The longer you wait to fix a problem, the worse it gets and the greater the damage. The same scenario applies to a leaky roof or to Nassau County's looming 2011 budget gap.
The speculative budget approved for next year is unsafe for taxpayers. It could put bond ratings at further risk and result in tax increases or draconian cuts in services. But who should execute the fix? Should it be done now or later?
County Executive Edward Mangano doesn't yet have the situation in hand. The Nassau County Interim Finance Authority, the state oversight board, sidestepped a decision last night on taking control. That was the right call. By next week, NIFA should make public its justification for a control period and the urgency for it.
Yet while a NIFA control period isn't the desired solution, it might be the only one.
Mangano's contradictory behavior is eroding confidence in his skills. He alternately claims the budget is balanced and then turns around the next minute to shake his tin cup. His efforts to get concessions from the police unions have been amateurish. He got slapped down by his fellow Republicans when he sought a sales tax increase.
NIFA, which was created for a much greater fiscal crisis in 2000, remains, but with reduced powers. It's clear that state law requires NIFA to take control of the county's finances when there is a substantial likelihood that the budget is out of balance by 1 percent, which amounts to $26 million for next year. While there are estimates that the budget is out of whack by more than $60 million, the law is vague about when the control period is triggered.
A control board would give Mangano the hammer power he needs to freeze wages, reopen contracts and cut staff. Besides, the leaders of the police and civil service unions are reluctant to make any givebacks unless NIFA gives them cover.
Mangano working with NIFA control could be effective. But politically, it's a hit the GOP doesn't want to take in the New Year, when the county legislature is up for election. If Mangano refuses to work with NIFA - or if the legislature refuses to cooperate - NIFA can turn the screws by halting all short-term borrowing, the county's fiscal lifeline.
NIFA has armed itself with a powerful law firm and auditors. Mangano responded by hiring his former law firm. Republican leaders are sending out Comptroller George Maragos to bang the partisan drums and discredit NIFA. What we don't need is an ugly, partisan battle and costly litigation. That's a fight the taxpayer loses no matter who wins.
After Tuesday's NIFA meeting, Mangano said he would partner with NIFA unless he got union concessions. That's a step in the right direction. If NIFA needs to execute a hostile takeover, however, it must make a persuasive case that a control period is urgently needed and justified. A control board actually controlling the county puts us in uncharted waters. But a county executive who finds himself lost at sea would be worse. hN