Nassau suit against fiscal board tossed

Christopher Wright, right, addresses a meeting of the Christopher Wright, right, addresses a meeting of the Nassau County Interim Finance Authority (NIFA) while Chairman Ronald Stack, center, listens during a meeting in Uniondale. (March 22, 2012) Photo Credit: Newsday/Thomas A. Ferrara

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A judge has dismissed a lawsuit by Nassau County that sought to overturn decisions by a financial control board that blocked county efforts to pay for tax refunds and hire outside consultants.

State Supreme Court Justice Thomas A. Adams said in a ruling Tuesday that the suit, filed in March by Nassau County Attorney John Ciampoli, failed to show that the Nassau Interim Finance Authority exceeded its authority when it blocked creation of the county's residential tax refund payment program in October.

The decision also said Ciampoli did not challenge NIFA's rejection of contracts to pay the county's bond counsel and Albany lobbyists in a timely manner.

Ciampoli said he planned to re-argue the case.

"I don't take no for an answer," he said Thursday. "I see no reason not to bring the whole thing back before the court, because I'm confident when we finally thrash this out in a courtroom, the result will be different."

NIFA chairman Ronald Stack didn't return a call for comment Thursday. Board member Chris Wright declined to comment, citing a potential appeal.

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The suit argued that NIFA improperly blocked Ciampoli's request to sell as much as $21 million in property tax refunds to private investors, who would have paid taxpayers the full amount due, including interest. Nassau then would have repaid the investors over seven years at 5.95 percent interest.

NIFA also blocked Nassau's request to use past bonding authorizations by the county Legislature to borrow $192 million to pay business and residential property tax refunds. County Executive Edward Mangano, a Republican, had planned to borrow for the refunds, but minority Democrats on the county legislature refused to provide the necessary votes.

Last month, Mangano and Democrats reached an agreement that allowed the legislature to approve $75 million in borrowing this year to pay refunds. County Comptroller George Maragos has estimated that the backlog of unresolved property tax challenges stands at $335 million.

The suit dismissed by Adams also contended that NIFA refused to extend a contract with longtime county bond counsel Orrick, Herrington & Sutcliffe as "retaliation" after the firm disagreed with NIFA on the tax refund issue.

Ciampoli has accused NIFA of rejecting a contract with an Albany lobbyist because the lobbyists had recommended Nassau seek state legislation so that it could borrow without NIFA authorization.

"NIFA has now engaged in a pattern and practice of disapproving these contracts," Ciampoli said Thursday.

Mangano's office declined to comment on Adams' ruling.

Legislative Minority Leader Kevan Abrahams (D-Freeport) said the decision should be a "wake-up call" for Mangano and county leaders to stop fighting NIFA and work with them.

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"Like every other lawsuit against NIFA, the county executive wasted taxpayer money pursuing a frivolous action," he said.

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