A New York State watchdog votes to take control of Nassau County's finances on Wednesday after determining the county, which is the most affluent in the state, would run an impermissable deficit in 2011.
NEW YORK ( TheStreet) -- A New York State watchdog voted to take control of Nassau County's finances on Wednesday after determining the county, which is the most affluent in the state, was lining itself to run an impermissable deficit in 2011. The Nassau County Interim Finance Authority voted 6-to-0 in favor of the control resolution, saying its calculations found the county was on track to run a cash deficit of $49 million on its fiscal 2011 budget of $2.7 billion. The watchdog has the right to step in if a deficit of 1% is likely, in this case $27 million. "The magnitude of this cash deficit expected by NIFA approaches twice the $27 million figure triggering NIFA's statutory obligation to impose controls," NIFA states in its resolution, adding later: "In other words, these are not technical accounting entries but dollars that the County will likely be short when the bills come due." NIFA estimates Nassau County would run a statutory deficit of $176 million in fiscal 2011, a figure that reflects the impact of technical accounting referenced above. From here, NIFA said it would work with Nassau County officials to prepare and implement a balanced budget plan, and that County Executive Ed Mangano now has until Feb. 15 to submit a revised proposal. -- Written by Michael Baron in New York. >To contact the writer of this article, click here: Michael Baron. >To submit a news tip, send an email to: firstname.lastname@example.org