Westchester County faces a projected $90 to $160 million revenue shortfall this year because of the coronavirus-induced economic shutdown, forcing officials to begin taking cost-cutting steps to narrow the gaping budget hole.
County Executive George Latimer, who delivered the sobering news Wednesday afternoon, said most of the deficit would be the estimated $60 million to $125 million loss in sales tax revenue. There would also be another $10 million lost through the hotel occupancy tax with much of the balance of the shortfall a result of the anticipated vanishing Parks Department revenue.
Latimer said all possibilities will be up for discussion on how the county deals with the catastrophic economic blow.
“At the end of the day we’re not going to sugarcoat this for the residents of Westchester County,” Latimer said. “This is a fiscal disaster. It’s going to be a fiscal disaster for your town, for your village, for your city, for your school district, for your fire district.”
The first phase of a reallocation of resources includes three steps that will account for an estimated $21 million, Latimer said. One step will be to apply $10 million the county had earmarked for its reserve fund toward the deficit.
The other measures will be to bond an estimated $6 million to $8 million for tax certiorari payments and also borrow an estimated $5 million in pension costs.
Latimer said these initial actions are not what he wants to do but the unprecedented situation leaves him and his administration with few options.
“We had had that practice for many years,” the county executive said of the bonding for those expenses. “I was critical of that practice but now we’ve saved money for a rainy day. The rainy day has come. It is actually a fiscal monsoon that has arrived.”
He said there would be at least a second and a third phase to the plan, officially dubbed Westchester Forward, in the coming weeks and months to try and close the gap further. There is also the hope that the economy can start functioning sooner rather than later, which would reduce the shortfall.
However, Latimer vowed that he would not put residents’ lives at risk for the sake of the economy.
“We will not sacrifice people’s lives on the alter of economics,” Latimer said. “We will make these decisions with the economic impact in mind. We’ll put public health first. We will put the health and the lives of the people first.”