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Oyster Bay budget increase driven by increase in labor costs, official says

Town of Oyster Bay Finance Director Robert Darienzo

Town of Oyster Bay Finance Director Robert Darienzo at a Town Board meeting in Oyster Bay on March 7, 2017. Credit: Howard Schnapp

Greater costs for Oyster Bay’s workforce are a major factor in boosting town spending in the proposed $306.5 million 2020 budget, the town finance director said Tuesday at a budget hearing.

The proposed budget would increase spending by $6.6 million compared to the adopted 2019 budget, a 2.2% rise.

“The majority of the increase [in workforce costs] will be in the form of contractual union raises for full-time employees in January and July, totaling 3.4 percent,” town finance director Robert Darienzo said in a budget presentation at Tuesday's Town Board meeting.

Darienzo said the state mandated minimum wage increase — set to go to $13 from $12 on Long Island on Dec. 31 — was responsible for hikes in part-time wages. “These salary increases will result in increased cost for social security, MTA payroll tax, and New York State employee retirement system pension bill,” he said.

The Town Board is expected to approve the budget at its Oct. 29 meeting.

Salaries would go up to $87.4 million from $83.3 in the adopted 2019 budget and employee benefits would rise to $67.7 million from $66.2 million, according to budget documents.

The proposed budget keeps the tax levy flat at $232.9 million, compared to $233 million in the current year. Individual levies would go up and down, however, with levies for highway, parks, solid waste and public parking increasing while the general fund and sanitation district levies would decrease.

The town has mostly maintained a large tax increase that took effect in 2017 that was intended, according to a 2016 town financial plan, to create recurring additional revenue to wipe out an accumulated fund deficit in 2018.

The town’s cumulative fund deficit peaked in 2015 at $44.6 million and fell sharply in 2016 to $24.2 million and closed more in 2017 to a $9.4 million deficit, according to town figures. Darienzo said the deficit turned in to an $8.2 million surplus.

Darienzo defended the town’s calculation of its surplus during his presentation as Moody’s Investors Service said the town ended 2018 with a $5.5 million deficit and the New York State Comptroller’s calculations show a $10.2 million fund balance deficit in its fiscal stress measurements. The town, Moody’s and comptroller’s office use different funds when calculating surpluses and deficits.

The town plans to borrow $50 million in 2020 for capital projects, according to an August town borrowing prospectus.

Darienzo said the town expects to resolve a lawsuit over the sale of the town’s public works facility. Developer Syosset Park Development LLC sued the town earlier this year for $31.2 million plus interest and other costs after terminating its purchase of the land. The town disclosed in its 2018 audited financial statement that it could issue bonds to pay for “any settlement or litigation amount, should it be necessary” to resolve the lawsuit.



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