Nassau financial watchdog warns county's proposed $4.6 billion budget shows a 'strained' fiscal future

Nassau’s fiscal watchdog group warned that the county’s financial future is “strained” because of what it calls a frowned-upon use of reserve funds to balance next year's budget.

The county plans to use $43.5 million in reserve funds to balance its proposed 2027 budget, a tactic it has turned to before. But the Nassau Interim Finance Authority, the state-run board monitoring the county's budget, said in a report published recently that relying on savings to cover county operations is just a temporary fix that “does not resolve the County’s underlying structural problems.”

It's not just a question of accounting practices; experts have told Newsday that consistently relying on reserve funds depletes counties' money for emergencies, natural disasters or severe economic downturns that could push officials to have to turn to borrowing.

“NIFA continues to have significant concerns about the County's long-term fiscal outlook,” Mohsin Meghji, NIFA’s chairman, wrote in a statement to Newsday.

The county needs to "exercise greater financial discipline if it is going to correct its ongoing economic uncertainty and address long-term liabilities,” he wrote.

The release comes days before lawmakers are expected to hold a final hearing on the budget, which will be immediately followed by a vote. 

 Nassau County Executive Bruce Blakeman, who crafts the county’s budget that eventually requires legislative approval, told Newsday that "it was totally anticipated that NIFA would have something bad to say about the finances of Nassau County" shortly before voters would elect a new governor.

Six of NIFA's 11-member board are appointed by the New York governor, effectively giving them control. 

Blakeman’s proposed budget for 2027 poses a fiscal risk of somewhere between $60.5 million and $145.5 million, according to NIFA. The county’s reserve funds are insufficient to cover its future risks and liabilities, the report said. 

Nassau's proposed $4.6 billion budget does not raise the county’s portion of property tax and accounts for hiring three dozen new police officers. It largely hinges on a crucial revenue stream from sales tax.

Blakeman is expecting next year $1.7 billion in sales tax revenue, historically the county’s biggest source of income, to balance the budget. NIFA said in its report that assuming a county-wide sales tax growth of 2.9% is risky because sales tax fluctuates based on the economy and whether people are spending money. 

Another source of funds for the county is red light camera fees. Nassau is projecting $33 million in red light camera fees for 2027, which NIFA said is unrealistic. Last year, the county got $29.1 million from those fees, the group reported.

Nassau officials stopped charging $100 in extra fees attached to each $50 red light camera ticket after an appeals court ruled them illegal in late 2024. But the county has argued it should not have to reimburse drivers for the illegal fees, which it argues drivers paid "voluntarily." An appeals court has yet to rule on that.

One portion of the county budget that came under fire from Democrats last month was the police department’s plans to go $10 million over budget on overtime spending. Police Commissioner Patrick Ryder said newly hired officers working at a lower pay scale will help bring overtime costs down. In its report, NIFA said it was unclear how much overtime spending would continue to accrue before those officers could graduate from the academy and begin their new roles.

NIFA also took aim at Nassau officials for not cooperating with an audit of the county’s tax assessment system. County officials dodged meeting requests for months, NIFA said in its report, after the group hired a private accounting firm to determine whether Nassau’s property tax rolls were “accurate and equitable.”

Eventually, on July 28, NIFA ordered Joseph Adamo, Nassau’s assessor at the Department of Assessment and Supreme Court Justice Stephen Bucaria, chair of the Assessment Review Commission, to immediately comply with the audit.

“To date, they have not done so,” NIFA wrote.

Nassau's legislature faces an Oct. 30 deadline to adopt the budget. Its budget hearing is scheduled for that day. It will then go to NIFA, which will review and approve or reject the spending plan.