Politics & Government

Judgment Day for Nassau County

NIFA-imposed deadline is here — county must show that 2011 budget is balanced.

The deadline for Nassau County Executive Ed Mangano to prove to the Nassau Interim Finance Authority (NIFA) that his 2011 budget is fiscally sound is here.

Twenty-one days ago, NIFA , ordering that Mangano prove that his  is balanced, and not running a deficit greater than one percent.

To date, the state watchdog group has asked for additional information regarding the county’s finances, specifically $61 million in proposed labor savings, $23 million in state risks and $75 million in bonding for tax certiorari settlements.

Find out what's happening in Five Townswith free, real-time updates from Patch.

Mangano said he has submitted details on various contingencies, including , but has remained relatively silent about details in labor negotiations with Nassau’s five largest unions — secrecy he says is crucial to talks with NIFA and .

“NIFA’s drumbeat in the media has done little to help assist Nassau County other than to create doubt where none should exist,” Mangano said in a statement issued Wednesday. “Although the comptroller, [county] Legislature and I all agree the budget is balanced, we have complied with NIFA’s unprecedented demand for information and documentation.”

Find out what's happening in Five Townswith free, real-time updates from Patch.

Calls to some county legislators for comment were not returned. Nassau Democrats have made their  and also appeared in numbers at the two most recent public NIFA meetings.

The county has submitted six separate letters to NIFA detailing the contingencies, as well as what it says is proof the budget is balanced “prior to these additional contingencies,” according to Deputy County Executive for Finance Timothy Sullivan in a Jan. 14-dated letter.

The $23 million in state risks –  and surcharges on tickets on the Long Island Expressway, which would need state  approval – are backed up by  and expenditure cuts.

Another letter details the county’s fund balance –$65.4 million as of the end of 2009 – and states that it is expected to increase due to a $5 million surplus incurred at the end of the 2010. Payment on debt is approximately $150 million in 2011, to be paid for out of operating funds.

NIFA has  as it audits the county budget. According to the NIFA charter, if a budget deficit of 1 percent or more – approximately $26 million – exists, a control period could be imposed. Estimates peg the deficit at about $343 million for 2011.

The six-member NIFA Board of Directors is not expected to render a decision until after accountants finish the auditing process and consult with attorneys.

A call to NIFA’s Mineola offices confirmed a formal hearing will not take place Thursday, and a decision is not expected to be rendered immediately. The agency must provide a notice of a meeting at least 72 hours in advance.

Should a control period be issued, NIFA can bring only $10 million in relief by halting the annual step increases to union employees, minus the costs of its legal fees. It can also halt the county from , known as revenue anticipation notes (RANs) and tax anticipation notes (TANs), which are paid back once money from sales and property taxes, respectively, are received.

Such a move leaves the county with few options in regards to making up the lost revenue, either layoffs – extremely difficult with union members due to a no-layoff clause that expires at the end of the year – or to raise taxes, something Presiding Officer Peter Schmitt, R-Massapequa, has vowed will not happen.

Nassau County is also readying a suit against the state should NIFA impose a control period, and is expected to be joined by the various county unions, because the statute establishing NIFA has never been tested in court.


Get more local news delivered straight to your inbox. Sign up for free Patch newsletters and alerts.

We’ve removed the ability to reply as we work to make improvements. Learn more here