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Laura Curran: $261 million deficit due to COVID-19 pandemic

Nassau County Executive Laura Curran says she expects

Nassau County Executive Laura Curran says she expects a $261 million budget deficit this year due largely to COVID-19 costs. Credit: Howard Schnapp

The COVID-19 pandemic will have a "painful" effect on Nassau County's finances, with officials projecting a budget deficit of $261 million this year, according to a new county budget report.

The county is expected to see a revenue loss of $319.4 million, according to projections in the report from the county's Office of Management and Budget.

The budget shortfall is expected to be $261.1 million because Nassau is not filling 331 vacant positions funded in the 2020 budget, according to the report and Deputy County Executive Raymond Orlando.

The most significant revenue loss comes from an expected $136.3 million decline in sales tax receipts — a drop of 10%. Sales tax receipts account for more than 40 percent of county revenue, Curran said.

"That 10 percent reduction will be painful. We will feel it," Curran said.

"It's pretty sobering," Orlando said in an interview. "Moving from a situation where we were expecting to have a balanced budget to over $260 million deficit, virtually overnight, is daunting, unprecedented and unexpected."

The county's deficit had been declining since reaching a high of $189.2 million in 2014. By 2018, the deficit was down $61.2 million, according to the latest figures from the Nassau Interim Finance Authority, the county's financial control board.

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County officials said they developed their projections by adjusting estimates for fees from sources such as red-light cameras. Those revenues are expected to drop by 50 percent in the second quarter of the year and 25 percent in the final two quarters, when an economic recovery is expected, officials said.

“This is our first attempt to address the COVID-19 impact on the county’s finances," Orlando said.

"Things could go better as we learn more and get more data throughout the calendar/fiscal year, but things could also be kind of worse than we think today," Orlando said.

Nassau is projected to receive $3.2 billion in revenue this year, $319.4 million less than in the 2020 spending plan NIFA approved last fall.

The county has a $3.55 billion budget this year.

The county also is projected to receive:

  • $66.4 million less in fees for recreation, mortgage recording and tax map verification and other services.
  • $31.5 million less in fines and fees, such as for red-light camera violations.
  • $31 million less in state aid.
  • $21.8 million less in revenue from Nassau Off Track Betting. The county was expected to receive $20 million this year from designated video lottery terminals at Resorts World Casino at Aqueduct Racetrack. Also, betting parlors are closed and the agency's operations effectively have shut down.

Curran said Tuesday she was issuing a memo to all county departments, directing them to find ways to cut costs. Measures will include an immediate freeze on hiring and nonessential purchases, Curran said.

"We've been very disciplined in our spending," Curran said. "We've been holding the line on government growth, holding the line on the number of government positions that we fill."

Asked about the prospect of county layoffs, Curran said: "At this time, I do not, but we're looking at everything all the time."

Ron Gurrieri, president of Civil Service Employees Association Local 830, said in a statement it was, "irresponsible" for Curran "to even consider a cut to our already understaffed essential workforce. Our County employees are putting their lives on the line, providing vital services to the county and they are thanked with the suggestion that they might lose their jobs?"

Gurrieri continued, "This is a thankless gesture from the County Executive and her administration."

NIFA chairman Adam Barsky said Tuesday night: "It's good that the county is trying to assess the financial impact that the COVID response is having on county finances, and it's encouraging to see that they're trying to put a plan together to address it."

"It's a major problem, it's not of the county's doing, this is being experienced by Suffolk and New York City, and New York State. We're at the epicenter of a global pandemic crisis, probably some of the hardest hit areas in the world. It's certainly going to be a setback for them, but it's one that everybody recognizes there's going to need to be federal support, state support, NIFA's going to be here to help support the county in any way we can."

NASSAU COUNTY DEFICIT

Revenue losses include:

• $136.3 million in sales tax receipts.

• $66.4 million in departmental revenue.

• $31 million in state aid.

• $21.8 million in OTB/VLT revenue.

• $9.3 million in special taxes.

• $7 million in rents and recoveries.

• $5 million in permits and licenses.

• $4 million in investment income

Source: Nassau County Office of Management and Budget Report

Past budget deficits

2014 $189.2 million

2015 $125.3 million

2016 $83.1 million

2017 $63.2 million

2018 $61.2 million

Source: Nassau Interim Finance Authority

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