3.             Transfers of Industrial Power

SUMMARY

                The Members of the Economic Development Power allocation Board (“EDPAB”) are requested to recommend the Power Authority Trustees’ approval of the allocation transfers detailed below.

BACKGROUND

EDPAB is requested to recommend the Power Authority Trustees’ approval of transfers of power allocations for 15 companies that have changed names and or/locations for various business reasons. EDPAB has recommended approval of such transfers in the past.

DISCUSSION

                The proposed transferees are as follows:

Boston Scientific Corp./NAMIC Technology Center, in Glens Falls, Warren County, has been in business at this site since 1969.  BSC designs, manufactures and markets single-patient-use medical products, primarily for diagnosing and treating atherosclerotic cardiovascular disease.  The company was awarded a 650 kW Power for Jobs (“PFJ”) allocation, which the Trustees extended through the program’s current sunset of June 30, 2009.  Recently, BSC and its assets and liabilities were purchased by Avista Capital Partners.  The business conducted by BSC at the Glens Falls location remains unchanged.  The company is now called NAMIC/VA Inc.  The company will continue to honor all terms and commitments of its contract with the Authority. 

Canajo Manufacturing Company, in Canajoharie, Montgomery County, manufactures candy at a location where candy has been made by various companies since the early 1900s.  Originally, a PFJ allocation of 700 kW was awarded to Richardson Brands Company.  On September 23, 2003, the Trustees acknowledged Richardson Brands Company’s name change to Joyco USA Confectionery, Inc. by transferring the allocation.  The Trustees transferred the allocation to Canajo Manufacturing Company at their May 25, 2004 meeting, as Canajo acquired most of Joyco’s assets and all of its equipment.  When Canajo applied for PFJ benefits, it received a reduced allocation (600 kW) by the Trustees at their September 20, 2005 meeting due to lower reported employment.  In 2006, the company merged with Richardson Brands Company, which is a portfolio company of Founders Equity, a capital management firm in Manhattan.  Canajo is now Richardson Brands Company and still manufactures candy.  The Trustees recently extended the PFJ allocation through the end of the PFJ program on June 30, 2009.  The company will continue to honor all terms and commitments of its contract with the Authority.

Central Suffolk Hospital, in Riverhead, Suffolk County, is a non-profit community hospital for the east end of Long Island, providing inpatient and outpatient services, intensive care, cardiac care, pediatrics, obstetrical services, radiology, rehabilitation, pharmacy and long-term care .  The hospital is changing its name to Peconic Bay Medical Center.  CSH originally received a 200 kW PFJ allocation, which was extended for rebates through June 30, 2009.  The hospital will continue to honor all terms and commitments of its contract with the Authority. 

Charmer Industries, Inc., in Astoria, Queens County, in business since 1944, is a wholesale distributor of wine and spirits.  The company merged with Peerless Importers, Inc. in response to competitive pressures.  In addition to merging, the company changed its name to Empire Merchants LLC.  The business conducted by the company remains unchanged.  The company operates out of the former Charmer and Peerless locations in Queens and Brooklyn.  Charmer originally received a 750 kW PFJ allocation, which was extended for rebates through June 30, 2009.  The company will continue to honor all terms and commitments of its contract with the Authority.

Delphi Automotive Systems, LLC, in Amherst, Niagara County, produces various essential parts for automotive radiators through injection molding for its Lockport plant and also places gaskets on headers to form the seal on the radiators.  Delphi has one PFJ allocation.  At their April 27, 1999 meeting, the Trustees granted Ultra Tool and Plastics, Inc. a 150 kW PFJ allocation.  The PFJ allocation went to the Pineview Drive location.  At their September 23, 2003 meeting, the Trustees transferred Ultra’s PFJ allocation to Viking Industries, LLC, which promised to honor all terms and commitments of that allocation.  Viking closed the Pineview Drive facility in early 2004 and consolidated its equipment and jobs and PFJ allocation at its Commerce Drive facility.  At their December 13, 2005 meeting, the Trustees transferred Viking’s PFJ allocation to Delphi, which promised to honor all terms and commitments of that allocation.  However, the PFJ allocation’s employment commitment was reduced.  The company received extended benefits for rebates through June 30, 2009.  Delphi is relocating its Amherst plant functions to the Lockport plant in a critical move to stay competitive and increase efficiencies in process flow.  The Amherst plant’s functions and equipment will be called power train, or PTC, molding, consisting of 17 injection molding machines and 2 gasket lines at the Lockport plant.  Delphi is transferring 101 workers from Amherst to Lockport.  The allocation transfer would also involve a change of service provider from National Grid to New York State Electric & Gas.  Delphi will continue to honor the terms and commitments of its contract with the Authority.

EDO Corp., in Amityville and Bohemia, Suffolk County, has been in business for more than 60 years.  EDO is the leading systems integrator and producer of high-technology electronic products for the defense industry and government agencies, including avionics and tactical jamming equipment, as well as antennas, radar systems and space-based communications equipment.  AIL Systems, Inc. was awarded a 2,700 kW PFJ allocation by the Trustees at their meeting of January 27, 1998.  On May 1, 2000, AIL and EDO merged.  The allocation was extended through June 30, 2009.  On December 20, 2007, EDO was purchased by ITT Corporation, with ITT acquiring EDO’s assets and liabilities.  The business conducted by the company and its location remain unchanged.  The company, now named ITT Corporation, will continue to honor the terms and commitments of its contract with the Authority. 

F. P. Pla Tool and Mfg. Co. Inc., in Buffalo, Erie County, is a contract precision machining business founded in 1944 that serves the aerospace, compressor, energy and general manufacturing industries, in addition to being a cutting tool manufacturing business.  The company originally received a 100 kW PFJ allocation.  The allocation was extended for 50 kW through June 30, 2009.  In order to accommodate the demand from new clients, the company moved from Buffalo to a new larger facility in Lackawanna, in addition to changing its name without a change in ownership to Alliance Innovative Manufacturing, Inc.  The company, which is continuing business as a precision manufacturing facility, will continue to honor the terms and commitments of its contract with the Authority.

Fordham University - Marymount College, in Tarrytown, Westchester County, has been a liberal arts college for women since 1907.  Fordham received a 400 kW PFJ allocation.  The college received extended benefits for rebates through June 30, 2009.  The Marymount campus is closing and has been replaced by a new campus in West Harrison.  Fordham wishes to transfer its PFJ allocation to its Rose Hill campus in the Bronx.  However, the jobs associated with the PFJ allocation have been transferred to three locations – the Harrison, Lincoln Center and Rose Hill campuses.  Fordham will continue to honor the terms and commitments of its contract with the Authority.

General Electric Plastics, in Selkirk, Albany County, has been in operation at this site for more than 40 years.  GEP develops and manufactures plastics materials and resins.  The company was originally awarded a 5 MW PFJ allocation.  In August 2002, the business component became GE Noryl, LLC, a wholly owned subsidiary of General Electric Co.  The allocation received extended benefits for rebate through June 30, 2009.  On August 31, 2007, GEP was purchased by SABIC, which acquired its assets and liabilities.  The business conducted by the company and its location remain unchanged.  The company, now named SABIC Innovative Plastics, will continue to honor the terms and commitments of its contract with the Authority. 

Glens Falls Lehigh Cement Company, in Glens Falls, Warren County, is the oldest cement plant in New York, having been in business for more than 110 years.  GFLC was originally awarded a 1 MW PFJ allocation.  The allocation was extended through June 30, 2009.  In 2005, Lehigh Cement Company fully acquired GFLC.  The company changed its name to Lehigh Northeast Cement Company.  The business conducted by the company remains unchanged.  The company will continue to honor the terms and commitments of its contract with the Authority.

Greatbatch, Inc., founded in 1970 in Clarence, Erie County, designs, develops and manufactures batteries, capacitors, EMI filters, coated electrodes, stimulation leads, catheters, introducers and assemblies used in the implantable medical industry.  Wilson Greatbatch, Ltd. originally received a 1,200 kW PFJ allocation.  At their December 31, 2005 meeting, the Trustees recognized the company’s name change to Greatbatch, Inc.  The Trustees extended an allocation of 780 kW through June 30, 2009.  The allocation is spread over four facilities in Clarence:  10000 Wehrle Drive, 9645 Wehrle Drive, 4100 Barton Road and 4098 Barton Road.  Since the company is closing the 9645 Wehrle Drive facility, it wishes to transfer that portion of its PFJ allocation to the other facilities.  Greatbatch will continue to honor the terms and commitments of its contract with the Authority.

Lancaster Steel Service Company, Inc., in Lancaster, Erie County, has been in business and owned by the same two families since 1936.  From a large distribution center, Lancaster offers an extensive line of products and services, including structural steel, merchant bars, plates, reinforced steel fabrication and flat rolled products.  The company originally received a 500 kW PFJ allocation.  The allocation was extended through June 30, 2009.  On October 4, 2006, Lancaster was acquired by Ryerson Inc.  The business conducted by the company and its location remain unchanged.  The company, now named Ryerson, Inc., will continue to honor the terms and commitments of its contract with the Authority. 

Merritt Plywood Machinery, Inc., in business for more than 150 years and located in Lockport, Niagara County, designs, manufactures and installs custom machinery for the hardwood veneer industry.  Merritt originally received a 75 kW PFJ allocation.  The company received extended benefits for rebates through June 30, 2009.  In June 2008, all of Merritt’s assets were purchased by Merritt Machinery, LLC.  The business conducted by the company and its location remain unchanged.  The company will continue to honor the terms and commitments of its contract with the Authority. 

The New Museum of Contemporary Art was founded in 1977 in New York, New York County.  The museum, originally the recipient of a 50 kW PFJ allocation, received extended benefits for rebates through June 30, 2009.  The New Museum moved to its new building in Manhattan in November 2007 and requests that its PFJ allocation be transferred to the new facility.  The museum will continue to honor the terms and commitments of its contract with the Authority.

Organichem, Inc., established in 1999 and located in Rensselaer, Rensselaer County, conducts large-scale pilot manufacturing of active pharmaceutical ingredients for medicinals, botanicals and diagnostic substances.  Albany Molecular Research, Inc. owned 40% of the company, with Organichem management owning the rest, but AMRI acquired all of Organichem through warrants received when the company was established.  In 2007, the company changed its name only, without any ownership change, to AMRI Rensselaer, Inc.  The company, originally the recipient of a 1,000 kW PFJ allocation, received extended benefits for rebates through June 30, 2009.  The company will continue to honor the terms and commitments of its contract with the Authority. 

RECOMMENDATION

It is requested that the Economic Development Power Allocation Board recommend that the Power Authority’s Trustees approve the name and/or location changes detailed above.

Mr. James Pasquale presented the highlights of staff’s recommendations to the Board.  In response to a question from Mr. Nicandri, Mr. Pasquale said that the changes in locations are within New York State.

The following resolution was unanimously adopted by members of the Board present.

                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.

4.             Other Business

            In response to a question from Mr. Nicandri, Mr. Pasquale agreed that the current economic climate could have a potential impact on some of the customers.  In response to another question from Mr. Nicandri, Mr. Pasquale explained that the Power for Jobs (“PFJ”) program’s sunset is June 2009.  The contracts for the non-PFJ (Energy Cost Savings Benefits Program) customers were also extended through June 2009.

                In response to further questions from Mr. Nicandri, Mr. Pasquale explained that for the past three or four years PFJ customers received approval for one-year extensions.  The Authority processes the contracts each year as new legislation authorizes the extensions.

5.             Next Meeting

                The next meeting of the Board is to be determined.