ROCKLAND: Q&A with Rockland County Executive Ed Day

John Jordan | November 2015

Hard Choices Lead to Tangible Progress in Rockland County

 

Ed Day  Rockland County Executive
Ed Day
Rockland County Executive

Rockland County Executive Ed Day has followed through on his campaign promise back in 2013 to bring governmental and budget reform to turn around a county government on the brink of default.

In fact, in the first days of administration in January 2014 he learned that the county was just $42,000 from defaulting on its debt.

Since that time, Day and his administration have succeeded in bringing reform to county government operations and arranging a $96-million bond financing deal that has helped put Rockland back on much firmer financial footing.

Real Estate In-Depth sat down with County Executive Day at his offices in the County Office Building in New City recently to discuss the initiatives he has put in place, what his plans are for the remainder of 2015, and his outlook on the Rockland County economy in 2016.

RIN: What are your thoughts on the latest upgrade by Moody’s Investors Service (see page 17) and what it says about your administration’s policies to turn around county government finances?

Day: This is the third upgrade we have had in 21 months. Given where we were in January 2014 near default and being told upgrades were out of the question; to have the belief in the direction we are going to be shown in the markets like it has been is just an amazing feeling, it really is. I feel so happy for the people of Rockland because this is telling people that we are on the right course, we are turning the corner, the markets believe in us and are ready to invest in us and investors will come. There is a tremendous impact for Rockland County economically because of that and we are going to continue, we are not stopping, we have jumped almost off the most fiscally stressed list (in New York State). That has been taken notice of… From the first year of my administration we went from the bottom (worst) to eight-tenths of a percentage point off the list entirely. It is a justification of direction. I think it is important because people are seeing the results of the direction we are taking. It has not been easy and will not be easy, but they understand that at least something positive is happening. Bringing the budget last year below the (2%) cap. This year actually taking that massive payment for the deficit bond ($96 million) and also the other deficit and rolling that into the operating budget at only $4 additional a month (to taxpayers) a month that is just an amazing accomplishment, people were looking at a 15% to 18% tax increase to pay off those sins of the past.

RIN: How much of an increase in spending has been proposed in this year’s budget?

Day: Our budget we decreased. We actually have pared the budget back by nearly $43 million, which is the most significant cut of county budget (spending) in Rockland County history.

RIN: Does that include costs associated with the Summit Park Nursing Care Center and Hospital?

Day: Summit Park is not funded. I have been very steady about that. I said that we would not fund Summit Park in 2016. It was very important that everyone, including the potential buyer understand that… Sadly we did not have the desired result we wanted. We wanted the buyer to successfully purchase the facility and hire as many of our workers as possible and keep our resident patients there right now where they are physically, but unfortunately the buyer has revealed himself, according to the LDC (established to sell the hospital and nursing home) to not have any merit whatsoever. He has been dragging the process along and we have seen delay after delay and people need to understand that each delay per month is roughly a $1 million loss for Rockland County. It has been almost 16 months since he signed the PSA (Purchase Sale Agreement). Editor’s Note: The county and Summit Park Acquisition Group. Co. announced the PSA for the facility in July 2014.

RIN: When did you want to have the Summit Park sale close?

Day: The initial closing date was by December 2014. This is how long it has been dragging on. He came to us back in the fall (of 2014) and said he could not close by the end of December. The LDC gave him until September 30th (2015), which I thought was a little too liberal because I recognized that Sept. 30th is only 90 days from the end of the year, that would have been a very aggressive course for closure, but we deal with what we have. The buyer came again after many, many months he finally got his CON (Certificate of Need from the New York State Department of Health.) We were not very happy with the speed or lack thereof in which he was moving on interviewing potential employees, he had to turn this thing over, it had to be turn key. This to me took way too much time.

We were still committed to him and were holding our end of the bargain with him. We reduced the (sale) price from $36 million to $32 million with the understanding he would take over September 30th. That was part of the arrangement; we said fine there were fewer beds. We wanted to do the right thing. On Sept. 16th he (Shalom Braunstein of Monsey, manager of the purchaser Summit Park Acquisition Group. Co.) went to a legislative meeting, notice he did not speak to the LDC, he went to a public hearing, where he spoke publicly and said I cannot ensure the safety of the patients I need at least another month. That was September 16th, we said, Oct. 16th is a month, we are going to give you another two weeks, six weeks total (till the end of October). We will help you, we will support you operationally at cost, we will get you through the whole month of October with one proviso—come down on the closing date (Sept. 30) and sign the papers and give us your check. I think that is a reasonable thing to ask. Instead what the buyer did was at roughly nine o’clock at night (on Sept. 29th) his attorneys notified the LDC that he had terminated the contract…

Editor’s Note: County Executive Ed Day began the closure process for the Summit Park Nursing Care Center and Hospital on Oct. 5. On Oct. 22, Day announced that the New York State Department of Health had approved its plan to close the facilities by year’s-end. The Journal News reported on Nov. 13 that the union representing workers at the complex—the CSEA—had filed suit in an attempt to block the closure of the Summit Park facilities. Braunstein has stated in published reports he is willing to negotiate on the purchase of the property.

RIN: What are some of the other major items of your proposed budget?

Day: For the first time in memory our organization—county government—is running in the black two years running. I don’t think people could have put these two things in the same sentence: Rockland County and surpluses two years in a row. The most key piece here is that for only $4 additional per month we have taken a massive payment ($96 million) and we have rolled that into the operating budget. So for a slight tax increase, we are not just dealing with the operations of government, but we are dealing with this massive (debt) payment. Key to this is divesting of Summit Park. We are actually able to deal with the issue of the closure. The closure brought with it about $8 million in cost…to deal with.

Editor’s Note: The County Executive said he has pushed up the sale of a county office building across the street from its offices in New City to help offset some of the closure costs of the Summit complex. The county has budgeted $4 million in connection with the sale of that property. It will then relocate some county offices to the Summit Park complex. He has also directed the Sheriff’s Department to provide security for all county government buildings, which will save the county approximately $1.4 million.

RIN: What is your view of the state of the Rockland County economy?

Day: Essentially it seems we are rebounding a bit. Our sales tax revenues are up slightly, which is great. We are not over-relying on that, because that is how government got in trouble before. We are very conservative in our estimates and that is why we are not getting in trouble. The mortgage tax revenue has gone up a bit, which is consistent with the increasing number of homes being sold. Our unemployment is low (4.6% as of September 2015). The economy is rebounding. Every economy took a big hit in 2008 obviously. It has been a long road back but we feel better about where we are. Right now, we feel good about where we are going, we are going in the right direction.

 

John Jordan
Editor, Real Estate In-Depth