Island Park, Huntington Bay on state comptroller's list of municipalities designated in 'fiscal stress'

Chronic budget deficits placed two Long Island villages on New York's annual list of municipalities designated in "fiscal stress," State Comptroller Thomas DiNapoli said in a report released Thursday.

Island Park, in Nassau County, was one of only three villages across the state listed as having "significant" fiscal stress, the most serious of three categories, the comptroller's office said. Huntington Bay, in Suffolk, was one of four villages "susceptible" to fiscal stress, the office said.

It was the second time in three years Huntington Bay received that designation. The village also made the state list in 2023.

The comptroller's office surveyed 518 villages statewide whose fiscal years ended between Feb. 28, 2024, and July 31, 2024. Nine villages, including Island Park and Huntington Bay, were deemed to have some level of financial stress due to poor budgeting, the report said.

“The number of local governments with a fiscal stress designation remains low following several years of emergency federal pandemic aid that helped stabilize their finances,” DiNapoli said in a statement. “With that aid coming to an end and uncertainty coming out of Washington on state and local funding cuts, local officials should closely monitor their financial condition so they can be prepared for any financial challenges that lie ahead.”

The comptroller's office considered factors such as villages' year-end fund balances, short-term cash-flow borrowing and operating deficits. The office also weighed other economic indicators such as population trends, poverty and unemployment in each community.

The comptroller's office gave Island Park a score of 81.7 out of 100, where a high score indicates significant fiscal stress.

The report said Island Park had a 2023-24 deficit of about $700,000, or about 12%, on an annual budget of $5.84 million. 

Mayor Michael G. McGinty said Thursday he was not surprised by the report, adding the village has taken steps in recent years to improve its financial condition.

The village is raising taxes by 7% for the second year in a row, McGinty said. The village also has trimmed expenses such as payroll and overtime, and cut sanitation collection from three days a week to two.

“We have cut expenses, we have increased revenues and, yes, we have increased property taxes,” he said, adding the tax hike equates to less than $100 for the average household. "We are a blue-collar community. As a result, $100 is a lot of money.”

Huntington Bay's fiscal stress score was 52.5 last year, DiNapoli's office said. The village had a 2023-24 deficit of about $67,524, or 2.7%, on an annual budget of $2,515,403, the report said.  

Mayor Mark Dara said Thursday he inherited the deficit when he was elected last year to replace former Mayor Herb Morrow.

Morrow said two years ago that he was under investigation by the Suffolk County District Attorney's Office for allegedly using his village-issued credit card for non-village expenses. 

Dara said the district attorney's investigation is ongoing. A spokesperson for District Attorney Ray Tierney did not return an email seeking comment Thursday.

Dara said the village board has passed a 15.75% property tax increase that will raise taxes on the average home by about $350. He said the tax hike faced little opposition because residents understood the need to balance the village's $2.8 million budget.

“I tightened up a lot of things. … We did everything we could. At least now we have a positive cash flow,” Dara said, adding he anticipates a surplus of $45,000.

By Carl MacGowan

carl.macgowan@newsday.comCarlMacGowan

Carl MacGowan is a Long Island native who covers Brookhaven Town after having previously covered Smithtown, Suffolk County courts and numerous spot news and feature stories over his 20-plus year career at Newsday.