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Here's something Buffalo-area unions and corporate chiefs agree on: preserving cheap Niagara hydropower for local industry.

An AFL-CIO group met with state lawmakers Thursday to urge support for the re-licensing of the New York Power Authority's hydropower plant in Lewiston.

"We want the plant to stay in its existing ownership with the existing cost structure," said Phil Wilcox, coordinator of the WNY AFL-CIO Economic Development Group.

Inexpensive hydropower from the 2.5 megawatt Niagara Power Project supports about 50,000 jobs at 110 companies in the region, he said. The Power Authority also supplies residential electricity to municipal power authorities.

The labor-business support counters pressure from host communities on the tax-free power plant.

The labor group, working with an 18-company coalition of hydro users, is seeking fast-track license renewal to fight fears that industrial power could be shut off. Although the Power Authority's license doesn't expire until 2007, companies may put off long-term investments now because of uncertainty over future electric costs.

The Federal Energy Regulatory Commission is responsible for re-licensing the hydro plant. The federal government shares jurisdiction over use of the Niagara River with Canada.

But fast-track approval requires widespread community backing, and host communities and environmental groups are preparing to question the Power Authority's license. The Niagara Power Coalition seeks payments in lieu of taxes (PILOT) from the tax-exempt plant and other concessions. Local governments that host the plant's operations and give up access to the Niagara gorge are being shortchanged, the group argues.

Legislators and labor leaders at the meeting Thursday indicated that a compromise should be worked out.

"We're not saying there shouldn't be PILOTs," said Assemblyman Sam Hoyt, D-Buffalo. Hoyt was among nine Western New York lawmakers who attended the meeting or sent a representative. A letter from the local delegation supporting the Power Authority's relicensing is being drafted.

Any PILOT should be constructed so it doesn't raise industry's cost for electricity, Wilcox said. Instead the increase could be shouldered by residential customers in municipal power zones, who pay about one-third the market rate for electricity, he said.

Imposing real estate taxes on the Power Authority's plant will backfire if it results in higher electric costs that drive away industry, Wilcox said.

Although the license expiration is eight years away, "today it's already an issue," said Assemblyman Robert A. Daly, R-Lewiston. Amid uncertainty about future power, "if you try to capitalize an investment over 10 years, you can't do it."

Carbide Graphite Group in Niagara Falls has shelved a $40 million expansion partly out of uncertainty of future power allocation, Wilcox said. A member of the International Brotherhood of Electrical Workers, Wilcox is employed by Niagara Mohawk Power Corp., the distributor of Niagara power.

Unions also want some modifications in the hydropower deal. Labor should have a voice in the power allocation process and oversight on job creation promises, said Rick Sirianni, president of Local 1-3516 of the Paper, Allied-industrial, Chemical and Energy Workers.

CTG's KeyCorp pact
valued at $20 million
Computer Task Group Inc.'s new contract to take over information technology work for KeyCorp in Western New York is worth $20 million over three years, the Buffalo-based computer services company announced.

Key has cut its Western New York work force by 8 percent, eliminating 107 jobs, by shifting responsibility for its customer information work to CTG, which said it will hire most of the banking company's information technology workers. CTG will manage Key's deposit, loan origination and customer information services.

CTG was named Key's preferred vendor for information technology services in January 1998.

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