Editorial: Nassau's 'miraculous' surplus is too good to be true
Nassau County Executive Edward Mangano and Comptroller George Maragos say the county generated a budget surplus in 2012. "It's miraculous, in a way," Maragos commented, as if Mangano had done a loaves-and-fishes maneuver with a stack of hundreds, turning the county's poverty into a feast of plenty for the taxpayers.
Maragos had warned in July that the county would have a deficit of $45 million. But on Monday, he said it would instead finish up with a $25 million surplus -- a swing of $70 million. Even in November, Mangano projected Nassau would end 2012 shy $12 million in a report to the Nassau Interim Finance Authority.
But now they say Nassau is rolling in dough.
In reality, and according to generally accepted accounting principles, the county ran a huge deficit last year, spending and running up in bills at least $100 million more than it took in. Masking this with $17 million in money borrowed for long-term projects that went to pay other bills is mismanagement. Paying practically nothing on more than $70 million in tax certoriaris and not reflecting those debts on the books is misdirection. Using rainy day-reserves and borrowed cash to pay about $40 million in termination costs is a mess.
And none of it's a miracle.
In addition, superstorm Sandy pulled down sales tax receipts as it was driving overtime and other expenses up. Those expenses have been masked by $188 million in Sandy borrowing, but the county likely won't see the 100 percent federal reimbursement that would make it a wash. So more unbudgeted bills may be waiting in the wings, some already run up and others yet to come.
Nassau County is more than $3 billion in debt. The hole is getting deeper every year. In the face of this, Mangano has reduced county spending significantly, and faced revenue challenges.
A miracle would be heavenly, to part this sea of debt and deliver the county to financially safe ground. Until one comes, though, mere mortals like Maragos and Mangano would be wise to stick to earthbound accounting methods.