Suffolk County Executive Steve Bellone presented the County’s first-ever Multi-Year Financial Plan, a tool that he said will allow the county to focus on long-term planning and to track the impact of policy decisions over time. The MYP uses forecasts to provide insight into future financial conditions and capacity so that strategies can be developed to achieve long-term financial sustainability for the County, Bellone said.
“After taking office and making the tough decisions that were necessary to save Suffolk County from the brink of financial insolvency, this Multi-Year Financial Plan makes clear that our hard work is paying off, with real and significant long-term benefits for taxpayers,” said County Executive Bellone. “Today we have a blueprint that clearly shows that the reforms we have made are not only strengthening our finances, but are laying the foundation to ensure responsible budgeting over the long term.”
Last year, Bellone announced the Securing Suffolk’s Financial Future Act, a seven-point financial reform plan that he said would strengthen the county’s financial future by focusing on long-term planning solutions. The cornerstone of the plan was Local Law 24-2019 requiring a four-year financial plan, which was adopted with bipartisan support in the County Legislature. The implementation of the MYP also brings the County in line with best municipal practices set forth by financial experts including the New York State Comptroller’s Office and the Government Finance Officers Association.
In 2012, Suffolk County was facing a $500 million operating deficit and a $200 million annual structural budget gap that threatened its financial solvency. Today, Suffolk County has a structurally balanced budget and is projecting operating surpluses over the next four years.
Plans to Rebuild Reserves with over $100 Million Infusion
Over the period covered by the MYP, the county will have the opportunity to add $68.6 million to the General Fund and $40.6 million to the Police District Fund to rebuild its reserves, if the current projections by the County Budget Office materialize.
Bellone said that he is committed to presenting budgets each year that will rebuild the county’s reserves in accordance with best financial practices. In addition, to the extent that the results are better than expected, Bellone said that he will work with the Legislature to adopt a policy that makes the best use of those funds, such as, but not limited to, paying down debt, one-time capital purchases, increasing reserves and funding innovative ideas that will create efficiencies and improve service delivery.
The plan to rebuild budgetary reserves, Bellone noted, will serve as an important factor in raising the county’s bond rating, which will lead to lower borrowing costs in the future. Increased reserves will also help smooth out financial operations when revenues and/or expenditures do not align with projections in the financial plan, helping prevent the need to pierce the property tax cap or make additional cuts to services, he said.
Additional Actions to Promote Financial Reforms
In the FY 2020 Budget, the County established an Insurance Reserve Fund, which provides $1 million to assist in mitigating financial risks to the County resulting from unexpected legal expenses. With the planned surpluses over the next four years, additional dollars will be added to the Fund.
Last year, Bellone said that he worked with the County Legislature to adopt a series of financial reforms that have since been implemented, including a local law to modernize the county insurance reserve fund, which was originally established in 1980. Since the fund was created, the New York State Comptroller has updated the guidance for the creation and maintenance of such funds, therefor the law put forth will update the County’s Liability and Casualty Reserve Fund to reflect modern standards.
The County also implemented a debt management policy to achieve sound financial management, which will lead to both improved investments and taxpayer savings. The goals of the plan, are to guide the County in policy and debt issuance decisions, maintain appropriate capital assets for present and future needs, promote sound financial management, protect and enhance the County’s credit rating, ensure the legal use of the County’s debt issuance authority and to evaluate debt issuance options.