County budget could have $134M hole: Maragos

The Island Now

Nassau County could end 2017 with a $134 million deficit under County Executive Edward Mangano’s proposed budget, county Comptroller George Maragos said last week.

Some $48.3 million of $64.4 million in projected revenue from a new “public safety fee” is unlikely to materialize, according to the review of Mangano’s $3 billion budget he released Oct. 5.

The “public safety fee,” a $105 surcharge for traffic and parking tickets, is among dozens of new fees and increases to existing fees that Mangano, a Republican, wants to impose in lieu of a property tax hike. He projects they would raise about $83 million to help cover a 3.22 percent spending increase driven by raises for county employees.

Because it “will face considerable public opposition and fall well short of expectations,” Maragos, a former Republican who recently became a Democrat, projects only 25 percent of the revenue will come through.

Other risks include $15 million in sales tax revenue; $22.1 million in possible overspending on salaries and benefits; and $3 million that Mangano’s administration expects from Nassau County Off-Track Betting Corp.’s pending deal to lease 1,000 video gambling machines to Resorts World Casino in Queens.

“The county will face difficult choices in 2017 and beyond as structural costs continue to climb and new revenue sources prove more challenging to find,” Maragos said in a statement. “A rethinking of government is necessary to put the county on a stronger financial footing.”

Mangano’s budget poses an even larger deficit risk of $194.1 million according to the stricter financial standards of the Nasau Interim Finance Authority, the state oversight board that controls the county’s finances, Maragos’ review says.

NIFA does not permit borrowing for operating expenses, but currently allows the county to borrow in order to pay property tax refunds.

Mangano’s fee hikes face strong opposition from Democrats in the county Legislature. The Republican-controlled Legislature has until Oct. 31 to approve a budget for Mangano to sign before it goes to NIFA’s board of directors for approval.

In an Oct. 7 letter to Maragos, Eric Naughton, the deputy county executive for finance, said the comptroller’s review relies on unfounded assumptions, such as the idea that the Legislature would reduce the public safety fee without putting other revenue or spending cuts in its place.

Naughton also says the county ended 2015 with a $56.9 million surplus after Maragos projected a large deficit for that year.

“Your analysis of the 2017 proposed budget is extremely troubling because many of your conclusions are not logical and do not appear to be based on any analytical methodology,” Naughton wrote to Maragos.

Maragos’ report on the county’s 2015 finances said the surplus was achieved through $141.3 million in borrowing, and that the county actually ended the year with a $125.3 million deficit according to NIFA’s standards.

In an email to Naughton, Maragos said the bulk of the deficit risk would go away if the Legislature approves the full $105 public safety fee.

By Noah Manskar

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