North Hempstead Supervisor Judi Bosworth has proposed a $138.1 million town budget for 2021 that does not cut services or lay off staff but includes a 2% increase over the current spending plan.
The tentative budget would allocate $71.2 million to the town’s general fund, $39.2 million to the town outside village fund and $27.7 million for 20 town-operated special districts. It would use nearly $5 million from a fund balance accumulated from previous years of surplus to cover funding gaps created by the coronavirus pandemic.
Under the proposal, the general fund tax will increase by 3.4%, while the outside village fund tax will go up by 1%.
The tentative budget, which was submitted at a Sept. 24 town board meeting, comes at a time when local governments continue to grapple with the fiscal pain stemming from the pandemic, which has shrunk municipal revenue in areas ranging from sales taxes to park fees.
Comptroller Tania Orenstein said North Hempstead has responded by cutting expenditures, refinancing its debt in bonds and using a portion of previous years’ surplus to fill budget gaps left by lowered revenue projections.
"We chose to only appropriate fund balance for those one-off kind of events," she said in an interview Wednesday. "We really kept our expenses as tight as we could. … We only wanted any tax increase to be for actual, needed operating increases."
By the end of 2019, the town had a balance of more than $17 million in its general fund, $20 million in its town outside village fund and $10 million in its special districts fund. In the proposed budget, $3.6 million, $1.2 million and $140,000, respectively, from each fund will be used to help cover anticipated shortfall in revenue.
In total, the proposed appropriation adds up to $4.94 million, the amount that would be taken out of the town’s $47 million fund balance.
"This budget, like all previous ones under my administration, is a tough but realistic document," Bosworth said Thursday at the beginning of a virtual work session. "There are no phantom revenue projections."
The town has a long-term debt of $168 million, which decreased by $6 million from last year, and a short-term debt of $15.3 million, almost doubling the $8 million from last year.
Steven Pollack, the town’s finance director, said the increase in short-term debt mostly came from borrowing to fund several capital projects that officials expect to be reimbursed by the Federal Emergency Management Agency and the state.
The public can comment on the tentative budget next Thursday. A public hearing on the preliminary budget will be held on Oct. 22. Council members are scheduled to vote on the final spending plan on Oct. 29. The three meetings are all virtual and will start at 7 p.m.