In a fiery radio interview, Nassau County Executive Edward Mangano yesterday said he is working hard to cut county expenses and vowed to fight the state's takeover of the county's finances.

"Do we have challenges? Absolutely, but we're meeting those challenges," Mangano told WNYM-AM radio host Curtis Sliwa. "The people of Nassau County are going to know the truth, as long as my lungs have air."

Aides have disclosed that Mangano plans to file a legal challenge to the takeover, and Republican lawmakers planned to meet Friday about the suit.

On Wednesday, the Nassau Interim Finance Authority seized immediate control of Nassau's finances, citing a $176-million budget deficit. That is more than seven times the 1 percent gap that triggers a takeover under state law. NIFA gave Nassau, one of the nation's wealthiest counties, until Feb. 15 to come up with a plan acceptable to the state board, first created in 2000 during an earlier fiscal crisis.

Mangano, who disputes the estimates of a large deficit in the 2011 budget and says his plan is balanced, Thursday called NIFA a "shadow government" that could spark a property tax hike in an already heavily taxed county by mandating additional revenues.

NIFA members have said they cannot increase property taxes or direct Mangano to raise them. They say all they can do is mandate a balanced budget. "We can't raise taxes, nor will we ever suggest that it be done," NIFA member Leonard Steinman said.

advertisement | advertise on newsday

NIFA representatives and Mangano have been at odds over several key line items in the 2011 budget. NIFA and other entities have said the budget risks range from $158 million to $258 million. They include real estate sales that have not closed yet, $61 million in proposed labor concessions and new revenue that require state approval before they could materialize.

Republican legislators plan to meet today with Mangano and his outside attorney to be briefed about the county executive's lawsuit, which is expected to be filed Friday or Monday.

Presiding Officer Peter Schmitt (R-Massapequa) called a news conference for Monday to "discuss ethical and legal challenges to the NIFA takeover and control board status," according to the media advisory.

Schmitt is expected to again question the role of NIFA chairman Ronald Stack, a managing director of Wells Fargo Bank, where the county has $80 million in operating accounts. Schmitt is expected to call on Mangano to move the money out of Wells Fargo.

Stack and the NIFA counsel have said there is no conflict of interest because, as a municipal bond adviser, he has no association with the county's accounts.

An aide said Schmitt also will contend that NIFA member Thomas Stokes, who worked as a top budget adviser for former Nassau Executive Thomas Suozzi, was improperly paid more than $80,000 for unused vacation time - above the allowable limit - when he left the county payroll.

However, Stokes said yesterday that "everything was done properly, according to policy and vetted with the county attorney's office. Any vacation time that was forgone was because of the brief transition period and was done at the current administration's request."

Schmitt also will call for NIFA directors to file financial disclosure reports with the county because they have now become county policy-makers, according to Schmitt aide Ed Ward.

Meanwhile Thursday, Nassau's top Democrat said a lawsuit by Mangano and top GOP legislators would be ineffective and wind up costing taxpayers "several millions" in legal fees.

"Mangano is a nice guy, but he's completely out of his depth," said Jay Jacobs, Nassau and state Democratic Party chairman. "He doesn't have the capacity to manage in a fiscally conservative way."

advertisement | advertise on newsday

But Mangano spokesman Brian Nevin said a legal fight would be necessary to prevent a possibly large tax hike, and blamed many of Nassau's current fiscal difficulties on "lavish" and unaffordable labor contracts cemented during the Suozzi administration.

"Jay Jacobs is absolutely wrong," Nevin said. "The county executive was dealt a very bad hand by Tom Suozzi."

With Celeste Hadrick