The state oversight board controlling Nassau County’s finances on Thursday said the county must cut spending or raise revenue to trim a projected 2017 budget deficit by nearly $40 million.
The Nassau Interim Finance Authority’s Board of Directors passed a resolution directing the county to reduce a projected $99.5 million deficit in County Executive Edward Mangano’s proposed budget to $60 million, the amount NIFA has agreed to allow.
The $3 billion budget Mangano, a Republican, submitted last month contains $217.4 million in risky revenue and spending, including $67.4 million in proposed fines and fees that require approval by the county Legislature, according to a NIFA analysis released Thursday.
Even if all the risks are addressed, the county would still end next year with a $99.5 million deficit according to generally accepted accounting principals, the standard NIFA uses that does not count borrowing or reserves as revenue. That could lead NIFA to impose drastic spending cuts, as it threatened last year.
“While it remains the responsibility of county leaders to solve their own fiscal problems, we recognize our statutory mandate and are not taking any of our options off the table,” NIFA’s report says.
Mangano spokesman Brian Nevin declined to comment on the report because county officials are still reviewing it.
Mangano’s administration says the budget is balanced because expenditures match revenues, including borrowing and reserves.
The deficit NIFA projects could shrink by $88 million if the county Legislature approves dozens of new and increased fees, including a controversial $105 traffic and parking ticket surchage, the report says.
The report noted the Legislature and other officials have rejected Mangano’s proposals to fix the county’s budget problems.
“The Legislature cannot continue to be a passive player in solving the county’s fiscal problems,” the report says. “They need to partner with the administration to find and help implement creative solutions to the county’s fiscal imbalance.”
In a statement, Presiding Officer Norma Gonsalves (R-East Meadow) said the Legislature will “weigh NIFA’s input with the county executive’s proposal as we draft our amendments.”
The Legislature has until Oct. 31 to approve a budget.
The Legislature’s seven Democrats have publicly opposed the fee hikes, which Mangano proposed in lieu of a property tax increase.
Acting Police Commissioner Thomas Krumpter told legislators Thursday that the police department would have to cut community policing programs, such as its popular Problem-Oriented Police unit, without the $64.4 million the ticket surcharge is expected to collect.
While the county has made progress toward deficit reduction, the deficit is likely to grow and its goal of balancing the budget by 2018 is unlikely, according to NIFA’s budget analysis.
NIFA’s analysis is reminiscent of the start of last year’s showdown between county officials and the authority, created by a state law in 2000 to save Nassau from bankruptcy.
The Legislature stopped Mangano from raising property taxes 1.2 percent but was forced to approve $46 million in fee increases after NIFA’s threats to impose a hiring freeze and cut services.
“After 16 years of largely ineffective finger pointing and scapegoating, it is time for the county’s leaders and policy makers to work together for the county’s residents,” NIFA’s report says.
NIFA took control of Nassau’s finances in 2011 when the county deficit ballooned to $127 million, and will maintain control until the deficit is less than 1 percent of the total budget.