NIFA changed the accounting equation, adds Sullivan, the deputy county exec. The panel no longer found it acceptable to list the proceeds of bonds floated to pay for property tax refunds as operating revenue, as had been done in prior years—ripping an annual $100 million hole in the budget that NIFA demands answers for. Had NIFA counted the bonds—borrowed money—the same way it allowed under Suozzi, Mangano argues, along with other revenue streams accounted differently now, the agency would have no justification for such action—and they still don’t.
“Because of a stroke of a pen, a change of a policy, we would have to raise taxes 22 percent?” he asks. “All of these revenue things that are in that 176 [million] were accounted in the past, even more.”
Historically, Nevin and Mangano explain, the county legislature would unquestionably approve requests by the county executive for additional bonding for tax assessment refunds in the legal process known as tax certiorari—though the practice, since proceeds are non-reoccurring revenues, was frowned upon by NIFA. Such borrowing requires approval from a supermajority of the legislature, 13 of the 19 members, meaning supporters from both parties. This time around, however, charges Nevin and Mangano, those monies—to repay taxpayers who’ve wrongfully been charged too much on their property tax bill—are being held hostage by Yatauro, in a move Nevin calls, the “Yatauro Back Peddle” or simply, “Flip-Flop,” evident in her own correspondence, he says.
They contend she promised her side’s support, then flaked out and responded negatively to the idea when pressed by NIFA during a conference call among the three parties. In NIFA’s eyes, that meant the funds were “at risk.”
“Today County Executive Mangano and I reached a bi-partisan agreement with respect to handling the review and funding of tax refunds,” she writes in an Oct. 20 letter to Nassau County Comptroller George Maragos, Mangano and Schmitt. “Both the county executive and I have pledged to work together, share information in a timely fashion and reach agreements throughout 2011 for a level of bonding as warranted.”
Then in a letter dated Jan. 21, days before NIFA’s takeover decision, she wrote: “I feel this is necessary as there seems to have been some confusion or misunderstanding of our intention as reflected in the statement which the county executive and I released on October 20, 2010 on this issue… No set amount of bonding is being agreed to at this time but rather, as we agreed to on October 30, only a level of bonding which is ‘warranted,’ as we in the Legislature using our collective judgment determine at that time, will be authorized.”
At the heart of Mangano and his team’s fervor is their adamant belief that the county’s 2011 budget is in fact balanced, with a surplus, though modest, anticipated for 2010 of at least a few million dollars. Additionally, they question why NIFA didn’t wait until at least the 2010 sales tax receipts were in before taking such a drastic and damning step in declaring a control period.
NIFA can’t do anything that would actually help rectify the county’s fiscal problems during this “control period” anyway, complains Nevin, proof the takeover was all a sham—the most they could do is freeze union wages, but only if they enact a “fiscal emergency,” a small drop in the bucket compared to the savings he and his team say they have orchestrated through restructuring and recent concessions with Nassau’s largest union, the Civil Service Employees Association Local 830, valued at $70 million through five years. Although even that agreement, which would have brought in about $2 million the first year, is now on hold because of the NIFA action.
Getting down to the nitty-gritty, Nevin alleges that the NIFA board members are suspect, consisting of former Suozzi cronies, such as Tom Stokes, the board’s lone Republican, who “helped create the current mess” as Suozzi’s budget director.
“[Stokes] oversaw the $133 million deficit that the county executive inherited upon taking office,” Nevin explains.
“That was Stokes’ budget. He prepared that budget. Stokes was here when those labor contracts were signed. NIFA was the oversight board when these labor contracts were signed. And none of that is being reported, that we see. And it should be concerning. I mean, the architect of Nassau’s deficit and labor contracts is now its watchdog. I don’t think you could think of anything crazier than that.”
Nevin pointed out that Marlin, the board’s Conservative Party member and accomplished author who’s also former CEO of the Port Authority of New York and New Jersey, has no love for the Nassau County Republican Party or its chairman, Joe Mondello.
NIFA board members would not comment publicly for this story when contacted by the Press, citing the county’s pending litigation. Democratic Party Chairman Jay Jacobs, however, rebuked the charges categorically.
“How do you malign George Marlin?” he asks. “The guy headed up Conservatives for Mangano, for crying out loud. He was good then, but now, because he votes against Mangano’s ridiculous budget, all of a sudden he’s an evil man who’s ‘ethically challenged’? And Chris Wright—he hasn’t been connected with the Democratic Party in any capacity in nearly a decade! How powerful am I that I managed to get all the members to vote unanimously?”
Mangano is steadfast in his convictions.
“There’s a political agenda to make certain that this administration, an administration supported by the Tea Party, fails in its mission to bring tax relief to the people of Nassau County,” he maintains. “It’s been said and rumored in other circles: ‘All you have to do, Ed, is put in a tax increase, and these people go home.’ Democrats will be happy; they have their issue to malign this administration and run against the legislature in a very important year, which is a redistricting year. That’s what’s occurring.
“If you believe that there is no politics in play, then I’m sorry, you’re awful naïve, because the fact of the matter is, we’re ending with a surplus. There should be no drumbeat of this. The prior administration had much more grave problems in their budget years. That board said, ‘Everybody come together,’ and urged the legislature to work together. Not one peep to work together here. When I offered to get together and try to work with them, they said, ‘No, we have to enact a control period first.’”
NIFA, obviously, sees it differently.
Tags: Arps, Brian Nevin, Christopher Wright, Civil Service Employees Association Local 830, Cover Story, Democratic Party, Desmond Ryan, Diane Yatauro, Ed Mangano, Eden Laikin, featured, featured-scroll, George Maragos, George Marlin, Howard Weitzman, Jay Jacobs, Joe Mondello, Joseph Kearney, Judith Kaye, Judy Jacob, kadden, Leonard Steinman, Long Island politics, Meagher & Flom LLP, Nassau County, Nassau County Industrial Development Authority, Nassau County Interim Finance Authority, New York Court of Appeals, NIFA, Patrick Foye, Peter Schmitt, politics, Radler, Republican Party, Rivkin, Robert Wild, Ronald Stack, Slate, Tea Party, Thomas Stokes, Tim Sullivan, Tom Gulotta, Tom Suozzi