D ANIEL P.

M C C OY
C OUNTY E XECUTIV E

C OUNTY OF A LBANY
O FFICE OF THE E XECUTIVE
112 S TATE S TREET , R OOM 200 A LBANY , N EW Y ORK 12207-2021 (518) 447-7040 - FAX (518) 447-5589 WWW . ALBANYC OU NTY . COM

C HRISTINE Q UINN , ESQ

D EPUTY C OUNTY E XE CUTIV E

MEMORANDUM
To: From: Date: RE: All Albany County Legislators Albany County Executive Daniel McCoy November 23, 2012 2013 Budget Discussion

It is critically important for the Legislature to partner with me. This budget is directly tied to the future of the nursing home. The budget outlines titles and salary line increases that were based on ways to generate revenue, limit overtime costs and address pay equity issues. This was explained in departmental budget messages and at every opportunity including committee meetings as the proposal was reviewed. At the same time, I delivered a budget that accepted responsibility for finding a solution right now to the Albany County Nursing Home and set the course for financial recovery. In ten months time, we have found a solution to an issue that has been hanging over our heads for ten years. My transition team comprised of community leaders and experts in their filed made a priority recommendation that the nursing home is not sustainable. This recommendation came after three independent reports done by the prior executive, comptroller and legislature all of which conclude that the County has experienced notable operating losses and the path which we have been heading is not the best option to serve our senior population. Our solution ensures that we protect our seniors, while also ensuring fairness to the taxpayers of Albany County. The time to accept responsibility to this challenge is right now, not a year from now, not ten more years from now. We cannot kick the can down the road any further. We had been working on an agreement that will conservatively save $80 million dollars, while also ensuring that the home stays in operation and gets critical renovations that have been put off. I am confident that we would have reached an agreement that would have been more than fair to county taxpayers. Unfortunately, actions by the Legislature have impeded this process. The Legislature has filed a budget which doesnt allow us to move forward in our discussions with USG. The $2 million dollar sponsorship that was included as part of the negotiation was eliminated. All positions at the nursing home have been fully funded for 2013 instead of for 6 months until the transition

could take place. While we appreciate that legislators have told the Times Union they support restored funding to positions in the event talks fell through, they have made it impossible to continue those talks. If legislators had created a contingency fund, we could have kept negotiations open. This is an extremely costly mistake. My budget is a roadmap toward a future budget within the 2% tax cap; a law which we must make all responsible efforts to comply with. I have shared with the Legislature and the public as much information as possible, and have even delivered packets of information about this proposal directly to the Times Union in an effort to be transparent. These actions taken by the legislature make it impossible to achieve a budget within that cap and instead, signal even greater double-digit tax increases in 2014 and 2015. I have repeatedly invited legislative leaders, throughout the year, to discuss the budget, the future of the nursing home and negotiations with USG and no one came to the table. The proposed changes submitted by the legislature get us no closer to achieving future budgets that show fiscal responsibility and the ability to live within the 2% tax cap. Let me be clear, if we continue to operate the nursing home, it will cost the County $18.1 million in 2013, $19.8 million in 2014 and $18.5 million in 2015 given current assumptions of revenues and cost drivers. Likewise, if the county isnt going to be pursuing sponsorship with USG, considerable investments will have to be made at the nursing home including staff and the building. Our application to build new was rejected, so we need to make considerable investments. Likewise, it eliminates our ability to live within the property tax cap in the foreseeable future. During our negotiations with USG, certain questions have arisen with respect to the loan agreement. This is altogether a legal and proper use of public funds. While the Constitution prohibits the County from making loans for private purposes, the Court of Appeals has allowed loans for sports stadiums, hotels, museums and economic development. If building a football stadium is a public purpose, surely taking care of the elderly who cannot otherwise find proper skilled care in Albany County is a public purpose. Constitution Article 8 actually mandates that nothing shall prevent a county from making such provision for the aid, care and support of the needy as may be authorized by law. Thus, the loan provisions are inapplicable to situations like this where a county leases a private company its facilities to care for the elderly who cant find a proper safety net facility elsewhere. I have talked about maintaining that safety net for seniors. I need to make a very important comparison. We built an annex to our jail. We keep Corrections Officer vacancies open in the amount of $1.4 million dollars a year. Our jail has housed a maximum of 780 prisoners this year. Its certified for over 1,000. Albany County fully funds this. Legislators have no problem paying nearly $59,000 a year to take care of each prisoner at the jail but arent willing to take the appropriate action to accept financial responsibility for our seniors by getting out of the nursing home business and leasing our facility to a highly regarded provider. Legislators say seniors at the nursing home are important but clearly they are willing to spend the money on prisoners and doom our frail and elderly. This is inexcusable. Regarding the overall action of the Audit and Finance Committee, to entirely disregard suggested new positions as an across the board policy decision is objectionable. It is clear, by the Legislatures own admission, that they made no attempt to analyze or conduct a cost benefit analysis regarding any new positions contained in my proposal. Furthermore, cutting positions in various departments, like the Department of General Services, will have a negative impact. Eliminating 5 positions will result in $50,000 more in overtime and the removal of an additional $53,815 in temporary help will further limit the departments ability to manage its workforce.

Eliminating an analyst position in the Department of Management and Budget, which existed previously, further limits the Countys ability to analyze and manage the countys finances. Our budget is $568 million across more than 30 departments. It is also not responsible to increase revenue lines when the Commissioner of that department has said it is not feasible. The DSS Commissioner clearly stated that adding revenue ($305,760) was not recommended based on the timeline to collect. Furthermore, removal of the support collections assistant manager will undermine the Countys ability to manage our fiscal operations in DSS. Also, the increase in revenue for boarding inmates of $700,000 is a stretch, especially since the contract to accept prisoners from Vermont has yet to be awarded. The proposal that the Legislature announced is not acceptable -- raising taxes while not offering a Nursing Home solution. If the proposal is not altered to address the most pressing challenge we now face, I will exercise my veto powers on all added and increased items that are fiscally irresponsible.