The Nassau County Legislature voted down a bill last week that would have given the Nassau Interim Finance Authority the ability to borrow more than $400 million more to pay tax refunds owed to commercial property owners.
The vote was mostly split down party lines, with Republicans voting against it and Democrats voting for it. Josh Lafazan (I-Syosset), who usually caucuses with the Democrats, voted against the measure.
“Sounds like its just a balance transfer on a credit card,” Legislator Steven Rhoades (R-Bellmore) said, according to Newsday.
But Democrats like Delia DeRiggi-Whitton (D-Glen Cove) saw it as a missed opportunity.
“For years the refunds issue has been ignored … and now we’re in a situation where any time the county can be ordered to pay,” she said. “I don’t like to borrow, but I thought this would be a good way to do it.”
According to Newsday, an official with the Curran administration said the county could not immediately pay the $360 million in tax settlements due. Borrowing through NIFA would allow these payments to be spread out until 2041 if necessary. And DeRiggi-Whitton pointed out that NIFA has a higher credit rating than Nassau, which means it would be allowed to borrow money at a lower rate than the county.
“Now if the county has to bond for it, it will be at a higher rate,” she said. “I’m not understanding what their reasons were for voting against it.”
Presiding Officer Rich Nicolello (R-New Hyde Park) said he voted against it because he did not want NIFA around for another 20 years.
“The vote against the $400 million in new NIFA borrowing was a clear message from this legislature that we have no interest in extending the life of NIFA,” he said according to Newsday.
The Legislature did approve a second bill that would ask the state Legislature to allow Nassau to charge commercial property owners a fee to cover refunds. DeRiggi-Whitton said the fund would cover future commercial property refunds but would not reduce the massive backlog.
As for how the county would pay off the $360 million in property tax refunds, DeRiggi-Whitton said the county would have to use any extra revenue it can get its hands on. She mentioned the recent Supreme Court ruling that would allow the government to collect an online sales tax on out-of-state retailers.
“If we get a little more income for things like that, it would help,” she said. “We’re going to have to pay this off one way or another.”
The Curran administration, meanwhile, said that it would ask the state Legislature to approve NIFA borrowing, according to Newsday.
Reach reporter Luke Torrance by email at firstname.lastname@example.org, by phone at 516-307-1045, ext. 214, or follow him on Twitter @LukeATorrance.