Although the Nassau Interim Finance Authority, after much wrangling with the county, approved the Legislature’s and County Executive Ed Mangano’s 2017 budget in December, it is now searching for a consultant to identify potential cuts in 2018.
On Jan. 20, the financial control board issued a request for proposals for a consulting firm. The consultant would recommend cuts to the Legislature and Mangano in the hope of preventing the county’s deficit from increasing to $191 million, as NIFA estimates it will.
“[NIFA] found significant budgetary risks that could endanger the county’s statutory requirement to ensure balance on a Generally Accepted Accounting Principles basis,” NIFA’s request read.
Nassau is the only county in New York that is required to pay all property tax refunds rather than individual districts, at a yearly cost of $100 million or more, which is covered mostly through borrowing, according to the New York Property Tax Monitor.
According to NIFA Chairman Adam Barsky, the county borrows an average of $80 million a year to fulfill that guarantee, and the deficit further increases when the county has to borrow money to settle a lawsuit.
In an attempt to mitigate this problem, NIFA plans to have its consultant present the Legislature with proposals to cut spending in the 2018 budget on May 31.
“We would like to work with Nassau County,” Barsky said, “but we want to be prepared that in the event we get presented with a budget that is not sufficiently balanced, we can make our own cuts.”
County officials scrambled for months to find revenues with which to reduce the 2017 budget deficit. Last September, Mangano proposed increasing certain traffic fines by $105. After citizens complained, the Legislature decided to reduce the proposed hike to $55, leaving a $36 million gap in the budget.
Mangano also proposed cutting funding to some nonprofit social service agencies, which rely on county aid to provide services such as early intervention and drug treatment. NIFA rejected that spending plan, however, because it relied on penalties from a 2013 law that requires businesses to report their income and expenses. The law is currently facing a legal challenge, and the county has been issued a temporary restraining order preventing it from ordering the payment of those fines until a court decides on the measure’s constitutionality.
Nassau’s finalized budget includes a freeze on hiring new police officers until March, a reduction of bus funding and an end to aid for local villages. The Legislature also voted to increase the tax map verification fee for real estate transactions by $130. These proposals reduced the projected deficit from $142 million to $106 million.
“The county executive has significantly reduced the deficit since taking office,” said Brian Nevin, a spokesman for Mangano. “He has cut over $330 million in wasteful spending.”
NIFA does not believe this is enough, however. “We still see significant pressure on spending,” Barsky said, “so they need to make more significant efforts to either reduce their spending or increase their revenue, and increasing the revenue doesn’t appear to be on the agenda for this year.”
Responses to the request for proposal are due on Feb. 13.
Erik Hawkins contributed to this report.