Letter to Editor Rockland Voice
From: Jim Flynn
Dear Editor: Clarkstown is Insolvent – Let me explain why.
At the Clarkstown Town Board June 23, 2015 meeting Deputy Comptroller Mary Maloney presented the comptroller’s overview of the Town’s multiyear financial plan out to 2019. In order to fully understand what the plan reveals, I reviewed the past few years’ financial results for Clarkstown as detailed in its Annual Audited Reports. I chose the Audited Reports because they reflect actual results and not the hopes and dreams of the Town’s budgets.
The following facts immediately became apparent.
1) Not all of the Town’s costs were included in its budget.
2) Property taxes have increased at over twice the rate of inflation – the Consumer Price Index between 2008-2015 rose by 10.5% while Clarkstown’s properety taxes went up by 22%. In the same period the Town’s Long Term Liabilities increased by 46% from $236 million to $345 million. That represents an increase of $109 millions over 6 years or 18.8 millions a year.
3) The Town has run a deficit every year since 2008! The only reason it did not show a deficit in 2008 was that it sold a transfer station to the County for $15 million. As of 2014 the General Fund Balance (the Town’s emergency cash reserve) is right back where it was when that asset was sold in 2008.
Here are the numbers for the Town’s General Fund Balance – In 2007 it was $12.2 million, 2008 $25.5 million (up by +$15 million because of the sale of Transfer Station), 2009 $25.2 Million, 2010 $24.1 million, 2011 $20.8 million, 2012 $16.9 million, 2013 $14.9 million and 2014 12.5 million.
Last year Supervisor Gromack and Deputy Supervisor Gromack with the support of Councilwoman Hausner attempted to sell another town asset – the Middlewood Senior Housing Complex – to stem the losses in the general fund caused by deficit spending that could not be covered by rising property taxes. This plan was prevented by the actions of Councilmen Hoehmann and Borelli.
4) As of 2014 the Clarkstown is insolvent – The Town’s Net Assets declined last year to below zero to a deficit of $13,700,854.
The bad news is simply stated – Supervisor Gromack had led the Town to the edge of a financial precipice and immediate action must be taken to stop the Town’s decline to financial ruin and taxpayers financial ruin with runaway property taxes driving home equity values down.
I am not an alarmist but the simple fact is that the picture has worsened since the last Comptroller’s Report one year ago.
The Town Comptroller, in attempting to warn the supervisor about the future, continues to hint to Town Board that it is heading rapidly to a ‘Greek tragedy‘. At the insistence of Councilmen Hoehmann and Borelli and heeding the warning about the Town’s perilious financial situation last year, we witnessed for the first time during Supervisor Gromack’s reign that he finally agreed to a five-year plan with a balanced budget for 2015. The books were balanced by cutting police overtime which is running at $10,000 PER DAY.
The Comptroller’s outlook for the next five years now is warning all property taxpayers that the Town’s finances will be affected by increases scheduled to occur in the Town’s labor contracts which are already in force. In addition one must note that cost projections have not been increased in the outlook for salaries and pension costs for most town employees in the CSEA whose contract expires in December of this year. Nor have such cost projections been included for police salaries in 2018 and 2019.
Even if one does not count these many cost increases that are clearly going to impact the Town’s financial position negatively by 2019, the Comptroller’s outlook comes up with an annual shortage (deficit) of $14.5 million dollars which would require taxes to be increased by 15% over the next four years. That is an average increase of 3.75% each and every year.
Now add to this the items that were not included in the Comptroller’s plan:
a) 2% Payroll increase of $3 million
b) Pension increase due to raises of $750 million
c) Retiree Health Care Increases of $1.25 million
d) Compensated Absences of $1 million
These four items alone raise the tax increase to 5% each year for the next four years.
Does Supervisor Gromack really want to permanently balance his proposed budgets and actually pay all of his bills instead of putting them on the Town’s credit card for future property owners to pay when the present owners have been driven out? To do so and stop the Town’s Long Term Liabilities from growing at a horrendous rate he would need come up with an extra $18.8 millions a year in income or expenditure reductions. The end result if the Supervisor continues on this present path is an increase from $96,764,490 (the current tax levy listed as Town Tax on your Bill) to $136,077,775 an increase of 40.6% over the next four years or 10.5% a year.
Supervisor Gromack can talk about living in a desirable town according to CNN or having a “safe town”, which should not be surprising giving taxpayers are paying police overtime of $10,000 per day, but the financial facts are indisputable:
1) The Town of Clarkstown under Supervisor Gromack’s leadership has now the second highest property taxes in all of the United States;
2) The Town of Clarkstown is insolvent; and
3) The Town can not expect to sell its assets such as Middlewood to escape its problems on the backs of its senior citizens.
I do not believe our current leadership under Supervisor Gromack or Deputy Supervisor Lasker has either the will, or the desire, to admit to the problems they have created never mind implement the required solutions.
Nanuet, New York.