Report says Mangano budget has $244M in potential risks

Nassau County Executive Edward Mangano's 2011 spending plan is full of uncertain revenue that could lead to a multimillion budget deficit next year, the head of a state fiscal monitoring board said yesterday.

Ronald Stack, chairman of the Nassau Interim Finance Authority, said the level of risky revenue, estimated by NIFA staff at $244 million, is "just not acceptable."

Mangano, who submitted his $2.6-billion budget on Sept. 15, said he took "exception" to Stack's "pronounced judgment."

Mangano said he still is negotiating with union leaders for concessions, and noted that the county legislature still must hold hearings before adopting the budget on Oct. 30.

While the county is expected to end 2010 in the black, NIFA members are worried about next year.

George Marlin, a board member and conservative commentator, said Tuesday: "There is no doubt that Nassau County is on the edge of a fiscal abyss here. I wonder why the county executive has not called this a fiscal emergency," to alert the public to looming financial problems.

"It looks like a fiscal emergency to me," Marlin said during a NIFA meeting in Mineola.

Responding to Marlin, Mangano said his budget "averts a fiscal emergency."

Tuesday, the NIFA board authorized a committee of three members to hire legal counsel to advise the board on its legal powers, and to "guide us on any action that may be necessary," said committee member Robert Wild.

Under the state law that created NIFA in 2000, the agency has the authority to take control of Nassau's finances and freeze union contracts if the county runs a deficit of 1 percent or more. However, a detailed interpretation of its powers as a control board has never been done. Generally, to fill gaps the county has to raise taxes, cut expenditures or raise revenue.

In an effort to close a projected $343-million budget deficit and still hold the line on property taxes, Mangano's budget relies on $61 million in labor concessions he will "order" if union leaders do not agree to givebacks. He also plans to end by 2013 Nassau's guarantee to pay school and town districts' share of property tax refunds because of erroneous assessments; he has proposed borrowing $364 million to pay off future and pending refunds until then.

An eight-page NIFA staff report Tuesday said Mangano's budget "relies on significant state approvals, numerous revenue actions, passage of ordinances by the county legislature, extraordinary levels of unacceptable borrowing for operating expenses, and most importantly, labor concessions that have not been secured."

Said Stack: "Mineola, we have a problem. The budget presented, in my view, is not balanced."

While some of the questionable revenue represent "reasonable risks" by themselves, "as a cumulative number [they] are just not acceptable," he said.

Mangano said he has contingency plans, such as $30 million in land sales or cutting some $69 million in discretionary services, if budget gaps occur next year. He noted that NIFA had approved borrowing by the past Democratic administration to pay tax refunds, while his plan would end the practice.

"Nassau County has hit the wall," Mangano said. "We need to take bold, aggressive, decisive actions."