Last October while the world was just beginning to feel the effects from the Wall Street collapse, Nassau County legislators grappled with a potential budget shortfall and responded with nearly $30 million of spending cuts. These included drastic reductions in social programs and the elimination of staff salary increases. We reduced sales tax growth projection to nearly zero.
Throughout the fall and winter months, financial institutions tumbled in the face of mounting bad economic news. From reliable sources we heard our 2008 sales tax revenue was coming in well below anticipated numbers. We also began to hear projected revenue numbers for 2009 could create a $150 million hole in our county budget.
By February it was obvious that our planning was overshadowed by a deepening recession. A creative approach was needed. We knew the only way to close the budget gap and restore stability was through cooperative discussions between labor and management with both sides finding a mutually acceptable compromise.
County Executive Tom Suozzi, the person responsible to manage our county budget, proposed a three-pronged approach to fixing the projected budget gap.
The first step had to do with federal aid. We sought and eventually received a commitment to receive federal stimulus dollars in the form of Medicaid assistance. The anticipated budgetary relief for our County is in the $30-$40 million dollar range.
The second step involves gaining state authorization to impose a cigarette tax, surcharges on traffic/parking tickets, and to install red light cameras at high accident intersections to penalize drivers who run red lights.
Once approved this new revenue source will add some $30 million to our county income.
To emphasize the urgency for these legislative items I led a delegation of my colleagues to Albany to discuss first hand with state lawmakers how critical it is that these three bills pass in the Legislature. The trip was a total success. Thanks to Deputy Assembly Speaker Earlene Hooper and State Senator Craig Johnson we were able to meet with Speaker Sheldon Silver and Senate Majority Leader Malcolm Smith. We met with several members of Nassau County's Assembly delegation, as well as Senate Minority Leader Dean Skelos. Our requests for help were well received. Our direct approach seems to have been the right approach. We remain hopeful that our legislative initiatives will be passed.
The third component of the County Executive's proposal involves negotiating for concessions from the unions which represent our workforce. We, the elected officials, remained focused on the goal of realizing $45 million in labor savings. The County did achieve that goal through a negotiated lag payroll where workers will defer two weeks pay until they leave county service. Also negotiated successfully was an early retirement incentive which will serve as an inducement for over 300 public employees to retire before July 1st. All told, labor concessions could save us close to $45 million.
The current economic challenge has shown what government leaders can do when faced with an unforeseen crisis. We did not react to the threat of a massive budget gap by raising property taxes. Nor did we put our collective heads in the sand. We worked together, we negotiated in good faith; we stayed focused. Together with our state lawmakers and union leaders we are making the tough decisions.