New York State Exposed: Energy tax assessment

Posted at: 12/19/2013 6:47 AM
Updated at: 12/19/2013 7:29 PM
By: Rebecca Leclair

You might not really think about this, but every time you turn on a light or crank up your thermostat, you are getting taxed by Albany. With energy rates that are so high, yet again, our state ranks among the worst in the country.

Unless you've actually studied your RG&E, you probably don't even know that every month, you pay a special tax for energy that goes straight to the state government. Albany calls it the New York State Assessment. Businesses and homeowners can do nothing to escape it.

Toby Clark lives in Perinton and always keeps his thermostat at 71. He has multiple sclerosis and he needs the temperature inside his house to stay steady, so his symptoms don't flare up, whether it's sweltering hot outdoors, or freezing cold.

Toby Clark said, “Because of my lack of mobility, I don't plan on going outside, running around keeping warm or jumping up and down, I plan on keeping the heat up. So I can survive the pain of my illness.”

He's home all day because he cannot work anymore, so, he using a lot of energy. He even has to charge his wheelchair eight hours a day so he can get around. When News10NBC told him New York State

adds a two percent tax to his utility bill, this was his reaction.

Clark said, “They seem to find more and more ways to take just a little bit more out of your pocket every month.”

Homeowners started paying an extra energy tax four years ago when the legislature said it needed to raise revenue. The tax brings in about $500 million annually for the state government. You pay on average $55 and that's on top of what you pay for natural gas and electricty. 

New York State's electric rates are 42 percent above the national average. New York is usually in the top four and in October, we paid more than people in 46 other states. 

Many people have complained Albany taxes too much and things like heat and electricty are necessities not luxuries.

Senator Ted O'Brien said, “It's really the worst kind of tax because it does affect low income earners who are the least likely to be able to afford it. It's a regressive tax and it affects affluent people as well and it's really having a crippling affect on I think in terms of our ability to encourage manufacturing in our area.”

According to Rochester Gas and Electric, the New York assessment can cost a medium sized manufacturer more than $50,000 a year, and even a small retail operation typically pays close to four thousand dollars for that tax.  Last week, the governor's commission on tax relief recommended changing that. 

The head of Unshackle Upstate, a business advocacy group, said there's a $2 billion surplus for next year, so he says the state could easily eliminate the tax for manufacturers to help them compete. Right now, minimal plans to help homeowners.


However, thousands of taxpayers could get a $350 dollar rebate next October right when Governor Cuomo would be running for re-election. Unshackle Upstate says that rebate money will most likely be paid out by the energy tax dollars you already sent in.

Brian Sampson, Unshackle Upstate, said, “This is just simply, they took it out of your left pocket and they are trying to re-insert it into your right pocket but it's still your money.”

The assessment is just one tax you have to pay on your electric bill. When you add up all the state and local taxes, plus fees, it comes to about 25 percent..


News10NBC is going to be following our legislators to Albany when they start the new session in January to see if they are going to do anything about the energy tax. 

Tax Relief Commission Report
Comments from Unshackle Upstate regarding Tax Relief Commission
State Rankings of Energy Costs
Sen. Ted O'Brien's plan to help reduce business costs 
How to read your bill