The Westchester County Board of Legislators will hold its third and final public hearing on the 2015 county budget Wednesday night, as lawmakers continue to prune and graft items onto the original proposal.
County Executive Rob Astorino, a Republican, unveiled his $1.76 billion budget proposal last month, and although it kept the tax levy increase at zero, it was criticized for asking to borrow $8 million to pay for back-tax settlements and deferring $15 million in mandatory pension contributions.
Astorino said the county would pay $76 million of its total $91 million pension obligation but would use a state amortization program that essentially allows a municipality to borrow from Albany for its contribution to the fund, then pay back the borrowed amount with 3 percent interest over a 10-year period.
“In a perfect world, the county would never borrow and pay all its bills in cash,” Astorino said. “But in the real world, you are faced with tough decisions. A $100 million pension bill translates to a 20 percent tax increase or 1,000 layoffs. Neither of those choices is realistic or even possible, so you work with your least-worst options like borrowing.”
When Moody”™s Investors Service downgraded the county”™s bond rating last year ”“ from its highest rating, AAA, to AA1 ”“ it cited “structural imbalances” in budgets from prior amortization as a factor in the decision. Democratic Legislator Peter Harckham, of North Salem, said Astorino “is financing his zero perfect budget with our children”™s credit card.”
“This is poor fiscal management and will create a terrible financial burden for our residents and business owners in the very near future,” Harckham said. The lawmaker estimated that the pension borrowing would amount to an additional $2.7 million in costs through 2026.
Astorino”™s budget proposed to increase spending by $21 million, or 1 percent, from 2014. Savings would come in part from $1 million in overtime cuts to the Department of Public Safety and through staff consolidations, elimination of a position in the clerk”™s office and by not replacing 20 vacant positions. The total headcount in the budget is 4,859, and county employees have an average salary of $77,000, $12,000 more than the private sector average in Westchester.
Staffing costs including pension contributions and $212 million in Medicaid costs continue to drive the majority of Westchester spending, with 83 percent of the budget tagged nondiscretionary payments mandated by New York state.
John Ravitz, executive vice president and chief operating officer of the advocacy group The Business Council of Westchester, said the budget highlighted the need for state lawmakers to “aggressively address” unfunded mandates ”“ but called the plan itself “sound.”
“The budget sends an important message to business leaders that Westchester is on the right track and that the county is a good place to do business,” he said in a statement.
The budget anticipates an increase in sales tax revenue of 4 percent, although mortgage tax receipts are expected to continue to decline ”“ down $4 million, to $16 million, in 2015. Westchester expects its fee revenues to remain basically flat at $150 million.
Although the county tax levy would remain flat under the proposed budget, the impact on individual tax bills can vary by municipality based on assessed property values and equalization rates. The budget only affects county taxes, which make up about 20 percent of an average property owner”™s bill ”“ with 60 percent coming from school district taxes and the remainder being made up of city, town, village and special district taxes.
Legislators are set to vote on their amended plan Dec. 9, at which time it will be sent back to Astorino, who will then either veto items or sign it into law. The county charter requires that a budget be in place by Dec. 27.
Likely to be increased by legislators from Astorino”™s proposal are subsidies to the county”™s child care program and Westchester social services. In addition to the operating budget, the county executive also proposed $256 million in his annual capital budget for work that includes infrastructure repairs to county buildings and roadway work.
