Lawmaker, unions, pour on criticism of canal transfer

By Rick Karlin 

Thursday, April 7, 2016

State Canal Corp. will go from Thruway to Power Authority

ALBANY — It was part of the 2016-17 budget that passed last week, but lawmakers and unions alike on Thursday were trying to throw cold water on a deal in which the perpetually money-losing Canal Corp., which operates the Erie and Champlain canals, is transferred from the Thruway Authority to the Power Authority.

The state's Utilities Workers of America, Local 1-2, is warning canal employees that "NYPA is not your friend.''

And Republican state Sen. Joe Griffo, the Utica-area lawmaker who chairs the Energy Committee, said the transfer "is not a done deal'' because details of how the changeover would occur haven't been finalized.

Griffo on Thursday issued a press release stressing that lawmakers still need to strike an agreement by July 1 with Gov. Andrew Cuomo about how transfer will take place.

"My preference was to take it outside the budget, to have thorough vetting and discussion,'' Griffo said.

Among the items he said needs to be finalized are protections for programs like Recharge NY, which gives upstate industries low-cost electricity, and potential guidelines or controls about how much money the Power Authority can spare to subsidize the canal, which runs at a cost of $87 million each year. Remarks by Griffo and labor representatives like Utilities Workers spokesman John Melia are emblematic of how controversial the move is turning out to be.

Throughout the budget talks, the shift was said to be off the table, but it was put in the budget in the middle of the night.

The union is upset because its members have been without a contract with the Power Authority for seven years, Melia said.

The union says the Power Authority has exploited its quasi-government status to avoid reaching a contract with about 50 unionized workers who operate some of the massive hydroelectric plants in western and northern New York.

"We've been trying to take action for years,'' said Melia.

And Griffo, like members of the Business Council of New York State and other upstate lawmakers, expressed fear that taking on the money-losing Canal Corp. could hinder the Power Authority's ability to keep generating low-cost electricity.

The added responsibility for the canal is coming as the Power Authority has struggled with its own finances, due in part to low-cost natural gas, which makes hydropower comparatively more expensive, Griffo said.

Under the budget language approved by lawmakers the Canal Corp. is "reconstituted'' as a ''subsidiary corporation of the Power Authority.'' That could presumably occur regardless of whether lawmakers reach a deal on the details.

But with lawmakers upset in the first place, the transfer could remain as a hot-button political issue, especially if upstate Senate Republicans decide to hold back something the governor wants as part of a bargaining process.

Canal Corp. spokesman Shane Mahar said the corporation looks forward to working with lawmakers on a transition plan. The transfer can be laid out either through a separate chapter of law by July 1 or if the legislature doesn't enact a chapter by Oct. 1. The transfer would take place Jan. 1.