Refinancing hundreds of millions of dollars and proposing tens of millions of dollars in spending cuts are key elements of the $3.3 billion budget proposed for Nassau County in 2021 due to the coronavirus pandemic.
The proposed budget was introduced by Nassau County Executive Laura Curran last Wednesday.
The budget is a decrease from the $3.55 billion spending plan approved for 2020, according to county officials.
The budget calls for the Nassau Interim Finance Authority, which has overseen the county’s finances for the past two decades, to restructure $360 million in debt from the county and the finance authority, according to a county news release.
Curran said the uncertainty that has lingered throughout the year due to the pandemic was the reason for the proposed restructuring of debt.
“Restructuring bonds would not be necessary or justifiable in an ordinary year. Extraordinary times as these, however, call for this extraordinary, yet targeted and appropriate, measures,” Curran said.
Of the debt, $240 million comes from finance authority bonds while the remaining $120 million comes from county bonds. The county, according to the news release, will save $285 million in 2021 and $150 million in 2022 by refinancing the debt.
Despite the county facing a 2020 midyear deficit of $385 million due to the pandemic, county officials anticipate that Nassau will end the year “in budgetary balance.” The gap closing plan combines the use of $112 million of fund balance, $103 million in funding from the federal CARES Act, $75 million from the finance authority’s debt extension, $38 million in funds to financially support litigation and workers’ compensation expenses, $32 million from completed or abandoned capital projects and $25 million in expense controls.
“The pandemic has plunged Nassau and other local economies into a steep and unprecedented financial crisis, and my budget reflects this emergency,” Curran said. “With shared commitment and the resilient spirit Nassau residents have demonstrated throughout this crisis, I’m confident we’ll emerge stronger in the years ahead.”
Richard Nicolello (R-New Hyde Park), presiding officer of the County Legislature, told Newsday the Republican majority “will conduct a thorough review and analysis of the County Executive’s budget to ensure it is fiscally responsible and does not put additional burdens on Nassau taxpayers already struggling with the financial impact of COVID-19.”
The Republican legislative majority subpoenaed Curran’s administration in early August to analyze her plan to use the Nassau Interim Finance Authority to combat the looming debt the county faces due to the coronavirus pandemic.
Nicolello signed the three subpoenas, which sought financial statements from the county’s budget director, Raymond Orlando, and county consultants Public Financial Management.
According to officials, Curran discussed the plan with leaders from the majority and minority caucuses in the County Legislature and hopes to continue to have more in-depth briefings so the county can deal with the financial crisis in the most effective way.
According to officials, the county was projected to suffer a $749 million deficit in 2020 and 2021.
Officials said Nassau will also save nearly $70 million by eliminating 329 vacant county positions. Other savings outlined by the county include $16.7 million from a contract with the NICE bus service, $12.8 million in public safety overtime and $5.8 million in Medicaid due to additional federal funding.