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NIFA delays votes on sewer consultant, turf fields

Jon Kaiman, chairman of NIFA, right, speaks during

Jon Kaiman, chairman of NIFA, right, speaks during a public hearing in Uniondale, Friday evening, May 8, 2015. Credit: Danielle Finkelstein

The Nassau Interim Finance Authority put off votes Wednesday night on county proposals to hire a consultant to recommend whether to lease its sewage system to a private investor and to spend more than $11 million for artificial turf fields at Eisenhower Park in East Meadow.

NIFA chairman Jon Kaiman said the state monitoring board, which controls the county's finances, needs time to review a contract with KPMG that would pay the firm $270,000 over six months to study the proposed sewer system lease.

"It's a fairly important proposal that warrants significant time and effort by staff to discern the plan's long-term implications," Kaiman said before Wednesday's NIFA meeting.

Nassau County Executive Edward Mangano wants KPMG to determine whether leasing the county's three sewage-treatment plants, 53 pumping stations and 3,000 miles of sewers will generate enough to pay off long-term debt and stabilize sewer rates.

"NIFA should take as much time as necessary to explore the document before taking action," Mangano spokesman Brian Nevin said.

KPMG would receive 0.45 percent of the lump sum Nassau receives in a leasing deal. If a 49-year lease provided Nassau a hypothetical $750 million, KPMG would get nearly $3.4 million.

Kaiman said the board likely will consider the KPMG contract, which was approved Monday by the county legislature's GOP-controlled rules committee, at its next meeting.

NIFA member Chris Wright said there is no point in studying "a transaction which is likely doomed at the outset."

Wright said similar sewer leases have "only benefited the dealmakers." He said Nassau has already outsourced the management of the sewer system to New Jersey-based United Water "and evidently exhausted efficiencies, leaving only rate increases as a remedy."

Administration officials have said sewer rates likely will rise over the next 40 years regardless of who controls the system but that a private investor could stabilize rates.

In 2012, NIFA blocked Mangano's $5 million consulting contract with Morgan Stanley to negotiate a similar lease, calling the arrangement "backdoor borrowing." The board's leadership has since been replaced and has been more supportive of Mangano's fiscal initiatives.NIFA also postponed consideration of a $10.8 million contract with Laser Industries to install artificial turf on seven ballfields and a nearly $450,000 contract with A. Vournou Construction Management to manage the project.

Kaiman said the board questioned whether it's the right time to fund the project as the county struggles with its finances.

"It's an expensive investment and a fairly large expenditure," Kaiman said.

Wright said the fields "cost a lot to install, maintain and replace, and don't make money. They are a costly extravagance that the county can ill afford in its present condition."Nevin said the administration has withdrawn the contract "until NIFA is prepared to consider it."

During its brief meeting yesterday, the board approved a $13.4 million contract with J. Anthony Enterprises for improvements to the county's Department of Public Works Hempstead Road Maintenance facility. The board also approved four legal contracts, as well as a $60,000 contract with Albany lobbyist Robert Bishop.

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