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Long Beach officials say the city will soon run out of money

Long Beach City Hall. Lawmakers are calling on

Long Beach City Hall. Lawmakers are calling on the state to audit Long Beach finances after city officials warned of a potential government shutdown. Credit: Steve Pfost

Long Beach officials said the city has “curtailed” spending, and state and county lawmakers are calling for an audit after a bond measure to cover workers’ separation payments was rejected.

“We’ve curtailed all spending and are aggressively going after any funds owed to the city,” Long Beach acting City Manager Michael Tangney said. “There will be pain and a tremendous potential for layoffs determined in the next week.”

Nassau County Legis. Denise Ford (R-Long Beach) and Assemb. Melissa Miller (R-Atlantic Beach) issued letters late Thursday to state Comptroller Thomas DiNapoli requesting a review of city finances. Long Beach officials said the city is scheduled to run out of money in the next three weeks.

Tangney said Long Beach would determine this week what measures would be needed to keep the city operating until July, including potential layoffs and service cuts.

“The city will never shut down,” Tangney said. “But the tremendous possibility of layoffs exists.”

The city had counted on the $2.1 million bond to cover payments already made to 58 current and former employees, including a $108,000 payment to former City Manager Jack Schnirman, who was elected Nassau County comptroller in November.

City Council voted 3-2 on April 17 to reject the borrowing. The city had borrowed $3.4 million for earned leave and separation payments to balance the 2017-18 budget, City Council President Anthony Eramo said.

“Moving forward I think everyone wants to reform this process,” Eramo said.

On Friday, the city released a $95 million budget proposal for 2018-19 that calls for a 12 percent tax increase.

Ford asked DiNapoli to specifically examine the separation payments made to several people who remain on staff.

Long Beach paid out $267,000 to at least seven active employees, including Tangney, Corporation Counsel Rob Agostisi and Deputy City Manager Michael Robinson.

Former comptrollers Kristie Hansen-Hightower and Shari James, and former public works director Jim LaCarrubba, who all left the city last year, also received payments.

Some of the payments went to employees who had intended to leave for other jobs but ended up staying with the city, Agostisi said.

“This time is the employees’ property,” Agostisi said. “Everyone earned that time.”

Some employees said they tried to return the payments when they decided to stay with the city but were told they had to keep the money.

Ford and Miller’s letters had not been received by the comptroller’s office Friday, officials said. The state reviews Long Beach’s finances annually under a 10-year monitoring program that started in 2011 when the city was near bankruptcy.

Ford also asked for a review of “honest and accurate financial information” submitted to the state by Schnirman.

Schnirman, a Democrat, said in a statement Friday that the earned-leave obligation payments were applied evenly in the city.

He said Republican lawmakers are “creating distractions” as Nassau County conducts a nepotism audit.

“We are surprised that Legislator Ford would choose to get involved now after she remained largely silent during what was truly an unprecedented, inherited fiscal crisis in 2012,” Schnirman said.

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