Good news: It appears Nassau overstated last year's budget deficit

Now that Nassau's financial control board has agreed to refinance $1.4 billion (BILLION!) in county debt to provide County Executive Laura Curran with $285 million in upfront "budget relief" this year, lets look at the accuracy of Curran's budget forecasts.

In a report issued Dec. 21, her budget analysts  predicted the county would end 2020 with a $385 million budget deficit, including a $261.7 million drop in sales tax revenues.

There's no doubt sales tax collections plummeted when Gov. Andrew Cuomo shut down New York's economy last March in an attempt to slow spread the spread of the coronavirus.

But then sales taxes collections began inching up again as the economy slowly reopened.That led Nassau legislative Republicans to predict the sales tax decline would not be as bad as the 20 percent drop forecast by Curran's budget seers.

Curran, a Democrat,  and Nassau Democratic legislators, however, were not so optimistic and rejected spending changes for this year proposed by Nassau Republicans.

The Democrats may have been too pessimistic.

The legislature's independent office of budget review on Jan. 4 reported Nassau had collected $1,094 million in sales taxes by then for 2020.

That is a 4.7 percent decline for the year -- not 20 percent.  And Nassau is expected to collect more sales tax revenues attributed to 2020 through mid February.

OLBR reported the 2020 sales tax collections were already $71 million higher than Curran budgeted for 2021.

The report notes that Curran's budget office projections of 2020's sales tax collections  "appear to be severely understated." 

                                                                     

Legislature's Office of Budget Review Jan. 4 report

History repeats itself. 

Curran's Office of Management and Budget in Dec. 21 of 2019 predicted that Nassau would end 2019 with a small budgetary surplus of $215,823.

Guess what? It turns out they were off by more than $76 million.

Ten days after Curran's budget office predicted a small $215,823 budgetary surplus at the end of 2019, the county ended 2019 with a $76.8 million surplus as calculated by the Nassau Interim Finance Authority, the county's financial control board. And NIFA excludes revenues that are allowed to be part of "budgetary" surpluses.

But nobody said a word about the discrepancy.

It might explain, however, why Hempstead Town, which has an experienced controller overseeing its budget, was able to convince the federal government to give the town $133 million in federal cares act money while the county got only $103 million.