On November 5th, 2014 in a remarkable public meeting during which alternative budget proposals were discussed, the members of the Town Board of Clarkstown resolved their differences and produced Clarkstown’s first balanced budget in eight years.
The main points of the budget are:
- The Town portion of the 2015 property tax increase will come in slightly over 1% and will be below the State Tax Cap.
- While an asset (the Germonds cell tower) will be sold the proceeds will be placed in the Reserve fund and not be used for operating expenses. It is hoped that this action will maintain the Town’s AAA bond rating.
- Police overtime, presently running at a rate of $12,000 per day, will be cut by approximately 7% along with other departments.
The route to agreement on the Town’s 2015 budget was long and contentious. It began with a Town Board Workshop held on June 24, 2014 in which the Town Comptroller, Edward Duer, and Mary Maloney, Deputy Comptroller, presented the Town’s multi-year financial plan in a new annual public process that was proposed by Coumcilman Hoehmann. The purpose of these annual presentations is to extend the budget process making sure that the Comptroller presents a multi-year outline of the budget so that better long range planning can occur.
Duer’s presentation revealed that because of past deficit spending Clarkstown’s Reserve Fund was continuing to decline and had now been depleted to the extent that the Town would lose its Triple A Bond rating. Projections for the end-of-year 2014 show that the reserve fund will be approximately $13 million having declined from just under $25 million in 2009. Supervisor Gromack, Deputy Supervisor Lasker, and Coucilwoman Hausner had hoped to sell the profitable Town asset – the Middlewood Senior Housing Complex – earlier this year for about $10 million to get the reserve fund up to the minimum needed to keep the AAA rating. This proposal was halted on the objections of Councilmen Hoehmann and Borelli and by the outrage of taxpayers over selling an asset that is expected to provide a future excellent income stream to the Town.
Duer declared “the fund balance won’t last forever!” He then warned the Town Board about its deficit spending indicating that if the Town stays with a 2% tax cap limit for the next four years and does NOT cut its spending, the budget would be in deficit by over $6 million each year for the next four years.
First Budget Proposal
The initial 2015 budget proposal came when the Supervisor released an announcement on September 30, 2014 that he had a preliminary budget with only a 1.1% property tax increase and that “the Town’s fiscal management had again earned a ‘AAA’ bond rating from Standard and Poor’s with CNN/Money Magazine ranking Clarkstown as #7 in Best Places to live and as one of the Top 10 safest places”.
However, the announcement failed to recognize that the Town is in the Top 5 of highest property taxes in the entire United States, that it had been running deficit budgets for many years, and that it has over $100 million dollars in bonded debt. These facts were glossed over with the statement that “the Town is facing a number of continuing increasing costs and decreasing revenues”.
Additionally, the proposal suggested selling the Germonds cell-phone tower for approximately $1 million and using these funds to meet current operating expenses while continuing to deplete the reserve fund and making no significant new cuts in expenditures particularly in the Town’s $6 million bill for overtime.
This proposal by the Supervisor was countered in a Town Workshop on October 21, 2014 in which Borelli and Hoehmann announced a plan to amend the fiscal year 2015 budget by recommending approximately $2.3 million in cuts to bring the budget into balance.
“We have a problem” said Councilman Borelli, “The preliminary budget that was presented in September has many underlying issues that create a structural deficit totaling $2,260,000.” According to Councilman Hoehmann, “while the budget at first glance looks good, upon closer analysis budget gimmicks are used that only mask the problem and will result in a certain downgrade in our bond rating and other negative consequences unless we once and for all address the issue”.
Hoehmann and Borelli went on to state that the issues the Town should address are:
- $500,000 is proposed to be drained from the reserve fund.
- $1 million from a one-time non-recurring sale of an asset should not be used to balance the budget.
- Unrealistic assumptions were being made to “balance “ budget such as overestimating revenue generated from Mortgage tax income by $400,000 and assuming that election costs of $360,000 will be reimbursed by the County of Rockland, causing a potential $760,000 shortfall.
- The most recent Standard and Poor’s rating review notes the structural deficit and use of reserve funds and indicates that unless these are addressed the future rating will be negatively impacted.
“We need to implement meaningful cuts in spending,” said Councilman Hoehmann ,”such as the ones Councilman Borelli and I have outlined tonight”
Public Hearing on proposed alternative budgets
Supervisor Gromack with the support of his Democratic colleagues, Deputy Supervisor Lasker and Councilwoman Hausner, began the November 5th, 2014 Town Board meeting by outlining their response to the earlier counter proposal from Republicans Borelli and Hoehmann.
The Supervisor pointed out that they would accept numerous of the Republicans’ suggestions such as placing the proceeds of the sale of the cell tower into the Reserve Fund but that the Hoehmann/Borelli proposal to cut overtime across all departments by 15% in one year was not acceptable though they could agree to a 5% cut each year for the next three years. The Supervisor emphasized that the main point for the public was that the 2015 tax increase would be below the tax cap and that the Town Board should now get behind this compromise proposal and approve it.
The Town Board Debates
With that scenario in place the scene was set for a remarkable four hours of public debate between the Town Board members and members of the public in which it quickly became clear that, while all of the Board members agreed that property taxes would not be raised above the tax cap, Republicans Hoehmann and Borelli would not approve any budget that continued the Town’s past practices in running structural deficits and taking any money from the Town’s Reserve Fund.
Both Republicans made it clear that the deficit remaining to be eliminated was only $500,000 and that there were numerous opportunities in a budget of about $140 million to make a further half million dollar cut by tackling questions such as overtime reduction, the use of town cars by otherwise highly compensated employees, bringing work in house, and making reductions in mailings etc.
A somewhat contentious discussion followed over areas where non-emergency overtime cuts could be made. Unfortunately, the minor overtime spent by the Town Clerk became the focus of the discussion while the major source of the Town’s overtime expenses, namely police overtime which constitutes at least 50% of the total $6 million of overtime presently being expended by the Town, avoided a similarly sharp critique.
Hoehmann stated: We are only off (a balanced budget) by half a million or $600,000. Are you telling me that in a budget of this size we can find another five hundred thousand? Let’s look at the spending. There is $125,000 in the postage line, $85,000 for advertising, ….. Why are we paying several photographers? Maybe we need to look at our advertising practices. If there is a will to balance the budget for the first time and eliminate deficit financing and at the same time protect our bond rating I believe we should do it and find the $600,000.
Following the Board members review of areas where additional cuts should be made it was apparent that an impasse remained. Deputy Supervisor Lasker challenged Hoehmann and Borelli to show her the line items they were going to reduce with Hoehmann replying that he had been doing that since the meeting began. Supervisor Gromack emphasized that he felt that the budget was fine the way it was without being in balance and that as the year went on the Board could work on making additional cuts.
The Public Comments
Perhaps the key public comment of the evening came from a resident who revealed that he had information Councilwoman Lasker had contacted people requesting them to come and speak against the “tea party people” who wanted a balanced budget. Gillies reported that he was informed individuals had been provided talking points to use at the Board meeting one of which was to be used to criticize Hoehmann and Borelli for their advocacy of a balanced budget. Gillies remarks ignited a number of comments many supportive of his position but some that were not.
First-VP Town of Clarkstown CSEA: Our members have assumed the responsibility of over 70 positions left vacant after employee retirements. This has resulted in substantial savings for Clarkstown Taxpayers in the form of eliminated salaries and health benefits. …. In order to prevent the cuts in services one would expect from such a workforce reduction certain departments have strategically increased overtime hours. These increases have cost taxpayers substantially less than the salaries and benefits of the retired employees ……. The original budget proposal came with an additional tax increase of 1.1% ….. which will cost the average taxpayer in Clarkstown only $39 more than they paid in 2014 which will be rebated by the State of New York. … An alternative budget was proposed seeking a 15% overtime reduction for Town workers. This would make it even more difficult for the town of Clarkstown to provide residents with the services they deserve ….. The Clarkstown CSEA encourages the members of the Town Board not to accept the budget with such extreme and unnecessary cuts that will result in a loss of services.
Jeff Gillies: I’m pretty much a life-long citizen of Clarkstown. I’m a pretty average guy, lucky enough to be employed in a decent job, raising an 8-year old daughter and a newborn with my wife in a modest home, but I’m also wondering how much longer I can afford to stay here and raise a family.
That’s a particularly sad reality because the Town of Clarkstown is absolutely hammering taxpayers with one of the highest levels of property taxes in the nation yet somehow can’t balance a budget with all that money.
And to top it all off, Ms. Lasker in particular seems to be either unable to comprehend that this is a problem, or simply doesn’t care. I base this on the fact that she is doing all she can to ensure the passing of yet another operating deficit budget in the 2015 calendar year.
I say this because it has been brought to MY attention that Councilwoman Lasker would rather stack the deck against fiscal responsibility than balance the Town of Clarkstown’s budget.
How do I know this? It came directly from her.
I have a reliable source that has told me that Ms. Lasker has given very specific instructions asking people to speak up tonight in support of the proposed deficit budget. While I’m not naïve enough to think this sort of thing doesn’t happen all the time, there are many disturbing facets in how Ms. Lasker has gone about this and the content of her message.
Councilwoman Lasker, the information provided to me indicates that you asked people to speak in favor of quote “OUR” budget proposal in which you specifically mentioned Mr. Gromack, Stephanie Hausner and yourself in that description of “our.” The highlight of that proposed (deficit) budget is a watering down of Councilman Hoehmann’s and Borelli’s proposal to cut overtime by 15% next year, changing it to be a 5% cut for three years. What’s really disturbing is that you either truly believe this or that you are asking people to believe your Republican colleagues’ proposal would have “devastating consequences to the safety and quality of life of our residents.”
If you TRULY believe that, I think you are completely out of touch with reality. If you DON’T truly believe it, then you are possibly outright lying to the citizens you are supposed to represent. I’m not quite sure which is worse.
I believe that you also wanted to be congratulated for being under Governor Cuomo’s tax cap which is fair enough because we do know how hard that is to achieve. But when it is accomplished by covering up an operating deficit by selling money-making assets such as the cell tower or a senior housing development or dipping into our ever depleting reserve funds, is that really something to be proud of? I really don’t think so.
You might counter with the fact that Money Magazine recently rated Clarkstown #7 on the Best Places to Live in the nation and that Clarkstown is consistently ranked one of the safest towns in the nation.
We have a FANTASTIC police department and I have the UTMOST respect for them, but their operating budget is simply way too high. If we aren’t one of the safest towns in America working with that budget, something would really be wrong. Clarkstown may have ranked number 7 in the best places to live, but I would suggest that is more by past reputation than actual reality. Our high schools are in complete disrepair, our roads are a mess, Germonds pool is leaking water and we may not have the money to fix it. Our high ranking in this regards is a house of cards at best.
You also further warned your supporters that a “few tea party residents are going to attend here tonight”. “Let them speak first” you said, “so then you (Lasker’s supporters) can go up and say: “I don’t know where these people are coming from; this is a great budget and the town is still providing all the essential services that we all expect and depend on”. Also you told them it is important to say: “I can’t understand why the entire town board wouldn’t support this budget as it is under the cap. This is good for Clarkstown!”
Ms. Lasker, how difficult is to understand that an operating budget with a deficit that sells assets to plug those recurring deficits and STILL requires depleting our reserve funds is NOT a good budget.
A GOOD budget would be a balanced one under the cap, but you would rather disingenuously promote the idea that a 15% reduction in overtime costs would have “devastating consequences to the safety and quality of life” of our residents.
Would you like to know what would really have “devastating consequences to the safety and quality of life our residents”?
I would suggest that running ourselves out of our triple A bond rating and into bankruptcy, where we no longer have the money to pay for ANY of our police department needs represents a VERY REAL and GRAVE danger to the safety and quality of life of our residents.
Ms. Lasker, do you truly believe that any reasonable person thinks that a 15% percent cut in overtime across all departments of the town, whether it comes from one department or another is really going to put anyone’s safety at risk? If so, why can’t you come up with a plan to get that cost savings somewhere else in the budget? I see you all up there pointing fingers at each other asking: “where is this line item where these cuts are coming from – show me the line item for the savings. Rather than asking each other where you are going to find it, why don’t you WORK TOGETHER to try to find the savings? Instead of pointing out “Hey, you don’t have the savings line by line, why don’t you just get together and fix it?
Ms. Lasker, you would rather suppress people speaking out against a deficit budget and you refuse to accept that the Town of Clarkstown’s budget has serious and fundamental problems. This is not what we should expect from our elected officials.
I say, with sincere and heartfelt regret, Councilwoman Lasker, that you would rather suggest yet another deficit budget is a good deal for the town than to spend ANY time and effort in order to put forth a balanced one. It really makes me wonder whose interests you truly represent. It doesn’t seem to be the overburdened taxpayers you are supposed to represent.
I’d like to hear in detail how our safety is being jeopardized by a 15% cut in overtime across the entire town’s budget. Again, I am not saying that all 15% has to come from the police department budget and I’m not saying it has to come from the Town Clerk’s budget but it is something to work towards to try and find real savings. Continuing to deplete our financial resources is NOT a good deal for the town. Since I don’t believe that you can explain any of this in a respectable manner, perhaps a better place to start would actually try to putting a stop to deficit spending and bleeding the taxpayers at the same time. Thank you and goodnight.
Carol Jigarjian: We are under the Governor’s tax cap so I don’t think $39 will cause anyone to have to leave Clarkstown and if you get the $39 back …. what is the problem of saying: “I can’t live here anymore”. This budget is not putting you in that position. …… It is ridiculous to say that we are being cheated by the Town Board. We are not. …. I don’t think people should be told they are deliberately deceiving the public. If you really want to see a ‘smoke and mirrors’ budget if that is what some of you are so worried about in this audience you should go over to the County Executive’s door and take a look at the budget he proposed. These people on the Town Board are doing a much better job than the County Executive. This is more Republican nonsense that we should never have a deficit – it is completely unproductive and it doesn’t add any solutions. It just points fingers at people accusing them of cheating the public. They are more competent than the County Executive who some people here seem to think ‘walks on water’. Well, he doesn’t.
Pat Godfrey: I asked you politely many times before if you would consider cutting taxes? There’s a recession going on and people are not making the money they used to make. Well four years later tonight this is the first time you are actually talking about cutting something and it is not even cutting the budget it’s only overtime! People on the board are making out like: “Oh, my God, how is this possible”. Welcome to what the people of Clarkstown and Rockland have been going through since 2008! This is what we have been dealing with but you guys have been insulated because when you need to all you do is raise our taxes ……. You are still raising taxes! ……. It’s outrageous …. We don’t have the money … you are $100 million in debt ….. yet you are arguing about cuts in overtime. You have really got to get to what needs to be done. Thank you Mr. Borelli and Hoehmann for bring up a budget that actually starts making some cuts …… cutting the overtime – you act as if you are insulted. Get with the program!
Tom Nimick: Mr. Gromack I would first like to remind everyone that this is a budget hearing and when you are talking about preparing a budget and about what “might happen” or “may happen” during the year, that is really outside the realm of budget discussions. The issue is that a budget is what YOU PLAN FOR in the coming year. Currently, regardless of what you say you have a deficit budget. Yes, all of the proposed budgets keep below the tax cap … that is not what is being discussed here, they are all under the tax cap. But at the same time you have a deficit budget so let’s think about that.
What does a deficit budget mean? It means you are taking money from the Reserve Fund or you are selling assets to cover operating costs. That is bad business practice. Basically you are spending our future. …… The budget needs to be balanced! Eight years of deficit budgets, if I heard correctly, is spending a lot of our future.
Where to cut? Where is all of the money going? I can point to one place – there is a contract that ends on December 31, 2014. I’m not sure everyone in this room knows about the ‘special bargaining unit’. It is not part of the regular union contracts. This is all supervisors in the special bargaining unit. They got a really cushy deal a couple of years ago (approved by Councilwoman Lasker who is the only councilperson still on the Board from the time the special bargaining unit contract was created) in a bargaining agreement that is over at the end of this year. It had no business being there in the first place. Those salaries need a ‘cut’ not a ‘freeze’ but a cut. Those are lucrative salaries made on the backs of the taxpayers. The Special Bargaining Unit, headed by Mr. Ed Lettre, who happens to be the Head of the Conservative Party. Oh, my gracious what a surprise! He used to be a councilperson in Clarkstown until he discovered a more lucrative profession.
One lady said that $39 would not mean someone would be leaving Clarkstown. She doesn’t live on my street. There is somebody who has been living on my street in the same house since 1951. She has told me directly that she can no longer afford it. That’s a problem. Someone who has been a faithful resident of Clarkstown for her entire life. You need to get this budget under control and the first step is to balance it. Thank you.
Ralph Sabatini: Police overtime is $4.2 million per year which is $12,000 per day! As well as being the 7th best place to live in the United States we are also the 4th highest taxed in the United States. I did an analysis using the 2014 budget and I came across a line item contained in 16 separate departments called ‘FOOD’. The total of that line item is $40,000 for 2014. I have heard no mention of that being cut. I don’t really understand what it is for. I would like to think it is not ‘feeding at the trough’ as many taxpayers seem to think the local politicians do. I am more inclined to think it was simply overlooked. I have a bigger problem with the use of the Reserve Fund. The use of an income producing capital asset to lower operating costs is unconscionable. To say that you are selling a million dollar asset and putting it in the reserve and yet still draw down the reserve by $500,000 is a little bit of ‘smoke and mirrors’, a bit of a sham.
I also want to talk about overtime but not as it involves the police – I appreciate the police force we have and think they do a great job. I have been accused of being anti-union but if it were not for my wife’s teachers’ union pension I would not be in Clarkstown. I am not anti-union but I am anti-waste. $12,000 per day in police overtime is a bit much. Since you are looking to compromise and nobody thinks a 5% cut in overtime is enough and everyone thinks 15% is too much, why don’t we go to 10%? That is an extra $300,000 out of the budget for overtime. It’s very simple and I have nothing further to say.
Olive Branches Extended
At the end of the nearly three hour public comment period Supervisor Gromack made an impassioned speech outlining how past budgets of the Town were produced and pointed out that on several occasions costs formerly borne by the County budget were being passed on to the Towns and placing stress on their own budgets. Just this past year a further $300,000+ in costs related to the holding of local elections had been billed to the Town.
Hoehmann stated that he was prepared to accept any compromise that reduced the budget by a further $500,000 and which would protect the AAA bond rating by not tapping into the Town’s already severely depleted Reserve Fund. He pointed out that Standard and Poor’s had given the town a negative outlook in the last rating evaluation and that the interest payments alone on the Town’s outstanding debt were running at an annual rate of double the tax cap. Because of those financial facts the Town would have to balance its budget this year and continue the process in the out-years.
Gromack Takes Command
In a very welcome act of leadership, Supervisor Gromack took executive command of the process stating that if he had to “stay into the wee hours of the morning” to get agreement on the budget he would do so. The supervisor then stated that having heard all of the inputs from the Town Board members and from members of the public he was prepared to move further on budget reductions towards bringing it in to balance as requested by Councilmen Hoehmann and Borelli. He enumerated several items which he suggested could be revised such as:
- Taking $100,000 out of the Planning Department for a comprehensive plan study related to Nanuet in the understanding that the Board would work very hard to get a grant from the State to make up that amount. This is an item particularly related to efforts that Councilwoman Hausner has been playing the initiating role.
- Reducing overtime by 7% across all departments with a little more flexibility for the Highway Department given that a winter with more than average snowfall can wreak havoc on the best intentions in that department to reduce overtime. The police chief indicated that he would make every effort to meet that goal
- Oil prices have been declining markedly and hence the Supervisor suggested that fuel costs for Town vehicles would like drop for a prolonged time and that the budget for fuel could be reduced by $75,000.
- There will be auctions next year of surplus Town vehicles which should net another $50,000 to the income line for the Town.
- Postage and advertising could be cut by $25,000.
Numbers Crunched and Budget is Balanced
The Board adjourned for nearly half an hour to allow the comptroller and his staff to crunch the numbers. When they returned the previously impossible had been accomplished. The Town Board had balanced its 2015 budget, increased its Reserve Fund by the future sale of the Germonds cell tower, reduced the Town’s overtime charges and stayed below the State Tax Cap. The motion to approve the balanced budget for 2015 was made by Councilman Hoehmann, seconded by Councilman Borelli and was followed by a unanimous vote met by prolonged applause.
That evening the Clarkstown Town Board demonstrated it had the will to produce a budget that is good for the Town’s employees, good for maintenance of critical Town services and good for the taxpayers.
Thanks Is Due
The taxpayers owe a particular debt of gratitude to Councilmen Hoehmann and Borelli for their leadership in putting forth an alternative budget that required much time and effort on their behalf to bring to a successful outcome.
Councilwoman Hausner is owed a debt of gratitude in so graciously conceding that a further $100,000 be reduced in one of the programs for which she plays a key leadership role and in also taking responsibility in seeking a State Grant to fund those efforts.
Supervisor Gromack deserves our particular gratitude for his willingness to take an additional step towards the position of the minority Party on the Town Board and for leading the final deliberations of the Board which resulted in an unanimous approval of this budget.
It all goes to prove that where there is a will in Clarkstown, there is a way to balance its budget, protect its employees, and be fair to its taxpayers.
Picture Credit: http://www.thenationalpatriot.com/2011/08/05/credit-downgrade-the-ripple-effect-whos-at-fault/