Faced with a $50 million deficit as a result of having to finance nine state mandates, along with the loss of sales tax revenues and other sources of county income, Rockland County Executive C. Scott Vanderhoef last week said he will have to shut down or merge several programs.
At a news conference July 26, Vanderhoef said the Displaced Homemaker Guidance Center will close in September, the Department of Mental Health”™s community day treatment program will close, the prenatal program run out of Nyack Hospital will be wound down; and the merger of the Haverstraw Clinic to Pomona to save on rent are among the programs that will be affected.
A hotel bed tax, something the Rockland Business Association fought against vigorously, is another means to achieve some revenue, he said.
With the cuts Vanderhoef is proposing, as well as the revenues he is hoping the county”™s Legislature will approve, will save Rockland $22.7 million, still short of its goal ”“ but a start, said Vanderhoef. “A good portion of this money would be put on a separate deficit line.”
Standard & Poor’s Ratings Services recently lowered its long-term rating and underlying rating on the county”™s general obligation debt two notches to BBB+ from A.
“We believe management will need to make swift, and perhaps unpopular, decisions to restore fiscal stability to the county and replenish reserves, especially in light of fiscal 2010 projections. The county”™s future credit direction will depend on management”™s ability to create and implement a realistic plan to restore balance to the budget since financial flexibility has diminished,” Standard & Poor”™s credit analyst Danielle Leonardis said in a statement.
“That”™s called ”˜bingo,”™” said Vanderhoef. “Not because they said it, but because we need to do it.”
In the race to replace revenue loss, said Vanderhoef, “We took an extra effort to underspend the budget, despite the effort over the past two years to cut it by almost $44 million, we still have losses that bring our deficit to nearly $50 million. The race has been ongoing, but we are losing it against the economy and loss of sales tax, mortgage tax and property tax revenue.”
Rockland expects its Medicaid bill to go up to $2.6 million in 2012. “Just the Medicaid program is double the tax cap by which we are bound by the new law. We can”™t change the mandates, which are 73 percent of our budget, so we are working with the 23 percent of the budget we have control over.”
Ultimately, with the cuts in services, elimination of programs and consolidation of services will ultimately see Rockland in the black by 2015, he said.
Vanderhoef slammed the county CSEA, which is proposing a 4 percent each year increase over the next four years. “It”™s an outrage,” he said.
“I have been saying the county has been on an unsustainable path for years,” said Al Samuels, president of the Rockland Business Association, just named to the Mid-Hudson Empire State Development regional council. “We didn”™t cut back on the entitlements we gave. It was noble to want to help so many people but we hurt the county in the long run. We can”™t continue to do it.
“I support the county executive in his quest ”¦ particularly in regard to the bed tax. As long as he keeps it at the same level as the counties surrounding us (three percent), I have no reason not to ask our hotels and motels to agree. Rockland”™s in trouble. It”™s time to get ourselves out of it.”
