$500.3 million Hempstead budget cuts taxes, uses reserves to maintain services

Hempstead Town Board members approved a $500.3 million budget for next year, cutting taxes and borrowing from reserves to balance the town budget and maintain services.

The Town Board unanimously approved the budget Wednesday night, which reduces the town’s tax levy by $2.5 million from $253.1 million to $250.6 million dollars, town officials said. The budget includes nearly an additional $50 million in expenditures compared with 2021.

The average homeowner is expected to see their annual town property taxes reduced by $10, Hempstead Town Comptroller John Mastromarino said. The tax bill does not account for assessments and fees from special districts.

"A year after working with a bipartisan town board to freeze town taxes in 2021, I am proud to present a town budget for 2022 that slashes taxes, while preserving programs and services for residents during a time where they need it the most," Hempstead Supervisor Don Clavin said in a statement. "In the midst of a global pandemic, we’re providing tax relief, delivering top-notch services and enhancing the quality of life for residents of America’s largest township."

The budget includes $20.5 million in reserves used to balance the budget for the second straight year. Mastromarino said the town has adequate reserves to use for the budget in lieu of raising taxes, which led to its bond rating upgrade by two credit rating agencies.

Hempstead received $133 million last year in federal COVID-19 CARES funding for pandemic-related expenses, based on its population of nearly 800,000 residents.

Town Board members voted to use $70.1 million on payroll expenses for sanitation workers, public safety and other departments they said were essential workers during the pandemic. Town officials said they were told the funding was properly used, but the town’s use of CARE funding is still under investigation in a U.S. Treasury audit.

"No CARES funding was used in this budget and we never budgeted the CARES money," Mastromarino said. "The Treasury guidelines say we can use it to offset public health and public safety payroll. We drew down the money and put it into the rainy day fund and now we’re using it and returning the money to the residents by tapping into it and minimize the impact of our taxes."

Jason Abelove, the Democratic candidate for supervisor, criticized the town for using the funding for payroll expenses rather than for small businesses and first responders during the pandemic.

"They bailed themselves out of a budget mess," Abelove said. "They didn’t help the people they were supposed to help."

Town officials said they reduced taxes this year by cutting $2.5 million in the past two years by slashing staffing positions that went unfilled in the supervisors’ budget. Town officials said the town’s sales tax and mortgage recording tax was also higher than expected.

The budget also accounts for nearly $27 million in federal emergency rental assistance the town budgeted for as income and planned expenses to be distributed this year.

By John Asbury

john.asbury@newsday.comJohnAsbury

John Asbury is a breaking news and general assignment reporter. He has been with Newsday since 2014 and previously worked at The Press-Enterprise in Riverside, California.