Cuomo casts doubt on gas tax bill

The Climate and Community Investment Act, proposed in the state Legislature, would create a new carbon tax to combat climate change, but could increase New York’s gas prices up to 55 cents per gallon.

Gov. Andrew Cuomo cast doubt Thursday the state will adopt a law to combat climate change that would exponentially increase the price of gas for all New Yorkers.

The Climate and Community Investment Act would create a new climate pollution fee or carbon tax on fossil fuel companies to act as an incentive to reduce carbon emissions statewide and reinvest the money in a fund to rejuvenate New York’s green energy economy.

If passed, the measure could increase gasoline prices 55 cents per gallon and heating costs by more than 25% by more than doubling New York’s current gas tax rate.

Cuomo shot down the idea at a briefing Thursday at a senior center in the Bronx.

“You can’t do it that way,” Cuomo said as Democrats have pushed the new carbon tax. “I understand the concept, and the concept, it makes sense. But how does it work? What’s the economic impact? You’d have to ask all those questions.”

Sen. Kevin Parker, D-Brooklyn, sponsors the Climate and Community Investment Act S4264A/A6967, which would amend state Environmental Conservation, Executive, Labor, Public Authority and Tax laws to address climate change by expanding clean and renewable energy sources and projects, establishing a climate pollution fee and household or small business energy rebate, creating a climate pollution community just transition program and the Climate and Community Investment Authority.

The measure has 27 sponsors in the Senate and dozens of others in the Assembly. Democrats who support the measure are pushing to pass the bill before the end of legislative session June 10.

“We are pushing hard toward the end and trying to work on this legislation,” Parker said during a virtual press conference about the bill Wednesday. “It’s gaining momentum by the day.”

Funding from the tax will be evenly split with one-third to moderate- and low-income families, one-third to environmental justice communities and one-third to support green energy projects. The bill creates the Climate and Community Investment Authority, which will distribute the payments.

The new fee would fund a rebate as a direct tax credit for low- and moderate-income families and small businesses created under the measure.

Upstate families who make under the state median income of $70,000 would receive a rebate of $1,100 each year. New York City households would receive an annual rebate of $700 annually, as energy costs are lower in the city.

Any household that filed state taxes is eligible and automatically opted-in for the credit. No paperwork is required to receive the benefit.

New Yorkers who are eligible, but do not file taxes, would fill out an online form to receive the credit.

Rebates will be distributed at least quarterly.

The state Department of Taxation and Finance will collect polluter penalty funds and be given to the authority.

Senators and assemblymembers in the Environmental Conservation committees continue to negotiate the bill.

“There are conversations about moving the bill forward — we’re not quite ready as a conference yet,” said Parker, adding he expects amendments to the legislation.

“Staff are going through it with a fine-toothed comb, and we are working with legislators to address some of their concerns.”

Critics have raised issues about efficacy of the state mailing rebate payments, families having the money in time to offset higher energy expenses

“All of these things are being raised by my colleagues or other groups,” Parker said. “We are in the midst of negotiating the bill. We hope to be able to address many of the things people are [concerned] with.”

Senate Republicans railed against the measure and drew attention to the proposed gas tax increases at the end of April. Other downstate Democrats have spoken out against the Climate and Community Investment Act.

The state has the nation’s seventh-highest gas tax at 43.12 cents per gallon, according to the Tax Foundation. California has the highest rate at 62.47 cents per gallon.

The state’s gas tax would swell to 98.12 cents per gallon under the Climate and Community Investment Act — an increase of more than 127%.

Activists argue fossil fuel companies’ pollution rates and deciding increasing costs to consumers will cost New Yorkers more in the long run than a higher state gas tax.

Parker said the Republicans’ criticism of the bill is out of hand.

“They have not even acknowledged climate change is a real issue,” Parker said. “They really have no moral platform to stand on to talk about regressivity or to talk about how we should be addressing climate change. I’m happy to have conversations with them, many of them are members of my committee. [They] did not come up with anything that has been either helpful or instructive, and if they have real critiques on the bill, they should come forward with amendments and the conversation the CCIA is moving forward to address instead of standing on the sidelines heckling.”

Republican senators argue Parker is unwilling to listen to their input, adding he struck down their request this week to hold a public hearing on another proposed measure that could increase New Yorkers’ energy utility costs.

“It is not strictly Republican criticism, and Sen. Parker knows that; the bottom line is this out-of-touch proposal will harm every family and business in this state — regardless of political affiliation — at a time when we are struggling to recover from the economic devastation from the COVID-19 pandemic,” said Senate Minority Leader Rob Ortt, R-North Tonawanda.

The bill is the next step to implement the Climate Leadership and Community Protection Act passed in 2019, which mandates a 40% reduction of statewide greenhouse gas emissions by 2030 and a 85% emissions reduction by 2050, Parker said.

The CCIA will create an estimated 160,000 green energy jobs. Activists in favor of the bill say the authority will help the state transition to a renewable economy, reduce vehicles and public transportation’s dependence on fossil fuels and create energy-efficient schools and public housing.

“We think this does that in a very effective and efficient manner, and we don’t think this creates any kind of division,” Parker said. “It’s really just a Republican talking point that looks to divide the state. We’re looking at this as a one New York strategy with emphasis of helping moderate- and low-income New Yorkers.”

The measure remains in the Environmental Conservation Committee in both chambers.

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