Mangano: Now would 'partner' with NIFA

Nassau County Executive Edward Mangano on the job

Nassau County Executive Edward Mangano on the job this month. Photo Credit: Alejandra Villa

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Nassau County Executive Edward Mangano, worried that a state oversight board is prepared to take control of the county's finances next week, has made a dramatic turnaround, saying he will "partner" with the board if unions do not provide millions of dollars in concessions.

Until Tuesday evening, Mangano had strongly resisted any talk of a takeover by the Nassau Interim Finance Authority, insisting his $2.6-billion budget for next year is balanced and does not contain a deficit of 1 percent or more - the trigger for a control period.

That changed when the NIFA board announced Tuesday, after conferring privately for nearly three hours with attorneys and accountants, that it will hold a public meeting next Thursday - two days before the budget takes effect, when control is expected to begin.

"If the unions don't work with us to achieve real savings, the county executive will partner with NIFA to protect taxpayers," a Mangano aide said in a statement.

NIFA officials agree that partnering means the oversight board takes control, a step that Mangano had yet to concede as he spent all day Wednesday in negotiations with the county's unions.

"We're an oversight board. Either we have control or we don't. There is no way we could partner with him or anybody else because we don't have the authority to do that," said one NIFA official, who did not want to be identified. "It sounds like a Hail Mary pass on the part of the county executive."

Although members of the NIFA board declined to talk publicly Wednesday, sources say sentiment is strong among the six directors to vote to take over Nassau County's finances when they meet again on Thursday, with Conservative George Marlin and chairman Ronald Stack the most concerned about the county's budget being out of balance.

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The others are waiting for technical questions to be answered by outside counsel Judith Kaye, the state's former top judge, and the accounting firm of Grant Thornton. They argued behind closed doors Tuesday that Mangano deserved an "eleventh-hour warning" and one more week to figure out how to fill a $158-million deficit - a number calculated by Moody's Investors Service last month when the ratings agency downgraded Nassau's credit from Aa3 to A1.

Any NIFA decision is expected to be unanimous, but nothing is set is stone as yet, board officials said. "This is really still in motion," an official said. "It can go different ways."

By offering to to partner with NIFA, Mangano apparently is counting on the unions deciding that they would rather deal with him than with the state agency, which has the authority during a control period to freeze union salaries.

"The bottom line is there is a control board that is just about to walk in the door and we don't want that," said Jerry Laricchiuta, president of the Civil Service Employees Association. "We can stop it and I think we should."

He declined to speak for the other unions, including the Police Benevolent Association, which wields significant political clout. PBA President James Carver declined to comment except to say, "I've been in constant contact with the county executive about issues relating to the budget."

Sources say unions may provide $20 million in savings to Mangano by the time NIFA meets again - far short of the $61 million anticipated by the county executive.

 

History of NIFA

 

Created by the state in 2000 in reaction to Nassau's 1999 fiscal crisis, in which the county's credit rating dropped to near junk levels.

Members: Authorized by law to have seven board members appointed by the governor; one has been vacant for five years.

Powers: Can take control of Nassau's finances if the county defaults on payment of its bonds or runs a deficit of 1 percent or if "there is a substantial likelihood and imminence of" such a deficit.

Under a control period, NIFA can freeze union salaries regardless of existing labor contracts.

It can require the county to prepare a financial remediation plan, which it can approve, reject or modify.

It also can review operation and management of county functions.

Lifespan: NIFA will exist as long as any of the $1.9 billion it borrowed on Nassau's behalf is still outstanding - about 15 years.

Funding: Financed by the county's portion of the sales tax.

Compiled by Celeste Hadrick

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