Hempstead Town Board members voted 6-1 Tuesday night in favor of a proposed 2019 budget with a 3.5 percent tax cut, but Supervisor Laura Gillen raised questions about savings.
About 100 people attended each of two public hearings Tuesday.
The five Republican council members and Democratic Senior Councilwoman Dorothy Goosby passed the $432.5 million budget with a 3.46 percent tax cut, which is largely based on $8.5 million in expected savings from planned early retirements.
Gillen had presented an amended $442 million budget, with a 2.39 percent tax cut, but remained divided with the GOP majority over about $10 million in spending.
Board members on Tuesday debated the two budget proposals, including the town’s practice of predicting savings for early retirements, known as “less savings.”
Hempstead Councilman Bruce Blakeman, who voted in favor of the budget, said the board was using less savings for a tax cut, rather than adding a tax surplus now to make tax cuts later. He later said the savings would avoid overbudgeting $8 million caused by Gillen not accounting for early retirements.
“Less savings is a way to pad money and hide money by removing it so there’s a surplus next year so whoever is running can say they’ll save taxes,” Blakeman said. “We feel it’s better suited in the pockets of taxpayers and we can afford a 4 percent tax cut because those savings are to occur.”
Gillen has opposed the practice and has not included the savings in her budget because she said the money is not guaranteed to be saved. She pointed to the 2017 budget, which forecast $13 million in savings, but the town later had to borrow $8.5 million to cover separation payments.
“In 2017, we missed the mark by a whole lot,” Gillen said.
Town Comptroller Kevin Conroy said the union contract negotiated last year included a retirement incentive to give employees and their spouses lifetime medical coverage, increasing the expected number of retirements.
The board this year budgeted $12 million in savings expected from 100 employees retiring and 113 employees have retired so far with $11.3 million in savings, Conroy said.
“In 2018, we have demonstrated we are there,” Conroy said. “There is quite a bit of enthusiasm of people going for it.”
Chris Wright, of Levittown, who serves on the Nassau County Interim Finance Authority, said he was concerned the budget does not account for separation pay.
“Borrowing money is no way to balance a budget. It isn’t revenue, because you have to pay it back,” Wright said.
The town would owe about $3 million in separation pay for about 100 expected retirements, Conroy said. He said the payments should be covered by savings, but could be covered by $140 million in the town’s reserves.
“It’s a prudent and fiscally sound budget,” Conroy said.