The short list of “critical, non-controversial” measures Governor Paterson has sent the deadlocked state Senate for possible action tonight includes a bill authorizing Nassau County to issue bonds to finance early retirement incentives for county employees. Pursuant to an agreement between County Executive Thomas Suozzi and his local Civil Service Employees Association (CSEA), the county reportedly plans to issue $65 million in 10-year bonds to finance added severance payments of $1,000 per year of service for several hundred employees — in addition to their generous, taxpayer-guaranteed public pension and post-employment health benefits, that is. The goal is to clear workers off the county payroll without layoffs.
But the bonding, which passed the Assembly 130-5 earlier this month, has already touched a nerve at the Nassau County Interim Financial Authority (NIFA).
“The County’s plan to issue debt to pay this expense places a burden on future taxpayers in the form of debt service costs,” NIFA noted in its May review of the county’s financial plan update. “Bonding for operating expenses was part of the pattern that led the County into a fiscal crisis necessitating the formation of NIFA.”
Borrowing money to cover operating expenses was also part of the problem that led to New York City’s near-bankruptcy in the mid-1970s. Yet Rockland County is already in line behind Nassau with its own request to issue bonds to cover a retirement incentive. In fact, both the Nassau and Rockland bills were “passed” by Senate Democrats during their questionable rump session this afternoon.
These are troubling precedents, to say the least. And the fact that Paterson considers them “non-controversial” is yet another troubling indication that the lessons of the 1970s are quickly being forgotten around the state Capitol.
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