Nassau County Executive Edward Mangano, who tried unsuccessfully for the past year to persuade county Democrats to borrow millions of dollars to pay property tax refunds, is now citing superstorm Sandy's devastation in an attempt to win their approval.
Mangano has submitted a new request for the legislature to borrow $165.42 million to pay commercial and residential property tax refunds, arguing that Nassau's homeowners and businesses need the money to rebuild.
"In the aftermath of superstorm Sandy, tens of thousands of Nassau homes and businesses were destroyed," Deputy County Executive Tim Sullivan wrote in a memo last week. "This bond will provide immediate relief to those residents so they can begin rebuilding their lives."
But Democrats say Mangano is using Sandy as an excuse to pay tax-protest attorneys, who receive a percentage of their clients' refunds and often donate to Mangano and the Republican Party. Newsday reported last month that residential tax-protest firms in the past three years have donated $450,000 to local politicians, mostly Nassau Republicans, including $70,000 to Mangano.
Minority Leader Kevan Abrahams (D-Freeport) said, "We believe it to be shameless that the administration would use a situation as devastating and disastrous as Hurricane Sandy to try to be able to pay tax [protest] attorneys. At the end of the day, residential tax [refunds] only total $20 million. If we focus on the people who need it the most, we're throwing in another $140 million to pay the friends of his campaign or even the Republican Party and continue to put the county in debt."
He added, "If this is a focus on Hurricane Sandy, why not a bonding mechanism for more road projects, because our roads were destroyed, or for the sewage treatment plant?"
Borrowing requires 13 votes -- which means the 10-member Republican majority on the legislature needs at least three Democratic votes. Democrats have said they would not agree to borrow for tax refunds unless Republicans agreed to a "fair" redistricting process.
Mangano deputy Ed Ward said the county executive "has no time to respond to Kevan Abrahams' allegations. However, these are refunds that the residents and small businesses of Nassau County are owed. His intention is to get the refunds owed to residents and small businesses who have been impacted by the storm. They're owed the money. It should be paid, and there's no reason to wait."
Tax-protest attorney Laureen Harris said that Mangano's move is "legally intelligent." She noted the taxable status date in Nassau is Jan. 2 for the 2014-15 property tax bills. Owners of destroyed homes and businesses are entitled to drastic assessment reductions if the properties are not rebuilt by then.
"It has nothing to do with paying tax [protest] lawyers," Harris said. "It has to do with easing the government and allowing people breathing time to rebuild."
Mangano first tried to persuade the legislature in December to approve borrowing $102 million to pay refunds to commercial and residential property. He reduced the request in June to $41 million, hoping the county would not close the books on 2011 with a deficit.
When Democrats refused, the county transferred the money from its $92-million rainy day fund for this year. Citing the drop in reserves and other financial problems, Moody's Investor Services downgraded Nassau's credit rating last month.
Sullivan said in his memo that borrowing the $165.42 million will allow Nassau "to maintain its current level of cash reserve. Maintaining the county's cash reserves is critical to ensure cash flow for further emergency relief efforts related to Superstorm Sandy."