NIFA threatens to freeze hiring, make cuts, limit contracts to force Nassau budget changes

A state oversight board in control of Nassau's finances threatened to impose a freeze on new county hires, make cuts to all departments and limit the approval of new contracts if the GOP-controlled legislature does not alter the 2016 budget proposal to increase revenue and reduce spending.

In a letter to legislative leaders, Nassau Interim Finance Authority chairman Jon Kaiman said County Executive Edward Mangano's $2.95 billion budget "contains risky propositions and questionable projections that could put Nassau County in a $50 million hole."

He cited $12 million in new revenue from a 1.2 percent property tax increase that Republican and Democratic legislative officials have vowed to strip from the budget, and $20 million from a proposed video lottery terminal parlor. The Nassau Regional Off-Track Betting Corp. has yet to select a location for the gambling parlor and past attempts to find a home for it have run up against stiff community opposition.

Kaiman said that without major revisions, the board would consider rejecting the budget and imposing its own changes.

"We are aware of the enormity of a control board having to take on decisions that others were elected to make," Kaiman wrote. "We will explore the parameters of our authority and the extent to which we are authorized under the law to resolve the problems that presently exist when the government is unable to do so."

In a statement, Mangano said, "We will closely monitor the Legislature's budget process and reserve further legislative comment until amendments are approved by the Legislature and forwarded to me for comment."

Lawmakers from both parties have said they will strip out the tax increase and replace the revenue, although neither side has offered specific proposals.

Kaiman said that NIFA, which meets Monday night, is establishing a Strategic Planning Committee with the authority to modify the budget to eliminate all nonessential spending and reject borrowing to pay county bills or fund projects.

The result, Kaiman said, would be a countywide "hiring freeze and drastic cuts in all departments, programs and agencies that receive discretionary dollars from the county."

A separate NIFA Procurement and Contract Monitoring Committee would review contracts to determine if they are "essential in substance and cost" and can be eliminated.

Last year, Mangano proposed a 3.4 percent property tax hike. County lawmakers stripped it out and substituted seven budget amendments to replace $31 million in expected new tax revenue.

Mangano vetoed the amendments, saying they contained "risky one-shot revenues and expense reductions that violate sound budget practice."

NIFA said it would not approve the budget if it included the legislative amendments, saying they relied on speculative revenue and tactics prohibited by the board. The legislature made no move to override Mangano's budget veto, and the tax hike stood.

The legislature is set to vote on the 2016 budget Oct. 29.

Presiding Officer Norma Gonsalves (R-East Meadow) said: "For five years, Nassau Republicans have cut hundreds of millions of dollars in wasteful spending and have held the line on property taxes. The 2016 budget that NIFA will receive will build on these successes."

Minority Leader Kevan Abrahams (D-Freeport) said NIFA "is correct that our county is fiscally on the wrong track and is at risk of financial uncertainty. But that should be on the county executive to make hard cuts and cease his rampant mismanagement -- not on the backs of Nassau taxpayers."

With Joye Brown

By Robert Brodsky

robert.brodsky@newsday.com@BrodskyRobert

Robert Brodsky is a breaking news reporter who has worked at Newsday since 2011. He is a Queens College and American University alum.