North Hempstead Deputy Supervisor Joe Scalero said at the time of the 2023 tentative budget’s preparation that the general fund reserves were overfunded to a level of over 30% and the Town Outside Village fund reserve was in excess of 40% of the fund budget during his budget presentation Thursday.
The North Hempstead Town Board held its first budget workshop on the morning of Oct. 13. The workshop primarily consisted of Scalero providing major highlights on the 2023 tentative budget while answering questions from all members of the board.
In 2011, the town board enacted a fund balance reserve policy for the town’s general fund, requiring the town to maintain a fund balance reserve that is at least 10% of the town’s total general fund budget for the year.
“We’re well in excess,” Scalero said. “You may get to a certain point where you’re basically overtaxing residents with the intention of putting money aside in excess of what you need.”
On Oct. 11, Supervisor Jennifer DeSena called for an 11% tax cut to be included in the $158.4 tentative budget for 2023 she had previously proposed.
DeSena said the town’s current reserves are at least $26 million, well in excess of the minimum set by the town board in 2011.
Scalero clarified that some bond rating agencies recommend larger reserves in case a municipality defaults on its bonds.
“We are in excess of what both are required of us by our own policy, and what’s recommended by bond rating agencies,” Scalero continued.”We can spend some of that money by reappropriating it into the budget, reducing our tax burden on the residents and still have very healthy fund reserve balances.”
Scalero said if the tax cuts amendments are kept in the adopted budget in November, the general fund reserve excess would drop to 23.5% and the Outside Village Fund would still be in excess of 41.3%.
DeSena previously said the proposed amendment would lead to approximately a $33 decrease per household for the general fund and keep the tax levy flat for the Town Outside Village Fund.
In the town’s $89,098,154 general fund for the original budget, $40.5 million was allocated to the outside village fund, which covers services for residents who live outside incorporated villages, and $28.8 million for the 20 town-operated special districts, which set their own budget.
The Town Outside Village Fund Tax Levy was previously increased from $27,970,865 to $28,874,137 in the original budget, a 3.22% increase that would increase taxes on the household by $28.88 according to town officials.
The seven-member Town Board was scheduled to conduct one more public work session at town hall on Oct. 20 at 7 p.m.
The Town Board is permitted to make changes and amendments during this period, if necessary, and will have a public hearing on Oct. 25 at 6 p.m. when the tentative budget will become a preliminary budget.
A final special meeting is scheduled for Thursday, Nov. 3, when the board will vote to adopt the budget. North Hempstead’s Town Board has routinely adopted the town budget before Election Day., which this year is Nov. 8.