New York's annual cleanup expenditures far exceed that of most states, and New York's existing hazardous waste-related fees greatly exceed the superfund-related business fees imposed in virtually every other state, a state-by-state analysis environmental spending shows.
New York's already heavy environmental fee-burden is a strong argument for rejecting increases in hazardous waste fees that have been proposed both in Governor Pataki's executive budget and in the new Assembly Superfund plan, said Ken Pokalsky, director of environmental and regulatory affairs.
"These fee increases would dramatically increase New York's outlier status on this cost-of-doing business factor," Pokalsky said in a March 26 letter to legislative leaders on this issue.
Pokalsky cited "An Analysis of State Superfund Programs," published in 1998 by the Environmental Law Institute (ELI) of Washington, D.C. This analysis, which ELI has said it plans to update this year, is a comprehensive review of state-level remediation programs.
Pokalsky said the ELI analysis showed that:
- Only two states New York and New Jersey spent more than $50 million on remedial programs in 1998. In contrast, among the 42 states providing expenditure data, the average state spending on cleanups was $12.8 million, while the median spending level was just $2.3 million. Two-thirds of all states spent $10 million or less on remediation programs.
- In comparison to these national averages, New York's existing hazardous waste-related fees (waste end "special assessments," hazardous waste program fees, and facility permit fees) generate approximately $13 million per year in revenues, or more than the total remediation expenditures of at least 33 individual states. (The $13 million figure excludes half of New York's revenues from hazardous waste facility permit fees, which go to the DEC's regulatory account; it also excludes $13 million in petroleum fees and nearly $30 million in additional petroleum fees that are dedicated to the state's oil spill account.)
- The proposed hazardous waste program fee surcharges included in the Executive Budget would generate an additional $18 million in fee revenues. If adopted, the $31 million in hazardous waste fees imposed on New York businesses would exceed the total remediation budgets of all but five states, Pokalsky said.
Pokalsky used the ELI data to review the fee structures of several of the highest-spending states. This review showed that:
- New Jersey, second on ELI's state superfund spending list, imposes a combined petroleum and chemical transfer tax that raises about $15 million per year. (In 1998, New Jersey dedicated a roughly equal amount of current revenue from the state's corporate income tax, rather than new fees, to expand and continue the program.)
- Washington, third on the ELI spending list at $43 million, imposes an excise tax (0.7 percent of the wholesale price) on petroleum, chemicals and pesticides.
- Texas, fourth on the ELI's spending list at $42 million, imposes both a hazardous waste generator fee and an industrial waste generator fee. In comparison, [in New York?], a large commercial waste management facility currently pays a $100,000 per year permit fee, a $40,000 program fee, plus per-ton special assessments and local gross receipts taxes. Under the Executive Budget proposal, this facility, and other large generators, would pay up to $360,000 in additional waste-related surcharges.
- According to the ELI report, Michigan, fifth on the spending list at $40 million, does not get more than 20 percent of its superfund budget from either waste fees or dedicated taxes.
- Pennsylvania, sixth on the ELI spending list at $37 million, imposes hazardous waste transportation and management fees that range from $1.50 per ton (transportation to a recycler) to $12 per ton (disposal at commercial facility). By statute, the state is to adjust these fees annually to collect revenues of $5 million per year, plus the cost of program administration.
"From these data, it is obvious that New York's existing superfund-related business fees already exceed the highest possible fee levels in most other states," Pokalsky concluded. "The proposed fee increases would subject more than 700 facilities to additional surcharges ranging from $4,000 to $360,000 per year. Most of these are small businesses, and most are located in upstate New York."
For these and other reasons, The Council has urged lawmakers to reject additional business fees as part of a Superfund refinancing bill, Pokalsky noted. The Council argues that lawmakers should instead adopt a broad-based funding mechanism, such as the permanent dedication of existing general-fund revenues for a pay-as-you go refinancing mechanism.