NIFA Issues Control Period on Nassau County

Nassau County is now a ward of the State of New York.

The six member Board of Directors unanimously voted Wednesday afternoon to issue a control period for the county’s finances after the state watchdog determined that Nassau’s budget will reportedly run a deficit of approximately $176 million in the 2011 fiscal year.

The amount is more than the one percent necessary to trigger a control period, or $26 million of the .

County Executive Ed Mangano had recently for his 2011 budget, but NIFA Chairman Robert Stack said the budget “does not meet the standards necessary to project… balance.”

Stack said that the announcement of a –the CSEA–had not been reviewed or submitted to the NIFA board before the decision was made. Stack added that Mangano had been invited to the meeting Wednesday but was not apprised of the vote or decision.

In his stead, Mangano sent County Attorney John Ciampoli, who said that the county would review the 30-page documented decision made by the NIFA board and that a decision would be made regarding a lawsuit to stop the takeover of the county because the statute establishing NIFA has never been tested in court. The unions are expected to join in the suit against NIFA.

NIFA can bring only $10 million in relief by halting the annual step increases to union employees, minus the costs of its legal fees. It can also halt the county from issuing short-term bonds, known as revenue anticipation notes (RANs) and tax anticipation notes (TANs) which are paid back once money from sales and property taxes, respectively, are received.

A freeze on bonding would leave Nassau with few options to make up the lost revenue, either layoffs–extremely difficult with union members due to a no-layoff clause that expires at the end of the year–or to raise taxes, a notion Republican legislators–who are up for election this year–have vowed will not happen.

“There is clearly another agenda at play here,” Legislative Majority Leader Peter Schmitt, R-Massapequa, said Wednesday afternoon.

When questioned about both the existence of a deficit in Nassau’s finances in prior years and under previous administrations Stack denied that the timing of the issuance of a control period was political in nature.

At a press conference following the vote at the , Mangano disagreed, saying that the move was in fact political and an attempt to discredit him and his administration in an election year by forcing the county to raise property taxes.

“(Residents) should question (NIFA’s) motivations,” Mangano said. “It’s to discredit the administration, the purpose of the administration, the purpose of the legislature and the pledge that we have made to the people of Nassau County which is clearly we will not be raising real property taxes in this economy.”