Post by backdoorit on Oct 16, 2014 19:22:13 GMT -5
Nassau's financial control board says the county is a long way from meeting requirements to end state oversight of its budgets, citing continued reliance on borrowing to cover day-to-day costs.
The Nassau Interim Finance Authority on Wednesday released its review of County Executive Edward Mangano's multiyear plan, including his 2015 budget. NIFA said the deficit next year could be as large as $209 million without approval of about $150 million in borrowing that largely is meant to pay for property tax refunds.
Earlier this month, county Comptroller George Maragos put the potential deficit, counting borrowing, at $221 million, and the Office of Legislative Budget Review estimated the shortfall could be $174 million.
NIFA also said the 2015 budget contains a possible $25 million hole if lawmakers don't approve Mangano's property tax levy hike of 3.1 percent. The board also projected a sales tax shortfall of about $12 million in 2015. Sales tax receipts for 2014 already are estimated to be $63 million less than budgeted.
NIFA chairman Jon Kaiman said the report reflects the challenges still facing the county, despite actions by Mangano this year to balance the budget long-term. Labor deals approved this year set lower pay for new hires and Mangano initiated revenue measures including school zone speed cameras.
"My focus here is to look at these changes that have been made and say we are moving in the right direction," Kaiman said yesterday. "But this will still be a very difficult year."
The NIFA report doesn't constitute an approval or rejection of Mangano's budget. The County Legislature must vote on it, no later than Oct. 30, before NIFA takes it up.
But the report calls it "disconcerting" that the county won't achieve budget balance -- without borrowing -- in 2015, which it had set as a goal in 2011. NIFA noted that the projected deficit is more than eight times the $29.8 million that triggers a state control period.
"The county must cut back on its borrowing if it is ever going to free itself of a control period and regain its place among the pre-eminent counties in the country," NIFA said.
Deputy County Executive for Finance Tim Sullivan responded to the report by noting that the administration has gotten state approval for a plan to overhaul its commercial property tax grievance system. That will save between $70 million and $80 million a year in borrowing costs once it's effective in 2017, Sullivan said.
"The County has always faced risks. However, County Executive Mangano has always managed those risks and achieved positive budgetary results without burdening homeowners," Sullivan said.
NIFA member Chris Wright, a longtime critic of county budgeting practices, said: "Since the county hasn't committed to a year in which they will achieve budget balance, and have clearly missed the 2015 requirement by over $150 million, it would be helpful to have them 'pick a year' so that we can have accountability."
Also Wednesday, NIFA approved borrowing including $85 million for capital projects; $35 million to aid owners of properties damaged in superstorm Sandy in Oct. 2012; $20 million for employee termination pay and $8.6 million for judgments and settlements.
The termination pay and judgment borrowings were on a split vote, with board member Dermond Thomas joining Wright to oppose termination pay and Wright, Thomas and John Buran voting no on the judgement/settlements.
"We also told them, this time last year, that they had borrowed their last dollar for termination pay, and we should hold them to both their broken promise and to our unanimously approved directives," Wright said of the county.
The Nassau Interim Finance Authority on Wednesday released its review of County Executive Edward Mangano's multiyear plan, including his 2015 budget. NIFA said the deficit next year could be as large as $209 million without approval of about $150 million in borrowing that largely is meant to pay for property tax refunds.
Earlier this month, county Comptroller George Maragos put the potential deficit, counting borrowing, at $221 million, and the Office of Legislative Budget Review estimated the shortfall could be $174 million.
NIFA also said the 2015 budget contains a possible $25 million hole if lawmakers don't approve Mangano's property tax levy hike of 3.1 percent. The board also projected a sales tax shortfall of about $12 million in 2015. Sales tax receipts for 2014 already are estimated to be $63 million less than budgeted.
NIFA chairman Jon Kaiman said the report reflects the challenges still facing the county, despite actions by Mangano this year to balance the budget long-term. Labor deals approved this year set lower pay for new hires and Mangano initiated revenue measures including school zone speed cameras.
"My focus here is to look at these changes that have been made and say we are moving in the right direction," Kaiman said yesterday. "But this will still be a very difficult year."
The NIFA report doesn't constitute an approval or rejection of Mangano's budget. The County Legislature must vote on it, no later than Oct. 30, before NIFA takes it up.
But the report calls it "disconcerting" that the county won't achieve budget balance -- without borrowing -- in 2015, which it had set as a goal in 2011. NIFA noted that the projected deficit is more than eight times the $29.8 million that triggers a state control period.
"The county must cut back on its borrowing if it is ever going to free itself of a control period and regain its place among the pre-eminent counties in the country," NIFA said.
Deputy County Executive for Finance Tim Sullivan responded to the report by noting that the administration has gotten state approval for a plan to overhaul its commercial property tax grievance system. That will save between $70 million and $80 million a year in borrowing costs once it's effective in 2017, Sullivan said.
"The County has always faced risks. However, County Executive Mangano has always managed those risks and achieved positive budgetary results without burdening homeowners," Sullivan said.
NIFA member Chris Wright, a longtime critic of county budgeting practices, said: "Since the county hasn't committed to a year in which they will achieve budget balance, and have clearly missed the 2015 requirement by over $150 million, it would be helpful to have them 'pick a year' so that we can have accountability."
Also Wednesday, NIFA approved borrowing including $85 million for capital projects; $35 million to aid owners of properties damaged in superstorm Sandy in Oct. 2012; $20 million for employee termination pay and $8.6 million for judgments and settlements.
The termination pay and judgment borrowings were on a split vote, with board member Dermond Thomas joining Wright to oppose termination pay and Wright, Thomas and John Buran voting no on the judgement/settlements.
"We also told them, this time last year, that they had borrowed their last dollar for termination pay, and we should hold them to both their broken promise and to our unanimously approved directives," Wright said of the county.