastructure makes all of this possible. We need to balance out investments in resource planning, long-term planning, with costs. transmission, or financing for offshore wind, and you need clarity of policy in terms of long-term investments that we don’t have.

www.nycapitolnews.com

Ray Long, Vice President, Government Affairs, NRG Energy, Inc.: Here in New York we have the opportunity to take advantage of all of these

THE CAPITOL

things, the new trends going forward. We’ve got to give the people what they want. And what we’re seeing is that people want electric vehicles; they want smart meters; they want new technologies. But at the same time they want the big trifecta of energy issues. They don’t want to overpay for electricity. They want the reliability that the power is always going to be

Long: There are resources out there that are ready to go that will do a number of things, back to those three major points that I made before. Natural-gas combined-cycle technology stabilizes cost. It’s among the lowest conventional, proven-out technologies that are out there today, reducing emissions. We don’t need to look much further than our own backyard in and around the New York City area to see the opportunity to get new technology in place in a reasonable amount of time that achieves those three objectives.

Lanahan: Emissions, with repow-

there. Finally, New York has been a leader on environmental regulation. They want to see their emissions reduced across the board.

Sergej Mahnovski: Senior Advisor and Director, Office of Energy Policy and Infrastructure, New York City Department of Environmental Protection: There is no magic bullet, so we have to be careful. I think we have to balance all of these resources. Going forward, regardless of what happens with

Indian Point, New York City needs to have a more robust natural-gas and electricity infrastructure feeding the city.

TC: What are the obstacles to upgrading existing plants through repowering? Gupta: It goes back to lack of financing in the business models. If we support those repowerings and we want them to happen, it’s a policy decision of the Public Service Commission to have long-term contracts. This goes back to: What’s the role of Con Ed, and possibly the New York Power Authority taking power. But unless you solve that business-model issue, you’re not going to have the financing to do the repowering.

THE CAPITOL

ering, come down, certainly the health-based emissions. Carbon emissions are maybe in the 50 percent range, but [nitrogen oxide] and other emissions are going to come down 90 percent. So even if you get an extra 500 megawatts or 1,000 megawatts from repowering, the health-based emissions we’re talking about that result in asthma are going to be declining in any neighborhood. And so it’s not true that repowering results in higher emissions and higher health costs.

Kremer: Repowering—it’s not the ultimate solution. I think that there’s a lot of facilities on Long Island in the LIPA service area which, to go ahead and repower those facilities would be an enormous waste of money. They’re past their state of practical use. They’re obsolete. And the answer is, when you repower, somebody’s got to pay the cost of repowering. It’s going to be passed on, ultimately, to the consumer. The answer is, how do we get new power sources—and the 800-pound gorilla in the room is the 2,000 megawatts from Indian Point. While we can talk about all these potential sources of new power, how do we deal with the potential shortage of 2,000 megawatts in a region that relies on Indian Point power to the extent of 25 percent of the city’s power?

needs?”—yes. The trade-off for the public decision: What are the benefits, or perceived benefits, of

Energy Dumping Drives Resources Out of the NY Market & Discourages Others from Investing Here By Gavin J. Donohue

Although numerous reports and studies recently have shown that New York's energy supply will be sufficient through at least 2020, New Yorkers must plan for the future. This plan should examine the resources available in-state to ensure self-sufficiency.

shutting it down, versus the cost of shutting it down, in terms of people paying more for electricity and higher CO2? The trade-off has to be made—and that is what the public debate is about. And the policy decision is really the mix of: What do you want; what are the tradeoffs—short-term, long-term health versus catastrophic risk? But I don’t think people should assume that if the decision was made that it had to be shut down—or was to be shut down—that we couldn’t keep our lights on.

Gianaris: One of the things about the Indian Point debate…is an environmental-justice plan. We’re talking about closing a nuclear plant in one of the wealthiest counties in the entire nation and the replacement for that is undoubtedly going to come in neighborhoods like mine that are already producing more than their fair share. So you’re trading off a lowrisk, high-yield possibility, in terms

New York is fortunate to have a generation fleet that optimizes a broad spectrum of technologies and fuels, and does so while complying with the state's significant environmental rules and public policies. Private companies continue to invest in new, efficient generation – critical development that will lead to jobs and tax revenues - in addition to an even more reliable electric system. Certain actions can put such investment at risk. New York operates in a competitive marketplace for energy and market signals are very effective for driving the location and timing of investment in new resources. The disruption of those signals, particularly through unwarranted government intervention, sends a chilling message to those entities considering investment in New York. The latest example of this is the New York Power Authority’s (NYPA) effort to artificially crash energy prices by importing unneeded capacity from New Jersey via a new transmission line. This project makes no economic sense, yet NYPA is pushing forward with its plans despite a potential multi-million dollar price tag to its customers. More problematic is that NYPA is partaking in this classic "dumping" in an effort to crash the energy market in New York City. This cuts the legs out from under companies that have invested billions of dollars, pay millions in taxes, and employ thousands of workers. While NYPA's efforts may result in the short-term lowering of prices, the medium - and long-term effect will be driving existing resources out of the market and discouraging others from investing. Furthermore, New York won't see a single additional job created, as the new transmission line will simply tap into New Jersey's resources. Behavior like NYPA's cannot be allowed to stand and derail the benefits that have been provided to New York through the success of competitive energy markets. New York has the resources, workforce, and investment capability to generate its own energy without such interference. Gavin J. Donohue is President and CEO of the Independent Power Producers of New York, Inc. and a member of the New York AREA Advisory Board.

TC: What should happen, and what will happen, with Indian Point?

S P E C I A L

S P O N S O R E D

S E C T I O N

Gupta: If you were to shut it down, how would you replace the power? For the combination of the power and the new transmission, you could replace it. There would be a cost impact and there would be CO2 penalty, but it can be done. The question is: Can we reliably meet the electricity needs if Indian Point wasn’t there? And the answer would have to be: Yes. The question would be: What to get in terms of the benefit from shutting it down and what are the costs of shutting it down? But from a purely “Can it be done?” and “Can you meet the

of a catastrophe that could happen in Westchester County that could affect us all, undoubtedly, for a greater certainty that you’re going to increase asthma; you’re going to increase emphysema in some of the lower-income neighborhoods in New York City where the replacement is going to come from. And that needs to be part of this discussion, because that hasn’t been.

www.nycapitolnews.com

The New York Affordable Reliable Electricity Alliance (New York AREA) is a diverse coalition of New York's best-known business organizations, labor unions, independent energy experts and community leaders working together for clean, low-cost and reliable energy solutions that foster prosperity and jobs for the Empire State.

W W W. A R E A - A L L I A N C E . O R G AUGUST 22, 2011

Open For Business? By Andrew J. Hawkins Dan Burnstein

Lt. Gov. Robert Duffy, center, will lead the regional council effort.

hen it comes to job creation, New York is in a race for the middle. Unemployment is on the rise. The state is adding jobs more slowly than the national average. New York consistently falls at the bottom of lists of businessfriendly states. Experts acknowledge there’s no chance of reaching the top—taxes in the state are too high, regulatory hurdles too insurmountable. Instead, they say the state should aim to be somewhere in the middle. And that might not mean a complete overhaul of the state’s economic development policy, just some tinkering under the hood. Who better for the job than self-professed “car guy” Gov. Andrew Cuomo? Meeting with his cabinet in Albany last month, the governor declared that “Phase I” of his master plan to remake the state—which included closing a $10 billion budget gap without raising taxes, capping property taxes and legalizing same-sex marriage—was complete. Phase I was important, he said, but “Phase II” was going to be where the rubber hit the road. “Jobs, jobs, jobs” would be the focus, he said, adding: “It’s going to be fun. It’s going to be different.” But job creation has never been the forte of state government. And New York’s past efforts to encourage private-sector growth have been scattershot at best, hobbled by the lack of a cohesive, statewide strategy,

AUGUST 22, 2011

and undermined by deep divisions and dissimilarities between the state’s upstate and downstate economies. Cuomo won’t be able to wine-and-dine the economy, like he did with legislators during the first part of the year. And the state’s lead agency for job creation, Empire State Development, has been weakened by years of infighting, budget cuts and the lack of a clear chain of command. The risks for Cuomo are huge. By taking ownership of the state’s struggling economy, he is committing himself to turning one of the nation’s least businessfriendly states into one of the best. He is also taking the old cliché that “government doesn’t create jobs” and attempting to prove it wrong. The hope is an aggressive marketing effort, coupled with a regional approach to strategic planning, will improve the state’s standing and encourage businesses to stay in New York while bringing in new industries and nurturing emerging sectors across the region. He is already tying the effort to his reelection, blasting out emails to supporters trumpeting a “fundamental shift in the state’s approach to economic development.” But not everyone is optimistic about Cuomo’s attempt to monkey with the engine of New York’s sputtering economy. “What really is going to drive the future of the economy, upstate or downstate, is not government

www.nycapitolnews.com

economic development,” said E.J. McMahon, director of the fiscally conservative Empire Center for New York State Policy. “It gives everybody something to do, more or less. “If it were possible to have a plan implemented to make things better,” he added, “somebody would have done it already.” New York’s problem is well-documented. Chief Executive magazine polled 550 CEOs across the nation in May, asking them to rank the most and least businessfriendly states. Texas was number one. California was at the bottom, with New York nipping at its heels. The conservative Tax Foundation presented a bleaker picture, placing New York dead last in its annual ranking of state business climates. The state has “the third-worst individual income tax, the ninth-worst sales tax and the worst property tax,” according to the 75-year-old group. The prospect of a rising tide lifting all boats is bleak. Upstate communities continue to hemorrhage population and jobs. And the main economic driver downstate, Wall Street, is bracing itself for a double-dip recession. Stores are closing, factories are decommissioning, construction jobs are drying up just as fast as federal stimulus dollars, and the state’s infrastructure budget is stretched thin. Cuomo isn’t the first governor to come up with plans to revitalize the economy. New York has had a

THE CAPITOL

history of strategies that sounded grand but amounted to nibbling around the edges, shuffling desks and looking for marginal gains. For decades New York has tried to boost the economy and encourage privatesector development through either bond sales or tax incentives, but those efforts inevitably fell short. Twenty years ago, then Gov. Mario Cuomo introduced an $800 million bond act aimed at creating jobs through infrastructure projects. But voters concerned about increasing debt service ultimately rejected the plan. Former Gov. George Pataki created the Empire Zone program in hopes of spurring economic growth through tax incentives and government subsidies for businesses. But after years of allegations of fraud and mismanagement, the program was shut down. While his predecessors have approached the state’s diverse economy by bifurcating it into upstate and downstate areas, Cuomo’s approach has been to decentralize economic development efforts. He divided the state into ten regions, and appointed councils to develop strategic plans for each with representatives from business, labor, higher education and advocacy groups. The regional economic development councils will compete for a pot of $130 million in grants and tax credits to spur job growth.

“G

et off the bottom of the list! Get into the middle of the pack!” Kenneth Adams said, his voice rising with emotion. “We have enough assets and a big enough economy that we don’t need to be at the top of the list.” Adams, president and CEO of Empire State Development, is sitting in his new 37th floor office in midtown Manhattan, preaching the administration’s new mantra. He believes New York shouldn’t aspire to be on par with Texas, the nation’s top state for job creation. Instead

he wants New York to beat its immediate peers and climb to the middle. New York can beat New Jersey (ranked #47 in Chief Executive); it can beat Connecticut (#43); it can even beat Pennsylvania (#39). But the road to true economic development will be long and contentious, as members of the newly formed regional councils are just beginning to figure out. “Successful plans will not just identify key projects that will require state resources but they’ll also identify reforms to the region’s business climate that could be in tax, regulatory and government procedures,” he said. Adams said regions that developed successful plans would receive the largest chunk of state dollars. Other regions

would have to settle for less. The spirit of competition would encourage council members to set their natural differences aside and unite under the common goal

“If it were possible to have a plan implemented to make things better, somebody would have done it already.” of winning more state dollars, he said. That said, Adams acknowledged that the amount of state money available is not a lot: $130 million for the initial competition, $10 million for a worldwide marketing campaign and $1 billion through a new consolidated funding stream for projects the councils determine to be part of their regional strategy. “Remember, it’s a $1 trillion economy,” Adams said. “$1 billion in $1 trillion is a tenth of a percent.” Adams, who formerly ran the state’s Business Council, said he is aware that government more often hurts than helps private-sector growth. He said Cuomo aims to change that, first by streamlining government and making it more efficient, and then by listening to the private sector’s concerns about red tape and obstacles to job creation. “There are a lot of reasons to come here,” Adams said, gesturing to the Manhattan skyline outside his window. “But there’s just as many obstacles.”

A Andrew Schwartz

THE CAPITOL

Andrew Schwartz

during Cuomo’s tenure as secretary of the U.S. Housing and Urban Development agency—a combination of bond measures, grants, and tax incentives to

s the 10 regional councils begin meeting across the state to hash out their individual strategic plans, tensions are already emerging. Higher education wants more community development, much like the Federal Empowerment Zones deployed

www.nycapitolnews.com

encourage building and construction projects. Business executives say enough community development; what the state really needs is economic development, a.k.a. tax incentives and public subsidies for private companies in exchange for job development. Labor wants more infrastructure spending, as well as better benefits and better-paying jobs for workers. Technologists and venture capitalists want more incentives for the state’s emerging biotechnology and nanotechnology clusters. “I’ve already seen strain in our council,” said Andrew Rudnick, president of the Buffalo Niagara Partnership and a member of the Western New York council. “But it’s not melodramatic.” The regional councils could deepen the rifts between labor and business. Pat Purcell, assistant to the president at United Food & Commercial Workers Local 1500, said unions and businesses need to overcome their differences before reaching a consensus on any strategic plan for economic development. “To be successful, there needs to be acknowledgement that wages and benefits and working conditions, in relation to tax breaks and subsidies—they matter,” Purcell said. “When we’re at the table with businesses and companies, the AUGUST 22, 2011

“It’s going to be extremely difficult, it’s going to be a lot of work and it’s going to be contentious. But nothing ventured, nothing gained.”

Andrew Schwartz

saying success will rely on more than just a few million dollars for local development projects. Rob Simpson, CenterState CEO and co-chair of the Central New York regional council, said the state needs to reconsider the types of businesses that receive public assistance and subsidies. “A lot of programs we’ve had over the years really favored and targeted the growth of large industries and heavy manufacturing, which has been at the detriment of innovative companies and small businesses,” Simpson said. Others agree the state needs to focus most on the creation of long-term, sustainable jobs for the 21st

AUGUST 22, 2011

Recruitment And Retention

Companies trumpeted by Cuomo for growing jobs see ways the state can grow itself

O Dan Burnstein

minute we start discussing this, the eyes roll and the faces frown.” So the questions remain: Can the state be all things to all people? Will Cuomo’s attempt to bring everyone to the table be enough to course-correct New York’s economic future? Will it pay off like his similar Medicaid effort, which brought all sides to the table to find savings? Some ideas are already starting to emerge. None of them reach for the stars, but all of them could bring incremental progress. The New York City regional council is looking at ways to merge two separate state taxes—a bank tax and a corporate tax—to ease the burden on local financial institutions. The Southern Tier regional council is examining ways it can capitalize on hydrofracking in the Marcellus Shale. The regional council in Central New York is debating ways to reduce the expense of workers’ compensation payouts while looking to better connect the region’s economy—which includes a thriving clean-technology sector—to the international market. Some participants are curbing their enthusiasm,

ESDC President Kenneth Adams thinks New York can be more competeive. century. That would mean fewer subsidies for the muffler plant in Monroe County, for example, and more public assistance for small biotech firms in Westchester. The business community was encouraged by Cuomo’s ability to cut spending and impose a property tax cap, but other policy changes, like mandate relief and tort reform, are a much heavier lift. What priorities the governor sets for next year will be just as important as the regional councils, if not more so.

hen businesses close, government usually takes the blame. In Rochester, the plan to build a downtown headquarters for Paetec, a telecommunications firm, has been thrown into question by the sale of the company to an outside group—three years after then Gov. Eliot Spitzer triumphantly announced the development project. He even showed up at a press conference in Rochester to trumpet the deal. Brian Sampson, executive director of the business advocacy group Unshackle Upstate, said the culprit wasn’t Paetec or the company that bought it. The real reason the development stalled, he said, was government. “Government just took too long to get into the game and at the table to make things work,” Sampson said. “And as a result, we stand to lose the opportunity to keep Paetec here in upstate New York.” A similar scene is playing out in Ticonderoga, in the North Country. A Lowe’s store recently closed, abruptly eliminating 87 jobs and leaving lingering questions among business owners about job growth in the region. “New York State and the Ticonderoga area are going through trying economic times,” said Matthew Courtright, executive director of the Ticonderoga Chamber of Commerce, adding that the shuttering of Lowe’s was “not expected and a surprise to everyone.” But Courtright is optimistic that Cuomo’s focus on job creation will bear fruit. “It’s our hope that the councils will truly assist each region…particularly small-business owners,” he said. Tony Collins, president of Clarkson University and co-chair of the North Country regional council, said the combination of the population drift from rural communities to cities and the state’s unfriendly business climate will make the administration’s efforts a heavy lift. But he thinks it can be done. “It’s going to be extremely difficult, it’s going to be a lot of work and it’s going to be contentious,” Collins said. “But nothing ventured, nothing gained.” ahawkins@nycapitolnews.com

www.nycapitolnews.com

nce in a while, Gov. Andrew Cuomo’s office fires off an email to reporters touting the latest success in keeping and growing jobs in New York. “Agro Farma will invest $97 million to build new facility,” one reads. “Investment in state-of-the-art machinery will retain 81 at-risk jobs and create 40 jobs in Monroe County,” says another. Cuomo likes to pat himself on the back after making these deals, knowing they bolster his image as a job creator and smart fiscal steward. But some of the business owners touted by his office say the state could be doing much more to encourage private-sector growth in New York. Back in June, Cuomo released a statement announcing biotechnology firm Acorda Therapeutics’ decision to expand and create 190 new jobs in Westchester. The deal, the governor declared, “sends another signal that New York is open for business.” But Ron Cohen, president and CEO of Acorda, argues that other states are much more attractive to biotech companies than New York. A native New Yorker who was looking to get back home from the West Coast, Cohen says the state’s high cost of living and exorbitant taxes make hiring new employees very difficult. “That is a major issue,” Cohen said. “Most of the people we’re trying to hire here…they don’t want to come because it’s much more expensive.” Acorda, which produces a drug called Ampyra that fights the symptoms of multiple sclerosis, received $5.2 million in tax benefits from the state in exchange for investing an estimated $36 million in a new facility. Cohen says the governor’s determination to put his own political capital on the line is encouraging, but the state has a long way to go before it can boast a biotech sector on par with that of New Jersey or California. “I would say I’m less pessimistic than I would otherwise be,” he said. “I’m not prepared to say I’m optimistic, just given the history I’ve seen in the last 25 years in the state.” Bill Flynn, president and CEO of Atlas Air Worldwide, sounded slightly more optimistic in the aftermath of his company’s deal with the state, announced by the governor in early June, to keep its headquarters in Purchase and create 50 new full-time positions. At the time, Cuomo applauded Atlas Air “for recognizing the benefits of staying in the Lower Hudson Valley” despite attractive offers from other states to move its facilities. Flynn credits the deal to a solid sales pitch from the governor and his advisors. “We talked with Empire State Development, and certainly heard Cuomo’s new policy objectives about retaining jobs in New York,” Flynn said. “That certainly resonated for us.” That said, the state often ignores the needs of small to medium-size businesses in its rush to retain and attract companies to New York, Flynn said. If Atlas Air, which operates the largest fleet of Boeing 747 freighter aircraft in the world, were located further downstate, the state might have overlooked the company’s interest in expanding, and might not have come up with the tax exemption plan it did to convince the firm to stay in-state, Flynn said. “The closer you get to Manhattan…be mindful not to lose perspective on the smaller-to medium-sized companies that are important to the economy as well,” he said. —Andrew J. Hawkins ahawkins@nycapitolnews.com

THE CAPITOL

BEYOND THE CAPITOL

Choosing Sides In The Southern Tier Cuomo’s economic development grants force the region to confront its future BY SUSAN ARBETTER

artha Robertson sat in her Ithaca office recapping the previous night’s meeting of the Southern Tier’s Regional Economic Development Council. “While I felt there was some disunity around ‘fracking,’ there was a strong feeling that this is a great opportunity,” she said. Across the state, 10 new regional economic councils are busy organizing and trying to develop strategies for creating jobs and improving the outlook for their particular sections of New York. As chair of the Tompkins County Legislature, though, Robertson sits on a council that faces pressure points unique to the Southern Tier: Theirs is the most economically depressed region of the state, but it could reap an economic windfall from the natural gas drilling technique known as “hydrofracking.” “When the Southern Tier was identified as a region [with an economic development council], gas drilling became the elephant in the room,” she said. “If a proposal supporting the gas-drilling industry comes out of this, there’s going to be a firestorm.” Robertson and the 31 other members of the council are expected to develop a five-year strategic plan for this predominantly rural region, in order to compete for one of four $40 million grants. The six regions that don’t win those grants will have to split another $40 million among them. From Robertson’s perspective, the dilemma is clear: Is the future in agriculture or hydrofracking? If we invest in both, do we risk our farms? When he campaigned for governor in 2006, Eliot Spitzer memorably referred to the Southern Tier as “like Appalachia.” But if the region is poorly understood by other New Yorkers, it holds surprises, as well. The state Department of Labor says private-sector employment in the Southern Tier has increased over the past year by 2,800 jobs. A big reason is Hamdi Ulukaya, a Turkish transplant to Chenango County who founded Agro Farma, makers of Chobani, the bestselling Greek yogurt in the country. Many of the 213 dairy farms in the county contribute milk to Ulukaya’s yogurt, and he wouldn’t do business anywhere else. “You have the milk right here, at the source,” Ulukaya said. “That’s one. And

THE CAPITOL

two, you have access to the markets. From the daily perspective, it couldn’t be any better. Boston, New York—it’s what all the food manufacturers want.”

Piaschyk owns and operates a 100-acre organic farm called Lamb’s Quarters. A Saturday night in late July found him attending an annual event in support of county farms called “Savor the Flavor,” featuring local delicacies. A member of the Plymouth Town Council and the Chenango County Farm Bureau, Piaschyk has seen too many farmers go belly-up—and he doesn’t share Ulukaya’s optimism about an agri-

“We all pay state taxes. We all pay into the system. If they think this is a way to make people think better or smarter—well, that’s sort of condescending.”

Martha Robertson

Hamdi Ulukaya

Drew Piaschyk

His company recently announced plans for a $97 million expansion, and he thinks the state should use economic development money to prop up the dairy industry with temporary price supports. “Let’s bring back the boutique farmers who have lost their farms over the last two decades,” Ulukaya said. “A lot of people will go back to their land because they love what they do.” But the founder of the county’s largest dairy-dependent industry won’t discount the benefits the region could see from gas drilling. “If there are natural resources under the ground,” he said, “and we can get it safely, and that could provide some economic advantage to the people of this area, then I can see that, too.” “I disagree with Hamdi on that,” Drew Piaschyk said. “That’s not teaching somebody to fish. That’s just giving them the fish.”

cultural future. “You cannot rely on a whole group of people like Hamdi who say, ‘This is a great spot and I’m going to put my yogurt factory here,’” he said. “That happens very rarely.” He believes gas drilling holds the promise of long-term prosperity for the region, and at a meeting of organic farmers he cast the single vote opposing a moratorium on hydrofracking. He calls himself a “gas deliberator,” but finds himself increasingly aggravated by the anti-drilling crowd. “Basically I’m responding against fear,” Piaschyk said. “I have an organic farmer who has an old gas tractor that spews out stuff all over the place, and he’s complaining about potential problems with hydrofracking!” All around him at the Farm Bureau

www.nycapitolnews.com

fund-raiser, farmers meet and mingle. They all know each other—and their positions on gas drilling. Erin Heaton is one of the opponents, fearing it will spoil the region’s agricultural lifeblood. “Chenango County provides 1 percent of the dairy needs of New York City, but it could be so much more,” Heaton says. “If you bring in heavy industrialization, I fear we’ll lose all of it.” Whatever the Southern Tier council recommends for a five-year strategic plan, Robertson and the other members know it will come with a ready-made and organized contingent of angry detractors. But the council’s first meeting was productive, not divisive, she said. It was packed with staff from more than a dozen state agencies, and a couple of consultants, as well, who commended them for having such an active and involved group of stakeholders. Prior to the meeting, members of Gov. Andrew Cuomo’s task force sent online surveys to all the members of the Southern Tier council asking them to rank the area’s five greatest economic development assets, among other questions. The top vote getters, Robertson said, were higher education, then a combination of agriculture and tourism, and then natural gas. Robertson believes the deeppocketed natural-gas industry doesn’t need taxpayer assistance from an economic development grant, but other sectors of the region’s economy do—desperately. And she wonders why Cuomo made this into a competition in the first place: The Southern Tier needs the grant money more than any other region in the state, yet has the least political power. “It’s hard to picture fewer than two of the grants going downstate. So the rest of us are in competition for two grants,” she said. “We all pay state taxes. We all pay into the system. If they think this is a way to make people think better or smarter— well, that’s sort of condescending.”

Susan Arbetter reports from the Capitol in Albany for Central New York’s PBS station, WCNY in Syracuse. She hosts a daily live radio show, “The Capitol Pressroom,” and produces The Capitol Report, broadcast daily on television across New York. AUGUST 22, 2011

But some would rather see Nick retire from politics altogether. Yonkers Council President Chuck Lesnick, who is challenging Michael in the Democratic mayoral primary, believes Nick is pulling strings for his brother in

“When you look at Michael’s transition, his positions were clearly more in line with the Democratic Party. In the end his switch made sense in order for him to be able to deliver.”

Purple Dynasty Michael and Nick Spano cross party lines to hold power in Westchester County By Ana Tinsly

he Spano family was once the most powerful Republican clan in Westchester County, back when Westchester County was all Republican. Yet as Westchester voters have turned their county decidedly blue, the once-red Spanos have straddled party lines to stay comfortably in the center. Nick Spano, a former Republican state senator who lost his seat five years ago, is now an influential lobbyist who works closely with Democrats. His brother Michael, an Assemblyman who switched parties from Republican to Democrat the year after his brother’s loss, is a front-runner in the race for mayor of Yonkers. Their opponents call it political opportunism. Nick calls it pragmatism. “I was a Republican because my father was one, though I wouldn’t trade my

AUGUST 22, 2011

experiences for anything,” he said. “When you look at Michael’s transition, his positions were clearly more in line with the Democratic Party. In the end his switch made sense in order for him to be able to deliver.” Their father, Leonard Spano, is a beloved Republican figure who served 34 years as a legislator and county clerk. Michael, who would not be interviewed for this story, has served on and off as an Assemblyman since 1992. Nick was elected to the Assembly at 25, then served 20 years in the Senate. He earned the nickname “Jolly St. Nick” as a wheeler-dealer who would bring home the bacon for his district. He was a Republican, but supported liberal causes like emergency contraception, same-sex marriage and a $2 hike in the minimum wage. “I was able to get results because I worked in a bipartisan way,” Nick

the party and the city. And he fears Nick, whose local clients include the Yonkers Raceway, will have undue influence over the office. “I feel like I’m running against the whole family,” Lesnick said. Nick has been accused of manipulating politics behind the scenes. He was rumored to have engineered the local Conservative Party’s 2009 endorsement of Democrat Andy Spano (no relation) over Republican Rob Astorino for county executive, in exchange for Andy later supporting Michael for mayor. When Nick endorsed Andy, he warned of “Republican extremists” who had hijacked his party—which insiders say signaled the end of his ties with the Republicans. He says his decision was based on friendship. Thomas James “I felt he was the most effective candidate. We had a good working relasaid. “I stand by every decision I tionship, and it was natural to support ever made. The minimum-wage fight, him,” Nick said. “The loyalty that existed for example, was a tough one. Many between us transcended politics.” Michael is favored in the mayor’s people were vehemently opposed, but I felt we had to respect the dignity of race, with support from the local Demopeople who were struggling to put food cratic Party and several Latino officials, who don’t hold his Republican past on the table.” Despite support from unions and against him. “Mike will represent the whole city, women’s groups, Nick finally succumbed to a Democrat, popular local legislator not just the parts that don’t feel it’s imporAndrea Stewart-Cousins. In 2004 he beat tant to maintain our schools or services,” her by 18 votes; in 2006 she beat him by says County Legislator José Alvarado. “Yonkers needs someone that’s acces1,800. Today Nick continues to wield political sible, regardless of origin.” Former Westchester Democratic influence in the Capitol as a lobbyist, with clients that include Con Edison, Cablevi- Chairman Ken Jenkins said Michael had sion and Congressman Eliot Engel—a made an honest transition to his new Democrat trying to protect himself in a party and won its backing the hard way. “He told me, ‘I’m going to go out and time of redistricting. Most recently Nick was back in Albany chiding his former I’m going to earn their support.’ And GOP colleagues for delaying the same- obviously he did,” Jenkins said. “Mike understands what needs to be done to sex marriage vote. “I had to speak out,” he said. “I was move an item across the line. Something the first in my party to support it, so he shares with his dad and brother. You it was natural for me, not for business need to be able to work with legislators reasons, but because I felt the time was across the aisle.” editor@nycapitolnews.com now.”

www.nycapitolnews.com

THE CAPITOL

The Metamorphosis How Courtney Burke plans to transform an agency with an ugly past By Laura Nahmias

t took Brad Pivar two years to find someone willing and able to take his son Scott to a local park once a week. Scott has a developmental disorder called “Fragile X syndrome” that leaves him entirely nonverbal. New York state helps pay for a care plan that includes weekly trips outside, but like other wellintentioned programs connected to the state’s Office for People With Developmental Disabilities, it suffered in practice. “It sounded great,” Pivar said. “The agencies were never able to find someone to do it.” Now Pivar is part of a 100-member task force the state created to help draft a new plan for the scandal-scarred agency. New York is petitioning the federal government for the right to throw out the rules governing how its developmental-disability programs are funded and managed, in favor of new ones developed by the task force. The petition, known as an experimental waiver, is the first major initiative from the agency’s new commissioner, Courtney Burke. Gov. Andrew Cuomo chose her to lead OPWDD in March after he forced predecessor Max Chmura to resign, following devastating reports in The New York Times on how the agency did little to deter or punish rampant abuse of the people under its care. “I was only going to take the job if I knew [the waiver] was going to move forward,” said Burke, who worked on state health policy for more than a decade at the Rockefeller Institute. The waiver works like a science experiment, Burke said. The state takes money it is supposed to use in structured ways, and instead uses it in a series of pilots to test theories of what programs might work better. This is a watershed moment, advocates said, to reform an agency in dire need of better communication, better care and more varied services. But advocates, patients and parents also worry about whether the many good parts of OPWDD will get thrown out with the bathwater. “At the end of the process, there’s a finite pile of money to be carved up,” said Pivar, who worries nonessential programs will get short shrift as the agency fixes its critical problems. The scale of this departmental reform, and its relative speed, has never been attempted before. OPWDD has more than 23,000 employees, oversees more than 126,000 people and hopes to start

THE CAPITOL

Commissioner Courtney Burke hopes troubled agency. new pilot programs by next spring. At the same time, the state has asked all agencies, including OPWDD, to make a 10 percent spending cut.

The starting salary for a direct-support worker, who works closely with disabled people every day, is just $29,900. And more than 80 percent of the workforce is made up of voluntary workers, who receive far less. Burke also plans to cut costs by complying with the state’s top-down mandate to roll the developmentally disabled population into managed care, something that scares people like Ann Hardiman, the executive director of a consortium of nonprofit caregivers called the New York State Association of Community and Residential Agencies. The principle behind managed care, Hardiman said, is that it becomes affordable for providers to subsidize sick populations in part by balancing them against healthier ones. That doesn’t necessarily work for the developmentally disabled. “A person with a developPatrick Dodson mental disability has a lifelong a medicaid waiver can help overhaul a disability,” Hardiman said. “It’s not going to go away.” Illinois, which has moved hospitalizations. That’s an incredible indicator that we’re not meeting the primary developmentally disabled populations into managed care, has had difficulty needs of our population.” The waiver could help loosen bureau- finding providers who would cover a population that is so sick. OPWDD has already undertaken some transformative measures, including a recent agreement to refer abuse complaints to the state police. Cuomo also pressured the Civil Service Employees Association to accept uniform punishment standards for employees accused of wrongdoing. Those changes will make it cratic tangles that cost money, too, Burke easier to hold employees accountable for noted. Wendy Orzel, a woman with cerebral bad behavior, Burke said. Cuomo has also placed Deputy Secrepalsy who uses a wheelchair, needed help setting up services in another state when she tary for Health Jim Introne and Special planned to visit an ailing relative. But to do Assistant to the Governor Linda Lacethat, she had to go through an authorization well, who worked with him when he was attorney general, in charge of helping process to show she was still disabled. “C.P. is a lifelong disability!” Orzel coordinate the waiver process with Burke, among other reforms they are said, throwing up her hands. Her husband, Michael, 54, who also overseeing. But one outcome the agency can’t has cerebral palsy and has a much harder time speaking than his wife, said the ensure is that providers will actually treat reforms should aim to help workers learn disabled individuals as individuals. Making to respect his dignity. He had trouble that philosophical change take root could getting the words out, but he spoke them take much longer than the five years the waiver process is expected to last. slowly and clearly. Burke is optimistic. But with 120,000 “The workers talk to Wendy great,” he individuals to oversee, and a waiting list said. “They talk to me like a child.” But a waiver is not alchemy, and it on top of that, the task will likely prove can’t create resources out of thin air. daunting. “To me, the more impactful thing we There isn’t money to pay workers more, Burke said, even though advocacy groups can do in the long term,” Burke said, “is have cited low pay as a disincentive to have a different culture that’s just much their ability to hire and retain competent, more supportive of the individuals.” lnahmias@nycapitolnews.com caring individuals.

“New York ranks last in the country for avoidable hospitalizations. That’s an incredible indicator that we’re not meeting the primary needs of our population.” Burke believes the state can save money naturally, by moving people who need less supervised care out of institutions and into more flexible environments. Some 10–20 percent of the population receiving institutional care doesn’t need to be there, Burke said, and institutionalization is four times more expensive than flexible home care. The Times found New York spends more than $1.8 million a year on each of the 1,300 individuals still living in staterun institutions, or more than $1,200 a day each. Nonprofit group homes also have high costs: One home with just 35 people in it charged the equivalent of $700 a day for each resident. The problem plagues the entire healthcare system. “The money is paying for too high intensive care in too expensive of a setting. It goes toward buildings for inpatient care when, if you had invested in primary care, the person would have never ended up in that institution,” Burke said. “New York ranks last in the country for avoidable

www.nycapitolnews.com

AUGUST 22, 2011

Upstate Smackdowns

Gregory Johnson (R)

Two upstate Assembly races will be decided Sept. 13 116th Assembly District Anthony Brindisi (D) vs. Gregory Johnson (R)

pstate Republican Gregory Johnson is taking another crack at the Oneida County Assembly seat vacated in May by RoAnn Destito, who Gov. Andrew Cuomo nominated to run the state Office of General Services. Johnson lost by 6,000 votes to Destito in 2010, but this year he hopes to win office by emphasizing jobs, improving the economy and reducing the state’s deficit by curbing state spending. He’s facing a stiff challenge from Democrat Anthony Brindisi, who boasts endorsements from several regional unions and the Mohawk Valley Chamber of Commerce. A Utica newspaper’s editorial board slammed Brindisi for failing to recuse himself from a Board of Education vote that saved a teacher’s job. He had hired the teacher’s mother as a musician for a campaign event. The race is expected to be tight. Brindisi has raised $101,152 since Destito stepped down, and he is plowing through it. This week he has only $26,539 on hand, while Johnson, as of last month, raised $25,000 and had $23,000 on hand.

116th

144th Assembly District

Sean Ryan (D) vs. Sean Kipp (R)

t’s the battle of the Seans! Buffalo has itself a barn burner next month when Democrat Sean Ryan and Republican Sean Kipp will fight to succeed 19-year veteran Assemblyman Sam Hoyt, who stepped down from his seat in June for a job in the Empire State Development Corporation. Ryan, an attorney representing some of Buffalo’s neediest citizens in housing-discrimination cases, is likely to secure a large swath of the progressive vote. He has advocated for affordable housing, food-stamp programs, living-wage legislation and energyefficient buildings. But Kipp is talking tough, calling his opponent “another rubber stamp for New York City corruption,” and claiming Ryan will raise taxes and force companies to move out of state. Neither candidate has raised much cash, with only a month to go. Ryan raised $8,200 and has $7,733 on hand; Kipp has a measly $200 in his campaign account. —Aaron Short editor@nycapitolnews.com

Anthony Brindisi (D)

144th Sean Ryan (D)

The Kamikaze Comptroller BY CHRIS BRAGG

Facebook

assau County Comptroller George Maragos has been an elected official for less than two years—but he is already making his second long-shot run for statewide office. Last year Maragos campaigned for the Republican nomination in the race to take on popular Democratic Sen. Chuck Schumer, but failed to garner enough

votes at the state GOP convention to make it onto the ballot. Now Maragos is back making an only slightly less quixotic run against the state’s junior senator, Kirsten Gillibrand, and insists losing last year’s nomination was part of a grander plan. “It wasn’t a serious attempt against Schumer,” Maragos acknowledged on his way to a clambake in upstate Onondaga County. “It was a reason to go around the

Nassau Comptroller George Maragos, left, seen here campaigning in New York City, is running a quixotic campaign against Sen. Kirsten Gillibrand.

AUGUST 22, 2011

“It wasn’t a serious attempt against Schumer. It was a reason to go around the state and visit county chairs.” state and visit county chairs.” Several other candidates have approached state GOP Chairman Ed Cox about running against Gillibrand, but so far Maragos is the only one campaigning. He has already visited 25 different counties, and has said he is willing to spend up to $5 million of his own personal fortune in the race. But Maragos said he would be inclined to do most of that spending once he has the Republican nomination wrapped up. A Greek immigrant who came to the U.S. at 8 years old (and still retains an accent), Maragos has a compelling personal story to tell. He paid his own way through college before making a fortune in the financial industry. In 2009 Maragos swept into office on the tails of the Tea Party wave that also undid heavily favored former Nassau County Executive Tom Suozzi.

www.nycapitolnews.com

Sean Kipp (R)

Since becoming comptroller, Maragos has been at times an ally and a thorn in the side of Nassau County Executive Ed Mangano, overseeing the finances of one of the nation’s more affluent counties, which has seen spiraling property taxes and years of overspending undo its solvency. Both Maragos and Mangano supported the failed proposal to build a new taxpayer-funded arena for the Islanders hockey team. That deal was opposed by the Nassau County Interim Finance Authority, which took over the county’s finances after it ran up a budget deficit of more than 1 percent of county spending. As an elected official in a county with a population of 1.3 million and an annual budget of $2.6 billion—and with his personal fortune—Maragos cannot be entirely dismissed, said Larry Levy, executive dean of Hofstra University’s National Center for Suburban Studies. But Maragos may not get much help from the the Nassau Republican Party, which is more focused on 2012 state Senate races, Levy said. And Gillibrand is experiencing her own rise in popularity, which has even spawned 2016 presidential chatter. “It sounds crazy to say, but five million bucks is nothing in a U.S. Senate race,” Levy said. “Gillibrand has the ability to raise virtually unlimited amounts of money to hold the seat.” cbragg@nycapitolnews.com

THE CAPITOL

PERSPECTIVES

When Democracies Fail Hugh Carey showed New York how—and why—democracy works

ugh Carey died this month. The praise and pride we heard were wellplaced and well-spoken. The former governor was an unusual and interesting man who was thrust into an unexpected crisis and managed it well. And the lessons of his success are available to anyone watching the failures of Washington. Democracies are fragile. They can fail over small matters. Success and failure are both choices. Societies fail when large social problems overwhelm them. Famine, war, oppression and institutionalized inequality smash the social contract; chaos and revolution ensue; and a new social structure emerges. It happened in America, China and Russia, and may be happening today across the Arab world. Governments fail for much smaller reasons, often because the political culture stops working. It’s not that bad ideas rule the day, or that the problems are overwhelming. It’s that political institutions simply can’t do the job they were created to do. Difficult decisions aren’t made, factional allegiances prevail over larger social interests and the

place virtue, with the kinds of abilities and shortcomings we see in ourselves and our friends. He came to be governor after a long career in the Congress, and he underpopulace loses faith that government can stood the complex interplay between executive and legislative responsibilities. function, much less be effective. The Legislature was beginning to So it was this month, when American democracy was stymied over the relatively emerge from its vestigial role under small question of an inevitable increase in Gov. Nelson Rockefeller, whose charm, the federal government’s ability to borrow. power and money overwhelmed the Put aside the intense disagreements over Senate and Assembly. The leadership of continued federal deficits; there’s legiti- both houses was a superb and unusual macy on all sides. The catastrophe was in odd couple, the conservative and elegant Sen. Warren Anderson of the way the federal government Binghamton, and the brassy approached and resolved the and old-style liberal Stanley problem. A collective madness Fink of Canarsie. damaged our economy, our They and their members standing in the world, and faith were willing to take political and confidence in our system. risks, push back when needed So it could have been 36 and take on traditional allies years ago when the financial to get a deal done. They stood insolvency of an obscure Richard Brodsky strong, compromised, led the New York state authority, the Urban Development Corp., forced public debate and enabled their members New York City and state to the brink to make decisions that were politically of bankruptcy. Again, the reasons and dangerous. The Legislature was a full contending positions weren’t the issue. partner, and no one complained about “three men in a room.” But the process made the difference. Carey assembled his own team, including The outcome was different back then, because New York’s political culture was future Lieutenant Gov. Richard Ravitch, strong. Public officials shared a view of how and brought the bankers, the unions, Mayor a democracy functions, what are matters of Abe Beame, the business community and principle and what are matters of strategy, the Legislature together. He provided the the role of compromise and, most impor- political leadership that forged a political solution requiring pain and change, and tant, the consequences of failure. Carey was the architect of that solu- solved the problem. Most important, New York saw that tion. He was a man of grand and common-

Ready For Recovery? New York must act now to be ready for growth when economy rebounds

espite the claims of partisans on both sides, there is little the federal government can do to quickly turn around the economy—but eventually it will recover. Generating confidence is tricky and unpredictable, but businesses will invest and hire once they believe customers are ready and able to buy what they are selling. The question for New York is: How can the state position itself to take advantage of that national recovery when it comes? Over 1.5 million New Yorkers fled the state in past decade. This startling statistic is most likely the result of a lack of jobs, high taxes and a terrible climate for business investment. Other states are acting now to reduce costs. New York needs to do so as well, despite the political difficulty in that approach. Gov. Andrew Cuomo’s property tax cap was a first step. However, mandate relief to lower costs on local govern-

THE CAPITOL

boost the final average salaries in their pension calculations. It isn’t unusual for many police and fire retirees to receive pensions higher than their base salaries. A state arbitrator just ruled that the ments and school districts is essential to town must pay retroactive 3.5 percent ensure the tax cap is a success. The state Triborough law is the most salary increases for the last two years, expensive Albany mandate, and must be and that Clarkstown cops shouldn’t pay anything for health insurance repealed. This law perpetubecause other towns don’t ates all terms of governmentmake their employees pay employee contracts after they either. expire unless both sides agree The examples are too to changes. While this seems numerous to cite, but the fair on the surface, in pracconsistent thread is this: Laws tice it has perpetuated scores passed by Albany—at the of unjustified benefits that behest of unions—mean New can no longer be sustained. John Faso York has the highest property Already taxpayers are on the hook for $150 billion in unfunded retiree taxes in the nation. Unless Albany fixes the things that drive up local and state health obligations. Take, for instance, the Buffalo school taxes, the property tax cap is likely to fail. Controlling governmental costs is district, which provides elective cosmetic surgery to its employees. Tummy tucks, the single best thing Albany can do to nose jobs, breast enhancement—all create an environment where the private courtesy of the taxpayers, and costing sector can create jobs when the national $9 million in 2009. This expense is fully 10 economy turns. This involves tough decipercent of all health-insurance costs for sions to reform collective bargaining; requiring all public employees to pay the school district. Or how about Clarkstown in Rockland something for health insurance; and County? Cops there average $142,000 creating alternative pension systems, in pay and, like police officers and including optional 401(k)-type plans for firefighters across the state, routinely new employees. Albany also shouldn’t simply throw retire after larding up with overtime to

www.nycapitolnews.com

democratic institutions could face and overcome profound problems. Carey couldn’t have succeeded without a deep appreciation of what makes democracies function. American isn’t a beacon of light and liberty around the world because of our chief executives. It is—or was—the highest expression of the idea of popular self-rule because of its legislative bodies. Therein lies the soul of democratic government: the check on unbridled and concentrated executive power, and the point of access for regular people who wish to affect their government. And because Carey understood this from his own experience, he, Fink and Anderson could solve a fiscal crisis and protect the idea of popular government. The Washington fiasco will do real damage for years. Blame, if you will (as I do), Tea Party fanaticism and right-wing populism. Blame (as many do) President Barack Obama for his inability to knock heads together and get a deal. Blame a culture of incivility and inflexibility, where compromise is a sign of weakness instead of a necessary part of any democracy. But take a moment to sing the praises of Carey, Fink and Anderson; lift a beer, Scotch or martini, and think upon the frailty of the institutions we rely on and the people who make them work. Richard Brodsky is a senior fellow at Demos, a NYC-based think tank, and at NYU’s Wagner School of Public Administration.

money at business. Instead we should move to a simpler tax system, with lower rates and fewer deductions for all, thereby creating a level playing field for individual and business taxpayers. Expediting new energy development upstate, and funding transportation capital plans for both upstate and downstate, is also critical. Wisconsin, Indiana, Massachusetts, Ohio and New Jersey, among others, have modified or reformed collective bargaining for public workers. Other states are moving to simplify environmental permitting. Still others are reducing impediments to growth, by reforming the process for business lawsuits, for instance. New York can and should move now in all these areas to take advantage of the national economic recovery when it arrives. Simply continuing the status quo without fundamentally changing the incentives for investment will leave New York behind in the race for new jobs and prosperity. John Faso is a former minority leader of the state Assembly and was the Republican candidate for governor in 2006. He is a partner in the Albany office of the national law firm Manatt, Phelps & Phillips, LLP. AUGUST 22, 2011

Isn’t It Time You Reduced Energy Costs In Your Facility?

ica INSULATION CONTRACTORS ASSOCIATION QUALITY . SAFETY . VALUE . INNOVATION

Insulation Contractors Association of New York City, Inc. 229 South Street Oyster Bay, NY 11771 T: (516) 922-7855 F: (516) 922-1414 www.icanyc.org

The Heat and Frost Insulators and the Insulation Contractors Association are committed to providing economical alternatives and innovative techniques aimed at reducing harmful emissions and daily energy consumption while complementing the focus toward sustaining a healthier and safer environment. What You Need to Know About A Mechanical Insulation Maintenance Program • Energy Savings $4.8 Billion Annually • Reduction of Harmful Emissions Eliminates 43 Million Metric Tons of CO2 Per Year • Creates More Than 89,000 Jobs Annually Shovel Ready - No Need for Costly Research and Development

The Heat and Frost Insulators, Local No. 12 25-19 43rd Avenue Long Island City, New York

• Return on Investment Typical Payback is Between 4-6 Months Providing Residual Savings • Reduced Maintenance Costs Increases Life Cycle of Equipment

11101-4208

• Proven Technology Achieved Without Disrupting Daily Business Operation

T: (718) 784-3456

For information on reducing your energy cost contact

F: (718) 784-8357

professionals in the insulation industry today.

www.insulatorslocal12.org

ISSUESPOTLIGHT

Public Utilities

rom Con Edison to the Oriskany Falls Telephone Corporation, New York’s public utilities are allowed to operate as monopolies. The state Public Service Commission sets their rates and oversees their performance, guaranteeing them stable revenue in exchange. But the process involves more than just delivering electricity, natural gas, water and telecommunications services: It increasingly takes into account environmental concerns, government finances, union relations and technological changes. In the pages that follow, The Capitol looks at how New York regulates utilities and tries to promote the common good.

Utility Players New York regulators try to balance growing needs By Jeff Jacobson

ublic utilities are some of the most heavily regulated companies in the nation—and also some of the most stable. State regulators typically approve their rates, profit margins and service standards after a quasi-judicial process of weighing testimony from the companies, their customers and consumer advocates. Yet the process has been evolving in New York, where the state Public Service Commission is increasingly trying to set a regulatory scheme that reaches beyond individual rate cases to consider long-term issues about how essential public services should be provided. New York regulators have been immersed in how to encourage energy conservation, expand naturalgas distribution, spur the growth of renewable power sources and manage the state’s resources more efficiently. “The commissioners, their job is to balance the interest of the utility with the public,” said Rob Thormeyer, spokesman for the National Association of Regulatory Utility Commissioners. “Regulation works. And in New York, I know it works well.” From 2007 to 2011, New York’s electric and gas companies asked for more than

$5 billion in rate hikes—but were granted only $2 billion. When utilities seek higher rates or other changes in how they operate, the PSC weighs each request against expert testimony from the Department of Public Service, consumer groups, business councils and environmentalists, among others. After exchanging thousands of pages of accounting records and legal arguments for months, the sides present their case to the PSC for a decision—unless they are able to reach a compromise among themselves and submit it to the commissioners for approval. “It’s rarely, any more, just two sides,”

system, he said, they are often at the The Interborough whim of legislative funding, which Rapid Transit determines the quality of the regulaPowerhouse at tors’ in-house staff. West 59th Street “The New York staff is one of and 11th Avenue. the higher-quality staffs in the country,” said Hempling. “You have an excellent chairman, in particular. He’s top of the line, Garry Brown.” Thirteen states currently elect utility commissioners; South Carolina and Virginia pick them in their Legislatures, and the rest— including New York—are chosen by the governor and confirmed by the Legislature. New York’s five commissioners serve six-year terms and are staggered to prevent any lapses in regulation. The terms of three commissioners expire next year, while Brown’s term ends in 2015. The PSC is not without its critics, who say it needs Andrew Schwartz to be more receptive to the concerns of ratepayers and thing that they had no participation in.” Like wants PSC commissioners to be more relevant to New Yorkers’ elected rather than appointed, saying that concerns. “The Public Service Commis- would force them to be more responsion is generally biased, I believe, sive to ratepayers’ concerns. But David in favor of the utility and not Bomke, executive director of the Energy in favor of the ratepayer,” said Consumers Council, New York’s largest attorney Irving Like, who has consumer-advocacy organization, said represented consumers in Nassau that’s the wrong remedy for an imperfect system. and Suffolk counties since the 1970s. “Just because they could get elected Like recently lost a case at the PSC against National Grid, in which does not necessarily mean that they he intervened to stop the utility from would be the best qualified to underbilling customers to clean up a now- stand the difference between ratedefunct power plant that had released structure designs and so forth,” Bomke said. “I do like the idea of accountability. carcinogens. “With the stockholders making no My concern is how you ensure the level of contribution,” he said, “it was unfair to expertise that’s necessary.” jjacobson@nycapitolnews.com burden the ratepayers to clean up some-

“There can be renewable-energy advocates, environmentalists, labor unions and other groups involved. It can address a whole range of utility policy.” said Scott Hempling, executive director of the National Regulatory Research Institute. “It may have been that way 30 years ago when I was getting started, but not any more. There can be renewableenergy advocates, environmentalists, labor unions and other groups involved. It can address a whole range of utility policy.” While most states operate under a similar

VOICES Donna DeCostanzo,

Senior Attorney, Natural Resources Defense Council

Q: How well does the system serve New York? DD: The current utility system in New York serves us well, but we need to continue to build our clean-energy economy and invest in our aging-energy infrastructure to ensure that our system continues to meet our needs in the most reliable, clean and cost-effective way possible. We need to harness the tremendous opportunities we have to make New York a leader in the

THE CAPITOL

clean-energy industry, attracting billions in private investment, creating thousands of good quality jobs, reducing New Yorkers’ energy bills, increasing reliability and improving public health.

Q: How can New York ensure higher quality and reliability? DD: In order to attract clean-energy investment and all of the economic development benefits associated with it, New York needs to demonstrate long-term commitment to these technologies, as well as regulatory certainty. New York also needs to ensure that policies are in place that align the interests of utility shareholders and consumers. These include the

www.nycapitolnews.com

implementation of effective revenue-decoupling mechanisms that remove the utility disincentive to scale up energy efficiency, as required by the April 2007 PSC order, and a framework of performance-based incentives and penalties that provides a way for shareholders to earn money from investing in cost-effective efficiency. In addition to increasing energy efficiency, the state should implement policies to scale up renewables, as well. The RPS [Renewable Portfolio Standard] has greatly helped upstate wind in New York, but the state should adopt a framework to foster a robust solar energy industry, including a market-based program to achieve the installation of 5,000 megawatts of solar photovoltaic generation by 2025. AUGUST 22, 2011

Still Plugging Away No clear lesson from deregulating New York’s electric market BY JEFF JACOBSON

T THURSDAY AUGUST 25, 2011

t has been a tumultuous summer in the education world, full of budget fights and labor showdowns. Heading into the new school year we are sitting down with a panel of leaders and influencers in the education field to better understand how the past year’s fights will play out in the school year ahead and how these events will impact education policy, city politics, teachers and parents for years to come.

PANELISTS:

SYDNEY MORRIS Co-Founder of Educators 4 Excellence EVA MOSKOWITZ Former City Council Member & Founder/Chief Executive Ofﬁcer of Success Charter Network SHAEL POLAKOW-SURANSKY Department of Education Deputy Chancellor & Chief Academic Ofﬁcer

BILL THOMPSON Former President of the NYC Board of Education & Former NYC Comptroller MERRYL TISCH Chancellor of the NY Board of Regents JOSEPH P. VITERITTI Thomas Hunter Professor of Public Policy at Hunter College STEPHEN LAZAR, English teacher in Brooklyn

8:00 a.m. Networking Breakfast 8:30 -10:00 a.m. Panel Discussion Followed by Q&A TICKETS: EARLY REGISTRATION: $30 for individual tickets/ $250 table of 10 AFTER 8/24: $40 for individual tickets / $350 for a table of 10 *$20 ticket for government and nonproﬁt employees

AUGUST 22, 2011

Public Utilities

“It may take another five to ten years before we figure out whether it was a success.”

MODERATED BY: Philissa Cramer Andrew Hawkins Managing Editor of Managing Editor at GothamSchools.Org City Hall News

LEO CASEY Vice President of Academic High Schools, UFT

he greatest upheaval in the history of New York’s regulated public utilities came 15 years ago, when then Gov. George Pataki shepherded a plan through Albany that opened the state’s electric market to competition. It’s still too soon to say how well it worked. “Even now the jury is really still out,” said Arthur “Jerry” Kremer, chairman of the New York Affordable Reliable Electricity Alliance and former chairman of the Assembly Ways and

Con Edison Building 4 Irving Place (@14th Street) New York, New York FOR MORE INFORMATION or sponsorship opportunities call 646.442.1662 or email us

jfreeman@manhattanmedia.com

While the nonprofit New York Independent System Operator that manages the state’s electric grid is a leader in responding to demand, Jones said, the new regulatory system may not be enough to bring down electric prices. Consumers can’t accurately monitor their consumption in real time, he said, and new entrants to the power market still face high barriers. “There’s not as many new players and smaller players” as the law’s authors had hoped, he said. The state’s wholesale power generators have a more clear-cut verdict: They believe deregulation was a boon for New York. “Wholesale energy price has remained flat, if not gone down, under an inflation-adjusted basis during the last ten years,” said Chris LaRoe, director of market policy for the Independent Power Producers of New York, a trade group representing electrical plants across the state. He said New York has robust protections against market manipulation, collusion and price-fixing, while the state has also benefited from a drastic reduction in air pollution. NYISO spokesman Ken Klapp said the nonprofit is implementing a $74 million “smart grid” to better manage power supplies, one of many changes premised on the benefits of competition. “Open, nondiscriminatory access to the grid and wholesale electricity market incentives have helped to cultivate the development of renewable sources of electricity in New York,” Klapp said. jjacobson@nycapitolnews.com

Means Committee. “It’s been a long-term thing, and I can’t say if it was bad, and I can’t say it was good,” he said. “It may take another five to ten years before we figure out whether it was a success. It’s really hard to pinpoint right now what it is.” The 1996 law let utilities keep their monopoly on the wires that distribute electricity, but created an open market for generating power. It was presented as a way to reduce costs, improve efficiency and help New York businesses cut their bills. Yet the market’s ability to plan for the state’s long-term supply needs is still untested, Kremer said, pointing to the lack of a firm road map for how aging power plants will be made more efficient, powerful and environmentally friendly. “Where’s the money going to come from?” he asked. “We could have a system in future years that breaks down because plants are too old. The question has not been answered: So who’s going to pick up the tab for it?” Kevin Jones, a professor at Vermont Law School’s Institute for Energy and the Environment, and former director of power market policy for the Long Island Power Authority, said deregulation was “a mixed success” that missed opportunities to make the system better.

www.nycapitolnews.com

News That’s Newsworthy NEW YORK PRESS ASSOCIATION

2010 Better Newspaper Contest Excellence Awards Coverage of Elections and Politics First Place & Second Place Coverage of Local Government First Place & Second Place Best Front Page Second Place

THE CAPITOL

About 25 PERCENt oF thE PowER usEd iN NEw YoRk CitY ANd wEstChEstER, with ViRtuALLY No EMissioNs. Now thAt’s RiGht FoR NEw YoRk. You have a right to know that about a quarter of the electricity in New York City and Westchester is generated by the Indian Point Energy Center, with virtually no greenhouse gas emissions, and at lower cost than other sources in the region. Indian Point’s operations are constantly reviewed by independent experts at the Nuclear Regulatory Commission (NRC). We’re also among the most thoroughly reviewed nuclear energy facilities in the U.S. Indian Point has invested over a billion dollars to upgrade and strengthen all our operations in recent years. We have layers upon layers of safety and security systems, so there are back-ups to the back-ups. Every day, we plan and train to expect the unexpected. An equivalent gas-fired power plant would emit millions of tons of pollutants a year into the air we breathe. And the independent experts in charge of New York’s electric grid have said that the city could face rolling blackouts throughout the New York area without Indian Point. All of us have a right to know why Indian Point is Right For New York.

RightForNewYork.com

Indian Point Energy Center

WE’RE RIGHT FOR NEW YORK

VOICES John Reese, Senior Vice

President, US Power Generating Company

Q: Are there efforts to lower utilities fees or taxes? JR: There’s been a continuing effort to reduce costs of providing electric service from generation through customer usage. There are very expensive programs for energy efficiency in the marketplace through NYSERDA, through Con Ed, through cooperation with the city. One of the things that has had a huge impact is twelve, fourteen years ago, the move to competitive markets. The fact is that electric generating units are available more now than they ever were. They are being optimized because of the pricing system ensuring the most efficient units run the most, and those are the lowest-priced units. We have, on the wholesale side, historically low electric prices. Often the end user doesn’t get to see that, because other costs have gone up while the wholesale price of electricity has gone down. Q: How can New York ensure higher quality and reliability? JR: We’re in the midst of something of a difficulty right now, where new entrants in the marketplace, on the wholesale market side, have resulted in the existing suppliers not being able to cover their dayto-day operating costs. So how that issue, which is at the federal level before the Federal Energy Regulatory Commission—the outcome of those processes has a direct impact on New York City and New York

State as a whole on getting the pricing right. While no one wants high prices, there have to be sufficient revenues to ensure the health, safety, reliable operation and investment in supply. We’re in the midst of kind of a mess in that area. Prices in July and now, going forward for the next several years, are going to look to be below the basic operating cost of the existing generators.

for its high cost of electricity. Recently there has been an acknowledgement that additional taxes and mandates on electric generation and/or distribution contribute significantly to the high cost of electricity and create an adverse impact on the state’s economic competitiveness.

Q: Are there efforts to lower utilities fees or taxes?

Q: Do utilities have access to necessary capital? JR: For us, for the independent power production center, the worst thing is uncertainty, and right now we’re in the midst of as much regulatory uncertainty as there’s been since the markets were created, which makes it much more difficult to get capital for investment. It also sort of places a burden for that next generation, then, on additional regulatory support, additional incentives that make it worthwhile. Because currently, given the market volatility, both S&P and Moody’s have been out there saying, “In this sector and this city, it’s very uncertain.” There’s a lot of regulatory uncertainty that brings an increase in investment costs.

Heather Briccetti, Acting President and CEO, the Business Council of New York State Q: How well do public utilities serve New York? HB: New York is recognized, both nationally and internationally, as providing utility customers with a high-quality and reliable product. Unfortunately, the state has received notoriety

HB: A 2010 report by the Public Policy Institute shows that 26 cents of every dollar spent on electricity goes to state and local taxes, and that state-imposed assessments and fees are a major factor in New York’s rates. In 2009 the state Legislature adopted a proposal by then Gov. David Paterson to impose a sixfold increase in the PSC Section 18a assessments. This resulted in an estimated $600 million increase annually to the consumer, which was used to bolster increased state spending. An effort is under way to repeal the entire fee, but most importantly, the current governor and legislative majorities have recognized the need to reduce the growth of state spending, obviating the need for additional revenue-raisers.

Q: Do utilities have access to necessary capital? HB: While the PSC continues to impose added costs to utility bills, they reject utilities’ proposals for increased capital for infrastructure investment. If New York does not do a better job on agreeing on how utilities can fund these infrastructure needs, the customer will either see a downgrade to their service or a higher cost.

extending

you r reach

Engineering and Planning Economic and Financial Solutions Energy Efficiency and Sustainability Homeland Security and Emergency Management Corporate Headquarters Willdan Group, Inc. 2401 E. Katella Avenue, Suite 300 Anaheim, CA 92806 800.424.9144 www.willdan.com

AUGUST 22, 2011

www.nycapitolnews.com

THE CAPITOL

Covanta_CQ_FullPage.pdf

3/17/09

10:00 AM

In the search for renewable energy sources, you are bound to run into some garbage. According to the World Economic Forum report “Green Investing,” Energy-from-Waste is one of the eight large-scale clean technologies that is helping to shape a lower-carbon infrastructure for the world. It’s more than rubbish. It’s renewable energy. Reduce. Reuse. Recycle. Recover Energy-from-Waste. www.covantaenergy.com

EXPERT ROUNDTABLE Public Utilities Garry Brown, Chairman, Public Service Commission

Q: How well does the public utilities system serve New York? GB: Quite well. Around the nation, the New York Public Service Commission is recognized as a national leader in both policies and capabilities in terms of regulating public utilities. We literally get hundreds of thousands of calls per year. The way the law works, utilities come in for rate filings and we have eleven months to review them, so they get what they ask for. Since 2007 our review processes reduced electric and natural-gas bills by more than $3 billion from what the utilities asked for, without compromising in any way the reliability of the system. Q: Do consumers have adequate access to the Public Service Commission? GB: During the rate case, it’s very important to us

George Maziarz, Chairman, State Senate Committee on Energy and Telecommunications

Q: Can New York improve regulation to ensure higher quality and reliability? GM: I think we have a lot of regulation already. Maybe what we need is greater oversight so that the utility companies carry out the things that they promise when they come in for a rate increase. Last year the energy committee held hearings on National Grid’s rate increase request. That’s the one where we found out that they had put in the rate increase some obscene expenditures. They were sending their kids to private school here. At that

to go out and do public hearings in the area where the rates will be impacted. We do numerous public hearings a year where any member of the public can come in and speak to an administrative law judge and be on the record. We’re also very proud of our online availability of data—probably more than any human being could ever want. We’ve got every item in every case, unless it’s confidential. Literally hundreds of thousands of people a year hit that website to get that sort of information on what’s going on in our various proceedings through the state.

Q: Are there any efforts to lower utilities fees or taxes to help consumers? GB: One of the rate-drivers has been the property taxes that utilities pay. If you allow the utilities to just pass those along to the consumers, it provides very little incentive for the utilities to challenge the appropriateness of the property taxes or anything else. What we’ve done is develop a sharing mechanism where, if utilities can actually reduce the property taxes, then the consumers benefit, but we also make sure there’s a way that shareholders benefit, as well. time, most of the National Grid people had come over from London, and one of the things they put in was to reimburse their kids’ education expenses.

Q: Are there efforts to lower utilities fees or taxes? GM: The taxes that were imposed in 2009 and 2010 never should have happened. The 18a assessment, which was raised in 2010, expires in 2014, and we should let it expire. What I’d like to see is some of the federal money we used for the heat program to be used for improving people’s energy efficiency within their homes—better doors, windows, things like that.

Q: Does the regulatory system allow enough access to capital? GM: I think it does. Utilities are private companies with a public purpose, and they always have to be

Chairman, Assembly Energy Committee

usually held in places where it’s not particularly convenient for individuals to participate. From a consumer perspective, I would say the system is broken.

Q: How well do the public

Q: Are there efforts to lower utilities fees or

utilities serve New York? KC: I think the current system has a lot of flaws in it, particularly in these last few years since the consumer representation has been significantly diminished. The governor has chosen not to fund a public utilities board for utilities’ rate cases. The Public Utility Law Project, a not-for-profit that was funded with certain revenues, is no longer in existence. The Consumer Protection Board has had its purposes largely dismantled. So we have a real loss in consumer representation. That’s in a system rigged against the consumer to begin with. The utilities come in with high-priced talent to make their case. Citizens are out there to fend for themselves, and the hearings aren’t even held at a time that’s reasonable for consumers to participate. They’re almost always scheduled at 10:30 in the morning, when most people are working. They are

taxes? KC: I opposed the Article 18a assessment that doesn’t even go to the benefit of utility customers any more. It became a general revenue source for New York at a significantly higher rate than it had been previously posed, and we’re continuing to argue that it should be retired before its expiration date in 2014. There are other fees that are included in the bill: the renewable portfolio standard and the system benefits charge. Those charges are off-budget. That is, they are not subject to any oversight in the budgetary process and not subject to legislative approval. They are imposed at the whim of the Public Service Commission.

Kevin Cahill,

AUGUST 22, 2011

Q: How can New York ensure higher quality and reliability? KC: We have to reinvigorate the staffing of the Public Service Commission, so it’s more evenly matched when www.nycapitolnews.com

Q: How can New York better regulate utilities to ensure higher quality and reliability? GB: We’ve been doing some really interesting things on this in the last five to ten years in penalizing or rewarding the utility on the basis of what they do in terms of quality and reliability. How many times a year are customers losing their power? If they do lose their power, how long do they lose it for? We set goals for the utilities to meet, with meaningful penalties or rewards associated with that goal. In addition, we’ve got a fairly significant inspection staff, especially for natural-gas pipelines.

Q: Does the regulatory system allow utilities access to necessary capital? GB: This is part of the balancing act we’re always doing, of trying to keep the rates as low as possible for consumers, but also making sure the utilities are financially viable organizations. Since 2009 the utilities have issued approximately $6.6 billion of debt at fairly favorable rates, so they have been able to access capital, even in these tough times. improving their system. Improving the system is good for ratepayers, because generally it makes it more energy-efficient. In the long run these energy upgrades will actually save their consumers money, and probably be better for their shareholders, too.

Q: Do consumers have adequate access to the PSC? GM: I think in theory, yes, but in practice, no. The Public Service Commission complaint procedure could be much better. You’ve got expand their accessibility through the Internet. The PSC has to do a far better job of publicizing its activities. More than anything, the PSC has to do a much better job of speeding up its decision-making process. In some respects it’s like a dark hole when they’re asked for a decision. For a decision from the PSC, the time frame to get an answer is measured in months or years, not in weeks or days. it comes to rate hearings, so that our state resources [are being used or that we have something] at least as good as those resources being used to justify a rate increase or justify a particular approach of the utility. A second thing, I think, is that the Public Service Commission should be using things like the benefits charge and other charges that are included in the bill since deregulation, to actually reinvest in the state’s transmission and distribution system.

Q: Does the regulatory system allow enough access to capital? KC: The rate structure with a guaranteed rate of return on investment makes utilities one of the most attractive places to lend money to. With the exception of the Long Island Power Authority and a few municipals around the state, they are by and large shareholder-owned entities. How much of the emphasis of these companies is going toward that bottom line on a quarterly balance sheet, and how much is going for long-term investment? What we have seen is a diminishment in the investment, and in particular in the human-resource investment in maintaining the infrastructure.

THE CAPITOL

T RIM

10x12.25

RIM

THE GREEN TEAM HELPED A BUSINESS IN QUEENS

WITH MONEY-SAVING PROGRAMS ON LIGHTING UPGRADES.

“Saving money is always good business.” —Rhonda, Owner, Feinman Custom Frames, Long Island City, NY See how I’m saving at conEd.com/Rhonda

Rhonda’s lighting upgrades

$3,600

ESTIMATED MONTHLY SAVINGS:

$215

GREEN TEAM COVERED:

$2,524 (70%)

PROJECTED PAYBACK PERIOD:

5 months

COST TO RHONDA:

$1,076

TOTAL VALUE:

Scan to see Rhonda’s story.

WE’LL HELP YOU SAVE CONNECT WITH THE GREEN TEAM AT CONED.COM/GREENTEAM

OR CALL 1-877-870-6118 ACT NOW. LIMITED TIME OFFER.* *Based on eligibility

200 Varick Street Suite 600 New York NY 10014 212 343 5700

TRIM

RIM

VOICES

Regulated utilities by the numbers Electric Companies

Customers

Sales revenues (in millions)

Average annual residential bill

Central Hudson

282,073

$475

$1,260

David Bomke, Executive Director, New York Energy Consumers Council

National Grid

1,350,393

$2,124

$1,124

Q: How well does the sys-

Consolidated Edison New York State E&G Orange & Rockland Rochester G&E

3,277,856 875,297 223,339 362,559

$7,139 $1,163 $438 $573

$1,074 $888

$1,178 $793

Gas Companies

Brooklyn Union Gas

1,014,510

$1,706

$1,237

Consolidated Edison

1,058,356

$1,768

$1,099

Central Hudson

Corning Natural Gas KeySpan Gas East

National Fuel Gas Distribution (NYS & Penn. )

63,668 11,622

509,665 622,250

$155 $17

$1,186 $873

$1,398 $1,150 $1,578 $1,281

National Grid

459,691

$629

$1,166

Orange & Rockland

127,654

$239

$1,412

New York State E&G Rochester G&E St. Lawrence

Valley Energy

222,267 244,722 15,375 1,640

$369 $314 $34 $2

Public Utilities

$1,302 $1,160 $1,353 $965

Water Companies

Heritage Hills Waterworks

2,487

$534

NY Water Service

44,173

$23

$490

Long Island Sea Cliff

United Water New Rochelle

United Water New York (Spring Valley) United Water Oswego

United Water Westchester

73,966 4,373

31,592 73,032 1,665

12,221

$46 $2

$40 $59 $1

$11

$560 $472 $695 $593 $731 $757

Source: New York State Public Service Commission. All ďŹ gures from 2009.

AUGUST 22, 2011

www.nycapitolnews.com

tem serve New York? DB: Over all, the current system serves New York very well. The appointment process ensures that the commissioners themselves are fully vetted and proven to have the expertise and skills necessary to serve. The terms of office help ensure that commissioners have a reasonable level of insulation from political pressure, while still ensuring that citizens have some opportunity to shape the commission through their election of the governor and their representatives in the New York State Senate.

Q: Do consumers have adequate access to the PSC? DB: Yes. New York demonstrates some of the best characteristics of participatory democracy, allowing individual consumers to participate as fully as their schedules permit. In addition, consumers can work through an organization such as the New York Energy Consumers Council to ensure that they have representation in the process. The NYECC and its predecessor organizations have intervened in countless Con Edison rate cases and other regulatory matters of interest to consumers in Con Edisonâ&#x20AC;&#x2122;s service franchise during the past six decades. The administrative law judges at the PSC and the staff of the DPS consistently demonstrate exceptional legal and technical expertise.

THE CAPITOL

BACK & F O R T H

Gas Regulator

s commissioner of the Department of Environmental Conservation, Joe Martens is at the forefront of an intense debate over high-volume hydraulic fracturing, a controversial gas-drilling procedure commonly called “hydrofracking.” Before he was appointed commissioner, Martens said hydrofracking in the Marcellus Shale may be “the most difficult and daunting” environmental challenge the agency has faced in 40 years. After he took over earlier this year, the DEC issued its updated draft supplemental generic environmental impact statement—known as an SGEIS—outlining how hydrofracking could go forward. Permitting could start some time in 2012, but Martens says he is certain the agency will have the country’s best regulations in place before anyone starts drilling. What follows is an edited transcript. The Capitol: How does your experience shape your approach as commissioner? Joe Martens: I’ve worked with the first Gov. Cuomo back in the 1990s, ’90 to ’94. Before that, I worked for the Adirondack Park Agency, then about fifteen or sixteen years with the Open Space Institute before I came back to work for DEC. My experience with the governor’s office obviously gave me a good view of how DEC works, and certainly helped prepare me for the commissioner’s job because I was familiar with most of the programs in a fair amount of detail. But obviously a lot had changed over fifteen years. I spent fifteen years working on land-conservation issues, which was very satisfying and rewarding, and not quite as rough-and-tumble as all the issues you face at DEC, which is a much broader spectrum of issues. With the combination of my APA experience, which was strictly a regulatory role on land use, and my work in the governor’s office, I think it gave me a good background on problems that DEC faces today, including high-volume hydrofracking. TC: Some environmentalists raised concerns about the size of buffers around New York City’s watershed and risks to tunnels that carry water to the city. Could that change? JM: Lots of concerns have been raised about various aspects. I’d first point out that, relative to the draft that I inherited when I became DEC commissioner, these are completely new provisions. The prior draft did not ban high-volume hydraulic fracturing in the New York City watershed or the Syracuse watershed, and our most recent draft did, with a generous buffer around the watersheds. There were not prohibitions on drilling on state land in the first draft, and now there are. There are prohibitions on drilling in floodplains, which seemed to me to be a no-brainer. There are lots of improvements that we’ve made from the original draft that I’m proud of, that I think were the right thing to do. Concerns remain about size of buffers and we’re looking at everything. Obviously it’s still a draft, and we plan to go into a public comment period shortly. Once again we’re going to take all the comments seriously, and we’re going to look at the information we get, reevaluate and finalize the document. TC: Will the yet-to-be-completed EPA study on hydrofracking impact state regulations? JM: We don’t intend to wait for the EPA study to be

THE CAPITOL

complete. We’re going to continue on with our process, which we have been doing for three years. We feel like we have studied the issue intensively. We’re always receptive to new information. Nothing is ever cast in stone. When the EPA study comes out—or any other study, for that matter—we’ll take a look at it and see if there’s anything in it that would help inform us and help improve our own process in New York. We feel like we’re very much ahead of the game here. We’ve been studying the issue for a long time, and we have developed stateof-the-art regulations that are the best in the country. TC: How will you carry out your mission, given steep budget cuts and the addition of hydrofracking to your responsibilities? JM: I think it’s pretty clear that, in order to accommodate the anticipated volume of permit applications, we will need more staff at DEC. We’re actually convening an advisory panel that consists of environmentalists, industry and localgovernment groups, to look at that issue of resources at DEC, and also look at some of the impacts to local governments and resources available to local governments to address issues at the local level. We’re very cognizant of the fact that this is a big new activity, potentially, in New York, and that we’ll need new resources to address it. We’ve devoted a lot of time and effort across many divisions at DEC thus far. If we don’t get new staff, then we’ll have to proceed extraordinarily slowly reviewing permit applications. We have a limited number of staff people now, and we’ll only review those applications that we can responsibly review; and then, if we issue permits, to monitor activity and enforce, if necessary. We’ll absolutely do what we can with the staff we have. If we’re going to accommodate a higher level of activity, we’ll need more staff, no question about it. TC: What role will the advisory panel play?

JM: It’s an important group. These are individuals that have been immersed in the issue for a long time. They bring a lot of expertise to the table. I wouldn’t be spending the time pulling them together if we weren’t going to take their recommendations seriously, and I think we’re going to have a very interesting process with them, which once again will help inform where we come out on the process in the end. TC: Is renewable energy taking a backseat to hydrofracking?

www.nycapitolnews.com

JM: I don’t think we’ve been talking any less about renewable energy. Our main task right now on the environmental front is to complete this SGEIS, but the state of New York has very ambitious renewable goals. NYSERDA is the agency that is collecting money and making grants to help promote renewables in New York. Obviously DEC is very involved in the Regional Greenhouse Gas Initiative, which once again raises funds to promote renewable energy and lower the emissions of carbon in the state. The state as a whole is still very aggressively pursuing and promoting renewables. They’re obviously very important to DEC, but our primary role, as far hydrofracking goes, is as a regulator, so that’s what we’re busy with right now. TC: Do you support Comptroller Thomas DiNapoli’s proposed recovery fund for gas-drilling accidents? JM: That’s one of the issues that we’re having the advisory panel look at: the impact on local governments. It’s premature at the moment for us to comment about funds for potential accidents, because we’re busy putting together a program that will prevent accidents. That doesn’t mean nothing will ever happen. Accidents can happen anyplace, but we’ve taken a very precautionary approach here, and don’t expect problems. It’s obviously something we want to look at, and we’re going to take his proposal very seriously. It’s going to be a topic with the advisory panel. TC: Are there any major misconceptions about hydrofracking? JM: I think there’s a lot of misconceptions and misinformation about the issue as a whole. There are lots of concerns about contamination from the hydrofracking process itself, issues and concerns about migration from these well bores that are thousands of feet underground and a long way from aquifers—that there could be contamination. There’s no question that there have been problems in this industry, but I think that we’ve done our best to address any possible problem that’s occurred. We have very cautious regulations and proposed requirements in the SGEIS, and we’re working on regulations to implement those. We’ve been trying our best to just educate the public and make people as well-informed as possible. TC: What else is on your plate? JM: This place is busy all the time, on many fronts. The legislature passed an Article X bill for siting power plants, and we have to come up with two major components of those regulations. The governor just signed the water-withdrawal bill, and we’re responsible for drafting the regulations for that. We are very active on invasivespecies issues. If you drive around the state you’ll see our purple pyramids all around the state that we have to pull down and examine to see what kind of critters are traveling around New York State. If we have invasives showing up, we take action against them. This is the height of our visitor season, so our campgrounds and our boat-access sites are all very active, and we’ve spent a lot of the early part of the summer fixing places that have been damaged by the floods in the spring. This is an incredibly busy place all the time on lots of fronts. TC: How much of your day is spent on hydrofracking, as a percentage? JM: It’s hard to say—it’s a long day. This is a very intensive effort. I spend a lot of time, and staff at the agency is spending a lot of time. I don’t sit around and calculate the percentage, but it’s a significant issue, and I spend a lot of time on it. —Jon Lentz jlentz@nycapitolnews.com AUGUST 22, 2011

Never Forget â&#x20AC;&#x201D; the Union Keeps Us Strong!

Richard C. Iannuzzi, President Andrew Pallotta, Executive Vice President Maria Neira, Vice President Kathleen M. Donahue, Vice President Lee Cutler, Secretary-Treasurer

Representing more than 600,000 professionals in education and health care. www.nysut.org