Written by George J. Marlin, Director Nassau Interim Finance Authority Friday, 25 May 2012 00:00
Throughout my career, both in the public and private sector, I have supported private-public partnership projects that truly benefit the general public and do not rip-off government sponsors, ratepayers or taxpayers.
For instance, in 1996, as executive director of the Port Authority of New York and New Jersey, I initiated what was at that time the largest privatization project in New York public finance history—the $1.2 billion privatization of JFK’s International Arrivals Building. The old I.A.B., which was owned and managed by the Port Authority, was a public embarrassment. The new building, which was built by private developers and is managed by a renowned professional corporation, is a model for airports throughout the nation.
On May 3, 2012, the county announced a so-called debt reduction and sewer stabilization plan. The first paragraph in the press announcement contained this false statement: “The plan also stabilizes Nassau County’s Sewer Authority which is set to face bankruptcy in 2014, as warned by the Nassau County Interim Finance Authority (NIFA) in an October 2009 report.” NIFA never made such a statement.
Actually, this dubious claim was made by County Executive Mangano and was confirmed by Deputy County Executive Walker. The March 18, 2012 issue of Newsday reports that Mangano said: “I inherited a bankrupt sewer district….” The March 19, 2012 issue of Newsday reported: “Deputy County Executive Robert Walker told Newsday that the county’s Sewer and Storm Water Finance Authority is supposed to be bankrupt by 2014.”
I recommend the county read the official statement of any Nassau County Sewer and Storm Water Finance Authority bond offering; particularly the section, “Security For the Bonds” which states:
“The County and the Authority (as a Covered Organization), pursuant to the statute governing NIFA, are prohibited from filing any petition with any United States district court or court of bankruptcy for the composition or adjustment of municipal indebtedness without the approval of NIFA and the State Comptroller, and no such petition may be filed while NIFA bonds or notes remain outstanding.”
Hence, the county’s claim is nonsense. It is a red-herring.
As for the county’s so-called “Debt Reduction Plan,” in my 35 years as an investment banker, I have never come across such an ill-conceived plan. It is an example of bad public finance and if implemented will give private-public partnerships a bad name.
The county expects to select a private investor who will finance $850 million to pay down existing low interest cost tax-exempt sewer debt and county debt. This is a form of backdoor borrowing. Potential financial investors who invest money to Public Private Partnerships (P3s) expect annual returns of 10 percent to 15 percent. To suggest that a private operator will achieve enough efficiencies to cover most of that cost and that assessment or user-fees will increase no more than the rate of inflation—well, anyone who believes that, I have a coliseum in Hempstead I would like to sell to them. (It is my understanding that the Goldman Sachs P3 fund passed on this deal. I can appreciate why.)
To use such costly funds to pay down low interest tax-exempt county and sewer debt makes no sense. This would be like drawing down the credit line on one’s VISA card at 15 percent interest per year to pay down one’s home mortgage, which has a 4 percent annual interest rate. Sheer folly!
Contrary to press release claims, this deal will not be a win-win. The big losers will be Nassau’s non-profits (e.g., North Shore Hospital), commercial real estate owners and homeowners. They will be the big losers because their toilet flush fees (a/k/a taxes) will be overflowing.
Therefore, because in my professional judgment the Sewer-Debt Plan is an ill-conceived backdoor borrowing scheme, I will oppose the approval of the Morgan-Stanley contract.
Friday, 06 December 2013 00:00
Howard Kroplick was just settling in to his new position as North Hempstead’s town historian in April of 2012 when a phone call from a resident who found an old headstone led him into a comprehensive study of all 28 cemeteries within
the town’s boundaries.
Kroplick, an East Hills resident for 29 years, serves in the unpaid role as an advisor to the North Hempstead board, out of his longtime love of history. His exhaustive study of the area’s cemeteries has helped him complete a history of
North Hempstead that will be published in January, which will coincide with the 400-year anniversary of the discovery of Long Island, by Dutch explorer Adriaen Block. It was Block, according to Kroplick, who first identified Long Island as an actual island, not a peninsula as many believed back then. The 128-page book from Arcadia Publishing is the first ever written about North Hempstead.
Thursday, 05 December 2013 00:00
For the time being, much of the Roslyn area is without representation on the Town of North Hempstead council. Recently, Thomas K. Dwyer, who has represented Roslyn on that body since 2002, announced that he would step down from the board while he is in negotiations with a Manhattan-based consulting firm.
Dwyer, who is the chief operating officer of Syosset-based American Land Services, would not identify the firm he is talking to, but he said that the new job would represent a conflict of interest with his work on the town board.
Thursday, 14 August 2014 00:00
SUNY College at Old Westbury recently named Dr. Anthony DeLuca of Levittown as the College’s NCAA Faculty Athletics Representative (FAR), beginning at the start of the 2014-15 academic year.
DeLuca, now entering his third year at Old Westbury, also holds the position as director Old Westbury’s Honors College.
“We are thrilled that Dr. DeLuca will serve as Old Westbury’s Faculty Athletics Representative,” said director of athletics Lenore Walsh. “He is a champion for intercollegiate athletics and has been involved with our program since his arrival at Old Westbury. I am looking forward to the opportunity to work closely with Dr. DeLuca in support of our students’ academic and athletic pursuits at Old Westbury.”
Thursday, 20 February 2014 00:00
Albertson resident and Kellenberg sophomore Gabby Schreib qualified for the Millrose Games in New York City. Schreib qualified as a member of the Sprint Medley Relay along with Danielle Correia, Bridget McNierney, and Jazmine Fray.
The Kellenberg relay’s close second place finish in January’s Millrose Trials has moved them closer to defending the title they won in the same relay at last year’s Millrose Games. Schreib and her teammates time is currently second in the United States for girls track and field performances.