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June 8, 2010


Hon. Dennis Gabryszak  (sent to all the members of the WNY Assembly delegation)
New York State Assembly
920 Legislative Office Bldg.
Albany, NY 12448

Dear Assemblymember Gabryszak:

On behalf of the 2,500 employer members of the Buffalo Niagara Partnership, I write in strong opposition to A.10257-A/S.7096-A, which would categorize gas and electric companies as “public agencies” thus, requiring them to pay the prevailing wage rate to any service worker that performs contractual work “for the benefit of a public agency with any third party person or entity acting in place of, on behalf of, or for the benefit of such a public agency pursuant to any lease, permit, or other agreement.” This surreptitious expansion of the current definition of “public agencies” will encompass virtually every contract entered into by privately-owned gas and electric companies.

New York already holds the dubious distinction of having the highest energy bills in the nation, due largely to the $6.4 billion in mandates, taxes and fees levied by the state each year. This new, unprecedented directive will significantly increase contracted labor costs, directly resulting in an added $50 million in costs to utility companies and their customers – another financial burden on New Yorkers at a time when they can least afford it. 

Beyond increased costs to taxpayers and utility customers, A.10257-A/S. 7096-A, would require utility companies to keep a complete record of how much each of their contractors and subcontractors pay their employees. This means that, instead of investing in their communities, fostering job creation and generating economic growth, utility companies will be buried under an insurmountable pile of paperwork due the burden of responsibility that this legislation places on them for the actions of companies over which they have no control. Moreover, failure to ensure that each contracted service workers is being paid the prevailing wage rate will result in excessive criminal penalties ranging from a Class A misdemeanor to a Class C felony.
 
Furthermore, this bill – offering no rationale – seeks to regulate the labor practices of shareholder-owned, non-municipal utility companies which are already highly regulated to ensure that they serve the public in the most reliable and cost effective manner. Therefore, it is counterproductive to expand the prevailing wage to utility companies when that means passing on those increased costs to a public that the state demands they serve fairly and cost efficiently. 

Additionally, this legislation will hinder utility companies’ ability to invest in infrastructure and jobs throughout the state while serving as a further disincentive for businesses to stay in or relocate to a state that has set a dangerous precedent of prevailing wage mandates on private sector companies. I urge you to oppose this downstate-sponsored bill and bring to the attention of your Assembly colleagues the repercussions A.10257-A/S.7096-A will have on Upstate business and residential utility customers. 

Sincerely,

Andrew J. Rudnick