Community Corner
Senate Gives Thumbs-Up to City’s $12M Bond Proposal
Councilman McLaughlin says Long Beach might be better paying its deficit without borrowing.
The State Senate unanimously approved legislation to allow the City of Long Beach to borrow $12 million in bonds after it was blocked last year.
In a 56-0 vote on Monday, state legislators passed the bill that lets the city issue up to $12 million in municipal bonds to help close a $10.2 million budget gap and pay for Hurricane Sandy-related repairs.
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The City Council on March 5 unanimously approved a home rule resolution to request the state’s permission to borrow the $12 million in bonds not only to close the budget gap, but also to pay for “extraordinary expenses” due to Hurricane Sandy, including flood relief projects in public places and interests on payments for disaster relief funding.
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Assemblyman Harvey Weisenberg, D-Long Beach, sponsored the bill, and in April the assembly approve it by a vote of 141 to 0. Gov. Andrew Cuomo must approve the request.
While Council President Scott Mandel said of the senate’s approval of the bill, This is good news for Long Beach taxpayers as we all recover from superstorm Sandy," fellow Councilman John McLaughlin called the measure “a year past due” and suggested that the city might be better paying its deficit without borrowing, according to Newsday. Said McLaughlin:"Are they going to rescind the tax increase? That's an important consideration."
Last year, the City Council approved a 6.6 percent deficit-reduction surcharge for three years, bringing last year’s tax increase to 14.5 percent that included a 7.9 percent increase in the 2012-13 budget that was approved that May. These measures were taken after the city, facing a $10.2 million deficit in the general, sewer and water and risk management funds, tried to borrow $15 million from the state with the promise of paying it back over 10 years, but Sen. Dean Skelos, the Republican senate majority leader from Rockville Centre, refused the bill to reach the senate floor for vote. In a letter to City Manager Jack Schnirman, Skelos said he was “troubled” by his “insistence on borrowing to address” the city’s financial woes rather than finds ways to cut spending.
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In March 2013, Skelos and Weisenberg filed bills in the senate and assembly in support of the city’s $12 million request for deficit financing. Skelos said that in light of Hurricane Sandy’s devastation, “we're looking to give local governments the tools they need to recover. All options are on the table."
Schnirman had said that if the senate and governor approved the bill, the city would return to a 10-year timeline instead of three years to repay the $12 million.
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