An ABC Member's Guide to The 2023 New York State Legislative Session

The 2023 New York Legislative Session has officially ended, the Senate went home officially on June 11th, and the Assembly wrapped up voting yesterday. It's vital for you as business owners to understand what happened during this legislative session and how that is going to impact your business and your employees.

Our Government Affairs Team has made it easy for you to access this information all in one spot below. The guide contains the following:

ABC Empire State Chapter President Brian Sampson's Statement to the Media Regarding the End of the Session
An Overview of ABC's Priority Bills
Important bills that passed after the budget was passed
A full guide of the enacted FY 23-34 New York State Budget

This webpage will constantly be updated with new information and helpful tips on how to navigate some of the new laws on the books. To access this guide, please click the button below:

We Fought For You Every Step of the Way

From the start of the session in January until the final vote in June, we never stopped advocating for our members. As a result, we had one of our more successful legislative sessions in the past few years.

How We Fought For You:

Our team tracked and monitored legislation from the moment it was introduced to the second it hit the floor for a vote. We were able to mobilize quickly when a bad bill was introduced, which was key to our success this year.
We had boots on the ground in Albany, meeting with elected officials regarding legislation that would impact the construction industry and our members. We had countless meetings with the legislature and their staff about these topics.
ABC testified to leadership in both houses about the affordability crisis and the negative impact of PLA and Prevailing Wage mandates have on New York State
ABC brought our members to Albany to share their concerns and fight against bad legislation at our annual state lobby day
In addition to these meetings, our team wrote countless letters, bill memos, and press pieces to support or block key pieces of legislation

Statement on the End of the 2023 Legislative Session

The following Statement is attributed to Associated Builders & Contractors, Empire State Chapter President Brian Sampson:

"Today was the final day of the 2023 Legislative Session. First, we want to start by thanking Assembly Leadership, where many harmful bills, such as the mandate of Project Labor Agreements (PLAs) on projects funded by the State University Construction Fund and multiple expansions of the state prevailing wage laws, failed to advance. These bills would have a profoundly negative impact on construction and drive the cost up for homeowners, businesses, and taxpayers.

However, our elected leaders failed to make New York more affordable. Nor did they address the housing crisis in an impactful way. They should have passed an extension of 421A, allowing developers to start and finish affordable housing projects. They should have also restricted the use of PLAs and the expansion of prevailing wage on renewable energy projects. Owners of these projects are already sounding the alarm about how much more expensive the projects will be in New York and how those costs will be passed on to the ratepayers. And as always, nothing was done to slow the escalation of general liability insurance rates, which can cause a small contractor to close up shop.

We need these issues addressed in 2024, whether in the budget or with stand-alone legislation.If the affordability crisis continues to deteriorate here in New York, we will continue to see people flee in record numbers for more affordable states. It's time for Albany to pass policies that will make things more affordable in New York, not less."

ABC Blocks Priority Legislation

As we approached the end of the session, the Government Affairs team identified a list of priority bills that we had to do everything we could to keep from passing. We focused our efforts on writing opposition memos and meeting with legislators and their staff to stop these harmful bills.

We are proud to say that through our efforts and with the support of our members, we've successfully blocked all of our end-of-session priority issues from passing. They are:

(S.5475A/A.373A) Prevailing Wage on all custom prefabrication work
- Stuck in committee
(S.4668/A.5006) Expansion of Prevailing Wage to any project over $5 million that receives a penny of taxpayer support
- Stuck in committee
(S.6050/A.5486) Project Labor Agreement Mandate on projects funded by the State University Construction Fund
- Passed the Senate, stuck in committee in Assembly
(S.5422/A.2512) Mandates that workers performing modular construction in New York City hold the same license as those working on the job site.
- Passed the Senate but was not voted on by the Assembly
(S.2762/A.766) Creation of an employee lien for wage theft where employees could go after company owners' personal belongings
- Stuck in committee
(S.1729/A.1669) Relates to coal tar and its use in pavement products
- This bill passed the Senate but did not advance in the Assembly

The bills above either only passed one house or were never brought up for a vote. Please note that this doesn't mean they aren't still in play. Technically, the legislative session doesn't end until the end of the year, so that these bills could be voted on during a special legislative session. These bills will also be reintroduced next year, and we will have to fight to block them again.

What Bills Passed at the End of Session?

The following bills passed both houses and can be sent to the Governor to be signed into law at any time.

S.4887 Roadway Quality Excavation Act

Requires contractors doing excavation work on an open street for a utlity company to pay preaviling wages to their workers
Includes compent contractor language will most likely lead to apprenticeship mandates on this type of work

S.4982/A.6604 Protects Employee Freedom of Speech & Conscience:

Prohibits employers from "coercing" employees into attending meetings related to politics or religious matters

S.1161/A.2034A Changes to Workers Compensation:

Increases compensation schedule in case of disability; provides that compensation after July 1, 2026, shall not be less than one-fifth of the New York state average weekly wage unless the employee's weekly wage is equal to or less than one-fifth the weekly wage, then they shall receive the entire amount.

S.6787A.6791/ Established a Construction Industry Advisory Council on Public Contracting Reform:

Creates a council to oversee public construction and make regulatory and legislative suggestions to "improve" the public work process in New York. It requires a report to be submitted 365 days after the first meeting of the council and the effectiveness of it. This is a concern because this council could use its platform to continue to push the union agenda.

S.1725A/A.4601A Provides for Protection of Certain Streams:

adds class C streams to the list of protected streams; exempts soil and water conservation districts that have an MOU with the Department of environmental conservation for certain permitting requirements.

S.1554B/A.4676A Creates a Temporary Commission to Conduct a Comprehensive Study on the Current Utilization of Paid Family Leave:

This commission will be able to make recommendations on how to increase access and expand this program

S.1873A/A.7295A Relates to the Max Number of Employees That a M/WBE Business May Have During a Declared State of Emergency:

Changes such maximum from three hundred employees to three hundred employees who work thirty or more hours per week over the period of fifty-two weeks for a total of 1,560 hours worked

Recap of the FY 23-24 New York State Budget

On Wednesday, May 3rd, Governor Hochul signed a $229B budget bill approved by the State Legislature the night before. This budget comes in over a month late, making it one of the latest budgets in over a decade. This year's budget is $9 billion more than last year's budget.

Below is a comprehensive guide for ABC Empire State Members to better understand what's in the budget and how that might impact your business. This budget recap does not contain everything found in the state budget. Instead, it's tailored to specifically focus on issues that are important to contractors operating in New York:

ABC's Statement on the Final Budget Deal

The following statement on the New York State Budget is attributed to the Associated Builders & Contractors, Empire State Chapter President Brian Sampson:

“Governor Hochul and elected leaders have been discussing for months their desire to make New York more affordable. That seems to be nothing more than a convenient talking point since they’ve passed a budget that did the exact opposite. This budget makes energy, construction, housing, and the overall cost of living dramatically more expensive.

There was a focused effort on energy and accessing renewable power. We agree that we need to focus on renewable alternatives. However, every project will now be subject to prevailing wage, which increases construction costs for taxpayers by 20-25%, and Project Labor Agreements, which limits the workforce to less than 30% of construction workers. How does the state expect to complete these projects on time and within budget when they are sidelining 70% of construction workers in New York? Why does it think private power producers are going to build projects in New York over other states that don’t force them to eat higher wages and benefits and slow walk the approval process?

The Governor and our elected officials talked about addressing the affordability and housing crisis by building 800,000 new affordable units. Yet this went unaddressed in the budget. They said they’ll deal with it post-budget. Yet, in this budget, they’ve actually made housing more expensive by passing the All-Electric Buildings. Combine that with higher mortgage rates, building material costs, inflation, and we have an even worse crisis on our hands than before this budget passed.

Explain to New Yorkers how this budget addressed the affordability crisis in New York. We don't see it. It really shouldn’t surprise anyone anymore why people continue to flee New York in record numbers. They aren’t escaping the weather. They’re escaping the unaddressed affordability crisis that leaders in Albany continue to make worse by passing bad policies like those contained in this final budget deal. New Yorkers deserve better.”

Key Issues

Authorizes NYPA to Build Renewable Energy Generating Projects

The Enacted Budget authorizes and directs NYPA to plan, design, develop, finance, construct, own, operate, maintain, and improve, either alone or jointly with other entities, renewable energy-generating projects in the state, including its territorial waters. The Enacted Budget includes new provisions requiring the acquisition of any land for a project to be purchased from a willing seller at fair market value, which is supported by the determination of an independent appraiser. Other new provisions are included to protect productive farmland from being utilized for projects.

The bill will require NYPA (in consultation with New York State Energy Research and Development Authority (NYSERDA), Office of Renewable Energy Systems (ORES), Department of Public Services (DPS), “climate and resiliency experts,” labor organizations, and environmental justice and community organizations) to produce a study and report on the state’s progress toward renewable goals and separately produce a strategic plan to attain such goals.

The bill will also require Project Labor Agreements and Preaviling Wage Mandates on all of these projects.

Climate Action Fund

The Enacted Budget establishes the New York Climate Action Fund, which would consist of revenues generated pursuant to regulations and actions taken by NYSERDA or any other state entity pursuant green house gas emission reductions. This would include future regulations establishing a cap-and-invest program for greenhouse gas emitters.

The Fund would consist of three separate accounts with differing allocations, as follows:
• Thirty percent to the consumer climate action account;
• Three percent to the industrial small business climate action account; and
• Sixty-seven percent to the climate investment account.

Projects that receive at least $100,000 of funds from the account are subject to prevailing wage and Project Labor Agreements, including, but not limited to, construction projects for affordable housing.

All Electric Buildings

New Buildings
On or after Dec. 31, 2025, the building code will prohibit the installation of fossil-fuel equipment and building systems in any new building under seven stories. There is an exception for new commercial/industrial buildings greater than 100,000 sq ft square feet (this is a carve-out for Micron in Syracuse). This will then extend to all new buildings after Dec. 31st. 2028.

Existing Buildings
The prohibition does not apply to any building existing prior to Jan 1, 2025.

Exemptions
The prohibition in new buildings allows exemptions for:

The generation of emergency backup power and standby power systems
Manufactured homes
Buildings or part of a building that is used as a manufacturing facility
Commercial food establishments
Laboratories
Car wash
Laundromat,
Hospital & other medical facilities
Critical infrastructure, including but not limited to:
- Emergency management facilities,
- Wastewater treatment facilities/water treatment and pumping facilities
- Agricultural buildings
- Fuel cell systems
- Crematoriums

*New buildings that fall under the exemption, except for agricultural buildings, need to limit the use of fossil fuel systems to the area of the building that is difficult or infeasible to electrify and needs to be constructed in a manner that is electrification ready. Exemptions need to be periodically reviewed by the building code council.

The code shall also allow for exemption of a new building construction project that requires an application for new or expanded electric service when electric service cannot be reasonably provided by the grid as operated by the local electric corporation or municipality provided, however, that the PSC shall determine reasonableness for purposes of this exemption.

Project Funding

Funding Highlights:

Department of Transportation:

$100M for local highways
$60M for CHIPS
$40M for State Touring Route Program

Environmental:

$500M for Clean Water Infastruture
$400M for the Environmental Protection Fund
$224M for the South Shore Staten Island Seawall
$200M for the EmPower Plus Program
Most of these projects will require PLAs!

Healthcare:

$1.7B for a New Department of Health Research Laboratory
$1B health care capital program (multi-year)
$890M for Mental Health Housing Expansion

Education:

$2.4B for SUNY/CUNY construction

Other:

NYRA is receiving $455M to redevelop the Belmont Race Track *this project will have a PLA*
$90 million for the New York Works statewide capital infrastructure program
Adirondack Park Agency received $30M to pay for the rehabilitation and construction of facilities
$20 million in New York Works funding for construction at the Conklingville Dam

Interested in learning more about specific project allocations? Contact Tanner Schmidt

General Business/Taxes

Index the Minimum Wage to Inflation

The budget increases the state’s hourly minimum wage from 2024-2026.

Downstate (New York City, Nassau, Suffolk and Westchester counties):

$16 on and after January 1, 2024
$16.50 on and after January 1, 2025
$17 on and after January 1, 2026

Upstate:

$15 on and after January 1, 2024
$15.50 on and after January 1, 2025
$16 on and after January 1, 2026

Beginning on January 1, 2027, the hourly minimum wage rate will be a wage of “not less than the adjusted minimum wage rate established annually by the commissioner.” This rate will be determined by the previous three-year periods published by the northeast region's non-seasonally adjusted consumer price index.

Exceptions starting in 2027:

There will be no minimum wage increase be no increase if the following year if any of the following occur, limited, however, for two consecutive years:

If the non-seasonally adjusted consumer price index for the northeast region urban wage earners and clerical workers (CPI-W) is negative
If the three-month moving average of the seasonally adjusted New York State unemployment rate rises by ½ % or more over the previous year
If there is a recurring decrease in the seasonally adjusted total non-farm employment for New York State

Tax Law Changes:

Brownfield Cleanup Program
- Amends the brownfield redevelopment tax credit to, among other things, allow the site preparation credit component to be claimed for up to seven years from the issuance of the certificate of completion (“CoC”) when the taxpayer was issued a CoC between 7/1/15 and 6/24/21.
Extended Provisions of Tax Law
- Extend the current 7.25% business income tax rate for three years, through tax year 2026, for taxpayers with a business income base over $5 million and extend the current 0.1875% capital base tax rate for three years, through tax year 2026.
- The historic properties rehabilitation credit is currently available for taxable years beginning before January 1, 2025. This would make the credit available for an additional five years through taxable years beginning before January 1, 2030.

M/WBE Statewide Disparity Study

NY extended the statewide disparity study regarding the participation of minority and women-owned business enterprises in state contracts through August 15, 2024.