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EDITORIAL / What's He Smoking? / Gulotta wants to avoid fiscal

There he goes again. County Executive Thomas Gulotta wants to sell

Nassau's rights to hundreds of millions of dollars in tobacco settlement

money for a mere fraction of its value and use a portion of the revenue

to plug a hole in the 1999 county budget.

Talk about a nicotine frenzy: County officials don't actually know

what Nassau would receive in a settlement, much less when the money

would flow in or for how long. But that didn't stop the cash-strapped

county from soliciting proposals last month to get quick money up front

- with bonds backed by anticipated future tobacco-settlement proceeds

- from investors willing to pay a fraction of any settlement's worth.

(The most conservative Wall Street estimate is that investors would be

willing to offer $170 million for the $684 million Nassau is hoping to

receive as part of New York State's $25-billion settlement with the

tobacco industry.)

This risky money grab is much too premature and deserves a hard look

by the Nassau County Legislature. Gulotta would do better to get real

numbers, gauge the real impact of what tobacco money could mean to

Nassau and advance concrete proposals on how the money - whether it is

borrowed against or not - would be used.

No one, not even tobacco's harshest critics, expects any full

settlement to go toward anti-tobacco projects, such as campaigns aimed

at stopping children from smoking. But certainly some should go there.

As for the rest, Gulotta would do better to earmark it for retiring

Nassau's staggering debt and fixing its antiquated and unfair

taxassessment system rather than offering vague proposals to create a

reserve fund.

The trade-for-quick-cash scheme is the cornerstone of Gulotta's

eight-point plan to pull Nassau out of the red and curb its fiscal

instability. But that's not planning; it's gambling. Gulotta is also

gambling on the State Legislature's approving a mortgage recording fee

and a cell phone surcharge. And he is gambling that his uncertain fixes

will allow him to fund a no-general-fund-tax-increase budget in 2000,

the eighth year in a row.

That may be good politics. But for a county in fiscal despair, its

woefully short of a lifeline.

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