The Nassau County Interim Finance Authority Thursday approved a wage freeze for Nassau County employees and said the Long Island county’s revised budget fails to address shortfalls.
County Executive Edward Mangano last week requested the salary freeze, which reduces payroll costs by $10.5 million, as part of his revised fiscal 2011 budget.
Fiscal 2011 began Jan. 1.
In a statement, NIFA chairman Ronald Stack said the proposals to close a $176 million deficit include actions that need local and state approval before the board can vote on those actions. In addition, he questioned the county’s ability to sell assets by Dec. 31 to generate needed revenue.
“Virtually all of the major items have yet to be implemented, may require approvals by the county Legislature or the state, and are thus unacceptably fraught with risk,” Stack said in a prepared statement. “They include furloughs and personnel actions needing further county action, while others need state law changes.”
Mangano’s revised plan includes more than 200 layoffs, $105.2 million of spending reductions, $8 million of savings from debt-service restructuring, and an anticipates $30 million less in property tax refunds than what NIFA projects the county will owe.
In a phone interview, Stack said the oversight authority will not restructure debt again to lower debt service costs this year.
A restructuring, sometimes called a “scoop and chuck,” would push out maturities and postpone some debt service payments this year by extending them into future years.
NIFA restructured some of the county’s debt in 2000 but the board will not approve such a refinancing again, according to Stack.
“We have been trying to get the county in order since 2000,” he said. “Basically in 2000 we did a lot of scoop and chuck. NIFA basically took a lot of debt service and levelized it and spread it out. We’re not going to do it again 10 years later.”
The authority in late January found Nassau County to have a fiscal 2011 deficit of $176 million and imposed a control period.
The shortfall is more than 1% of the $2.6 billion spending plan. Nassau contested NIFA’s control period but a judge earlier this month ruled against the county’s temporary injunction to stop NIFA’s oversight.
