D'Amaro: Projected 3-Year, $530M Budget Deficit ‘No Surprise'

Dear Editor:

Last week, County Executive Steve Bellone’s “Fiscal Analysis Task Force” presented its final report to the Suffolk County Legislature’s Budget and Finance Committee.  As the chairman of this committee, I want to thank County Executive Bellone for both forming this task force and attending the committee meeting.  It was helpful to obtain an independent review of the County's finances from such renowned financial experts. 

In sum, the panel projected a three year (2011-2013) budget deficit totaling $530 million.  Although the Task Force’s findings were quite sobering, they did not come as a surprise to me and, I believe, most of my legislative colleagues.  As we have crafted budgets year after year, we have known about the challenges facing the County budget that the task force detailed (although the task force's deficit projections were somewhat more conservative and therefore higher than our own Budget Review Office's figures).  

Revenue shortfalls and escalating costs, including decreased sales tax receipts, unfunded mandates, reduced state and Federal aid, increased pension payments and higher unemployment insurance costs, have been plaguing Suffolk County for my entire tenure in the Legislature.   As the Task Force noted, these problems are a direct result of the slumping economy, which is well beyond our ability to fix.  Accordingly, local governments like Suffolk get the short end of the stick.  We don't control the economy, but we get stuck with the bill when it goes wrong.  This has forced Suffolk to take a year by year approach to balancing its budget during these very uncertain economic times. 

Each year since the economic meltdown, the Suffolk County Legislature has made tough decisions and passed fiscally prudent budgets without raising General Fund property taxes. When mid-year budget shortfalls have occurred, the Legislature has acted swiftly in concert with the County Executive to approve mitigation measures that have kept the budget in balance and avoided a General Fund tax increase.   Without these actions, the fiscal condition of the County would have been much worse.

It is also important to note, given all the media attention to the Task Force's gloomy figures, that the budget shortfalls it disclosed are only projections that will materialize if we do nothing.  Furthermore, these projections are contingent upon a number of factors that are often difficult to predict.  For instance, the Task Force projected only modest sales tax growth of 2.6% over the next three years.  Legislative budget analysts, however, project growth of 3.85% and 3.65% the next two years.  If growth is higher than these figures, the shortfall will decrease. Similarly, the Task Force projects social service costs to increase by $86 million over two years.  If the economy improves and demand for these services decreases, or the State picks up some of these costs, that too would result in a lower shortfall.  These are just a few examples of the often fickle nature of budget projections.

However, we all agree that, as in the past several years, the County is facing more uncertainty in the overall economy and looming budget shortfalls if we do not act.  As we have done in the past, the Legislature will continue to work cooperatively in a bi-partisan manner with County Executive Bellone to do whatever it takes to mitigate any budget deficits while protecting taxpayers. In fact, the County Executive is presently crafting budget mitigation measures and meeting with our unions while the Legislature convenes its own working group, of which I am a member, that will also come up with broad proposals.  As we now move past simply defining the problem to finding solutions, the public should know that everything is on the table as we attempt to fix the problem and not the blame.  Our task will be difficult but not impossible. The County has made it through these tough fiscal times so far and I am confident that we will continue to do so.

Lou D’Amaro

Suffolk County Legislator

17th Legislative District

Letter dated March 14, 2012