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Comptroller George Maragos Gives a Lesson on NC Finances

Vintage Systems Without Oversight Characterize Nassau County Financial Picture

New Nassau County Comptroller George Maragos talked to Anton Community Newspaper editors on Tuesday, Feb. 9, about a month after being inducted into office. He said he has three goals, 1- to streamline government by making it more efficient; 2- to maximize non-tax revenues; 3- to help fix the tax assessment process.

As to the tax assessment, he said the basic problem is that we don’t have an accurate assessment of the properties and therefore there are grievances.

Manhasset Press [an Anton newspaper] editor Pat Grace commented that she attended a meeting where Helen McQueen, of the Assessment Review Commission (ARC), made a presentation. In the Manhasset Press, Ms. McQueen was quoted as saying, “The homeowner is the best person for information on their own property and any of its defects, and that a lawyer isn’t the best way for them to go.” Ms. McQueen said, “The homeowner should file his own grievance.” She said, “It is a simple process; nevertheless, the homeowner receives many letters from attorneys to file it for them.” She said, “The attorney fills out the exact same paperwork as the homeowner, and, it stands to reason the homeowner knows their property better.”

 McQueen explained that the commission has limited jurisdiction. They can only leave the assessment as it is or lower it. They do not raise it. The appeal process, she said, is not punitive. To file, go to the county website,, under the Assessment Review Commission, you can research the value of your property using the Sales Locator. It shows sales for the last 18 months in your neighborhood. Out of 350,000, properties it will show what sold in your school district. It shows both the sales date and sales price. The homeowner can then pick and choose comparable properties and it makes the adjustments, said the Manhasset Press article.

Last year Nassau County Assessor Ted Jankowski in talking to Anton editors said that the certiorari law firms are making millions of dollars in filing claims for people. At the February meeting, Mr. Maragos said accurately, the lawyers get half the funds returned by the county and this year that was in the millions.

Mr. Jankowski said additionally that taxpayers who hire certiorari firms receive bills from those firms for $35 each year, after the initial year, as they continue to file for them to see if they can get a reduction.

Mr. Jankowski said the Nassau County assessments had an accuracy variance of about 15 percent, which he said was in line with the national average. Mr. Maragos said that at the present time, commercial real estate sales show it is about 30 percent down from its assessed value. Part of that could be due to the downturn in the real estate market but he said it doesn’t account for all of the loss.

Additionally, there is no downside/penalty/or fee in filing for a reduction in assessment, although in some other states there is, said Mr. Maragos. The tax doesn’t go up, it only goes down. He hopes to determine the relative accuracy of the assessment figures. He said looking at the 2009 sales versus the January 2010 tax rolls, the figures fall all over the place; there is no correlation between sales figures and assessment. He blamed the errors on the statistical model used in generating the assessment figures for the last six years. He said an example was that for 130 commercial properties, on the commercial assessment roll there was a 30 percent variable, while the economy real estate drop was between 10 to 15 percent and therefore the figures don’t explain them. “In some there is a 100 percent deviation,” he said. “Properties are both over and underassessed.”

His evaluation is that the assessment statistical model is inaccurate which is what has resulted in the huge number of certiorari refunds.

His initial solution he suggested, is to take the three parts of the assessment system, the tax assessor; the assessment review committee (ARC) to listen to the complaints; and the Nassau County attorneys and put them under one commissioner since at present they work at cross purposes – there is no management structure.

Adding to the problem is that the county pays 9 percent interest on the tax refunds – since the system is greatly delayed. [Today many banks are paying .05 percent interest on regular accounts.] Currently there are 125,000 certiorari cases to be handled, he said.

Great Neck Record [an Anton Newspaper] editor Wendy Kreitzman asked how many villages of the 63 in Nassau County use their own assessments currently, and not the county’s. Mr. Maragos said 59 villages use their own assessments in collecting the village taxes.

Ms. Kreitzman asked how wrong were the county assessments in dollars. Mr. Maragos said the county refunded about $100 million.

He said a better way for the tax process to work would be if residents would file complaints before they are assessed. They have until March 1, to complain about the assessments for 2010.

[The ARC phone line message said on Jan. 4, 2010 the NC ARC will publish a new assessment for your property for the school tax bill of October 2011 and the Nassau County general tax for the year after 2012.]

Using the present system, Mr. Maragos said, “So in 2012/2013 they will contest the 2010 tax rolls.” He said if contacted by March, the reviews could be done in the same year.

Mr. Maragos is optimistic that the assessment process can be fixed. He cautioned that it will take time. “But if the correct frame work is in place and the current liability stabilized, we can go forward,” he said.

Special Districts Issue

When asked by Ms. Kreitzman about the issue of Special Districts that former NC Comptroller Howard Weitzman was looking into, he said the analysis of the figures was not complete. He called the studies “not professional” and said they were only a comparative study. There was no attempt to understand the different districts to answer, for instance, why Port Washington was so low and other districts high, such as offering different levels of service. He added that no attempt was made to justify the consolidation or that the county could do it in a more cost-effective way. It would only work if you could see benefits and had the right entities in place to provide the services, he said.

Ms. Kreitzman asked how the county would handle the energy tax repeal which will result in a loss of funding.

Mr. Maragos answered that it would be handled by streamlining government and to get non-tax revenues. He said for instance, the Nassau County Treasury department has been slow in sending out bills to a figure in the millions.

Better cash management was another area where non-tax dollars can be found, he said. “Better cash management is needed. There is from $400 to $8 million in 130 checking accounts that are not getting interest every month. Money sitting around has a risk factor. Half the county bank accounts bear no interest. “If you are doing good cash management you should invest safely and wisely and it can earn a few million dollars,” he said.

To contrast the system Nassau County is currently using with what is done in local school districts, Oyster Bay-East Norwich Assistant Superintendent for Business Christopher Van Cott explained how the school district handles their funds. He said, “District funds are kept in interest-bearing operating accounts, money markets, and CDs. Based on internal cash flow projections, we invest idle funds whenever possible. We belong to a cooperative banking consortium with other municipalities. This arrangement results in a higher interest rate paid by the participating bank due to the aggregated balances of the consortium’s members.” [This reporter, while covering school board meetings, regularly hears the school treasurer report on interest received from school accounts.]

Mr. Maragos said another issue in the county is that almost every department has its own system of operating and with about a half dozen types of vintage software, rather than one system: it needs an overall more efficient system.

Another area Mr. Maragos is looking into are contracts that run into the millions with no precise deliverable date and also contracts that are paid because commissioners sign off on them. A commissioner is allowed to approve a 10 percent variance in a contract but they are signing off at 30 to 33 percent more. Instead of signing them, they should be sent back for further explanation, he said.

He said maximizing the non-taxable revenues could find the county with a surplus: with closer scrutiny.

He added they were not getting all the grants from the state and federal government that they are entitled to – that there is no oversight for them. He added there was a responsibility to pursue the grants.

Another issue is vendors contracts with no follow-up such as those from park vendors and the hotel tax. “If they send it in [their tax money] all right but if they don’t we don’t find out.” There is no system in place to account for them.”

Mr. Maragos was asked if he foresaw any layoffs in the county. He said the current labor agreements that last until 2015 say there are no layoffs and no furloughs; also there is a 3.9 percent increase from the previous administration that he called a very bad policy.

He said he didn’t think the purpose of government was to hurt people by taxing them or laying off workers. He said it is important to, “be creative and go after non-tax revenue that they should go after and collect.”

He said recently the press talked about what he did with county cars. There are 192 cars that were unaccounted for. He said he went after the fleet management to set an example that people can’t use county property without a follow-up. “We will make people accountable.” He said in about six months to a year people should see the benefits of that. He said of his job, “It’s a challenge and I enjoy the challenge.”

Mr. Maragos said he has an MBA in finance; worked in investment banking; IT – information technologies; was a management consultant; and did research for Bell Laboratories in technology. He is bringing those skills to his new office as NC Comptroller.

Audit Advisory Committee

It should be noted that Nassau County has a six-member outside Audit Advisory Committee that Mr. Maragos would like to expand. A press release from Mr. Maragos said the committee met recently and discussed the County’s current fiscal status, the year-end independent outside audit plan and the internal audit plans. The committee is made up of leaders of Nassau County’s business, and government communities and advises the comptroller’s office on appropriate audit control and sound accounting practices.

In order to ensure maximum credibility and the independence of the Audit Advisory Committee, Comptroller Maragos reappointed all the members, who previously served under the Democratic administration. All but one accepted to remain on board.

The Audit Advisory Committee is chaired by Robert Wild and members include John Howell, John Schwartzman, Lee Launer, Aline Khatchadourian, and new member Tim Sullivan. At their first meeting, the members reviewed the committee’s Mission Statement; reviewed the organization of the county and the 2010 Field Audit Plan; and discussed the 2009 audit plan by the county’s independent auditing firm, Deloitte & Touche.

Comptroller Maragos would like to expand the committee to include other experienced individuals to represent the diversity of our county. Interested individuals are welcome to contact the comptroller’s office at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .