Westchester County charting a course to structural balance
Westchester County, New York, Executive George Latimer’s first budget seeks to restore fiscal health after years of operating deficits.
Latimer said his $1.94 billion fiscal 2019 budget would not dip into reserves and implements a hiring freeze, among other measures designed to put the county of 980,000 that sits north of New York City on the right track. The first-year county executive in his Nov. 9 budget address said greater fiscal discipline is needed with Westchester facing a $71 million budget gap as a result of a $32 million shortfall last year and $39 million deficit for 2018 that accounts for roughly 50% of the county’s rainy day fund.
“We need to establish a multiple-year game plan to ensure the long-term financial solvency of the county,” said Latimer, a Democrat. “This budget is a bridge to that long-term.”
In October, Moody’s Investors Service revised its outlook to negative for the county's Aa1 bond rating because of structural imbalance and a low reserves. S&P Global Ratings changed its outlook for Westchester to negative in 2017 because of the county lacking enough permanent revenue measures. The county is rated AAA by S&P and Fitch Ratings.
“We need recurring revenues that exceed what we can realistically expect our property taxpayers to pay,” said Latimer, a former New York state senator who defeated two-term Republican County Executive Rob Astorino last year. “Bridging from where we are through this year, we intend to visit our colleagues in Albany and discuss a host of different revenue areas that would give us the predictable revenue that would allow us to do the investments that are necessary going forward.”
The budget includes a 2% tax levy increase, which is below the 5.7% Westchester is allowed under New York State’s property tax cap law. Latimer said he is pursuing other revenue means to ease the pressure on taxpayers such as a proposal to transfer control of the Westchester County Center parking lot to a private company for $22 million. The county is also planning to issue $8.5 million of bonds to fund settlements for a backlog of owed corporate tax certioraris rather than budget out of the general fund.
“This budget strikes a balance between providing the services all of the residents of Westchester expect and deserve and keeping property taxes at a level they can afford,” said Latimer. “The modest increase included in the budget is within the State property tax cap, and acknowledges the hardship the federal government has imposed on the people of Westchester through the loss of the state and local tax deduction in the American Tax Cuts and Jobs Act.”
Westchester is the seventh most-populous county in New York State. The county has $1.1 billion in long-term general obligation debt, according to Moody’s.
The Democratic-controlled Westchester County Board of Legislators is slated to vote on a budget by the end of December after three scheduled hearings.