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Oyster Bay could cut as many as 200 jobs

Oyster Bay Town Hall on March 26, 2012.

Oyster Bay Town Hall on March 26, 2012. Credit: Nicole Bartoline

The Town of Oyster Bay, which threatened to lay off 150 employees amid a $13 million budget shortfall and rising health and retirement costs, is now proposing to cut as many as 200 workers next year.

Under its 2013 preliminary budget scheduled to be adopted Tuesday by the town board, Oyster Bay will increase its spending by about 1 percent to $265,190,651 from this year's $262,464,593, said Town Comptroller Robert McEvoy. The proposed layoffs would be on top of the 89 workers who took buyouts this year.

"The employees are very afraid," said Civil Service Employees Association Local 881 president Robert Rauff Jr. The union represents about 90 percent of the town's workforce of about 1,260.

Despite the possible layoffs, McEvoy said, current services for residents would not be reduced. But Rauff insisted the town cannot continue to provide the current level of services under the proposed layoffs.

"It will be devastating to the residents," he said.

Last year, the town's budget increased by 7.6 percent. This year, the town saw its bond rating downgraded by Standard & Poor's.

The town tax rate will rise about 3.8 percent after no increase last year. But McEvoy said the town would not exceed the 2 percent state cap on tax increases because of credit allowed for not exceeding the cap last year and exclusions such as increased pension contributions.

The budget includes a reduction of $10 million in salary and benefit costs from anticipated layoffs in addition to the $10 million savings from the buyouts this year. To reach the layoff savings, 150 to 200 employees would be eliminated, depending on their salaries, McEvoy said.

McEvoy said the town is facing a large increase in retirement costs, while health insurance costs increased $2.3 million.

The comptroller said there would be no increase in cash reserves next year but the personnel reduction would allow the cash reserves to increase in future years to try to satisfy the concern of bond rating agencies.

A drop in cash reserves from $20.3 million in 2005 to less than $1 million last year was one reason Standard & Poor's Ratings Services lowered the town's bond rating in June by three steps to A.

Local 881's Rauff said union officials would continue to talk to town officials. "The union is doing everything in its power to come up with a solution to avoid layoffs," he said.

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