ALBANY, NY (10/21/2009)(readMedia)-- Couch White, LLP today praised an October 20, 2009 ruling from the New York State Court of Appeals in favor of Crucible Materials Corporation and Syracuse Castings Sales Corporation in a case against the New York Power Authority (NYPA). The decision effectively secures large rebates and electricity reimbursement payments for Power for Jobs program participants throughout the State. The Court's decision affirms an earlier decision by the Appellate Division, Third Department.

"Today's decision reflects the willingness of the New York judiciary to correct a grievous wrong by a large state authority that deprived many New York businesses of legislative relief in the form of discounted electricity prices," Couch White partner Robert Loughney said. "We are very pleased with the Court of Appeals decision in favor of Power for Jobs recipients."

The Power for Jobs (PFJ) program is designed to provide discounted electricity prices in exchange for job commitments. In 2004, NYPA provided PFJ contract customers with an option to switch to an "electricity cost reimbursement" program where they could procure power through another supplier and, if the cost of those purchases exceeded the cost of NYPA power in 2005, NYPA would reimburse, or "rebate," the difference ("Rebate Option"). In 2006, when PFJ power became more expensive than utility-supplied power, the Legislature passed a law that afforded PFJ customers another opportunity to move to the "Rebate Option." In addition, the 2006 legislation provided restitution ("Restitution Option") for overpayments (the difference between the cost of PFJ power and utility-supplied power) retroactive to January 1, 2006.

At issue in the case was NYPA's interpretation of the 2006 legislation. NYPA informed PFJ contract customers that they must choose either the "Restitution Option" or the "Rebate Option" but could not choose both. Further, NYPA informed customers that if they selected the "Rebate Option," power prices from 2006 would be used as the base year for determining rebates.

In the lawsuit, two program participants, Crucible Materials Corporation and Syracuse Castings, challenged NYPA's interpretation, arguing that eligible manufacturers were entitled to choose both options, and that 2005 should be used as the base year when calculating rebates due to customers under the "Rebate Option." The Court of Appeals agreed.

"We are delighted with the Court of Appeals decision, which confirms the options and benefits that the 2006 legislation intended for certain Power for Jobs customers," said Loughney. "Although the decision addresses claims raised by Crucible Materials Corporation and Syracuse Castings, it has broader implications for many Power for Jobs customers, including establishing the base year for energy rebate payments and how energy reimbursement amounts owed to customers should be calculated. All Power for Jobs customers should be cognizant of the ramifications of this decision."

A copy of the decision from the New York State Court of Appeals is attached.

About Couch White, LLP: Couch White is a nationally-recognized, full-service business law firm based in Albany, NY with primary practice areas in energy, construction, commercial and business, environmental, and labor and employment law. With additional offices in New York City, Washington DC, and Farmington, CT, Couch White provides high-quality, cost-effective legal representation that leads to creative, ethical and desirable solutions for its broad base of clients. For more information visit www.couchwhite.com

Posted Wednesday October 21, 2009 at 04:54 pm by Couch White LLP
Last Updated Thursday September 02, 2010 at 01:43 pm