Holtsville fire officials hiked taxes more than needed, state audit finds

Holtsville fire officials raised taxes more than necessary over a four-year period and transferred $1 million into reserve funds for no apparent reason, the state comptroller's office said in an audit of district finances.

The fire district boosted its operating surplus to $4.8 million between 2019 and 2023 by underestimating revenues and overestimating expenses, resulting in "a lack of transparency with taxpayers," according to the report released late last month.

In a letter responding to the audit, district officials blamed confusing estimates provided by state insurance officials and promised to change their budgeting practices.

The 12-page audit does not accuse Holtsville fire officials of wrongdoing. It recommended adopting budgets with "realistic revenue and expenditure estimates" and improving the district's policy for reserve funds.

Auditors from the office of Comptroller Thomas P. DiNapoli reviewed the Holtsville fire district's finances from a period between January 2019 and December 2023.

During that time, the district more than tripled annual surpluses, from $550,000 in 2019 to nearly $1.75 million four years later, the report said.

"The board [of fire commissioners] did not adopt budgets with reasonable estimates or properly establish and manage capital reserve funds," the report said, adding commissioners approved transferring $1 million to reserves "with no indication of the board’s plan to use the funds."

The district tax levy rose by $771,762 from 2019 to 2024, "meaning that real property taxes may have been higher than necessary," the report said.

In the district's written response, included with the comptroller's report, Anthony Asselta, chairman of the board of fire commissioners, said the district had relied on estimates of employee insurance costs provided by the New York State Health Insurance Program, or NYSHIP. In past years, those estimates were "straightforward," he wrote.

"However, more recently, they have shifted to issuing a 65-page analytical report, which is challenging to interpret," Asselta wrote. "The district must now extract and calculate its own estimate based on the information provided in this complex report."

Other budget elements, such as estimates for service awards, accident insurance and workers' compensation payments, were overstated because they were not available until after budgets were adopted, he said.

Attempts to reach Asselta were unsuccessful.

The audit also faulted district officials for improperly establishing reserve funds totaling about $2.2 million to pay for trucks and buildings.

Asselta said fire commissioners voted on April 4, 2024, to formally establish those reserves. 

By Carl MacGowan

carl.macgowan@newsday.comCarlMacGowan

Carl MacGowan is a Long Island native who covers Brookhaven Town after having previously covered Smithtown, Suffolk County courts and numerous spot news and feature stories over his 20-plus year career at Newsday.