Nassau County Executive Laura Curran presented a new financial strategy to attack the County’s 2020 budget gap resulting from COVID-19’s economic devastation and recovery expenses. The key element of the plan, presented at a legislative hearing, is the deferral for one year of a $75 million payment on long-standing debt by Nassau Interim Finance Authority due in November. At the hearing, the Office of Management and Budget (OMB) and PFM, the County’s financial consultants, outlined the options and showcased their lowest cost and most flexible strategy to refinance and reduce this debt payment requirement. The new strategy:
- avoids additional borrowing by NIFA in FY2020,
- will not extend the current date of expiration of NIFA debt or extend the length of NIFA’s control period,
- and allows the County to continue to push for and best utilize any potential state and local aid from the federal government.
In addition, following the hearing, County Executive Curran sent a letter to Presiding Officer Richard Nicolello and Minority Leader Kevan M. Abrahams of the County Legislature calling for more robust and informed discussions with NIFA to strategize for the County’s 2021 budget and gap closing plan. Curran proposed joint meetings with her Administration, NIFA and leaders of the County Legislature to ensure full transparency and to get all hands on deck to develop future strategies.
“While Washington has failed to take real action and support local governments, financially crippled from the impact of COVID-19, I am urging the support of our Legislature on this creative financial plan as it is the best bet to maintain a balanced budget in 2020,” said County Executive Laura Curran. “In the absence of federal aid, we must forge ahead and strategize for 2021 and beyond, to ensure essential services are protected today and for future generations. We must work together, as we did through the long spring months of COVID quarantine, to get the County back on our strong financial path leading us out of NIFA’s control. But we will not settle for Washington’s failure to negotiate a solution to support devastated counties like Nassau and I am calling on our federal partners to renew their efforts now.”
The presentation of 2020’s financial strategy comes following OMB and PFM’s comprehensive review and analysis of refinancing NIFA debt tied to the Authority’s 2008B bonds, as directed by the County Executive. They explored opportunities to reduce debt payment requirements – with a $75 million principal payment due on November 15, 2020 – given the challenges brought on by Covid-19. Refinancing and deferring the 2020 debt payment would provide the County with the cash already deposited in the debt service fund.
