The Nassau Interim Finance Authority is a New York State public-benefit corporation created to assist Nassau County, a suburban county adjacent to the city of New York on Long Island, emerge from a financial and debt crisis that began in the late 1990s. As of the start of 2022, NIFA, as it is known, was still in place and still supervising Nassau's finances under a control period that resumed in 2011 after a three-year hiatus.
Organization
NIFA is guided by a seven-member board appointed by the Governor of New York, with one member recommended by the Senate Majority Leader, one by the Assembly Speaker, and one by the State Comptroller. Its management team is headed by Evan Cohen, who serves as executive director. According to its 2020 annual report, NIFA had G&A expenses in 2020 of $1.834 million. It listed a staff of five persons.
History
Though the U.S. federal government was in surplus at the end of the Clinton administration, the Republican Party-led Nassau County government faced possible insolvency by 2000. The signs of the crisis began in 1999 and led that year to the Democratic Party taking control of the county legislature, in a previously solid Republican county. Among the many reasons cited for the situation the county found itself in were excessive union contracts to attract county government worker support for the Republican Party; a refusal by the Republican county executive Thomas Gulotta to raise taxes; and an increase in borrowing to close the gap, particularly for the purpose of paying an increasing number of property assessment appeals coming out of an assessment system that relied on outdated data.
NIFA and the Gulotta administration
Gulotta, a Republican, had proposed a tax increase in the early 1990s, and was almost defeated by North Hempstead Supervisor Benjamin Zwirn in 1993. Gulotta resisted further tax increases for the rest of his time in office, and was re-elected in 1997. Two years later, the county's finances began to implode. The first chairman of NIFA, Frank Zarb, said in a retrospective that bankruptcy was a "real possibility." In June 2000, Republican Governor George Pataki signed the legislation creating NIFA. As part of the introduction of NIFA, the state made payments to Nassau County of $105 million over five years.
NIFA and the Suozzi administration
Gulotta did not stand for re-election in 2001. When Nassau County's Conservative Party endorsed money market specialist Bruce Bent as its candidate, the Republicans endorsed Bent as well. Bent was defeated by then Glen Cove Mayor Thomas Suozzi. The county's financial situation had led the outgoing Gulotta administration to implement a 9.1% property tax increase in the 2002 budget, and Suozzi's first budget had a property tax increase of almost 20%. His final budget before he was defeated for re-election in 2009, by County Legislator Ed Mangano, had a 3.9% increase. There were no other county property tax increases in Suozzi's two terms though the total increased taxes levied by Suozzi during his tenure became a campaign issue during his successful run for Congress in 2016. Suozzi dealt with a NIFA control board for much of his eight years in office, though the control period ended in 2008. But NIFA remained in existence even after the end of the control period and continued to monitor county finances.
NIFA and the Mangano administration
After Mangano was sworn in as county executive in 2010 following his victory over Suozzi, he and the county legislature eliminated a home energy tax. That act reduced tax to the revenues county budget, and about a year after Mangano was sworn in, NIFA re-instituted a control period. A lawsuit by Nassau County contesting the legitimacy of the control board was unsuccessful, and NIFA articulated the limits of its duties and the budgetary reasons for a control board, in a statement. Prior to that court decision, the Republican leader in the county legislature, Peter Schmitt, appeared to liken the bipartisan members of NIFA to a Mafia family.
The Mangano-NIFA relationship, with a control board in place, was marked by almost annual disputes over the budgets that Mangano submitted and the county legislature approved. A 2013 agreement between the police officers’ union and the county was criticized by NIFA. A multi-year plan submitted by the Mangano administration in 2015 was rejected by NIFA. NIFA implemented a wage freeze in 2011, though it was lifted over several years. NIFA rejected the county's 2016 budget, and implemented a quarterly review. In December 2017, NIFA ordered specific spending cuts after finding additional flaws in Mangano's budget.