Albany Debate Hemmed Hopes for a Green-Work Revolution

On Oct. 9, 2009, then New York State Governor David Paterson signed the Green Jobs/Green New York (GJGNY) bill into law. Passed by the New York State Assembly and State Senate, the legislation promised to provide energy efficiency repairs and retrofits to homes throughout the state, while saving customers money through future energy savings.

Most importantly for a state and a nation in the midst of a recession, the government pledged to offer training and job opportunities for new careers in clean energy. Supporters projected that the bill would ‘green’ one million homes throughout the state, and create 14,000 new jobs.

Six years past its passage, the legislation’s results are mixed at best. Only a few thousand homes were retrofitted, and it’s estimated that the program yielded only a thousand or so new jobs—1,069 as of last summer, according to state officials. The explanations for its shortcomings are as varied as the different parties involved in its crafting, but many agree that GJGNY’s biggest challenges came on its way to the governor’s desk.

A mid-recession idea

In 2008, the Center for Working Families (CWF) identified ‘green jobs’ as a potential policy push for the upcoming session in the New York State Legislature. Dave Palmer, the executive director of the CWF from 2009 to 2013, says that policy directors at the organization believed they could be successful.

“It would help to combat climate change and make homes more comfortable,” he says. “The Working Families Party had a good deal of power in New York State so they initiated high-level talks with the governor.”

Gov. Paterson and legislators in the State Assembly and Senate commenced discussions behind-the-scenes with the CWF, which drew up a policy paper in consultation with the Center for American Progress that detailed how the program might work. The government would establish a Residential Retrofit Investment Fund (RRIF) to stimulate private capital investment to help pay for the program.

The program would also stir interest from low and moderate-income New Yorkers with on-bill financing, which is when investors would subsidize the initial cost of the retrofit and receive a small portion of that homeowner’s utility bill over the course of 10 years to get their return of investment.

$112 million in administrative costs would be available via the Regional Greenhouse Gas Initiative (RGGI), which allows state governments to procure proceeds from carbon auctions by private businesses. The program’s infrastructure and administration would be led by New York State Energy Research and Development Authority (NYSERDA), and they would partner with community-based organizations (CBOs) and private contractors to target populations that had previously been ill-served by energy efficient repairs for retrofits and job opportunities.

Emmaia Gelman, who was a policy director at CWF during the GJGNY debate, believed the legislation could open new doors for underserved areas and demographics throughout the state, particularly in parts of New York City.

“It was going to create a large amount of jobs in communities typically left out of the job market and change people’s relationships to utilities,” she says now. “It was supposed to be economically transformational.”

The CWF was not the only interested party; labor activists, unions and CBOs all advocated for the bill’s passage, touting the promised economic stimulus and reduction in New York’s greenhouse emissions. It was a coalition of surprising bedfellows; Assemblyman Kevin Cahill thanked both the Environmental Advocates of New York and the International Brotherhood of Electrical Workers at the bill’s signing.

Debate over the bill largely took place behind closed doors, though a member of the Independent Power Producers of New York (IPPNY), a consortium of energy producers and manufacturers that advocated against green energy initiatives, filed a lawsuit claiming that the state had no authority to join RGGI. This endangered the program’s administrative funding. Conservative members of the Legislature also grumbled, and some suggested that it was a giveaway to left-wing interest groups.

But according to many who were involved in the talks, the biggest sticking point was an effort to attach job standards to the green-jobs financing.

Fight over job standards

The standards would have set a wage floor for contractors to meet or exceed: between $16 and $22.10 per hour, depending on the location of the company. They would also require contractors to hire two out of every four workers from the local community, and at least one in every four from groups traditionally underrepresented in the green construction business: women, people of color and low-income individuals.

For people at community-based organizations that had long focused on housing and environmental justice, the standards were an important opportunity to make sure that GJGNY not only created jobs but also brought low-income and minority individuals into the green energy industry. President Obama’s 2009 American Recovery and Reinvestment Act had funneled some funding for green jobs in low-income communities, but state legislation was a chance to move away from federal money and toward a market-driven model.

“The thing about weatherization is that it doesn’t bring anybody out of poverty. It just keeps people from freezing to death,” says Taleigh Smith, who was with Northwest Bronx Community and Clergy Coalition at the time.

Smith remembers the early drafting of the bill as an exciting time. Many late nights were spent negotiating with unions and service providers, crafting a long and detailed program to bolster hiring practices and empower their communities.

The CWF supported the standards that resulted from those talks, as did many community-based organizations and several contractors.

But many contractors worried that the standards would increase overhead and hinder effective recruitment.

“There was this clashing of visions for what the program was intended to be,” Smith says. “They had this kind of weak capitalist logic that having high standards for the workforce was going to drive up the cost.”

The Building Performance Contractors Association of New York State, a not-for-profit trade association representing more than 200 industry members, rallied 82 contractors in opposition to the job standards. In August 2010, they presented their concerns to NYSERDA, along with the list of names.

Jerritt Gluck of Bonded Building and Engineering in Long Island was among the BPCA contractors who expressed his misgivings about the standards at that forum.”The free market economy should be the basis for any industry,” he said in his comments to the NYSERDA advisory council. “Individual company policy should be just that, up to the company.”

Other contractors shared those misgivings. “The last thing we need is more government interference in our business,” said Doug Hawn of Artic Air, LLC, a Long Island company. “The need is not more bureaucracy but more sales so I can hire more people,” said Bruce McClean, of the East Syracuse firm Energy Savers, Inc. “Adding more requirements to this process will make Home Performance a dinosaur.”

Gelman always believed that wage standards needed to be mandatory for private contractors in the final bill. According to the CWF policy paper, the retrofit work that GJGNY would fund was often low-wage and nonunion. Since job creation was emphasized for vulnerable communities, Gelman wanted to make sure that jobs were available for individuals from those communities and that those jobs could support families.

“We had to have wage standards,” she says, “But everything we negotiated got thrown out in the Legislature.”

Though earlier drafts of the legislation indicated that wage standards were a topic of consideration, the final GJGNY bill in October did not include any mention of wage standards.

People knowledgeable with the negotiations differ on why wage standards were lost, but many said that NYSERDA was hesitant to enforce wage rules for private contractors, and state legislators believed that it was an encroachment on market principles.

“GJGNY was intended to both create good jobs and shape the local markets for energy efficiency improvement,” Stephan Edel, a policy director at the CWF, says about the process. “Some contractors and legislators opposed mandatory standards, but in the long run the real issue was that some of the staff at NYSERDA were never really convinced that labor standards should be part of the equation in the first place.”

Despite the loss of wage standards in the legislation, GJGNY passed with bipartisan support after respected Republican State Senator Thomas Morahan endorsed the bill. His support gave cover for other Republicans to follow suit. The bill passed unanimously in the Assembly and 52-8 in the Senate.

As the program rolled out, Smith began to see that the dispute over wage standards wasn’t so much contractors versus community groups, but upstate against downstate. She found that local Bronx-based contractors were amenable to hiring practices like the ones proposed for GJGNY: a wage floor and underrepresented, local hires. There was just one issue with using those contractors, she says: NYSERDA denied them bids when they applied for GJGNY projects.

Delays hit financing

Wage standards were not the only casualty in the GJGNY debate. On-bill financing was not authorized in the Oct. 2009 bill; that took until August of 2011, when Governor Andrew Cuomo signed the Power NY Act of 2011.

It was supposed to be in the original bill, but “folks were more comfortable with the traditional means of financing as opposed to the more innovative way,” recalls Conor Bambrick, who was the legislative director for the Energy Committee Chair in the New York State Assembly from 2004 to 2013.

When on-bill financing resurfaced during negotiations in 2011, the CWF intended to revisit the question of establishing wage standards. But they found little traction for their argument. Instead, the CWF and NYSERDA agreed on a form of ‘aggregation’ that was coupled with on-bill recovery’s adoption in 2011 (though it was not included in the actual bill). Under aggregation, a CBO could partner with at least three local contractors, and if those contractors agreed to wage standards set by the CBO, the NYS Department of Labor would ensure that the contractors abided by them. To date, only two CBOs throughout the entire state have successfully adopted the aggregation model.

Governor Cuomo signed the second bill into law on Aug. 4, 2011, surrounded by its supporters. The backers included Gavin Donohue, the executive director of the Independent Power Producers of New York, who remarked that the legislation was long overdue.

“We must rebuild and expand New York’s energy infrastructure to meet the demands of the 21st century and grow our economy,” Cuomo said at the bill’s signing. “This law will lead to new investment and create tens of thousands of jobs across the state.”

With the adoption of on-bill financing, supporters of GJGNY were still optimistic for the program’s future. By 2015, that optimism would be far more tempered.

Lackluster results

Different explanations are proffered for why the program failed to generate the number of retrofits or jobs it promised. One problem might be the very breadth of those goals: perhaps GJGNY became the hammer for too many nails. At the bill’s signing, Assemblyman Cahill admitted that the legislation’s goals were three-fold: it was “designed to create jobs, lower energy costs for homeowners, non-profits and small businesses and reduce greenhouse gas emissions.”

It was no mistake that Cahill listed jobs first. The economic stimulus promised by GJGNY became its most potent selling point, particularly during the 2009 recession. New York State lost 291,000 jobs from July 2008 to December 2009, with 70 percent of those losses in New York City and the surrounding area. Advocates for the new legislation saw the potential and changed the name of the bill from Green Homes, Green New York to Green Jobs. The slight change illustrates a shift in perspective as to the legislation’s goals, as well as a shift in how it was presented to the Legislature. The emphasis on jobs helped when seeking the support of legislators because conservative Democrats and Republicans could placate constituents who viewed energy efficiency programs with suspicion by highlighting the bill’s economic boon.

Some, including Bambrick, worried that this perception left the bill unable to deliver on its biggest promise. “The jobs prospect of it may have been oversold to the detriment of the program,” he says. “I think the job numbers that were thrown around at the time, maybe left a bad taste in the mouth of certain groups that the program didn’t deliver what was promised.”

Gelman believes GJGNY also overemphasized green training, as potential employees learned how to retrofit homes before jobs were available. Gelman also says that the effects of climate change remained too ephemeral for some New Yorkers.

“It’s too distant,” she says. “You’re talking about implanting an efficient gas boiler, and those folks are using wood pellets to heat their homes.”

Private investors—who were supposed to supply capital for the repairs during the program’s early years—were wary of funding retrofits because they were concerned there’d be no return on investment. But the program also required potential customers to take out loans, which was unlikely in the aftermath of the 2008 crash.

“The country was still reeling from a debt crisis,” Edel says. “We didn’t really consider how reluctant families would be to take on more debt while home values were dropping, no matter how secure the GJGNY financing was.”

The delay in approving on-bill financing may have played a role in reducing the program’s overall appeal, although there were many flaws LINK in the way GJGNY approached financing.

Bambrick does point to successes that came out of GJGNY; it proved that on-bill recovery was a viable approach for future legislation, and there were new and diverse voices and coalitions contributing to the debates about New York’s energy policies.

The most silver of linings to come from GJGNY, according to Smith, was a stronger connection between upstate and inner city community groups who were at the table for the GJGNY drafting process, and who now are paying close attention to other green state initiatives, including Reforming the Energy Vision (REV).

“It was a success for New York State to have all of us talking,” she says. “All of us are smarter about what’s realistic and not in our community. I think we have a more sophisticated conversation now than we did in the beginning.”

This series was produced by members of the fall 2015 urban investigative reporting course at the CUNY Graduate School of Journalism.