Taxes have become the key issue in the late stages of the rematch between Nassau County Executive Edward Mangano and challenger Thomas Suozzi, with both men making it the focus of television ads, mailings and news conferences.
Mangano, a Republican, is keeping up his relentless criticism of Suozzi, an eight-year Democratic incumbent when Mangano defeated him in 2009, for raising taxes twice as county executive.
Suozzi is defending the property tax hikes in 2003 and 2009 just as aggressively. He also is attacking Mangano's claims of freezing taxes, saying administration property assessment policies have caused many residents' school taxes to rise far beyond the levels that their local districts had approved.
But experts say the issue is far more complex than either is making it.
"You're always operating in the context of what came before you," said Frank Mauro, executive director of the Fiscal Policy Institute in Albany. "It isn't that the world starts over each year and you develop a budget from scratch."
Mangano's platform is direct: I didn't raise county taxes, and my opponent did. His campaign has repeated the argument with discipline, and key backers have echoed it.
In his four years in office, Mangano said, he has focused on expense cuts, rather than increasing tax revenues, to balance his budgets. One of his first actions upon taking office in 2010 was to repeal a home heating energy tax Suozzi had sponsored -- an action that bond rating agencies said created a $38.6 million hole in that year's county spending plan.
Mangano cited a recent state Department of Labor report showing Nassau has the region's lowest unemployment rate -- 5.9 percent, lower than Suffolk's and New York City's -- as evidence his policies are working.
"High taxes kill jobs," Mangano said in an interview. "These policies are working as thousands of jobs are returning to Nassau and our county now leads the state of New York in terms of job growth."
Relying more on fees
Mangano has relied more on higher fees for pistol permits and licenses for service providers such as home repair contractors to increase county revenue. Like many municipalities in recent years, Nassau has derived progressively more revenue from these fees -- an estimated $15 million this year, compared with $10.1 million in 2010, according to county budget records.
In his first budget, for 2003, Suozzi proposed a 19.4 percent increase in the county's property tax levy, which amounted to an extra $220 a year for the average household. Suozzi defended the action as necessary to offset surging mandated expenses, such as pension costs.
The county's bond rating had approached junk status at the close of Republican County Executive Thomas Gulotta's administration, and Suozzi said he coupled his tax boost with efforts to cut the size of the county workforce and secure cost-saving union concessions.
"The county was on the brink of bankruptcy and hadn't raised taxes in almost a decade," Suozzi said, citing a 2001 report by Syracuse University's Maxwell School of Public Affairs that said Nassau was the "worst run" of the nation's 40 largest counties. "We were falling off the edge of a cliff."
After the recession hit in late 2008, Suozzi again raised taxes. He coupled the 4.3 percent increase in his 2009 budget with a plan to install revenue-generating red light cameras around the county and to secure givebacks by county unions.
"Management's willingness to increase property taxes . . . provided additional financial stability," Fitch Ratings analysts wrote in 2009.
'Proactive response' praisedWall Street rating agency Moody's Investor Services said Nassau faced a $130 million budget deficit despite the tax increase because sales tax receipts had declined by $100 million since the recession started.
The county's "proactive response to the current budget gap, including the opening of settled labor contracts and willingness to implement new recurring revenues, is a significant factor in our affirmation of the county's rating," Moody's wrote in 2009.
The candidates also are tangling over whether Mangano's handling of property assessments has boosted school taxes, the largest portion of homeowners' bills.
Suozzi says Mangano's policies, including freezing assessments for four years and encouraging residents to settle grievances before paying their taxes, is shifting the tax burden from commercial properties to single-family homeowners by forcing them to make up revenue lost in successful challenges.
Nearly 85 percent of homeowners who filed challenges won reductions last year, county records show. Suozzi says that often means higher tax bills for property owners who don't challenge their assessments.
When a home's assessment declines, neighbors whose valuations remain the same have to pay more so that a school district's overall tax levy stays the same.
Newsday has reported that Nassau school tax rates are up this year by an average of 6.8 percent -- when district voters in May had passed budgets that would increase the tax levy by an average 2.9 percent. Last year, the average Nassau homeowners' school tax rate increased by 11.7 percent -- when 2012 budgets approved earlier had average increases in the tax levy of 2.6 percent.
"Ed Mangano is terrible at government, but he and his cronies are pretty good at politics," Suozzi said in acknowledging the tax attacks. "That's why it's important that we expose the fact that if he's opposed to tax increases, why has he allowed people's school taxes to increase so much?"
Mangano called Suozzi's claims "disingenuous," saying his plan to freeze assessments and settle some claims before they reach court has saved the county millions of dollars a year; county audits and reports say the amount of residential refunds owed annually averages about $20 million. "The county has nothing to do with school taxes," Mangano added.
'Pick your poison'Donald Leistman, a Mineola attorney who specializes in tax grievances, wouldn't speak specifically about Mangano's policies, but said that, "anytime you reduce the tax base" through successful grievances, "others have to make it up."
Leistman, a board member of the development group Association for a Better Long Island, said settling cases of merit before court can save the county money.
"It's a matter of pick your poison," Leistman said. "The county can be proactive and adjust as many claims as possible, or it can put them off, fight them, [but] at the end of the day, they're still going to wind up losing a substantial number."
In a recent letter to taxpayers, Plainview-Old Bethpage Superintendent Lorna Lewis called county assessment policies "solely responsible for the difference between the tax levy increase proposed by the district and your tax rate." She said the 2.89 percent increase in the district budget approved by voters -- within the state property tax cap -- was undermined by a "broken" assessment system.
"For homeowners who did not file a claim that their property's assessed value should be lower, the increase in their tax bill will be three times as high as they might have expected based on the budget presented in May -- and not a penny of the difference is attributable to the school district," Lewis said.
But Jay Herman, former deputy Nassau County attorney for tax certioraris and now senior partner at Herman Katz Cangemi & Clyne in Melville, said Mangano's approach to resolving assessment challenges has reduced county costs stemming from a "fiscal nightmare" of an assessment system.
"The intent of the system we have now is to try to correct assessments before tax bills go out," Herman said. He acknowledged "to the extent someone was not involved in the assessment process, there is an inequity that may exist."
Suozzi says that if elected he will unfreeze assessments and hire new staff to conduct grievance reviews. He said money lost to refunds would be made up only by properties within that same taxing district -- so homeowners, most of whom are part of the single-family residential tax class, would no longer see increases due to commercial grievances, which are part of a different class.
"Districts worked their brains out trying to live within the tax cap," Suozzi said. "But the whole thing is undermined by the simplistic political skulduggery that Mangano's done."
Mangano spokesman Brian Nevin called Suozzi's claims "absurd."
"As county executive, Tom Suozzi stated, 'I have absolutely no control whatsoever regarding school taxes,' " he said. "Now, he's trying to say Ed Mangano does." With Celeste Hadrick