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By Michael Christodoulou

Michael Christodoulou

If you’ve retired, you may have thought you closed the book on one chapter of your life. But what happens if you need to “reverse” your retirement?

Due to higher inflation and rising interest rates, many retirees are taking out more money from their retirement accounts than they had originally anticipated. As a result, some are headed back to the workforce. If you’re thinking of joining them, you’ll need to consider some factors that may affect your finances. 

First, if you’ve been taking Social Security, be aware that you could lose some of your benefits if you earn over a certain level, at least until you reach your full retirement age, which is likely between 66 and 67. Specifically, if you are under your full retirement age for the entire year, Social Security will deduct $1 from your benefit payments for every $2 you earn above the annual limit, which, in 2024, is $22,320. In the year you reach your full retirement age, Social Security will deduct $1 in benefits for every $3 you earn above a different limit, which, in 2024, is $59,520. 

Social Security will only count your earnings up to the month before you reach your full retirement age, at which point your earnings will no longer reduce your benefits, regardless of how much you earn. Also, Social Security will recalculate your benefit amounts to credit you for the months your payments were reduced due to your excess earnings. Social Security also allows you to pay back early benefits received if you withdraw your application within 12 months of starting benefits. This move could help you receive substantially higher benefits at full retirement age.

Your Social Security isn’t the only benefit that could be affected by your earnings. Your Medicare Part B and Part D premiums are based on your income, so they could rise if you start earning more money. Also, your extra income could push you into a higher tax bracket.

Nonetheless, you can certainly gain some benefits by returning to the working world. Obviously, you’ll be making money that can help you boost your daily cash flow and possibly reduce some debts. But depending on where you work, you might also be able to contribute to a 401(k) or other employer-sponsored retirement plan. And regardless of where you work, you’ll be eligible to contribute to an IRA. By putting more money into these accounts, you may well be able to strengthen your financial position during your retirement years. You might also be able to receive some employee benefits, such as group health insurance — which could be particularly valuable if you haven’t yet started receiving Medicare. 

In addition to the potential financial advantages of going back to work, you might get some social benefits, too. Many people enjoy the interactions with fellow workers and miss these exchanges when they retire, so a return to the workforce, even if it’s on a part-time basis, may give you an emotional boost.

In the final analysis, you’ll want to weigh the potential costs of going back to work against the possible benefits. There’s no one right answer for everyone, but by looking at all the variables, you should be able to reach a decision that works for you. 

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook, Member SIP

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

 

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Daniel R. Liff

Morgan Stanley (NYSE: MS )has announced that Daniel R. Liff, a Managing Director, Financial Advisor in the Firm’s Hauppauge Wealth Management office, has been named to Forbes Magazine’s 2024 list of Best-in-State Wealth Advisors.

Forbes’ Best-in-State Wealth Advisors list comprises a select group of individuals who have a minimum of seven years of industry experience. The ranking, developed by Forbes’ partner SHOOK Research, is based on an algorithm of qualitative and quatitative data, rating thousands of wealth advisors and weighing factors like revenue trends, AUM, compliance records, industry experience and best practices learned through telephone and in-person interviews.

“I am pleased that Dan is representing Morgan Stanley,” commented Robert Forte, Market Manager of Morgan Stanley’s Hauppauge office. “To be named to this list recognizes Dan’s professionalism and dedication to the needs of his valued clients.”

Morgan Stanley Wealth Management, a global leader, provides access to a wide range of products and services to individuals, businesses and institutions, including brokerage and investment advisory services, financial and wealth planning, cash management and lending products and services, annuities and insurance, retirement and trust services.

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Suffolk County Executive Ed Romaine stands alongside county legislators on May 7. Photo by Samantha Rutt

By Samantha Rutt

In his inaugural State of the County Address, Suffolk County Executive Ed Romaine (R) outlined a comprehensive four-year plan to revitalize and fortify Suffolk County, emphasizing key priorities such as fiscal responsibility, public safety, infrastructure enhancement and social services reform. 

“I am extremely hopeful about the future of this county and there are 18 reasons for that and they all sit around me,” the executive said of his Legislature. “I have watched this Legislature for many years. I was part of this Legislature for many years and I am so impressed with the dedication and commitment of these people,” Romaine said as he stood before the podium. 

Addressing an audience May 7 at the William H. Rogers Building in Hauppauge, Romaine outlined his administration’s achievements within its first 100 days while charting a course for the county’s future. 

“Let me start off by saying that the state of the county is good — but it can be improved,” Romaine said. “I am going to be working with the 18 people behind me, men and women of goodwill. Men and women of intellect. Men and women to lead this county forward, because I believe our best days are ahead.” 

Fiscal strength and accountability

Romaine heralded significant strides in Suffolk County’s financial standing, citing a notable upgrade in the county’s credit rating by S&P Global Ratings.

“One thing I’ve learned over a long life is all issues of government are issues of money,” he emphasized. “Right now our general obligation bonds are rated ‘AA-’. I am happy to say that we got our first upgrade this quarter and we are now ‘A+’.”

With an upgraded rating and a stable outlook, the county seeks fiscal stability and enhanced access to capital markets. 

Additionally, Romaine announced initiatives to ensure budgeting practices, including a commitment to adhere to the state-mandated 2% property tax cap and the establishment of a centralized grants office to maximize state and federal funding opportunities.

“New York State has a 2% tax cap, inflation is running a lot higher than 2%,” Romaine explained. “I will submit a budget this September for next year that will not exceed the 2% property tax cap. We cannot afford to do that.”

Investment in public safety

Recognizing the importance of public safety, Romaine announced key appointments within the Suffolk County Police Department and outlined plans to expand law enforcement capabilities. 

“Public safety is a concern — we have new leadership in our department,” Romaine said. “As I promised, I’ve hired more detectives, and we have more cops on the street. It’s important because two things that I’ve heard from the voters and residents of Suffolk County is we need the county to be safe and we need it to be affordable.” 

Investments in new personnel, equipment and technologies aim to uplift public safety efforts and address emerging challenges. Notably, Romaine emphasized the significance of fair and efficient operations within the Traffic and Parking Violations Agency, a growing concern among residents across the county.

Infrastructure revitalization

Romaine touched on the imperative to modernize and maintain county facilities, highlighting initiatives to renovate and upgrade critical infrastructure. With a focus on improving constituent affairs and enhancing employee morale, the administration plans to address long-standing deficiencies in county facilities, including the Suffolk County Police headquarters and the Medical Examiner’s Office building. 

Additionally, plans to reacquire the former John J. Foley nursing home property in Yaphank signals a strategic approach to meet evolving community needs while realizing significant cost savings.

Cybersecurity preparedness

Reflecting on the cyberattack of 2022 and acknowledging the enduring threat posed by cyberattacks, Romaine outlined measures to reinforce the county’s cybersecurity infrastructure. Through comprehensive audits, strategic hiring and resource allocation, the administration shifts its aim to mitigate vulnerabilities and safeguard sensitive data.

Social services reform and environmental preservation

“Now I come to the Department of Social Services, a department that needs a little bit of attention,” Romaine shared. “When I came into office and I read the Newsday article that Suffolk County was one of the worst in the state at processing SNAP [Supplemental Nutrition Assistance Program] applications and that we were way behind in processing social service applications … that is going to change. We are going to put staffing in, we are going to be on top of things.”

Additionally, Romaine reaffirmed the county’s commitment to environmental preservation — just like preservation was a staple of Romaine’s time as Brookhaven Town supervisor — citing investments in farmland preservation and open-space conservation as critical components of sustainable development. The county executive recently appropriated $15 million to preserve farmland across the county. Since taking office, nearly 100 acres of farmland and open space throughout the county has been preserved with additional acquisitions planned later in the year.

Looking ahead

“I believe working together, investing in our infrastructure and rebuilding what is needed in this county as our best days are ahead,” the county executive remarked.

In concluding his address, Romaine articulated a vision of optimism and collaboration, emphasizing the collective efforts needed to propel Suffolk County forward. With a dedicated team and a commitment to transparency and accountability, he expressed confidence in the county’s ability to overcome challenges and realize its full potential. 

“Let’s step up to the plate, we have a lot of challenges ahead,” Romaine concluded.

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By Michael Christodoulou

Michael Christodoulou

If you own a business and you offer a 401(k) or similar retirement plan to your employees, you’ll want to stay current on the various changes affecting these types of accounts. And in 2024, you may find some interesting new developments to consider.

These changes are part of the SECURE 2.0 Act, enacted at the end of 2022. And while some parts of the law went into effect in 2023 — such as the new tax credit for employer contributions to start-up retirement plans with 100 or fewer employees — others were only enacted this year. 

Here are some of these changes that may interest you: 

New “starter” 401(k)/403(b): If you haven’t already established a retirement plan, you can now offer a “starter” 401(k) or “safe harbor” 403(b) plan to employees who meet age and service requirements. These plans have lower contribution limits ($6,000 per year, or $7,000 for those 50 or older) than a typical 401(k) or 403(b) and employers can’t make matching or nonelective contributions. These plans are low-cost and easy to administer but the credit for employer contributions doesn’t apply, as these contributions aren’t allowed, and since start-up costs are low, the tax credit for these costs will be correspondingly lower than they’d be for a full-scale 401(k) plan. 

Matches for student loan payments: It’s not easy for young employees to save for retirement and pay back student loans. To help address this problem, Congress included a provision in Secure 2.0 that allows employers the option to provide matching contributions to employees’ retirement plans (401(k), 403(b), 457(b) and SIMPLE IRAs) when these employees make qualified student loan payments. Of course, if you offer this match for student loan payments, your costs will likely increase, although these matching contributions are tax deductible. In any case, you may want to balance any additional expense with the potential benefit of attracting and retaining employees, particularly those who have recently graduated from college. 

401(k) eligibility for part-time employees: Part-time employees who are at least 21 years old and have at least 500 hours of service in three consecutive years must now be eligible to contribute to an existing 401(k) plan. The inclusion of part-time employees could lead to higher business expenses for you, depending on the amount of contributions you may make to employees’ plans. Again, though, you’d be offering a benefit that could be attractive to quality part-time employees. 

Emergency savings account: Many people, especially those who don’t earn high incomes, have trouble building up emergency funds they can tap for unexpected costs, such as a major home or car repair or large medical expenses. Now, if you offer a 401(k), 403(b) or 457(b) plan, you can include a pension-linked emergency savings account (PLESA) that allows non-highly compensated employees to save up to $2,500, a figure that will be indexed for inflation in the future. PLESA allows for tax-free monthly withdrawals without incurring a 10% tax penalty. PLESA contributions are made on an after-tax (Roth) basis and must be matched at the same rate as other employee contributions.  

You may want to consult with your tax and financial professionals to determine how these changes may affect what you want to do with your retirement plan. The more you know, the better your decisions likely will be. 

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook. This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

 

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By Michael Christodoulou

Michael Christodoulou
Michael Christodoulou

We all hope to remain healthy and independent throughout our lives — but life can be unpredictable. If you were ever to need some type of long-term care, would you be financially prepared?

Long-term care encompasses everything from the services of a home health aide to a stay in an assisted living facility to a long residence in a nursing home. You may never need any of these kinds of care, but the odds aren’t necessarily in your favor: Someone turning age 65 today has almost a 70% chance of needing some type of long-term care services and support in their remaining years, according to the U.S. Department of Health and Human Services.

And all types of long-term care can involve considerable financial expense. The median annual cost for a home health aide’s services is more than $60,000 per year, and it’s more than $100,000 per year for a private room in a nursing home, according to Genworth, an insurance company. Furthermore, contrary to many people’s expectations, Medicare usually pays very little of these costs. 

Of course, some people expect their family will be able to take care of their long-term care needs. But this may not be a viable strategy. For one thing, your family members simply may not have the skills needed to give you the type of care you may require.  Also, by the time you might need help, your grown children or other family members might not live in your area. 

So, you may need to protect yourself and your loved ones from the potential costs of long-term care. Basically, you’ve got two main choices: You could self-insure or you could transfer the risk by purchasing some type of long-term care insurance. 

If you have considerable financial resources, you might find self-insuring to be attractive, rather than choosing insurance and paying policy premiums.  You may wish to keep an emergency savings or investment account that’s earmarked exclusively for long-term care to help avoid relying on your other retirement accounts. But self-insuring has two main drawbacks.  First, because long-term care can be costly, you might need to plan for a significant amount. And second, it will be quite hard to predict exactly how much money you’ll need, because so many variables are involved — your age when you start needing care, interest rates or inflation, the cost of care in your area, the type of care you’ll require, the length of time you’ll need care, and so on. 

As an alternative to self-insuring, you could purchase long-term care insurance, which can provide benefits for home health care, adult day care and assisted living and nursing home facilities. However, you will need to consider the issues attached to long-term care insurance. For one thing, it can be expensive, though the younger you are when you buy your policy, the more affordable it may be. 

Also, long-term care policies typically require you to wait a certain amount of time before benefits are paid. But policies vary greatly in what they offer, so, if you are thinking of buying this insurance, you’ll want to review options and compare benefits and costs.

In any case, by being aware of the potential need for long-term care, its cost and the ways of paying for it, you’ll be able to make the appropriate decisions for your financial situation, your needs and your loved ones.  

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.

 

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By Michael Christodoulou

One of your important sources of retirement income will likely be Social Security — but when should you start taking it?

You can start collecting Social Security benefits at 62, but your checks will be considerably bigger if you wait until your full retirement age, which is likely between 66 and 67. You could even wait until you’re 70, at which point the payments will max out, except for yearly cost-of-living adjustments. But if you need the money, you need the money, even if you’re just 62 or any age before full retirement age. 

However, if you have adequate financial resources to meet your monthly needs, whether through earned income, your investment portfolio or a combination of the two, you could have some flexibility in choosing when to take Social Security. In this case, you may want to weigh these considerations:

Life expectancy: For all of us, it’s one of life’s great mysteries: How long will we live? Of course, we can’t see into the future, so the question can’t be answered with total confidence. But to make an informed decision on when to take Social Security, you don’t need to know your exact lifespan — you just need to make a reasonably good estimate. 

So, for example, if you’re approaching 62, you’re enjoying excellent health and you have a family history of longevity, you might conclude it’s worth waiting a few years to collect Social Security, so you can receive the bigger payments. Conversely, if your health is questionable and your family has not been fortunate in terms of longevity, you might want to start taking your benefits earlier. 

Employment: You can certainly continue working and still receive Social Security benefits. However, if you’re under your full retirement age for the entire year, Social Security will deduct $1 from your benefits for every $2 you earn above the annual limit of $22,320. In the year you reach your full retirement age, Social Security will deduct $1 in benefits for every $3 you earn above $59,520. So, you may want to keep these reductions in mind when deciding when to begin accepting benefits. Once you reach your full retirement age, you can earn any amount without losing benefits. (Also, at your full retirement age, Social Security will recalculate your benefit amount to credit you for the months you received reduced benefits because of your excess earnings.)

Spouse: Spouses can receive two types of Social Security benefits: spousal and survivor. With a spousal benefit, your spouse can receive up to 50% of your full retirement benefits, regardless of when you start taking them. (Your spouse’s benefit can be reduced by the amount of their own retirement benefit and whether they took Social Security before their full retirement age.) But with a survivor benefit, your decision about when to take Social Security can make a big difference. 

A surviving spouse can receive the larger of their own benefit or 100% of a deceased spouse’s benefit, so if you take benefits early and receive a permanent reduction, your spouse’s survivor benefit may also be reduced for their lifetime. 

When to take Social Security is an important — and irrevocable — decision. So, consider all the factors before making your choice. 

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook. Edward Jones, Member SIPC

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File photo

By Emma Gutmann

As of a January report from the New York State Comptroller Thomas DiNapoli (D), Middle Country Central School District has dipped into the “susceptible” fiscal stress status. The district’s community letter on Feb. 1 stated that reserves are “close to being exhausted” and the budget gap is around $7.5 million.

The comptroller’s Fiscal Stress Monitoring System uses data submitted by local governments to provide every school district in New York with a fiscal and environmental score out of 100. Financial indicators for school districts consist of cash position, year-end fund balance, operating deficits and surpluses, as well as reliance on short-term debt for cash flow. Environmental indicators are forces beyond local officials’ immediate control, including teacher turnover rate, changes in property values, budget vote approval rate and percent of economically disadvantaged students and English language learners. 

A district’s overall score determines whether it has the label Significant Stress, Moderate Stress, Susceptible to Stress or No Designation. Middle Country’s 2022-23 fiscal year scored 25 points, the minimum value in the Susceptible to Stress range. Four other Long Island school systems joined Middle Country on the fiscal stress spectrum, with New Suffolk and Amityville in the most extreme category and Roosevelt and Springs in the mildest warning stage alongside Middle Country.

Instructional expenses continue to contribute to Middle Country’s budget overflow as the district strives to maintain excellence for students and staff under the financial strain. The district anticipates a need for two or three more PRAISE classes, where each accommodates eight special-needs kindergarteners. These valuable and necessary specialized classes come with a jarring expense, costing around $350,000 each according to Superintendent of Schools Roberta Gerold.

In an interview, Gerold noted that the pandemic has had an unprecedented impact on the student body, who could use support for their anomalous learning and mental health needs. In the vein of wellness, a boost in health care for current employees (plus 10%) and retirees (plus 25%) has been another cost driver. 

“We are a state-aid-dependent school district, which means when state aid is reduced, we feel the impact — and don’t have many alternatives other than raise taxes or cut programs or services,” Gerold said. “This year, Gov. Hochul’s [D] budget proposal cuts state aid. In Middle Country, if we were to receive what current law indicated we should, our state aid would be about $1.4 million more than what we are now supposed to receive.”

Middle Country has been lobbying to receive a larger slice of state aid with the support of local elected officials and working on a plan for financial recovery with the guidance of their administrative colleagues. The proposed state aid for 2024-25 is nearly $120 million, an increase of 4.64%.

Gerold reported that the school was able to offer programs with resources for their students’ evolving needs through federal funding — a pool which will expire in September of this year.

Although Middle Country has done its best to budget and ration its reserves, “the next couple of months are going to be difficult as decisions are finalized and implemented,” the district’s letter said. 

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By Michael Christodoulou

Michael Christodoulou

As we begin the new year, you may be receiving various tax statements from your financial services provider — so it’s a good time to consider how your investments are taxed. This type of knowledge is useful when you’re doing your taxes, and, perhaps just as important, knowing the type of taxes you generate can help you evaluate your overall investment strategy. 

To understand the tax issues associated with investing, it’s important to understand that investments typically generate either capital gains or ordinary income. This distinction is meaningful because different tax rates may apply, and taxes may be due at different times. 

So, when do you pay either capital gains taxes or ordinary income taxes on your investments? You receive capital gains, and pay taxes on these gains, when you sell an investment that’s increased in value since you purchased it. Long-term capital gains (on investments held more than a year) are taxed at 0%, 15% and 20%, depending on your income. 

Also, qualified dividends — which represent most of the dividends paid by American companies to investors — are taxed at the same rates as long-term capital gains. (Keep in mind that you’ll be taxed on dividends even if you automatically reinvest them.)

On the other hand, you pay ordinary income taxes on capital gains resulting from sales of appreciated assets you’ve held for one year or less. You also pay ordinary income taxes when you receive “ordinary” dividends, which are paid if you purchase shares of a company after the cutoff point for shareholders to be credited with a stock dividend (the ex-dividend date). 

Because your ordinary income tax rate may be much higher than even the top long-term capital gains rate, you may be better off, from a tax standpoint, by focusing on investments that generate long-term capital gains. And the best strategy for doing just that is to buy quality investments and hold them for the long term. By doing so, you could also reduce the costs and fees associated with frequent buying and selling.

The investment tax situation has another twist, though, because not all ordinary income is taxable — and if it is, it may not be taxable immediately. The most common example of this is tax-deferred accounts, such as a traditional IRA and 401(k). When you take money from these accounts, typically at retirement, you’ll pay taxes at your personal tax rate, but for the years and decades before then, your taxes were deferred, which meant these accounts could grow faster than ones on which you paid taxes every year. Consequently, it’s generally a good idea to regularly contribute to your tax-advantaged retirement accounts. 

Finally, some investments and investment accounts are tax free. Municipal bonds are free from federal income taxes, and often state income taxes, too. And when you invest in a Roth IRA, your earnings can grow tax free if you don’t start taking withdrawals until you’re at least 59½ and you’ve had your account at least five years. 

Ultimately, tax considerations probably shouldn’t be the key driver of your investment choices. Nonetheless, knowing the tax implications of your investments — specifically, what type of taxes they may generate and when these taxes will be due — can help you evaluate which investment choices are appropriate for your needs.  

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook. Edward Jones, Member SIPC

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Pictured from left, Randy Howard, Chief Operating Officer, St. Catherine of Siena Hospital; Laura Racioppi, AVP, Corporate & Community Partnerships, Suffolk Credit Union; Declan Doyle, President, St. Catherine of Siena Hospital; Michele Dean, President & CEO, Suffolk Credit Union; Charles Schembri, EVP, Chief Experience Officer, Suffolk Credit Union.

Suffolk Credit Union recently gave seven local non-profit organizations a boost with their budgets by helping them secure grants from the Federal Home Loan Bank of New York (FHLBNY) Small Business Recovery Grant (SBRG) Program. 

The St. Charles Foundation (Port Jefferson), St. Catherine of Siena Foundation (Smithtown) and Good Samaritan University Hospital Foundation (West Islip) received $10,000. In addition, the Nassau Community College Foundation (Garden City), Brotherhood for the Fallen (Ronkonkoma), Suffolk Crime Stoppers (Yaphank) and New Beginnings Christian Church (Coram) received grants of $5,000 each.

“Our team is proud to demonstrate our support for organizations that do so much to support our Long Island communities,” said Michele Dean, CEO and President of Suffolk Credit Union. “As a community-focused credit union, it is gratifying to assist the dedicated organizations that received these grants as they continue their work to ensure the health, safety and well-being of all Long Islanders.”

“FHLBNY members have continued to step up and answer the call from customers and communities that are facing economic challenges,” said José R. González, CEO and President of the FHLBNY. “We have been honored to work alongside Suffolk Credit Union and other members to support these efforts through our Small Business Recovery Grant Program.”

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Village board hires financial firm to untangle information gaps in capital fund record keeping

Capital project funds asphalt walkway, replacing crushed bluestone at the Harborfront Park for $249,000. Photo by Lynn Hallarman

By Lynn Hallarman

Concerns were raised by newly-appointed village treasurer Stephen Gaffga about the bookkeeping practices that track the village’s capital project fund, prompting a call for a full accounting of the fund’s financial records going back at least seven years.

Gaffga was recently the treasurer for the Village of Greenport. He was hired this past summer by Port Jefferson Village, replacing Denise Mordente who served as treasurer for the previous administration.

During the Nov. 20 meeting of the Port Jefferson Village Board of Trustees, Gaffga described the capital fund’s bookkeeping as having a “severe information gap” in the fund’s ledger. Standard financial procedures “were not followed as best practice,” according to Gaffga.

“I came into Port Jefferson in September, and I saw a negative balance with the capital fund,” the treasurer said. “I tried to figure out how that came to be.”

Gaffga explained at the meeting that capital projects were approved and money was spent, but all these expenses were recorded as a “running tally on the ledger.” This accounting method makes it seem like there is a negative balance for all these projects. 

“That’s not the case — we borrowed money, got grant funding, transferred money from the general fund, but the trail is very difficult to follow,” he said.

Gaffga recommended the board hire an outside specialized CPA firm, PKF O’Connor Davies of Hauppauge, to receive assistance in analyzing the record keeping of the capital fund going back in time. As stated at the trustees meeting, the cost of the lookback should not exceed $4,500 per year analyzed. The goal of the analysis is to uncover the financial history of each capital project and “establish a clean slate,” Gaffga said. 

“It is entirely possible that everything is OK dollarwise, and it is just a mess on the books,” he told TBR News Media. 

Former village Mayor Margot Garant, objected to Gaffga’s characterization of the records. “We did a lot in 14 years, and we used our money very carefully,” she said in an interview, adding, “The documents in place are pretty easy to follow. I don’t know what their issue is.” 

The New York State Office of the State Comptroller requires municipalities to undergo an annual audit of financial records. According to the 2022 audit done by the independent accounting firm Cullen & Danowski of Port Jefferson Station, the village had areas for improvement. 

Firstly, the village neglected to properly inventory its capital “hard” assets, according to Chris Reino, who represented the auditor at the August trustees business meeting.

The village has no running list of assets like trucks, buildings, computer equipment and furniture, for example, since “at least 2014,” Reino said. 

As a consequence, if something goes missing or “there is a catastrophe, it will be hard [for the village] to make a claim to an insurance company to replace it,” Mayor Lauren Sheprow noted.

Secondly, the report indicated that the “village did not maintain adequate accounting records” of the capital project fund.

Cullen & Danowski did not respond to email and phone requests for comment for this story.

Capital project fund

The capital project fund financed a range of projects over time for the village, such as restoring the East Beach bluff, repaving walkways at Harborfront Park, creating the Barnum Street parking lot, building bathrooms at Rocketship Park, digitizing records and more.

The trail of money for a project should be easy to follow by a citizen, according to the state Comptroller’s Office. Bookkeeping for the capital fund should tell the complete story of how taxpayer dollars are appropriated and spent for each project to prevent overspending or leaving financial holes in the funding for essential village improvements. 

“I want this board to be educated about this process, so we are all aware of where the money’s coming from and how it’s being spent,” the mayor said at the November board meeting. 

Financial transparency

At the August board meeting, Sheprow complained that members of the previous board “never saw the 2022 audit.” 

“I don’t recall specifically, but I know I had a discussion with [the trustees] and the treasurer that [the audit report] was in, and I believe that was January,” Garant told TBR News Media.

While financial audits should be posted, along with other yearly financial records on the village website after the Board of Trustees reviews them according to OSC best practice, the 2022 audit submitted to the village administration in January this year was not posted to the village website until this past week, shortly after TBR News Media requested to review the audit report (see portjeff.com/fiscalyear2022auditdocuments).

Mordente did not respond to requests for comment for this story about the village’s 2022 auditing process.

Moving forward, Sheprow said she wants to remedy this perceived gap in transparency.

Gaffga said at the November board meeting the village wants to establish a clean slate so there are no “skeletons bookkeeping-wise that could hold the village back.”

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