Nassau County is a fiscal mess.
The projected deficit using Generally Accepted Accounting Principles (GAAP) over the next four years is almost $1 billion.
That doesn’t include the roughly $700 million backlog of unpaid tax certiorari refunds, and estimated liability for claims and litigation.
The largest revenue source for Nassau is sales tax, and that isn’t growing.
Because of this, fees and fines have been increased to generate revenue; in Nassau, they are among the highest of any county in the state.
To make matters worse, a recent survey of Long Island’s CEOs showed only 5 percent thought local governments do a good job, and none do an excellent job.
Going forward Long Island’s economy is projected to grow at half the rate of the rest of the nation.
Here’s why: wages are decreasing towards the national average because most new job growth is in the lower paying service sector; and, there isn’t a decent supply of affordable housing.
On a larger scale, our national economy is in for a bumpy 2016, which will also negatively affect Long Islanders.
The depression of crude oil prices to around $30, though good in the short-term for the American consumer, is horrible for the world economy.
All 12 OPEC nations, along with Russia, Brazil and Norway are primarily dependent on oil revenue to balance their budgets.
With prices this low, these oil producing nations have been forced to find other ways to raise revenue and balance their budgets, and they are now selling any asset that’s liquid, such as stocks.
That means the stock market will get pounded all year, and U.S exports will slow unless oil prices miraculously firm up.
This slow slide towards a financial abyss needs to be mitigated here on Long Island with some creative thinking and prudent planning.
Here are some things we can do:
· Combine industrial development agencies (IDAs) from Nassau and Suffolk into one regional Long Island Authority, and work out a fair formula so each government entity contributes according to its past history.
If government is going to use the IDA and taxpayer funding to attract new business, the power of Nassau and Suffolk working together should be used to attract world-class companies to Long Island.
· Build up tourism and unique events across Long Island.
This would help attract and retain millennials, enabling the region to grow for years to come.
According to nycgo.com, in 2014, NYC attracted 56.5 million visitors, spending $41 billion, which saved taxpayers almost $1,800 per household in taxes.
These tourists are right next door, and there’s every reason for Nassau to become part of their travel itinerary.
· Speed up the permitting process so affordable housing can be built near mass transit.
If there is no affordable place to live then the local economy will continue to suffer.
Think of it as creating a farm system of future buyers of expensive Nassau County homes.
Developers will quickly deploy capital, creating good paying jobs and desperately needed tax revenue if government gets out of the way and let’s them operate in a timely fashion.
· Streamline local government looking for efficiencies. There are always new technologies being developed to help organizations run better, faster and cheaper. Incorporate suggestions from county employees, who know first-hand where improvements can be made and savings can be found.
Municipalities’ financial burdens of increasing wages, pension and health care costs will not change.
The only way to mitigate these costs and increase revenue is for government to plan long-term for a brighter future.