During a press conference last Monday, Nassau County Leg. Dave Denenberg, D-Merrick, and the Legislature’s Democratic Caucus demanded that County Executive Ed Mangano stop his "taxpayer-dollar wasting" lawsuit against the Nassau County Interim Finance Authority.
The Democratic Caucus stated that Mangano’s lawsuit challenges NIFA’s right to implement a financial control period over the County's finances. The caucus also stated that "the fact that Mangano is using Rivkin Radler, his former law firm, to sue NIFA is particularly troubling."
“Once again, the administration and the rubber stamp Republican majority are wasting tax payer money on Mr. Mangano's politically connected former law firm to sue the state, which will be defended at further cost to the tax payers," Denenberg said. "Let’s just work together and fix the budget mess instead of making it worse."
Deputy Minority Leader Kevan Abrahams, D-Hempstead, added: "The experts in the financial market determined that Mangano’s lawsuit is an action that will worsen the County’s financial status. The entire Wall Street community is watching our county carefully. Prolonged litigation, which I believe will be unsuccessful, can only drive confidence in Nassau County to a new low."
On Jan. 26, NIFA voted unanimously to implement a control period after their accountants analyzed the Mangano budget and his reply to NIFA’s request for additional financial data. NIFA determined Mangano’s 2011 budget had a deficit of more than one percent which, by State law, automatically triggered the control period.
"Our county is in the middle of an unprecedented economic crisis. I again urge the Mangano administration to work with, not against, NIFA and save our residents from a financial tsunami that will have devastating consequences on our taxpayers," Minority Leader Diane Yatauro, D-Glen Cove, said. "The Mangano-Schmitt lawsuit is a waste of time and precious tax dollars. Mr. Mangano must cease this destructive litigation immediately."
NIFA, created through state authorization in 2000 as a state oversight agency, has the right to impose a control period should the budget have or be about to have a deficit of one percent. NIFA accountants determined that the looming deficit of $176 million is closer to seven percent.
In a recent survey, an overwhelming majority of respondents urged the county executive to work with NIFA.
Leading Long Island economic advisor Dr. Martin Cantor, CPA, also commented on the issue.
“Nassau County is facing a fiscal abyss," he said. "Litigation challenging NIFA's authority is ill-advised and counter-productive not only because of the unnecessary legal fees; it will further jeopardize the county's standing on Wall Street. This would adversely impact the county's credit worthiness and increases the costs of any short-term borrowing required by the county. A county-led lawsuit against NIFA can only add to the problems of an embattled county."
“We in the Democratic minority have cautioned Mr. Mangano again and again not to resist NIFA as they try to work with his administration to balance the budget," Legislator Joe Scannell, D-Baldwin, added. "Everyone but the county Executive and his legislative leader, Mr. Schmitt, believes that the county’s numbers don’t add up. They should accept the reality that Mangano’s budget is not balanced and they should cooperate with NIFA. We all want to avoid further damage to the county’s credit worthiness and our taxpayers’ wallets.”