The state comptroller says Glen Cove's proposed 2013 budget "contains significant financial risks."
But Mayor Ralph Suozzi insists it is prudent, considering the recession and the need to stay within the state tax cap. And, he added, the city is adopting some of the comptroller's recommendations.
The City Council is scheduled to vote on the budget Tuesday night.
Comptroller Thomas DiNapoli's office reviews the city budget because of Glen Cove's ongoing deficit. The state noted the city plans to finance several major operating expenditures totaling as much as $6.8 million with long-term debt, although city officials say the total could be less than $1 million. "Debt service expenditures are a significant portion of the city's operating expenditures," the report states.
The comptroller said that in 2012 and 2013, the city will be borrowing $9.7 million to pay retirement costs, while the city says it will be less than $4.5 million.
"There is no way we cannot borrow for 12 or 13 police officers leaving in one year," Suozzi said.
The comptroller recommended the city set up a reserve fund for future retirement costs. Suozzi said, "We are looking at implementing that," starting in 2014.
The proposed budget was released several weeks ago. With adjustments made since then, it now totals $46,669,913, up 0.06 percent from this year. The total tax levy is $29,254,584, an increase of 1.82 percent over this year. The tax rate increase for residential taxpayers is 1.91 percent, and 1.70 percent for commercial taxpayers.
The comptroller's report said the city might have to borrow as much as $560,000 to pay for tax refunds to property owners who successfully challenge their assessments in 2013. It said the city should treat tax assessment appeals "as routine expenditures and pay them from annual appropriations."
Suozzi said that since the budget was presented to the comptroller, his administration had found another $100,000 for tax appeals, bringing the budgeted amount to $320,000 compared to this year's $360,000.
Glen Cove could experience a revenue shortfall in 2012 of $90,000 due to a decline in building permit fees, the state said. Suozzi said building department revenue last year was only $8,000 under the budgeted amount and much higher than the comptroller estimated. He said the estimated revenue was reduced in the new budget, to $375,000 from this year's $420,000.
The report also noted that the golf and recreation fund had a deficit of $660,878 at the end of 2011 and that the city needs to develop a plan to make the golf course self-sufficient. Suozzi said golf course and restaurant income has been hurt by the recession, but the deficit should be reduced next year to less than $600,000.