NIFA approves Nassau County's $3.3B budget for 2021

The Nassau Interim Finance Authority on Thursday approved Nassau County Executive Laura Curran's $3.3 billion budget for 2021, but required the county to work quickly to develop a plan for dealing with deficits projected to balloon over the next four years.

NIFA directors approved the budget in a 4-1 vote, with board member Paul Annunziato dissenting. The approval comes with the rare requirement that Nassau officials develop a "contingency plan" to deal with the loss of sales tax revenues in 2021, and future deficits, by March 31, and every three months thereafter.

Even with a refinancing plan set to take effect and save $435 million over the next three years, the county could face an $111.2 million deficit in 2021, $137.3 million in 2022, $285.7 million in 2023, and $359.7 million in 2024. NIFA made those projections in an October report.

"This plan right now isn't a plan. It lacks any initiatives to address those out years," Annunziato said. "In short, my conclusion of the county's budget, it is nothing more than a plan that says, let's delay and hope. Let's hope sales tax skyrocket much greater than what we've projected. Let's hope that the federal government gives us some relief."

Approval of Curran's 2021 budget follows weeks of negotiations among Republican county legislators who were at odds with the plan backed by Curran, a Democrat, and NIFA officials, who wanted authority to refinance the existing county debt.

NIFA had held off on approving the budget because the 15-year refinancing was key to balancing Curran's budget.

NIFA's plan to refinance its own debt, and county debt, will result in $435 million in savings for the fiscal years 2020, 2021 and 2022.

Until Monday, Republican lawmakers had refused to back legislation granting NIFA that authority, concerned that refinancing would extend the life of the control board for decades. With the authority in limbo, NIFA had delayed its approval of Curran's budget, which needed the panel's signoff by year's end.

"This is a budget that is being balanced based on the restructuring of existing NIFA and county debt that will provide more than $400 million in financial relief. By doing this we were able avoid a massive property tax increase and cuts to critical services for those most in need," NIFA chairman Adam Barsky said in a statement Thursday. "This remains a short-term extraordinary measure to address the unprecedented impact of the global pandemic. There still exists a longer-term structural imbalance that must be tackled sooner rather than later."

The deal to refinance was struck Monday after the county legislature approved Republican-backed legislation establishing a "special revenue fund" for excess sales tax receipts. Presiding Officer Richard Nicolello (R-New Hyde Park) said county officials were "excessively pessimistic" in their budgeting, and as such, proposed the fund as a way to give tax challenge refunds to businesses. The fund can also be used for "other uses," including for "various good government purposes," Nicolello said Monday.

NIFA officials approved several other measures Thursday:

• An 8 1/2-year agreement between the county and its Superior Officers Association.
• A $439.4 million contract with Western Bay Constructors to begin a massive public works project that aims to divert sewage out of Reynolds Channel and into the Atlantic Ocean.
• A $122.1 million project to build a land mobile radio system for the Nassau County Police Department.
• A proposed sale of cash flow notes, for $370 million. The county, battered by the loss of sales tax receipts due to the coronavirus pandemic, plans to borrow $70 million more than in December 2019 to cover budget shortfalls.

By Scott Eidler

scott.eidler@newsday.com@ScottEidler

Scott Eidler is a deputy editor for the towns department at Newsday. Scott has worked at Newsday since 2012 and previously covered municipal government and education.