The New York State Assembly late yesterday continued to debate several technical corrections to Suffolk County, N.Y.'s deficit bailout plan, jeopardizing a much needed fiscal bailout plan.
The stalemate comes at a crucial time for Suffolk County. Under the plan agreed to by the new York State Legislature on July 19, the county would issue up to $36 million of deficit bonds with maturities of up to six years. it would also raise its sales tax to 8.5 cents from 8 cents to bridge an estimated $47 million gap in its 1992 budget.
Without these measures, the county would likely run out cash sometime this fall, local officials say.
The corrections under debate include issuing deficit notes instead of deficit bonds, as well as using the proceeds of the sales tax increase to pay off the notes.
Steven Greenberg, a spokesman for the state Assembly, said ;late yesterday that Assembly staff members are still discussing the technical corrections and that no agreement has been made. He said he did not know if and when an accord could be reached. "All that I can tell you is the staffs are talking," he added. "I think something could be worked out."
The county Legislature late Monday refused to pass a home rule message needed to approve the original bailout proposal before it could be voted on by state lawmakers. This move stemmed from a disagreement over the size of the county's budget deficit. Although county finance officials project a $47 million gap on the $1.3 billion budget, several county lawmakers believe it could be less, sources say.
To appease the legislators, County Executive Robert Gaffney yesterday refined the plan to include a provision allowing for the sale of a budget note depending on the size of the deficit. Mr. Gaffney and his aides then began an all-out lobbying effort to convince members of the Assembly to approve the changes, sources said. Legislative sources say the state Senate has already agreed to approve the provisions.
The state legislative accord was reached after leaders of the state Assembly and state Senate ended their 1992 legislative session without passing a number of key bonding-related bills, including the deficit bailouts of Suffolk and Nassau counties, Gov. Mario M. Cuomo's $800, million jobs-creating bond act, and a bill renewing the city's authorization to issue bonds through a negotiated sale. Lawmakers are scheduled to vote on these matters today.
But without a home rule message from Suffolk County, the state Legislature cannot vote on the bailout plan. The home rule message basically certifies that the deficit bailout plan proposed by Mr. Gaffney has local legislative approval. This approval is needed before state lawmakers can vote on mr. Gaffney's deficit-closing initiative.