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NIFA threatens to cut $31M from Nassau budget

Nassau County Executive Edward Mangano works on the

Nassau County Executive Edward Mangano works on the 2015 budget in his office on Monday, Sept. 15, 2014, in Mineola. Credit: Howard Schnapp

Nassau's financial control board Tuesday threatened to cut $31 million from the county's 2015 budget if county lawmakers eliminate a 3.1 percent property tax increase proposed by County Executive Edward Mangano.

Jon Kaiman, chairman of the Nassau Interim Finance Authority, fired off the emailed warning to Presiding Officer Norma Gonsalves (R-East Meadow) and Minority Leader Kevan Abrahams (D-Freeport) at the close of business Tuesday -- a day before the Republican majority on the county legislature is expected to remove the tax hike and approve an amended $2.98 billion budget for 2015.

"While it is not our intention to advise whether to increase taxes or to refrain from doing so, it is our intention to make sure that the county meets its financial obligations," Kaiman wrote. "Accordingly, NIFA will use its power to remove from the 2015 budget an equivalent of the revenue that is being cut by the county legislature."

Kaiman, who could not be reached Tuesday, wrote NIFA will cut operations and likely apply an "across-the-board ban" on all capital projects, such as repaving roads, installing traffic signals and other long-term expenses paid with borrowed money.

The proposed tax increase is projected to raise $31 million.

Mangano said most single-family homeowners would be eligible for a tax rebate from the state that would reimburse their extra costs.Republican lawmakers, who won re-election with Mangano last year by touting their record of freezing taxes, have proposed replacing the tax hike by reducing the "outdated contracts" budget by $12 million; recovering the value of bond premiums, for $11 million; restructuring debt to save $7 million, and more aggressively collecting fees and fines, for $1.2 million.

Democratic lawmakers also want to eliminate the tax hike, primarily by dipping into the county's fund balance.

However, NIFA has said the county is not allowed to recover bond premiums, and several fixes are "one-shots." Also, fiscal experts have predicted multimillion-dollar "risks" next year and shortfalls this year.

"Cutting $31 million from the budget that is stressed to begin with can only mean that the legislature has decided to defund the county operations in a manner that we have not seen before," Kaiman wrote. " . . . NIFA is continuing to explore all options available to meet our obligations relating to this and future budgets."

Said Abrahams: "While we agree with NIFA's concerns as stated in their letter, it's our job to protect taxpayers who have been burdened by Nassau's fiscal mess for too long."

Gonsalves did not return a call for comment.A Mangano spokesman said the administration will review Kaiman's letter.

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