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HANDING TAXPAYERS THE CLIMATE CLEANUP BILL  
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Katya Schwenk
April 16, 2024
The Lever
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_ New York Gov. Kathy Hochul and Democratic legislative leaders nix a
landmark proposal that would have made Hochul’s fossil fuel donors
pay for their pollution. _

, (AP Photo/Hans Pennink and Michael Sohn)

 

In states across the country, lawmakers face a daunting budget
question: Who should pay to deal with the climate mess created by the
fossil fuel industry — taxpayers or the industry itself?

In the Democratic stronghold of New York — which requires expensive
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investments to fortify its cities and towns against flooding —
environmental advocates say Democratic leaders are about to offer a
troubling answer: New York taxpayers should foot the bill, not the
party’s fossil fuel industry donors.

Last year, the Democratic-controlled New York State Senate passed the
Climate Change Superfund Act, which would require major greenhouse gas
emitters to pony up billions of dollars to help the state deal with
the intensifying impacts of climate change. 

However, despite routinely portraying themselves as both climate
champions and defenders of taxpayer interests, New York Gov. Kathy
Hochul [[link removed]] (D) and
Democratic legislative leaders have so far declined to include the
legislation in the final state budget, which is being ironed out
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week. 

If the provisions are excluded, as some environmental groups now
presume, the decision would be a massive win for some of Hochul’s
major campaign donors who are tied to fossil fuel companies that would
have been required to make payments, according to campaign finance
records reviewed by _The Lever_. 

In the absence of a new superfund law, much of the cost of climate
mitigation could fall on working-class New Yorkers: Hochul has
recently declared
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she opposes any new tax increases on the wealthiest residents in her
state, which has the country’s second-largest number of
billionaires
[[link removed]]. 

The governor “turned her back on millions of people in hard-hit
disadvantaged communities,” said New York Public Interest Research
Group’s Anne Rabe, who noted Hochul’s silence on the measure and
expected it to be spiked. 

Provisions that have not been passed by both houses of New York’s
legislature regularly end up in the state budget, whose must-pass
status makes it one of the easiest ways to enact laws in the state.
Hochul’s own news release
[[link removed]] this
week touts the budget’s inclusion of other environmental policy
provisions pushed by lawmakers. 

However, when it comes to the superfund proposal, Hochul’s office
seems to be citing the fact that the bill has only passed one chamber
as a potential reason it could be excluded — and as a reason why
Hochul refuses to say anything about it. 

“The Climate Superfund Act has not been passed by the
legislature,” Katy Zielinski, Hochul’s deputy press secretary,
wrote in response to questions from _The Lever _before the
governor’s office announced
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budget deal on Monday night. “The governor will review any bill that
passes both houses; we are not going to comment on pending
legislation.” 

Hochul’s office did not respond to questions from _The Lever _on
the climate superfund’s exclusion from the deal on Tuesday, and
simply reiterated that “Governor Hochul will review all legislation
that passes both houses of the legislature.”

The superfund bill could still be passed by New York’s legislature,
even if it is excluded from the budget. However, “the New York
legislative session now is mostly a budget exercise — almost nothing
happens outside the budget, and the next three months will likely see
bupkis happen,” a New York Democratic political strategist
told _The Lever._

During Hochul’s 2022 campaign, the governor received half a million
dollars in campaign donations from oil and gas industry companies and
executives, as _The Lever _reported last year
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Some of those donors have ties to the 38 fossil fuel companies that
could face sanctions under the Climate Change Superfund Act.

John Hess, CEO of New York-based oil and gas giant Hess Corporation,
and his wife donated
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than $100,000 to Hochul in the 2022 election cycle. Hess would be
required to pay $600,000 annually to the state if the climate
superfund legislation is enacted, according to a Senate memo
with preliminary estimates
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by _The Lever_. 

Hochul also received
[[link removed][%7B1%7Cgro=d-id,c-t-id] a
combined $25,000
[[link removed][%7B1%7Cgro=d-id,c-t-id] in
the last election cycle from nephew and uncle Eric and Richard Slifka,
the CEO and board chairman, respectively, of oil company Global
Partners. Last year, the Massachusetts-based company announced
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joint venture with oil behemoth ExxonMobil, which would owe the state
$222 million annually under the superfund proposal. 

Hochul has also received $7,000
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the years from the Empire State Energy Association, a trade group
representing oil and gas companies in the state and which is lobbying
on
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legislation. The group represents the Chevron subsidiary Renewable
Energy Group
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New York’s Climate Change Superfund Act, which received a
groundswell of support from environmental groups and community
leaders, is part of a growing
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of state-level climate superfund bills that would force fossil fuel
polluters to pay into public funds that would, in turn, be used to pay
for climate mitigation. The proposals are modeled on the Environmental
Protection Agency’s original superfund program, which beginning in
1980 addressed industrial pollution by requiring the companies
responsible to aid in the cleanup of these so-called superfund sites.

None of the slate of climate superfund bills proposed around the
country has yet become law, but the state of Vermont appears poised
to send
[[link removed].] a
bill to its Republican governor’s desk, and legislation is pending
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Maryland and Massachusetts. In 2021, federal lawmakers proposed
similar legislation
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failed to get it off the ground.

“This is the next front in the fight against Big Oil,” said Jamie
Henn, the director of Fossil Free Media, which is waging a campaign to
enact climate superfund legislation nationwide. “These climate
superfund bills may be our best tool to finally make polluters pay for
the damage they’re doing to our climate and communities.”

In New York and elsewhere, the fossil fuel industry geared up for a
fight, Henn said. And it appears they have Hochul on their side.

“The Taxpayers Have Been Paying for Everything”

New York State Sen. Liz Krueger (D) first introduced New York’s
climate superfund bill
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January 2023. The bill would have required dozens of fossil fuel
companies to pay a collective $75 billion — $3 billion annually over
25 years — in restitution for the damages caused by unchecked carbon
emissions in New York.

Any company that does business in the state and is responsible for
more than one billion tons of carbon emissions between 2000 and 2020
is on the hook for superfund payments. Lawmakers drew from research
by climate scientists
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up with a list of 38 companies that would be responsible for such
payments, including oil and gas giants like ExxonMobil, Shell, and
Saudi Aramco.

The money would be allocated to climate adaptation projects across the
state, funding the kinds of costly infrastructure investments that
will be critical to climate resilience in New York, like restoration
of eroding wetlands
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storm drainage upgrades in dangerously flood-prone
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neighborhoods, and fortification of bridges
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In November, 99 mayors and town officials across the state sent a
letter
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Hochul to support the bill, saying the funds were needed to support
local climate infrastructure projects.

The state’s plans to address the effects of climate change and make
these infrastructure improvements, which were mapped out in
ambitious climate legislation in 2019
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all hinge on whether the state can come up with the money. The
infrastructure upgrades and other investments required are estimated
to cost tens of billions of dollars
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the next two decades.

“These are huge transitions, and to do that you need funds,” Rabe
said. And so far, she noted, “the taxpayers have been paying for
everything.”

That’s despite record profits for many of the companies on New
York’s superfund list. Under the current proposal, Saudi Aramco
would pay the state an estimated $644 million annually, a tiny
fraction of the Saudi Arabia-owned company’s profits, which
reached a historic $161 billion
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2022. ExxonMobil, which recorded a $36 billion profit last year
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would be responsible for $222 million a year in payments. 

“Unless we include the Climate Change Superfund Act in the final
budget, the Governor is choosing to have New Yorkers continue to foot
100 percent of the bill, which will run into the hundreds of billions
over the next several decades,” Krueger, the lawmaker that
introduced the bill, said in a statement to _The Lever_ before the
deal was announced. 

Krueger and other lawmakers have been fighting to pass the climate
superfund bill for over a year. In June 2023
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the legislation passed in the Senate, then stalled in Assembly
committees. In the fall, environmentalists began pushing for the
governor to include the proposal in her executive budget proposal.

But in January
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Hochul excluded the proposal from her budget, despite including other
climate policies that advocates had pushed for. As budget negotiations
progressed between Hochul, the Senate, and the Assembly, which also
signaled support
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the proposal, the governor was silent on the bill.

On Monday, Hochul’s office touted the environmental provisions in
the conceptual budget deal: investments of $500 million toward clean
water, $400 million for the state’s Environmental Protection Fund,
and $47 million for planting trees. Notably absent was any mention of
the climate superfund.

Even so, lawmakers can now push for a vote in the New York Senate and
Assembly, and then send the bill to Hochul’s desk. But then, again,
the fate of the legislation will be in the governor’s hands.

Big Oil Intervenes

As environmentalists have fought for the climate superfund, the fossil
fuel industry lined up to oppose it. In New York, the American
Petroleum Institute, the country’s largest oil and gas trade group,
emerged as a key opponent of the proposal.

The group sent a letter to New York lawmakers opposing the
legislation, _City Limits _reported
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March, warning that estimates of companies’ emissions were “not
accurate enough to base a prorated share of a $75 billion-dollar
penalty.” The group has sent similar
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lawmakers considering superfund legislation in both Maryland and
Vermont.

The American Petroleum Institute reported spending $35,000 lobbying in
New York state in just the first two months of 2024,
including lobbying
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governor’s office directly on the climate superfund bill.

It was just one of a host of fossil fuel and related industry groups
that reported lobbying on the bill over the last year, according to a
review of state lobbying disclosures. Others include the American
Chemistry Council, a chemical industry trade association, and American
Fuel and Petrochemical Manufacturers, another Big Oil trade group.

Multinational oil company BP, which would be sanctioned $183 million
annually under New York’s superfund proposal, reported spending
$90,000
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New York lawmakers last year, including on the superfund bill. 

Hochul has proven to be an ally of the fossil fuel industry. In April
2023, the governor quietly advanced a proposal
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weaken the state’s landmark climate law by raising limits on methane
emissions. After outcry, Hochul ultimately walked back that plan
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but she has continued to face criticism from environmentalists over
her implementation of the climate law, all while continuing to receive
campaign donations from the fossil fuel industry.

If New York lawmakers eventually pass the superfund bill and win
Hochul’s support, legal experts suggest
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the proposal will almost certainly face legal challenges. The American
Petroleum Institute is already claiming
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states don’t have enough proof to hold fossil fuel emitters liable
for damages. 

But the likely long road ahead does not deter advocates.

“We’re just not going to give up,” said Rabe of New York Public
Interest Research Group. “Because we can’t afford to. Since we
don’t have a dedicated fund, we’re not protecting communities from
constant flooding, from extreme heat in the summers.”

_Katya Schwenk is a journalist based in Phoenix, Arizona. Her
reporting and essays have appeared in The Intercept, the Baffler, the
American Prospect, and elsewhere._

* Climate Change
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* Fossil Fuel Corportations
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* taxes
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* Gov. Kathy Hochul
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