ECONOMIC DEVELOPMENT POWER
ALLOCATION BOARD
MINUTES
June
25, 2007
Video
Conference 10:00 a.m.
DMJM Harris,
1. Approval
of the Minutes of the Meeting of May 21, 2007
2. Power
for Jobs Extended Benefits, Energy Cost Savings Benefit
Awards and Economic
Development Power Contracts Extensions
3. Power for Jobs Extended Benefits
Recommendations
for Electricity Savings
Reimbursements
A. COMPANIES
IN JOB COMPLIANCE
Con
Edison -
|
American Cancer Society Diller East Harlem Arts & Education Local Development Corp. Brooklyn Home for Contemporary Theater & Art |
International Business Machines Intrepid Museum Foundation Jacmel Jewelry, Inc. Seybert Nicholas Printing Group, LP Streamline Plastics Co., Inc. Bronx Verizon |
|
|
Long Island Power Authority -
|
West Islip J.P. Morgan/Chase Lake Success |
Manhasset |
|
|
National Grid
|
Applied Energy solutions (CEN Electronics) Caledonia Bristol-Myers Squibb Company East Syracuse Diemolding Corporation Canastota Gouverneur St. Lawrence County Fiber Glass Industries, Inc. General Electric Plastics Selkirk |
Organichem, Inc. Rensselaer Revere Copper Products Sorrento Lactalis, Inc. Turbine Engine Components Technologies Whitesboro |
|
|
|
Bison Foods Division of Upstate Farms West Seneca Corning, Inc. (Sullivan Park) |
Dunmore Corporation Brewster |
|
|
|
International Business Machines ( |
|
|
International Business Machines ( |
Seneca Foods Corp. (Marion) |
|
|
Jada Precision Plastics Co. |
|
|
B. COMPANIES
NOT IN JOB COMPLIANCE
Con Edison
|
A. Stein Meat Products, Inc. Brooklyn Acme Architectural Products, Inc. Brooklyn |
American Indian Community House Kruysman, Inc. |
|
|
National Grid
|
Dielectric laboratories, Inc. Cazenovia Gaylord Brothers Liverpool |
RSA Solutions Inc. (Remarketing Services of |
|
Manitoba Corporation |
|
|
Seneca Foods Corporation (Leicester) Leicester |
|
|
4.
Transfer
of Industrial Power
|
Ademco Group Syosset Automatic Data Processing Edgewood ICM Controls Corporation |
IPAC, Inc Niagara Falls
Upstate Farms Cooperative, Inc |
OTHER BUSINESS
5.
Remarks from
the Chairman
6.
Next Meeting
A regular meeting of the Economic Development
Power Allocation Board was held via video conference at the following
participating locations:
1)
2)
3)
4) DMJM Harris
The following Members of the
Board were present at the following locations:
Frank
S. McCullough, Jr., Chairman (
Bernard P. McGarry, Member (
James
A. Duncan, Member, (
Kevin S. Corbett, Member (
Also in attendance were:
Timothy S. Carey President
and Chief Executive Officer, NYPA
Thomas J. Kelly Executive Vice President and General Counsel, NYPA
Louise M. Morman Senior Vice President, Marketing and Economic Development, NYPA
Anne B. Cahill Corporate
Secretary, NYPA
Joseph C. Carline Assistant
General Counsel, NYPA
John B. Hamor Executive
Director State Governmental Relations, NYPA
James F. Pasquale Director
Business Power Allocations, Compliance and Municipal and Cooperative
Marketing, NYPA
Michael A. Saltzman Director
Media Relations, NYPA
Anthony C. Savino Manager
Business Power Allocations and Compliance, NYPA
Mary Jean Frank Associate Secretary, NYPA
Lorna M. Johnson Assistant Secretary, NYPA
Keith Corneau Empire
State Development Corporation
1. Adoption of Minutes
The minutes of the meeting of May 21, 2007, were unanimously adopted.
2. Power
for Jobs Extended Benefits, Energy Cost Savings Benefit
Awards and Economic
Development Power Contracts Extensions
SUMMARY
The Legislature and the Governor have agreed in a public legislative conference to a one-year extension of the Power for Jobs (PFJ) and the Energy Cost Savings Benefit (ECSB) Programs, through June 30, 2008. As of today, there are identical bills in the Senate and Assembly concerning extension of the programs (Proposed Legislation). It is expected that the Governor will sign the Proposed Legislation, or similar legislation, authorizing a one-year extension on terms set forth in the bills. It is recommended that the Economic Development Power Allocation Board (the Board) authorize and recommend to the New York Power Authority (Authority) the extension of PFJ and ECSB program benefits effective July 1, 2007 (or later for ECSB applicants whose rates are not subject to increase on that date), to qualified applicants that execute appropriate extension agreements with the Authority.
Power For Jobs
The proposed legislation concerning further extension of the PFJ program would allow PFJ program recipients to continue with existing elections (i.e., power contracts or rebates) for an additional year through June 30, 2008 with the program benefits administered as in current law. In addition, the bills would, in effect, extend for another year the availability of restitution for those PFJ power contract customers that incur higher aggregate costs being in the program as opposed to taking service from their local utility under standard tariff provisions.
Under the Economic Development Law,
as amended by the Proposed Legislation, the Economic Development Power
Allocation Board (Board) may prescribe a simplified form and content for an
application for such extended PFJ benefits.
An applicant is eligible for extended PFJ benefits only if it is in
compliance with and agrees to continue to meet the job retention and creation
commitments set forth in its prior power for jobs contract, or such other
commitments as the board deems reasonable.
However, in light of the need to avoid disruption in the receipt of such
benefits, the new legislation provides that the Board expedite the awarding of extended PFJ benefits and defer the review of compliance with job
commitments until after the applicant has been awarded extended benefits.
Attached as Exhibit 2-A is a list by utility service area of the
current recipients of PFJ contract and rebate benefits.
Contract
Extensions and ECSB Awards
A number of the High Load Factor (HLF), Economic Development Power (EDP) and Municipal Distribution Agency (MDA) program customers underlying power contracts have terms ending on June 30, 2007, or on some other date before June 30, 2008. In order for such customers to enjoy extension or initial award of ECSB awards it is necessary to extend their power contracts. Extension of EDP contracts is subject to the approval of the Board. These customers are listed on Exhibit 2-B.
ECSB awards serve to moderate rates for businesses served under the HLF, EDP and MDA programs. Under the proposed new legislation the Board is authorized to approve extensions of ECSB awards through June 30, 2008. The Proposed Legislation would extend availability of ECSB benefits to entities that are currently receiving such benefits and businesses under these programs whose rates would be subject to increase on or before June 30, 2008. For entities currently receiving ECSB awards, the legislation provides for continuation of the existing level of benefits for another year while allowing the Authority to continue to use up to 70 MW of unallocated Replacement Power to fund the ECSB awards, provided that any such Replacement Power be made available for allocation in Western New York during the period of extension. The group of customers that are not now receiving ECSB benefits but whose prices are subject to increase after June 30, 2007 includes 37 businesses with so-called Option Five pricing contracts with the Authority that expire on October 30, 2007. Under the Proposed Legislation, these firms will be eligible to receive ECSB awards on a par with those received by existing ECSB program beneficiaries.
As under current law, applications for extensions of ECSB awards are to be in the form and contain such information, exhibits and supporting data as the Board may prescribe. The Board is to review the applications received and determine the applications that best meet the criteria established for the ECSB awards and recommend such applications to the Authority with such terms and conditions as it deems appropriate. In order to avoid disruption in the delivery of ECSB benefits, the bill directs the Board to expedite the awarding of ECSB and to defer the review of compliance with job commitments until after applicants have been awarded ECSB.
Attached as Exhibit 2-C is a list by utility service area of the
current recipients of ECSB awards and other businesses whose rates will be
subject to increase on or before June 30, 2008.
RECOMMENDATION
It is recommended that the Board authorize and recommend to the New York Power Authority extension of Power for Jobs power contracts and rebates, Energy Cost Savings Benefit awards and, where necessary, the length of contracts between the Authority and Economic Development Power Program customers through June 30, 2008, subject to review by the Board on or before September 30, 2007, of whether applicants for such benefits are in compliance with their respective contractual commitments associated with such program benefits. Extension of such benefits shall be effective as of July 1, 2007 (or later for ECSB applicants whose rates are not subject to increase on that date), subject to completion of appropriate written agreements between such applicants and the Authority and the requirements of the host utilities.
Before presenting the highlights of staffs
recommendations to the Board, Mr. Pasquale noted that both houses of the State
Legislature had passed, and Governor Spitzer is expected to sign into law, the
legislation extending the Power for Jobs, Energy Cost Savings Benefit and
Economic Development Power programs through June 30, 2008. He said that there could be unavoidable gaps
in service due to the fact that the legislation is being enacted so close to
the previous deadline for the programs, June 30, 2007.
In response to a question from
Mr. Corbett, Mr. Pasquale said that these power programs customers would
prefer that a long-term solution be found so that their contracts did not have
to be renewed on a year-to-year basis.
President Carey said that the Temporary Commission on the Future of
The following resolution was unanimously adopted
by members of the Board present.
RESOLVED, That the Board hereby authorizes
and recommends to the New York Power Authority extension through June 30, 2008
of Power for Jobs power contracts and rebates, Energy Cost Savings Benefit
awards and, where necessary, the length of contracts between the Authority and
Economic Development Power Program customers, subject to review by the Board on
or before September 30, 2007, of whether applicants for such benefits are in
compliance with their respective contractual commitments associated with such
program benefits, and be it further
RESOLVED, That extension of such benefits
shall be effective as of July 1, 2007 (or later for ECSB applicants whose rates
are not subject to increase on that date), subject to completion of appropriate
written agreements between such applicants and the Power Authority and the
requirements of the host utilities.
3. Power for Jobs Extended Benefits Recommendations
for Electricity Savings Reimbursements
SUMMARY
The Members of the Economic Development Power Allocation Board
(EDPAB) are requested to approve extended benefits for 43 Power for Jobs
(PFJ) customers as listed in Exhibits 3-A and 3-B.
BACKGROUND
In July 1997, the New York State Legislature approved a program to
provide low-cost power to businesses and not-for-profit corporations that agree
to retain or create jobs in
The PFJ program originally made 400 megawatts (MW) of power
available. The program was to be phased
in over three years, with approximately 133 MW made available each year. In July 1998, as a result of the initial
success of the program, the Legislature amended the PFJ statute to accelerate
the distribution of the power, making a total of 267 MW available in Year
One. The 1998 amendments also increased
the size of the program to 450 MW, with 50 MW to become available in Year
Three.
In May 2000, legislation was enacted that authorized another 300 MW of
power to be allocated under the PFJ program.
The additional MW were described in the statute as phase four of the
program. Customers that received
allocations in Year One were authorized to apply for reallocations; more than
95% reapplied. The balance of the power
was awarded to new applicants.
In July 2002, legislation was signed into law that authorized another
183 MW of power to be allocated under the program. The additional MW were described in the
statute as phase five of the program.
Customers that received allocations in Year Two or Year Three were given
priority to reapply for the program. Any
remaining power was made available to new applicants.
Chapter 59 of the Laws of 2004 extended the benefits for PFJ customers whose
contracts expired before the end of the program in 2005. Such customers had to choose to receive an
electricity savings reimbursement rebate and/or a power contract
extension. The Authority was also
authorized to voluntarily fund the rebates, if deemed feasible and advisable by
the Trustees.
PFJ customers whose contracts
expired on or prior to November 30, 2004, were eligible for a rebate to the
extent funded by the Authority from the date their contract expired through
December 31, 2005. As an alternative,
such customers could choose to receive a rebate to the extent funded by the
Authority from the date their contract expired as a bridge to a new contract extension,
with the contract extension commencing December 1, 2004. The new contract would be in effect from a
period no earlier than
PFJ customers whose contracts expired after November 30, 2004 were eligible for rebate or contract extension, assuming funding by the Authority, from the date their contracts expired through December 31, 2005.
Approved contract extensions entitled customers to receive the power
from the Authority pursuant to a sale-for-resale agreement with the customers
local utility. Separate allocation
contracts between customers and the Authority contained job commitments
enforceable by the Authority.
In 2005, provisions of the approved State budget extended the period
PFJ customers could receive benefits until December 31, 2006. In 2006, a new law (Chapter 645 of the Laws
of 2006) included provisions extending program benefits until June 30, 2007.
Section 189 of the New York State
Economic Development Law, which was amended by Chapter 59 of the Laws of 2004,
provided the statutory authorization for the extended benefits that could be
provided to PFJ customers. The statute
stated that an applicant could receive extended benefits only if it is in compliance with and agrees to continue to meet the job
retention and creation commitments set forth in its prior power for jobs
contract.
Chapter 313 of the Laws of 2005 amended the above language to allow EDPAB to consider continuation of benefits on such terms as it deems reasonable. The statutory language now reads as follows:
An applicant shall be eligible for such reimbursements and/or
extensions only if
it is in compliance
with and agrees
to continue to meet the job retention and creation commitments set forth
in its prior power for jobs contract, or such other commitments as
the board deems reasonable. (emphasis supplied)
At its meeting of October 18, 2005, EDPAB approved criteria under which
applicants whose extended benefits EDPAB had reduced for non-compliance with
their job commitments could apply to have their PFJ benefits reinstated in
whole or in part. EDPAB authorized staff
to create a short-form application, notify customers of the process, send
customers the application and evaluate reconsideration requests based on the
approved criteria. To date, staff has
mailed 200 applications, received 109 and completed review of 108.
DISCUSSION
EDPAB is requested to recommend that the Authority Trustees approve
electricity savings reimbursements rebates to 43 PFJ customers. Thirty-four customers are meeting their
current job commitments and are listed in Exhibit 3-A. However, nine customers reported actual job
numbers below their contractual commitment. Staff is recommending that these customers have
their allocation reduced proportionately to their job shortfall where
appropriate. These customers are listed
on Exhibit 3-B. Collectively, these
organizations have agreed to retain more than 31,000 jobs in
RECOMMENDATION
It is requested that the Economic Development Power Allocation Board
recommend that the Authority Trustees approve the payment of electricity
savings reimbursements to the Power for Jobs customers listed in Exhibits 3-A
and 3-B.
The following resolution was unanimously adopted
by members of the Board present.
WHEREAS, the following entities have
applied for extended benefits recommendations for electricity savings
reimbursements under the Power for Jobs program:
COMPANIES IN JOB
COMPLIANCE
|
Con Edison - |
|
|
American Cancer Society Diller Development Corp. Brooklyn Home for Contemporary Theater & Art |
International Business Machines Intrepid Museum Foundation Jacmel Jewelry, Inc. Seybert Nicholas Printing Group, LP Streamline Plastics Co., Inc. Bronx Verizon |
|
|
|
|
West Islip J.P. Morgan/Chase Lake Success |
Manhasset |
|
National Grid |
|
|
Applied Energy solutions (CEN Electronics) Caledonia Bristol-Myers Squibb Company East Syracuse Diemolding Corporation Canastota Gouverneur St. Lawrence County Fiber Glass Industries, Inc. General Electric Plastics Selkirk |
Organichem, Inc. Rensselaer Revere Copper Products Sorrento Lactalis, Inc. Turbine Engine Components Technologies Whitesboro |
|
|
|
|
Bison Foods Division of Upstate Farms West Seneca Corning, Inc. (Sullivan Park) |
Dunmore Corporation Brewster |
|
|
|
|
International Business Machines ( |
|
|
|
|
|
International Business Machines Jada Precision Plastics Co. |
Seneca Foods Corp. |
COMPANIES
NOT IN JOB COMPLIANCE
|
Con Edison |
|
|
A. Stein Meat Products, Inc. Brooklyn Acme Architectural Products, Inc. Brooklyn |
American Indian Community House Kruysman, Inc. |
|
National Grid |
|
|
Dielectric laboratories, Inc. Cazenovia Gaylord Brothers Liverpool |
RSA Solutions Inc. (Remarketing Services of |
|
Manitoba Corporation |
|
|
|
|
|
Seneca Foods Corporation Leicester |
|
NOW THEREFORE BE IT RESOLVED, That the
Board hereby finds and determines that such applications meet the requirements
of the extended benefits provisions of the Power for Jobs legislation contained
in Article 6 of the Economic Development Law as amended by Chapter 645 of the
Laws of 2006; and be it further
RESOLVED, That the
Board recommends to the Power Authority of the State of New York the 43 applications
for extended benefits recommendations for electricity savings reimbursements discussed
herein totaling 43,580 kW until June 30, 2007.
4. Transfers
of Industrial Power
The members of the Economic Development Power Allocation Board (EDPAB) are requested to recommend approval to the companies as detailed below.
BACKGROUND
EDPAB is requesting to approve the transfer of Power allocations for five existing companies that have changed names and or/ locations for various business reasons. EDPAB approved transfers of this nature at past meetings.
The proposed transferees are as follows:
Ademco Group (Ademco), located in Syosset, is the world leader in designing, engineering and manufacturing wired and wireless electronic security products for commercial and residential applications, with designing and engineering taking place at the companys Syosset facility. The company was originally awarded a 900 kW Power for Jobs (PFJ) allocation for 605 jobs by the Trustees at their meeting of May 30, 2003 and was reduced for PFJ Extended Benefits to a 650 kW allocation for 441 jobs by the Trustees at their meeting of April 28, 2006. In 2006, Honeywell purchased Ademco Group, with the company using the Honeywell name and manufacturing the same products. Honeywell has agreed to honor all terms and commitments with the Authority.
Automatic Data Processing (ADP), located in
ICM Controls Corporation (ICM), located in
IPAC, Inc. (IPAC), located in
Upstate Farms Cooperative, Inc. (Upstate), located in
It is recommended that the Power Allocation Board approve the name and or location changes detailed above.
Following consideration of such recommendations, the Members of the Board present voted unanimously to adopt the following resolution:
RESOLVED, That the members of the Economic
Development Power Allocation Board hereby approve the transfer of power
allocations for four existing companies that have changed names and/or
locations for various business reasons as described in the above memorandum to
the Board.
5. Remarks from the Chairman
Chairman McCullough said that staff would
inform the Board members when the Governor has signed the extensions bill into
law.
6. Next Meeting
The next meeting of the Board is to be determined.