Downstate businesses pay half of new tax on utilities; While WNY businesses struggle to survive, create jobs

 

Tonawanda, NY – The two-percent tax on utility bills, included in the State budget earlier this year, excludes the Long Island Power Authority.  The law only requires Long Island Power Authority customers to pay a one percent tax.


“The new two-percent utility tax charges businesses all across Western New York double what downstate pays,” said Senator Ranzenhofer.  “Albany makes one rule for Upstate and another for downstate  – it’s absolutely unfair.  The discounted tax places local businesses at a competitive disadvantage with downstate, ultimately leaving us in the dark.”


Tonawanda business W.H. Jones and Son continues to feel the pinch of the utility tax, with monthly increases of $17 for electricity and $23 expected during the winter for gas.  W.H. Jones and Son estimates the  new utility tax will cost an additional $500 on their utility bills per year.


“The new utility surcharge is just another thinly veiled tax on both businesses and individuals by New York State. I feel it unfairly rests on the back of manufacturers. Manufacturing operations typically are larger consumers of energy than their non-manufacturing counter-parts and therefore assume a larger percentage of this new burden.  Our impact is projected at approximately $450 to $500 per year for this new tax.  While this may seem small to some, when added to the already high cost burden for taxes, workers comp and health insurance - it becomes more difficult every year to do business in NYS.  Of even greater concern would be the effect on my large regional manufacturing customers.  If they decide this is just one more burden - when added to all others - that they no longer can compete in NYS - then they don't need WH Jones to be in "support of",” said W.H. Jones and Son President Todd Jones.


Individuals and businesses started paying an additional two percent State Assessment Fee on monthly utility bills on July 1.  New York State requires utility companies to pay the assessment until March 2014.  Utility companies do not profit from the tax.  The tax is expected to raise approximately $540 million in the first year.


Senator Ranzenhofer introduced legislation in the State legislature and began a petition drive to repeal the tax in August.  Since then, the proposed legislation, S6132, has added 15 Senators and 22 Assemblyman as sponsors; and almost two-thousand constituents have signed the petition.
 
W. H. Jones & Son, Inc. is a contract precision machine and fabrication job shop established in 1941.  The company designs and builds special custom machinery, precision contract machining, tool and fixture work, custom fabrications and reverse engineering.  Most of this work is performed on a job order basis in "support of" regional mid-large size manufacturers.


Senator Ranzenhofer was elected to the New York State Senate in 2008.  He represents the 61st Senate District which includes part of the city of Tonawanda, the Towns of Amherst, Clarence, Newstead and Tonawanda in Erie County and all of Genesee County.


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