The Town of Oyster Bay would receive at least $10 million less from Nassau County than it has paid utility companies in a tentative settlement with the county, according to town documents.
The tentative settlement would end a 15-year-old dispute over erroneous property tax assessments on utility-owned property in town garbage districts.
The town’s 2014 audited financial statement, which was released on Friday, shows that the town would receive $26.7 million from the county under the agreement, less than the $37 million the town has previously paid two utility companies.
Oyster Bay paid Keyspan $21.4 million in January and it made four payments to Verizon from 2006 to 2014 totaling $15.6 million, the financial statements show. The town borrowed to make the payments, meaning that taxpayers are paying interest on them.
The county’s payments to Oyster Bay would be split into this year and next year. The first installment would come as the town faces a cash crunch: the town plans to borrow $30 million for cash flow needs next month. The town board is scheduled to vote on the cash flow borrowing on Tuesday.
The audited financial statement also shows that the town’s fiscal situation deteriorated in 2014 more than originally estimated.
For example, the town’s general fund operated at a $19 million deficit in 2014, compared to an $8.4 million surplus the year before, according to financial statements for both years. In January the town had estimated that general fund deficit to be $17 million.
The 2014 audited financial statement was finished this month, about 10 months later than usual because of computer problems, town officials said.
Oyster Bay met an April 11, 2016, deadline to file the audited financial statement for 2014 that was set by Standard & Poor’s at the threat of losing its credit rating. The rating agency is expected to make a decision on whether to downgrade the town’s rating next week.
Oyster Bay finance director Robert Darienzo said the biggest cause of the general fund deficit for 2014 was “budgeting for a surplus that did not materialize as expected.”
Town officials expect the town’s financial position to improve. In January the town had estimated that 2015 would show a $5 million operating surplus, but that estimate had been revised downward to a slight deficit, according to the new financial statement.
The town’s disputed $20 million loan guarantees to indicted restaurateur Harendra Singh’s companies showed up in the town’s audited financial statements for the first time. Town officials have said those guarantees are invalid.
The statement also showed for the first time a $2 million indirect guarantee that is not in dispute and could be drawn upon if the town cancels its agreement with a Singh company at the golf course.