Nassau County Executive Edward Mangano in Woodbury on June 12,...

Nassau County Executive Edward Mangano in Woodbury on June 12, 2015. Credit: Barry Sloan

A state monitoring board that controls Nassau's finances said Wednesday it will no longer allow the county to borrow to pay termination costs for employees who take early retirement incentives.

The Nassau Interim Finance Authority at a meeting in Uniondale Wednesday night unanimously approved a new retirement incentive that will pay departing Civil Service Employees Association members $1,000 for every year of service with the county.

NIFA chairman Jon Kaiman said the county would have to pay for the incentive, and others in the future, from operating funds. In recent years, NIFA routinely approved borrowing for such incentives.

"This will reduce head count in government," Kaiman said. "The county is making an effort to reduce costs."

In an interview, County Executive Edward Mangano said Nassau is now in a position financially to absorb the incentive and termination costs.

"We will be able to achieve this," said Mangano, noting that no county executive in recent memory has paid for termination pay out of the operating budget. "We have been systematically repairing the county's finances."

County officials had said previously that Nassau would pay for the program from the operating budget only if fewer than 50 employees applied. If 50 employees or more took the incentive, the county had expected to borrow to pay for the costs.

NIFA's newest board member, businessman Adam Haber, a Democrat who ran unsuccessfully for county executive and State Senate, said the county must "break free from the practice of borrowing for proposed money-saving initiatives."

To date, 113 county employees have signed up for the incentive, said Eric Naughton, Nassau's deputy county executive for finance. If 200 employees accept the incentive by the Sept. 15 deadline, it would cost the county about $9.6 million in 2015, he said.

Naughton said the cost of the new incentive would be partially offset by $4.1 million in savings from not having those employees on the payroll for the final 3 1/2 months of the year. Also, Nassau is projecting a $5.7 million surplus by year's end, Naughton said.

However, County Comptroller George Maragos said earlier this month that Nassau is facing a budget deficit of as much as $62 million this year.

Naughton said the incentive, approved by the GOP-controlled legislature this month, will save $12 million annually in salary and benefits.

Legislative Minority Leader Kevan Abrahams (D-Freeport) said Democrats support paying for the incentive out of the operating budget "rather than putting it on the county's credit card."

Presiding Officer Norma Gonsalves (R-East Meadow) declined to comment.

CSEA president Jerry Laricchiuta said his priority is ensuring that Mangano replaces a high number of the retirees.

"Head count is very low and every department is understaffed," he said.

Since June 2011, 400 CSEA members have been laid off and 560 retired with incentives, including nearly 200 who took an identical program last year.

Mangano said the county will replace some, but not all, of the retiring employees.

New hires would take longer to reach top salaries and pay a percentage of health and pension costs under a labor deal signed last year.

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