March 2012 Column - Cash payment was best option for taxpayers

A few weeks ago a debate over how to pay a $7 million settlement took place between the Minority Caucus of the Legislature and the County Executive. Some members of the media reported on the process, but the reports never fully examined what transpired. My Caucus and I were accused of being “ignorant” and playing a “political game of chicken.” In the spotlight it appeared this issue had gotten very ugly, however, at the center of it my caucus remained very willing to compromise while keeping the best interest of taxpayers as our main objective.

 

As you may be aware, the final decision was to pay Ms. Morales, who suffered brain damage from a near drowning in a government operated pool, the $7 million settlement in cash. Those familiar with the case and the ongoing conversations, said to me, “you won,” when the proposal was made to pay the settlement in cash. I corrected them; it was the taxpayers that won. From the beginning, it was the Minority Caucus’s position that not borrowing was the best option. For too long we kicked the can down the road, adding to our debt. During the previous administrations’ term the Legislature approved efforts to pay down nearly $100 million in long-term debt, almost one-third of what the county owed, erasing some of the burden our children and grandchildren would be forced to pay, which would have grown due to interest each year that it sat.

 

We had already agreed to borrow $3 million to improve the polar bear exhibit at the zoo in order to keep the popular attraction and provide a better habitat for the bear. Not wanting to borrow a total of $10 million in just six weeks was main reason why the Caucus opposed bonding.

 

We were accused of refusing to compromise and I take offense to the allegations as my caucus has been very willing to work with the new administration, including supporting his appointments. The Minority Caucus’s first proposed paying $7 million cash and borrowing zero; the County Executive requested paying zero in cash and borrowing $7 million. Many meetings were held with the County Executive and the Deputy County Executive to fully vet our options and explore the ramifications of each scenario. The caucus agreed, in the spirit of compromise, to settle this lawsuit without incurring expensive late fees and borrow $4 million and pay $3 million in cash, a proposal that required the caucus to meet the County Executive more than half way. A counter-proposal to borrow $5 million and pay $2 million in cash was not supported by the Legislature.

 

As we approached the last session before the payment was due, the sales tax totals for 2011 were reported: $14 million above what was budgeted. This was great news for our county and using a portion of that unanticipated money for this unfortunate cost made sense. We should use cash when we are able, avoid using the county’s credit card and make the tough decisions when it comes to future spending so we can balance our budget, today and in future years without excessive borrowing. There are times when borrowing makes sense, this wasn’t one of them.