Matters of Money By Daniel G. Mazzola, CFA, CPA, CFP
We as American citizens have a tendency to pay more attention to our national issues than state and local matters. This is unfortunate, because while issues at the federal level may seem more compelling, state and local issues are just as relevant (if not more so) and are concerns for which we as individuals have a greater ability to exert influence. There is little one can do regarding our government’s foreign policy in the Middle East or the Federal Reserve’s quantitative easing strategies, but the average citizen can attend a town meeting, voice his opinions and be heard by locally elected officials.
While political activism is important at any rate, our efforts on the state and local level are likely to have a larger impact. Our nation has a long history of states and municipalities leading the way on issues from child labor to legal abortion to women’s suffrage. State and local advances provide the foundation for political change and which in turn give hope and momentum to other movements begun on a small scale.
Leaders are apt to use examples of local successes when they introduce legislation at the national level. We also participate in the local political process by voting for county executives, town supervisors and other representatives who share our concerns and work to encourage community development.
We obviously want virtuous people to run the country - we must introduce these individuals to the public at large by voting them into local offices. As they move up onto the national scene, these high standards hopefully will accompany them. When men and women of moral rectitude hold government office at any level, their noble qualities permeate the entire political system, to the benefit of us all.
This coming November elections will be held for a variety of local positions including Nassau County Executive, Town of Oyster Bay Supervisor and Nassau County Comptroller. As residents of Massapequa, we have a right and a civic duty to vote for candidates for these offices. Ed Mangano is seeking re-election as County Executive. He is a Republican running on a platform of reduced taxes, the promotion of an inviting business environment and controlled government spending.
One of our County Executive's first actions upon taking office four years ago was the repeal of a 2.5% home energy tax implemented in June 2008 and imposed on all residential energy sources, including LIPA electric, oil, natural gas and even firewood. A levy of this kind is the worst type of regressive tax in that it disaffects the poorest of Nassau County’s residents. Mr. Mangano dismissed the 3-year 13% property tax hike proposed by his predecessor, Thomas Suozzi, and has been diligent about not raising property taxes throughout his tenure. Whether our CE's policies alone have fostered job creation is open to interpretation. Initiatives that reduce government spending may result in loss of public service jobs, and the county workforce is already at its lowest levels in decades.
Private sector employment rolls, however, have increased. According to the County website (http://www.nassaucountyny.gov/), Mr. Mangano and his economic development team have created 19,000 private sector jobs in homeland defense, manufacturing and television/movie production industries, and the May Nassau County unemployment rate of 6.1% [compared to the state level of 7.6% and the national threshold of 7.7%] supports the claim that his administration maintains an attractive climate for business.
In an attempt to rein in spending, our County Executive effectuated a plan to consolidate Nassau County’s police precincts and to eliminate 108 mostly administrative positions, suggesting the plan would save the County $20 million annually. The Nassau County Police Benevolent Association was sharply critical of the plan when first announced, and has taken every opportunity to alert residents to the subsequent “rise” in crime. A Newsday story published in April 2013 found that major crime had increased by 5.6% in the former 3th and 6th precincts, two of the bases that were closed. Police Commissioner Thomas Dale swiftly blasted the report, stating that “Newsday ignored other metrics that show improvements in the crime rate.” Deputy Commissioner Thomas Krumpter asserted that an overall low crime rate makes quarterly statistics easily affected and therefore misleading: “It doesn’t take a lot to spike our numbers. Two guys do 26 robberies and that spikes robberies.” The question of whether a change in the composition of the police force diminishes the safety of residents is best answered by those directly impacted by the consolidation, and they should vote accordingly in the upcoming election.
In another controversial move designed to lower the county’s tax bite, Mr. Mangano ended the County’s commitment to towns and school districts obligating it to share in tax certioraris, i.e., payments made to residents when they can prove they have been overtaxed. School districts and villages are now responsible for paying off their proportional share of future property tax refunds. Mr. Mangano affirms the guarantee harmed homeowners in districts with a small commercial property tax base because their county taxes pay refunds for excess tax collected by other districts with a large commercial base. (Commercial cases account for 83% of refunds) School Board leaders vehemently opposed the measure, asserting the problem was the result of assessments conducted by the County, so the responsibility for refunding incorrect assessments lies with the County. While the action will save the county millions, it will not reduce an individual’s respective property tax levy, simply moving it to a different tax bill. Furthermore, the problem of inaccurate assessments leading to grievances and tax certiorari payments in the first place has not been remedied. Nevertheless, Nassau was the only county in the state burdened with such a guarantee, which left it obligated to refund money it never claimed nor intended to spend.
There is only so much any elected offial can do to fulfill their duties to constituents without major changes to county government and the ways its conducts its activities. Public service workers, whether union or not, are reluctant to acquiesce on wage and benefit concessions. Even with the elimination of hundreds of employment positions, there are wide gaps between revenues received and expenses for government services, the lion’s share of which is the form of salaries and health/retirement benefits.
Mr. Mangano and the County’s increased reliance on borrowing, optimistic sales tax revenue projections to cover tax assessment settlements, termination pay and normal operating expenses has been met with criticism: “Borrowing in not Governing” states Nassau County Interim Finance Authority member Leonard Steinman. Yet for a county that is already one of the most heavily taxed in the country, Mr. Mangano’s resistance to raising taxes is admirable, even if it results in an increased workload for employees. All residents must realize that sacrifices must be made to compensate for past failures of elected officials, both Republican and Democratic, to face up to tough economic realities in a responsible manner.
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