Albany County would stick to the state’s tax cap for the first time under County Executive Dan McCoy’s proposed budget for 2014, but the fiscal plan hinges on funding the county nursing home for only the first six months of the year.
McCoy released his 2014 Executive Budget to county legislators on Tuesday, Oct. 8. It proposes a 1.6 percent tax levy increase and appropriations totaling more than $574 million. The budget includes a three-year financial plan to bolster general fund reserves, with $150,000 added next year and $1.97 million in 2015.
The county nursing home would only be funded until the end of June under the budget plan, resulting in a savings of more than $17 million in associated health care expenses in the second half of the year.
“We have to tackle our deficit, which is $243 million,” McCoy said. “We have to start knocking that down.”
There are 42 existing vacancies that would be eliminated in McCoy’s budget for around $2 million in savings. Twenty-one are corrections officer and 21 are nursing home staff. McCoy said there are no layoffs included in his budget.
Sales tax revenue is scheduled to remain relatively steady at $243 million.
McCoy said savings were also achieved through reorganizing departments, enhancing partnerships and shared services, revenue recovery and other efficiencies.
McCoy said he hopes to maintain the county’s credit rating, as well. In September 2011, Moody’s Investor Services dropped the county’s credit rating from Aa2 to Aa3. Moody’s reaffirmed its rating over the summer.
“We have to strive to make a profit even though we are not in the business to make a profit,” McCoy said. “By doing things differently … that helped us achieve the 1.6 percent.”
The legislature’s Majority Leader Frank Commisso said it was “good” McCoy was able to present a budget below the county’s tax cap, but said legislators will still need to review the proposal.
“It is going to take some time for the finance committee and members of the legislature to take a look at where things are,” Commisso said.
Minority Leader Christine Benedict could not immediately be reached for comment.
McCoy said his proposed budget doesn’t contain any “one-shot wonders” and holds “true savings” without “draconian cuts.” His budget would raise taxes by $15 for a $200,000 home.
“My budget plan outlines the path for financial health for the next three years,” said McCoy in a statement. “Through partnership and compromise, I’ve proposed a budget that will cost the average homeowner an additional $1.25 per month, while adding money to the county’s reserves and solving the longstanding nursing home crisis with the establishment by the legislature of their LDC (local development corporation).”
McCoy has long said operating the nursing home is costing the county approximately $1 million per month, and that the burden needs to be lifted off taxpayers.
The six-month timetable for the nursing home change means county legislators will need to decide how to transfer operations of the nursing home to the LDC, which holds no funds or assets at the moment.
Commisso said “it’s hard to say” whether the LDC would be ready to take over the nursing home at that time. The biggest hold up could be receiving a certificate of need from the state.
“Sometimes it could linger for months and sometimes it goes on for a year or more before the certificate of need is issued,” Commisso said. “I am sure there will be a lot of discussion regarding the nursing home and how we proceed from this point and taking a look from where the money would be to continue it throughout the year.”
Commisso said the timetable is “achievable” if the state makes it a priority and “everything falls in place properly.”
Commisso stressed the importance of operating the nursing home and said it costs a resident about “a cup of coffee” per day.
“We also have to realize the nursing home is an important piece of government,” he said. “It takes care of many, many people and those in need of health care, veterans who are returning home. These are things I myself and many of the members are not going to walk away from. It is part of county government and it is part of our mission, and it always has been.”
Taxpayers would still be paying for the nursing home through an LDC, but making it “more professionalized” would lower the cost to a more manageable level, according to Commisso.
“If it were to cost $4 to $5 million per year, that would not be a big issue,” he said.
Nearly a year ago, McCoy proposed turning over the nursing home to Upstate Services Group LLC, but legislators rejected his idea in favor of creating an LDC to run the facility. Though McCoy agreed the legislature’s plan, he said he “still favored” USG taking over the home.
“Two things are very important: protecting our seniors and accepting responsibility and giving breaks to the taxpayers,” McCoy said.
McCoy said he is trying to give taxpayers relief while spurring economic development that leads to jobs.
If the legislature were to opt to continue funding the nursing home for the remainder of next year, McCoy said the legislature would have to add $6.2 million to the tax levy. This would lead the levy to increase by 8.5 percent, exceeding the tax cap, unless other reductions were made or revenues were added.
The June 30 cutoff is a year from the creation of the LDC, McCoy argued. He said the timetable is not meant to push legislators towards his plan.
“If it works, I don’t mind standing there and telling them it works,” he said. “As long as I protect the seniors and relieve the taxpayers, that’s all I care about. Under my plan, it happens.”
There will be a public hearing on the 2014 Executive Budget scheduled before the end of the month.
