Economists with the state's nonpartisan fiscal watchdog continue to research legislation that would create a $75 billion fund to pay for climate change initiatives and related projects, and have questions about the impact on consumers and ethics of the bill.

Gov. Kathy Hochul will make a decision to sign or veto a proposal later this fall to require large fossil fuel companies to pay the state $3 billion a year for 25 years to fund the costs of climate change based on their share of emissions. Supporters of the legislation, called the Climate Change Superfund Act, say the fund would shift the cost of clean energy projects off taxpayers. 

Officials with the Citizens Budget Comission (CBC) on Wednesday said they have outstanding questions about the fund.

"The state’s resiliency and energy transition needs are clearly significant, but the state still lacks a comprehensive needs assessment and investment plan," according to a statement from the CBC on Wednesday. "While the Superfund bill proposes a way to finance some of these costs, there are essential questions about the policy. Are multinational corporations' past global emissions the correct basis for cost recovery to pay for adaptive infrastructure in New York, and how much are those actual costs? Could the state legitimately and practically get these multi-national corporations to pay? Would payers pass along costs to consumers? If enacted, this bill will likely prompt legal challenge and the impact on consumers is uncertain."

The CBC expects to finalize research and a position on the proposal in the coming weeks, including impact on consumers, and the ethics of creating the fund outside the state budget process.

"Deciding how to raise and spend public dollars outside the budget process is wrong," according to the CBC. "Finally, this would interact with the state’s larger environmental goals and policies, which remain fragmented, lacking a state needs assessment and policy and investment plan."

Sponsor Assemblyman Jeffrey Dinowitz said he's confident the law will uphold legal muster.

"Polluters don't want to pay an extra penny, but we're only asking them to pay a tiny, tiny portion of their profits — maybe less than one half of 1%," Dinowitz told Spectrum News 1.

Dinowitz said the fund will keep the state on target to meet its emission reduction goals mandated five years ago under the Climate Act.

Fiscal Policy Institute economists estimate it will cost over $200 billion to transition the state away from reliance on fossil fuels, and pay for the harms of the warming climate caused by big polluters.

Advocates like NYPIRG Executive Director Blair Horner have fought to create the fund since the law was changed in 2019 that mandates 70% of New York's electricity be generated by renewables by 2030.

"We think the oil companies should be on the hook," he said. "And that's one way to offset the cost to taxpayers, and to provide needed resources to upgrade the grid."

But opponents, including state business leaders, are concerned about the costs of electrification and whether this Climate Superfund will uphold legal challenges — similar concerns Assembly Speaker Carl Heastie shared earlier this year.

Republican lawmakers argue businesses would be penalized for operating under permits formerly approved by state agencies.

"[Hochul] might sign it just to appease the environmental advocates and ... she thinks it's going to get thrown out in the courts," said Assemblyman Phil Palmesano, the ranking Republican member of the Assembly Energy Committee. "If she think it's going to get thrown out in courts, if it's not a viable thing. If it's unconstitutional, if it's not legal, she should veto it."

With the upcoming critical elections, lawmakers and advocates say they don't expect Hochul to make a decision about the Climate Superfund until after Nov. 5 — especially with a few New York House Democrats in tight races.