A report designed to help Nassau County, N.Y., officials close a $130 million budget deficit for the current fiscal year will indicate that the county is better off selling general obligation bonds rather than relying on the sale and leaseback of county facilities, county officials said yesterday.
The report, scheduled for release tomorrow, will present "dozens and dozens" of options that county officials can implement over the next 18 months to plug its budget gap, said a county spokesman, David A. Vieser.
The report, which is being prepared by a bipartisan committee of county officials, will include an analysis of several sale and leaseback proposals considered by the county in recent months. It will show that they are too expensive and that Nassau County should issue general obligation bonds instead, several county officials said.
The report also will explain the costs and savings that result from other revenue raising proposals, such as concessions from the county's municipal unions, increases in fees and taxes, and several bonding ideas, Mr. Vieser said.
Although the report will offer various options to close the budget deficit, one county finance official says a GO issuance is already in the works. The official, who spoke on the condition of anonymity, said a GO borrowing of $100 million, with the bonds maturing in five years and 10 years, is likely for fiscal 1992, which ends Dec. 31.
County finance officials said County Executive Thomas S. Gulotta and leaders of the county's legislative branch, the Board of Supervisors, have already reached a consensus on borrowing as much as $100 million in GO bonds, despite other nonborrowing options, finance officials said, Mr. Vieser called the GO borrowing "a real possibility, but the actual number has not been determined."
County officials termed a GO borrowing the most politically viable solution to the county's budget problems. Since Jan. 1, the county has laid off about 2,300 municipal workers amid intense political infighting between Republican and Democratic leaders.
However politically viable, the deficit borrowing is not one that appeals to one rating agency, county officials said.
Moody's Investors Service lowered Nassau's GO rating in January to A from A1. Marie Pisecki, an assistant vice president at Moody's, said the rating agency will be looking for a long-range financial plan to accompany any borrowing.
The existence of such a plan will help the county maintain its credit rating, she said. Nassau officials have termed Friday's scheduled report a first step in developing a more comprehensive financial plan. No timetable has been set for adopting a plan, they said.
Standard & Poor's Corp. and Fitch Investors Service do not rate Nassau County GOs.
County officials said the report does not recommend how much debt the county should issue, but rather explains the costs and legal hurdles involved in the sale and leaseback proposals compared with the issuance of GO bonds.
Mr. Vieser said the report is an attempt to form a consensus in a county wracked not only by a stiff regional recession, but also by warring political factions among its leadership. Neither the Republicans nor the Democrats have a majority on the board, which has argued for months on how best to deal with the county's 1992 fiscal year deficit.