East Hampton's new town supervisor has a new town hall he doesn't have the money to move into and an accumulated leftover town debt that's half the size of his annual budget.
Bill Wilkinson, six months on the job, is learning just how hard local government reform can be.
Already he's encountered staunch opposition to some of his proposals, and more is expected as he attempts to sell off properties and merge town departments with the aim of trimming between $20 million and $30 million from East Hampton's $70-million annual budget.
In May, an angry crowd of Montauk commercial fishermen came to Town Hall to accuse Wilkinson of reneging on a promise to support their industry when he proposed selling the commercial dock they used. And, last month, Richard Whalen, a lawyer for Concerned Citizens of Montauk, warned the Fort Pond House could legally be considered a park, requiring an act of the State Legislature to sell.
Wilkinson says he has no choice but to cut the budget and sell off some assets, in light of opposition to paying off debt with tax raises. "We have a budget that's the size of Southampton, and they have three times the people," he explains.
A Republican who lost the 2007 supervisor's race by about 100 votes, Wilkinson was elected last year by an impressive 2-1 margin. In both campaigns, he stressed the town was spending money it did not have. He and other critics say they did not realize just how out of balance the budget was until audits showed the real size of the debt - at least $30 million.
Last month, a special grand jury report said the town had a "complete collapse of fiscal management" by officials, saying they chose political expedience over financial responsibility over a six-year period.
Based on real estate values, East Hampton is one of the richest towns in the nation. A median home there is worth about $1 million. But, many in its year-round population of about 22,000 are far from wealthy. And their homes are modest.
Wilkinson, who has rejected a one-time tax increase to pay off town debt, has to borrow the money the town owes. Plans call for 10-year bonds, which would add $160 a year for a decade to an average residential tax bill.
But, borrowing won't solve the town's long-term problems. Wilkinson and his budget officer, Len Bernard, say they have to cut payroll and reduce services to reach long-term stability. "Sixty percent of our budget is salary and benefits," Bernard says.
Among items yet to be funded, they even need to find $1 million or so to move into their new town hall.
Wilkinson, who for eight years was a senior vice president for the Walt Disney corporation - which had more employees than East Hampton has residents - said his town has nearly 30 individual departments, which he wants to cut to 13. He's also working on an early retirement incentive for 45 to 50 workers, which could save $3 million a year. East Hampton has nearly 400 full-time workers and an additional 100 seasonal employees.
Not everyone agrees with Wilkinson's moves. When he put the Fort Pond House in Montauk up for sale, for example, the two Democrats on the board voted against it, and there have been several protests since. The town purchased the property for $800,000, and is still paying off $500,000 in bonds.
Democratic Town Councilman Pete Hammerle, who voted against the Fort Pond House sale, said he did not know about the plan to sell it before the matter came up at a board meeting. But, he adds, he has a good relationship with Wilkinson and the other Republicans.
Town Democratic leader Jeanne Frankl vows her party will closely monitor Wilkinson, charging he's already gone back on his campaign promise to foster open government - a charge Wilkinson denies.
Yet many year-round residents seem willing to give the new supervisor a chance, at least until he has to propose the town budget for 2011 this fall.
"People are fed up with the name-calling and finger pointing. Everyone knows Bill does not have an easy job. He's going to have to make some tough choices," said John Behan, a widely respected war hero and former state assemblyman from Montauk.
Ben Zwirn, the Democrat who ran against Wilkinson, agrees it's too early to pass judgment on his record.
"He deserves a chance. He had a big margin of victory. The public said they wanted a change," Zwirn, a former North Hempstead Town supervisor and deputy Suffolk County executive, said. "There's a lot of good will out there, Democrats and Republicans, we all have a lot at stake to getting our town finances back into balance," he said.
But, Zwirn added, Wilkinson and the rest of the town GOP have so far been short on the specifics of cuts and what they plan to sell - details that will emerge as the new budget is drawn up. "If they can do all they say, it will be wonderful," he said.
Getting out of debt
East Hampton town officials are looking at a number of ways at eliminating their estimated $30-million debt. Among the ideas being discussed are:
UP FOR SALE. Sale of "nonessential" town assets, including land and buildings not used for parks or other dedicated purposes. They hope it could bring in $4 million to $5 million.
DOWNSIZING. Merging town departments and agencies, reducing the town workforce by 45 to 50 people for an annual savings of $3 million.
SERVICE CUT. Eliminating leaf pickup, which could save $500,000 a year.
CLOSING UP. Closing the town recycling center one day a week for an annual savings of $250,000 to $300,000.
NEW LOCATION. Moving the town harbor master's office to the police department, which will save the town $40,000 to $50,000 over the summer.
DRIVING CHANGE. Changing the town policy on workers who use official cars, which could save $200,000 a year on maintenance, and eventually save $500,000 a year on new car purchases. MOVING OUT. Moving some town employees from an office building next door to town hall, allowing the town to either rent out those offices or sell them. No savings figures are available.
SCALING BACK. Cutting back on capital projects over the next few years to reduce debt service. No savings figures are available.