To amend the Niagara Redevelopment Act to encourage economic development and recovery in western New York, to promote fiscal transparency, to enhance the safety and security of the Niagara Power Project, and for other purposes.

July 20, 2005

Mr. HIGGINS introduced the following bill; which was referred to the Committee on Energy and Commerce

To amend the Niagara Redevelopment Act to encourage economic development and recovery in western New York, to promote fiscal transparency, to enhance the safety and security of the Niagara Power Project, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Western New York Redevelopment Act of 2005'.

SEC. 2. RENEW REPLACEMENT POWER.

Section 1 of the Act of August 21, 1957 (Public Law 85-859; 71 Stat. 401; 16 U.S.C. 836) is amended in subsection (b)(3) by striking out `for a period ending not later than the final maturity date of the bonds initially issued to finance the project work herein specifically authorized,'.

SEC. 3. ECONOMIC RECOVERY.

(a) License Conditions- The Federal Energy Regulatory Commission (FERC) shall include among the conditions imposed on any license issued subsequent to the original license for the project authorized by section 1 of the Act of August 21, 1957 (Public Law 85-859; 71 Stat. 401; 16 U.S.C. 836) in addition to those deemed necessary and required under the terms of the Federal Power Act, the following:

(1) ANNUAL PAYMENT- (A) In order to render financial assistance to the host governments in which any feature of the Niagara Power Project is located, the New York Power Authority (NYPA) shall make a mandatory annual payment from its gross proceeds to the Erie Canal Harbor Development Corporation in the City of Buffalo and the County of Erie in the amount of $10,000,000 for each 12-month period of the new license. For every 12-month period after the first such period after the license is issued and continuing for the life of the new license and any subsequent licenses, the annual payment shall include an additional 3 percent of the amount of the payment made during the preceding 12-month period.

(B) Prior to the establishment of the Erie Canal Harbor Development Corporation, the payment described in subparagraph (A) shall be held in escrow by the NYPA for transfer to the corporation upon its establishment. Such payment shall be used by the Erie Canal Harbor Development Corporation only for the development, design, engineering and construction of projects at the Inner and Outer Harbor in Buffalo, and Erie County, New York, including transportation infrastructure improvements and Skyway Bridge alternatives. Other qualified uses may include brownfield remediation, greenway trail design and construction and other waterfront environmental restoration projects.

(C) At the expiration of the Erie Canal Harbor Development Corporation the annual payments shall be made to the Erie County Industrial Development Agency for the uses and purposes set forth in subparagraph (B).

(2) ADDITIONAL ANNUAL PAYMENT TO COUNTIES- (A) In order to achieve the yet unrealized regional economic benefits that the New York Power Authority contracted to deliver on when it was awarded exclusive control of the Niagara Power Project, the Federal Energy Regulatory Commission shall include as a condition on any new and subsequent license, the payment of 1 percent of gross proceeds to be split evenly by the Industrial Development Agencies for each of the counties of Niagara, Erie, Chautauqua, and Cattaraugus, New York.

(B) Such funds shall be distributed by such agencies to high-load industries and businesses committed to incremental capital investment and job retention and creation in each such county. The proceeds shall be disbursed to such western New York industries and businesses and used by such industries and businesses to offset the high cost of energy in New York State and retain current employment levels.

(C) The payment of funds under this paragraph to Erie, Chautauqua, Cattaraugus, and Niagara counties shall be additional to, and shall not affect the obligation of the New York Power Authority to pay, any other funds to those counties under the terms of any judicial decree or settlement of an action brought by one or more of such counties against the NYPA.

(D) The term `gross proceeds', as used in this paragraph, means the total gross proceeds derived by the licensee from the sale of power for the preceding fiscal year, excluding power used by the Corporation or sold or delivered to any other department or agency of the State of New York for any purpose other than resale.

SEC. 4. TRANSPARENCY.

The Secretary of Energy, acting through the Office of Inspector General, Office of Audit Services, shall conduct an audit of Niagara Power Project finances and operations since project inception in order to provide consistent and timely information concerning the true economic impact of the Niagara Power Project and its revenue and disbursements and shall conduct subsequent annual audits to verify payments to host communities and others.

SEC. 5. PHYSICAL SECURITY AND SAFETY.

(a) In General- In order to improve the physical security of the Niagara Power Project, the Federal Energy Regulatory Commission shall include among the conditions imposed on any license issued subsequent to the original license for the project authorized by section 1 of the Act of August 21, 1957 (Public Law 85-859; 71 Stat. 401; 16 U.S.C. 836) in addition to those deemed necessary and required under the terms of the Federal Power Act, a requirement that the licensee shall acquire by contract or other agreement property or interests therein sufficient to provide an appropriate effective zone of separation between all project control, switching or generating facilities and any privately owned real property not used for the generation, transmission, or control of electric energy. Any such acquisition by the licensee shall be carried out pursuant to such terms as may be necessary to ensure replacement of any residential, educational, recreational, and community services and facilities acquired or adversely affected by such acquisition, and that such replacement facilities or services are of equivalent character, value, and number to those so acquired, while meeting contemporary standards for construction, operation, and level of service.

(b) Resources for First Responders- The New York Power Authority shall provide to First Responders serving the local jurisdictions in which the Niagara Power Project facilities are located adequate financial and other resources and assistance to acquire, operate, maintain, and replace, through the term of any license granted pursuant to this Act, the equipment and other assets needed to protect human life and property from harm should any feature or facility of the Niagara Power Project be subject to damage of any type because of an act of terror or other criminal behavior.

SEC. 6. HOLD HARMLESS.

Nothing in this Act authorizes any increase in the rates and charges for electric energy under the Replacement Power program.

SEC. 7. SEVERABILITY.

If any provision of this Act, or amendment made by this Act, or the application of this Act or such amendments to any person or circumstance is determined by a court to be invalid, the validity of the remainder of this Act and the amendments made by this Act and the application of such provision to other persons and circumstances shall not be affected by such determination.

END