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Nassau Republicans set conditions for $23M in borrowing

Majority Republicans on the Nassau County Legislature agreed Monday to approve half the $45 million in borrowing requested by Democratic County Executive Laura Curran to pay a court award in an effort to work with the new executive.

But Republicans had one condition: All eight Democrats on the county legislature also had to vote in favor of the borrowing, according to Republican and some Democratic officials.

After Republicans refused repeatedly during behind-the-scenes negotiations to provide more than five Republican “yes” votes, all eight Democratic legislators agreed to vote for borrowing $23 million.

That provided the 13 votes required to authorize borrowing.

Deputy presiding officer Howard Kopel (R-Lawrence) said Wednesday that senior Republican legislators decided to vote for the borrowing because they wanted to give Curran “a chance to manage.”

Minority Leader Kevan Abrahams (D-Freeport) said he was not involved in the negotiations with Republicans. But Abrahams said he believed the drop in the borrowing amount — negotiated by Chief Deputy County Executive Helena Williams — convinced 13 legislators, including his caucus, to vote in favor.

“Originally from our standpoint, we had no votes for $45 million,” Abrahams said. “Then maybe two. Then after the whole back-and-forth over the weekend, the number dropped to $35 million, then to $23 million. I’m not sure how it all came together. But when the number got down to 23, I had more support on my side of the aisle.”

The five Republican legislators who voted in favor were Kopel, presiding officer Richard Nicolello (R-New Hyde Park), Alternate Deputy Denise Ford (R-Long Beach), Legis. Vincent Muscarella (R-West Hempstead) and Thomas McKevitt (R-East Meadow.)

Voting against the borrowing were Legis. John Ferretti Jr. (R-Levittown), Steve Rhoads (R-Bellmore), Laura Schaeffer (R-Westbury), Rose Marie Walker (R-Hicksville), William Gaylor (R-Lynbrook) and James Kennedy (R-Massapequa).

New Legis. Joshua Lafazan (D-Syosset) had said before the vote that he would not approve $45 million in borrowing. He voted with his colleagues to approve the $23 million.

Lafazan said, “the $45 million was dead on arrival. But with the 50 percent reduction and with the guarantee that this would spark a larger conversation about Nassau’s bloated budget and cutting spending, I echo the sentiments of Mr. Nicolello when he said that Laura’s administration made the case that the $23 million would protect against a possible bond downgrade and allow them cash-flow flexibility.”

In 2016, Democrats killed Republican County Executive Edward Mangano’s request to borrow the $45 million. A federal court required the county, before it could appeal the award won by two men exonerated in a 1984 rape and murder, to put cash in a restricted bank account or put up a bond as proof it could pay.

The administration put the $45 million in a restricted bank account.

Although Republican legislators voted to borrow the money, all legislative Democrats, including Curran, a Baldwin legislator at the time, voted against the plan. Curran and her colleagues argued the county could take the money from the county litigation fund or other reserves.

The Curran administration requested borrowing of $45 million after the U.S. Supreme Court last month declined to hear Nassau’s appeal of the 2014 award to John Restivo and Dennis Halstead. Their convictions for the rape and murder of Lynbrook teenager Theresa Fusco were overturned after they had spent nearly 18 years in prison.

The county comptroller’s office told legislators that spending cash would deplete the county’s reserve fund. The office said the county had enough cash on hand, but strict accounting standards designated how the county’s reserve funds could be spent.

The Office of Legislative Budget Review reported the county had $171.5 million in cash on hand on Jan. 23 and another $45 million in the restricted bank account.

Using the accounting standards, however, the comptroller’s office argued the county would have only a little over $1 million left if it paid $45 million in cash, Payment was due Wednesday.

“It’s a new administration and leaving it with $1 million in unreserved reserve funds with a $3 billion budget is kind of risky,” Kopel said. “Basically, it comes down to accounting. On a budgetary basis, there’s plenty of money there. On a GAAP [generally accepted accounting principles], the money is generally spoken for.”

Abrahams said Democrats had voted against the borrowing in 2016 because there was no final judgment at that point. He said paying the $45 million in cash, “from our perspective, it was a little bit risky” without having final numbers for 2017.

He said the vote simply authorized the borrowing, which he said will not be done until later in the year as part of a larger borrowing package.

Still to be determined is whether the county’s financial control board will give the green light.

All borrowing by the county must be approved by the Nassau Interim Finance Authority, and some board members have taken a firm stand against allowing the county to borrow for operating costs.

A spokesman said earlier that NIFA will consider borrowing if it is approved by the legislature.

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