With flowers blooming and birds chirping, you may be in a spring-cleaning mindset. As you spruce up your home, you can also channel that energy into getting your finances in tip-top shape!
According to CERTIFIED FINANCIAL PLANNING® professionals, here’s how to clear away the cobwebs in your budget:
Sort expenditures: If you’ve ever sorted your clothes and other items into piles during a spring clean, this budgeting principle will be familiar to you: Review your expenses and categorize them into needs, wants and expenditures you’re ready to part with. Whether you do this on paper or electronically, use a color-coded system to visualize where your money is going.
Review your streaming services: Electronic subscription bloat is common, as is paying for forgotten subscriptions after free trials end. For example, you may be subscribed to several of the most common entertainment streaming services, such as Netflix, Max and Hulu. Do you really need all of them? Whether it’s an online newsletter or a music streaming service, cancel unused subscriptions.
Avoid bank fees: Review your bank statements. Are you getting dinged with fees? Consider switching to a bank that doesn’t charge an account maintenance fee. You can also set up notifications to avoid having your account get hit with an overdraft. If you do get charged, contact your bank to explain your situation — you may be able to have some fees waived.
Switch insurance carriers: Periodically review your insurance rates, and shop the market to see if better rates are available for home, automotive and other forms of insurance.
Reduce debt: If your debt is costing you a pretty penny, it’s time to act. A CFP® professional or credit counselor can help you craft a plan for consolidating debt into lower-rate credit card accounts, refinancing your mortgage and reducing your overall debt burden. You should also automate credit card payments (and other bills) to ensure you aren’t paying late fees.
Pay yourself first: Earmark a portion of your budget to savings and investments each month. This will leave you with more money for your important goals and less for frivolous spending.
This spring, go beyond dusting the baseboards and mopping the floors. Refresh your finances for a fresh start to the season. (StatePoint)
As you may know, some businesses pass along part of their profits to investors in the form of dividends. If you own shares of these companies, either directly in stocks or more indirectly through mutual funds, you may have a choice: Should you take the dividends as cash or reinvest them into the stocks or funds?
There’s no one correct answer for everyone. So, let’s look at some reasons for both choices — reinvesting or cashing out.
Reinvesting dividends offers at least two related benefits. First, reinvested dividends make up part of a stock’s total return, along with price appreciation. And second, when you reinvest dividends, you are buying more shares of the investment — and share ownership is a key to building wealth. Keep in mind that dividends can be increased, decreased or eliminated without notice.
It’s also easy to reinvest dividends. Through a dividend reinvestment plan, or DRIP, your dividends are automatically used to buy more shares of a company. And these new shares will generate more dividends that can be reinvested.
Consequently, it’s fair to say that dividend reinvesting is an economical way to grow your portfolio. However, a DRIP does not guarantee a profit or protect against loss, so you’ll need to consider your willingness to keep investing when share prices are declining.
If you’re mainly investing for long-term growth, you may well want to reinvest your dividends. But under what circumstances wouldn’t you want to reinvest them?
For starters, of course, you may simply need the dividends to help support your cash flow. This may be especially true in your retirement years.
But there may be other reasons to cash out dividends, rather than reinvesting them. You might already own a considerable number of shares in a stock, mutual fund or exchange traded fund and you don’t want to buy more of the same. By not reinvesting these dividends, you can use the money to help broaden your investment mix.
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You also might want to consider taking the cash, rather than reinvesting, if the company that pays the dividends appears to be struggling or has an uncertain future. Again, you could then use the money to fill gaps in your portfolio.
Regardless of whether you reinvest your dividends, you’ll pay taxes on them if your investments are held in a taxable account. Ordinary dividends are taxed at your ordinary income tax rates, while qualified dividends are taxed at the capital gains rate, which is 0%, 18%, or 20%, depending on your income. (A dividend is considered qualified if you’ve held the stock for a certain length of time.)
If your dividend-paying investments are held in a traditional IRA or a 401(k), you won’t have to pay taxes on the dividends until you begin taking withdrawals from these accounts, typically at retirement. And if you have a Roth IRA or Roth 401(k), you may not pay taxes on the dividends at all, provided you’ve had the account at least five years and you don’t take withdrawals until you’re at least 59½.
In any case, you may find that dividends, whether reinvested or taken in cash, can play a role in your overall financial strategy. So, follow your dividend payments carefully — and make the most of them.
Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook, Member SIPC.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor. Edward Jones, its employees and financial advisors cannot provide tax or legal advice. You should consult your attorney or qualified tax advisor regarding your situation.
As we enter the holiday season, your life may well become busier. Still, you might want to take the time to consider some financial moves before we turn the calendar to 2025.
Here are a few suggestions:
Review your investment portfolio. As you look at your portfolio, ask these questions: Has its performance met my expectations this year? Does it still reflect my goals, risk tolerance and time horizon? Do I need to rebalance? You might find that working with a financial professional can help you answer these and other questions you may have about your investments.
Add to your 401(k) and HSA. If you can afford it, and your employer allows it, consider putting more money into your 401(k) before the year ends — including “catch-up” contributions if you’re 50 or older. You might also want to add to your health savings account (HSA) by the tax-filing deadline in April.
Use your FSA dollars. Unlike an HSA, a flexible spending account (FSA) works on a “use-it-or-lose-it” basis, meaning you lose any unspent funds at the end of the year. So, if you still have funds left in your account, try to use them up in 2024. (Employers may grant a 2½ month extension, so check with your human resources area to see if this is the case where you work.)
Contribute to a 529 plan. If you haven’t opened a 529 education savings plan for your children, think about doing so this year. With a 529 plan, your earnings can grow tax deferred, and your withdrawals are federally tax free when used for qualified education expenses — tuition, fees, books and so on. And if you invest in your own state’s 529 plan, you might be able to deduct your contributions from your state income tax or receive a state tax credit.
Build your emergency fund. It’s generally a good idea to keep up to six months’ worth of living expenses in an emergency fund, with the money held in a liquid, low-risk account. Without such a fund in place, you might be forced to dip into your retirement funds to pay for short-term needs, such as a major car or home repair.
Review your estate plans. If you’ve experienced any changes in your family situation this year, such as marriage, remarriage or the birth of a child, you may want to update your estate-planning documents to reflect your new situation. It’s also important to look at the beneficiary designations on your investment accounts, retirement plans, IRAs and insurance policies, as these designations can sometimes even supersede the instructions you’ve left in your will. And if you haven’t started estate planning, there’s no time like the present.
Take your RMDs. If you’re 73 or older, you will likely need to take withdrawals — called required minimum distributions, or RMDs — from some of your retirement accounts, such as your traditional IRA. If you don’t take these withdrawals each year, you could be subject to penalties.
These aren’t the only moves you can make, but they may prove helpful not only for 2024 but in the years to come.
Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook, Member SIPC.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
Port Jefferson Village trustees meeting. File photo
By Lynn Hallarman
During the April 10 Village of Port Jefferson Board of Trustees workgroup meeting, Treasurer Stephen Gaffga presented the modified tentative budget for fiscal year 2024-25, highlighting the steps the new administration is taking to stay within the New York State 2% tax cap.
Gaffga divided the presentation into four sections:
• Overview of operational challenges and strategic initiatives
• Breakdown of the village’s funding sources
• Allocation of taxpayer dollars across services and obligations
• Explanation of the impact on resident taxes.
Operational challenges and strategic initiatives
Gaffga provided a detailed breakdown of a $541,000 rise in nondiscretionary spending for fiscal year 2024-25. This increase in spending is mostly due to contractual obligations, including employee health insurance, dental insurance, retirement and workers compensation. Notably, there is a large uptick in municipal insurance costs amounting to $131,000, signifying a 50% increase over the previous year.
Another challenge area is the gradual reduction over time in taxes collected from the Long Island Power Authority under the “glide path” agreement. This year, the village saw a decrease in LIPA’s tax contribution to the property tax base by $135,990. Gaffga noted a roughly $570,000 decline in the assessed valuation of LIPA properties, reflecting their reduced worth. “That decrease has an effect on the tax rate ultimately down the road,” he said.
Gaffga indicated that the village exceeded the state tax cap eight times in the last nine years. However, he asserted that will not be the case this year.
According to him, “spending under our control” — or discretionary spending — will decrease in the 2024-25 budget “by more than $260,000.” This decrease is due mainly to eliminating the managerial parking position and redistributing those duties over several departments.
“This operational change will result in a $190,000 decrease in spending, which will be passed on to the taxpayer,” he said.
Gaffga reported that the “deep dive” into the capital fund audit by specialized CPA firm PKF O’Connor Davies of Hauppauge continues. “They’re getting far along in that process. By the end of the fiscal year, we’ll have some idea of the results of that deep dive,” he said.
The treasurer stressed, “It is important that any changes made to this budget are made by the board and they’re done in full view of the public so that everybody understands that the board controls this budget.”
Funding sources
Property taxes account for 60% of the total revenues collected for the village’s general fund, which supports the operational aspects of the village’s budget. Other significant funding comes from managed parking, tax agreements with utilities and recreation fees.
Expenses
Employee benefits are the most significant expenditure at 23%, or $2.6 million, of the general fund. General governmental support, which includes funding the treasurer’s office, attorney support, the clerk’s office and the justice court, amounts to roughly $2.4 million.
Other village services funded by the general fund include public safety — fire marshals, building inspectors and code enforcement; culture, parks and recreation, including the Village Center programs; transportation, including sidewalk repaving; and home community services such as the building and planning department and street cleaning.
“The large majority of our spending [nondiscretionary] we do not have control over,” Gaffga said. There is a total village spending increase of 5%.
Tax impacts
The general fund appropriations in the modified tentative 2024-25 budget are projected at $11,458,475 ($11,371,826), an increase of 0.76%. In addition, the Port Jefferson Country Club budget is shown at $3,550,000 ($2,904,882), an increase of 22.21% that is paid for by raising dues and fees according to Gaffga.
Total amount of taxes levied by the village for the fiscal year are shown at roughly $6.8 million, about a 2% increase from last year. “New York State establishes the 2% tax cap to ensure local governments don’t grow their tax base beyond what is necessary. The village is coming under what the New York State allows,” Gaffga confirmed.
Residential individual taxpayers could see a tax increase of $1.45 per $100 of assessed valuation.
Residents can view the modified tentative budget on the village website. Public comments are open until 5 p.m. April 20. Comments should be directed to Sylvia Pirillo, the village clerk, at [email protected].
The Board of Trustees will meet again on Wednesday, April 24, at 6 p.m.
Happy New Year to all! At the very least, we can say that we are off to a rousing start. The Dow Jones Industrial Average rose a phenomenal 700+ points this past Friday. Not bad; another 7000 points and most of us will be even.
My wife states that I always look at the glass as half empty. Somewhat true, but as I write this article, it is Happy Hour; consequently my glass is half empty!
There are so many things to write about. Where to start? Oh yeah, how about our new Congress Person representing New York’s 3rd congressional district. Brought to you by Saturday Night Live, Mr. George, you can’t make it up, Santos. Let me think about his credentials. Baruch College, NOPE. Worked at Citibank, NOPE. Worked at Goldman Sachs, NOPE. Jewish, NOPE. Jew-ish — that’s correct!
Why do I write about this clown? [I don’t want to offend clowns, sorry]. I write about him because I hope they put him on the Congressional Finance Oversight Committee. A person that claimed he earned $6500 in 2020 was able to donate $175,000 to the Nassau Republican Committee in 2021 and lend his own campaign committee $750,000 in the same year. The man is a genius! How do you do that? I hope to be able to interview him for the next article. Boy oh boy, what we could learn. Alright, enough on this topic. UGH!
Starting with the bad news, it appears that Bed Bath & Beyond will have to close all of its stores — ran out of cash. They were never able to recover after the pandemic.
Sorry to digress, but speaking of clowns, it seems that Party City is also going into bankruptcy. So much for the song, “Send in the Clowns.” I really couldn’t help it!
Tesla is having its share of problems. It is cutting the cost of cars to be sold in China by 30%. Hey, what about us? Elon Musk appears to have become distracted by his purchase of Twitter. He needs to hire a new CEO for Twitter to show investors that he is refocused on Tesla.
Growth stocks lost their luster in 2022. The Russell 1000 Growth Index fell by 30% versus a 10% decline in the Russell Value Index. This was the widest gap in many years. It appears that high interest will be with us for a quite a while since Treasury yields are the highest in 20 years, thus giving us somewhat of “risk free” returns for the short term. This makes growth stocks less attractive for the present due to falling multiples. Even though the Value Index fared better, an investor should still look at only the companies that have strong balance sheets, thus weathering this awful inflation period we are in.
Companies that looked like they would grow forever made some terrible decisions. Prior to the year 2020, Amazon doubled its staff to more than 1.5 million. Alphabet [Google] increased its staff more than double to 180,000!
What do we do? The 60/40 portfolio model looks much better today than it did 12 months ago. Bond yields are much higher and stock prices are much lower. Bear in mind however, despite falling more than 20% in 2022, the S&P 500 is still trading around 17 times earnings, nearing its historical average.
Please be aware that tomorrow, Friday, brings the start of fourth quarter earnings season, with some of America’s giants — Bank of America [BAC], United Health Group [UNH], JPMorgan Chase [JPM], and Delta Airlines [DAL] — reporting results. The consensus is that several S&P 500 companies are to report fourth quarter losses for the first time in quite a while.
Even though there are more electric vehicles on the road, our giant oil companies have seen their stock prices close to double. Check out my favorite, Exxon Mobil [XOM] — $62 in January 2022, closed Dec. 31 at $110. Make sure you fill up this week!
Once again, wishing all a healthy and prosperous 2023.
Michael E. Russell retired after 40 years working for various Wall Street firms. All recommendations being made here are not guaranteed and may incur a loss of principal. The opinions and investment recommendations expressed in the column are the author’s own. TBR News Media does not endorse any specific investment advice and urges investors to consult with their financial advisor.
As I have mentioned in previous articles, crypto currencies are hard to understand.I have tried to explain crypto exchanges to the readers while not fully grasping all of the nuances involved in their workings.
We had a financial meltdown in 2008 caused by the corporate giant Enron. We now have a much bigger fiasco caused by a 29-year-old named Sam Bankman Fried. This MENSA wannabe was able to do a Harry Houdini act by making 8 billion dollars in investor funds disappear overnight.
Here are a few of the victims: The Ontario Teachers Pension Plan lost 95 million dollars.More than 100 affiliated companies are filing for bankruptcy. This financial genius has caused a situation so dire, FTX, Fried’s company stated that it doesn’t know where the assets went or who its top creditors are.
Have no worries folks because Congress is setting up committees to investigate what went wrong. Good news there. UGH! This in itself is a big problem. Apparently, Mr. Bankman Fried lobbied many elected officials in Washington hoping for loose oversight of crypto exchanges.
During the 2022 election cycle, Fried donated approximately 40 million dollars to Progressive Democratic candidates. Senator Kirsten Gillibrand of New York said she would donate the funds she received to various charities.Nice!How about having these funds returned to investors?
A question to be asked is why this financial collapse is being investigated after the mid-term elections? Just one more reason for term limits! Point of interest Senators Mitch McConnell and Chuck Schumer have been in office for more than 78 years combined. Come on already!They promise to fix problems that they are responsible for. TERM LIMITS, TERM LIMITS!!!Wake up everybody.
Enough ranting, what’s next?Where to invest? As I grow older, Healthcare stocks seem to be a a great area to put money.Why?Well, let me explain. This morning I had my 12th doctor visit this month and another one tomorrow to close out November.During the 1970s Healthcare was 8% of U.S. GDP [Gross Domestic Product]. Today it is more than 20%.
As citizens get better health care and live longer, they also in most cases accumulate more wealth.Due to more disposable income the Financial services sector is also a place to potentially invest. Within this sector there are areas that should do well over the next five years including Artificial Intelligence, Quantum Computing, Computational biology and CRISPR-related investments. CRISPR gives us exposure to companies specializing in DNA modification systems and technologies.
What should we be doing in December?Consider making tax-loss trades to book 2022 losses so that you can offset future gains. The S & P 500 lost a quarter of its value at the indexes low this year. Since October it has regained some territory making it down a mere 15%!Taking some money off the table and putting it into one and two-year treasuries, yielding 4.5% is not a bad idea. With North Korea, China and Russia rattling their sabers, some safer investments should be considered.
Here is some advice for pre-retirees. Next year, you will be able to contribute up to $22,500 to your 401K or 403b and other retirement plans — an increase of $2,000.Americans can also contribute an additional $6500 if you are over the age of 50.In addition, IRA maximum contributions are now $6500.
For those of us older folks, bond yields north of 4.5% make a portfolio of 60% stock, 40% fixed income attractive. A final thought, with the S & P down roughly 16%, here are some stocks to ponder. Are they an opportunity? Perhaps. Apple down 16% year to date.Microsoft down 27%. Alphabet down 34%. Tesla down 45%.Netflix down 52%. Amazon down 39%. I am not necessarily recommending them, but give them some thought.
I would love to hear from some of you that read my monthly article. I can be reached at [email protected]. From my family to yours, I wish you a happy and healthy holiday season and a prosperous 2023.
Michael E. Russell retired after 40 years working for various Wall Street firms. All recommendations being made here are not guaranteed and may incur a loss of principal. The opinions and investment recommendations expressed in the column are the author’s own. TBR News Media does not endorse any specific investment advice and urges investors to consult with their financial advisor.
What a week!Monday the Dow rose 765 points.Tuesday the Dow rose 826 points.Wednesday the Dow lost 40 points, a well-deserved rest. Back to the new reality.Thursday the Dow dropped 347 points followed by a loss of 630 points on Friday. Still, a gain of 1.5% for the week.
Is the market building a base at these levels? Were the gains of the past week what we used to call a “dead cat bounce” in a Bear market?Really hard to say.
Earnings are starting to weaken while consumer debt increases. An example of the cost of debt this year is as follows: Let us say that a family wishes to purchase a home while secured a $480,000 mortgage. Last year the cost would have been $2023 per month with an interest rate of 3%. That same mortgage presently would cost $3097 per month with a rate of 6.7%. Over a 30-year period you would pay an additional $385,000 in interest. These increases are taking a substantial portion of the middle class out of the real estate market. This is only one segment of a problematic economy.
Expectations of how many more rate increases the Federal Reserve will make is a big part of what is driving the price action in the stock market. The present administration is having a problem with conditions overseas.President Biden just met with the Crown Prince of Saudi Arabia. It was hoped that this meeting would lead to a production increase of 2 million barrels of oil per day.
Guess what? Upon Biden’s return, the Saudi’s announced a decrease of the same 2 million barrels per day. Productive meeting! On top of this, the President stated that we are facing a “potential nuclear Armageddon” the likes of which have not been seen since the Cuban Missile Crisis that President Kennedy faced in 1962. Nice thought to go to sleep with!!
Time to ease up a bit. The Federal Reserve cannot start cutting rates until the Consumer Price Index drops in half from its current level of 8.3%. In the meantime, investors should be taking advantage of U.S. Treasury yields. The 30-year bond is yielding 3.6% while the one- and two-year notes are yielding in excess of 4.1%. This is called an inverse yield curve.4.1% for one year sure beats the 0.001% the banks are paying. Not very neighborly!
We may be getting close to a market bottom plus or minus 10%. Many financial “gurus” are suggesting a large cash position in investor portfolios. Brilliant! This after a decline of over 30% in the market. Where were these people in January and February?
Is crypto currency a viable investment now?Bitcoin was supposed to be an inflation fighter. However, the worst inflation since the early 1970s has coincided with a 60% drop in Bitcoin’s price over the past year. It was also stated that Bitcoin is “digital gold.” Not proven true. Gold itself has outperformed Bitcoin, losing just 6% of its value.
Ethereum, which is the second largest blockchain, has had a major upgrade which may fuel money going into crypto. Readers need to do their own research pertaining to crypto. My last thought on this topic: crypto strategist Alkesh Shah of Bank of America still feels that bitcoin and other cryptos are still viable long-term investments. As an aside, I really don’t have a long-term horizon.
On a pleasant note, my wife and I just returned from Scotland where we visited our granddaughter at the University of St. Andrew, an incredible experience.
The economy there is booming. We did not see vacant store fronts. Much pride was shown in their communities; cleanliness and politeness were everywhere. I was very interested in the opinion of the Scots vis a vis the vote to break from the UK.
I will breakdown opinions in three groups. The youth have little interest in the monarchy, the senior citizens still admire the monarchy due to their memories of WWII. The 40–60-year age group I found most interesting, although my questions were asked at a single malt scotch distillery. The point was made that Scotland is a land of 5.5 million, like Norway and Sweden. The British Pound is in free fall, which is threatening government and corporate pensions. The Scots are upset over Brexit. They wished to stay within the European Union.
As we get closer to Thanksgiving, let us hope that the Russian people put pressure on Putin to leave office or better yet, the planet. Best regards to all and enjoy this beautiful Fall season.
Michael E. Russell retired after 40 years working for various Wall Street firms. All recommendations being made here are not guaranteed and may incur a loss of principal. The opinions and investment recommendations expressed in the column are the author’s own. TBR News Media does not endorse any specific investment advice and urges investors to consult with their financial advisor.
Legislator Rob Trotta, center, was joined by Republican lawmakers and a few environmentalists to decry proposition 2. Photo from Trotta's office
Several Suffolk County Legislators and a New York assemblyman urged residents to reject proposal 2, which County Executive Steve Bellone (D) put on the ballot to help close the financial gap caused by the pandemic.
If approved, the proposal, which was added to the ballot in July after a 14-3 vote in the county Legislature, would reduce the sewer stabilization fund by $180 million and move $15 million to the general fund. Bellone had proposed the moves to shore up the county’s finances after the economy stopped during the COVID-19-related shutdown.
“My hope is that Suffolk voters will ultimately see this proposal for what it is – a ploy to bail out Bellone’s mismanagement,” Legislator Rob Trotta (R-Fort Salonga) said in a statement.
“Proposal two has to be defeated,” Lee Koppelman, former Executive Director of the Long Island Regional Planning Board and the past head of the SUNY Stony Brook Center for Regional Policy Studies, said in a statement. “It is wrong to take money from a dedicated fund to balance the budget.”
While several of the politicians who opposed the proposal were republicans, Assemblyman Steve Englebright (D-Setauket) also decried the measure.
“I already voted and I voted against Proposition Two,” Englebright said in a statement. “I am totally against taking money from this fund to cover county expenses and I encourage the residents of Suffolk County to vote no, too.”
The Long Island Pine Barrens Society also opposed the proposal, suggesting the area needed the funds were needed to replace polluting septic systems with nitrogen-removing technology as well as sewers.
The Suffolk County Drinking Water Protection Program was created in 1987 by a 0.25% sales tax to fund water quality initiatives, the preservation of open space and control taxes in sewer districts.
Bellone has indicated that the measures would prevent layoffs of county workers that might be necessary to balance the budget. He also said on several calls to get the measure on the ballot that the county would not spend any less money on existing environmental programs.
The county executive has also indicated that the sewer funds can either protect taxpayers against higher sewer tax rates or against higher taxes that might be necessary to prevent a reduction in services.
On the ballot this year is also Proposition 1, which will extend the term of legislators from two years to four years.
Rocky Point residents took to the polls in 2017 to vote on propositions to demo the old and rebuild a new North Beach Company 2 firehouse, and purchase a new fire truck. A new bond is asking an extra $1 million to go all the way. File photo by Kevin Redding
*This article was updated to include a link to the firehouse projects budget breakdown.
As the Rocky Point Fire District settles in for a $1 million community bond vote Tuesday, some residents still have questions about the process and what their tax dollars will go if they vote “yes.”
The district has scheduled a vote for Tuesday, Oct. 13, for a $1 million bond to help complete the station 2 firehouse construction. Officials have previously said that because of a delayed start, expanding construction costs and the pandemic they do not have the funds to complete the original $7.25 million project.
The new firehouse along King Road in Rocky Point has been in construction since May of last year, but fire district officials said they need more funds in order to fully complete the project. Photo by Kyle Barr
In a Zoom conference call hosted by district officials Wednesday, Oct. 7, fire district commissioners, the project and manager and attorneys for the district answered the community’s questions.
Several asked if there would be absentee ballots for those unable to vote in-person out of concern for the ongoing COVID-19 pandemic, but Fire District Chairman Anthony Gallino said having to count absentee ballots would result in a “delay in the process,” when construction needs to be completed by the end of the year. Officials claimed that New York State law under Gov. Andrew Cuomo’s (D) executive orders are unclear regarding special district votes.
Fire District Attorney William Glass did not return a call for clarification before press time. Officials also said that if they waited for election day Nov. 3, the district would not receive funds until February next year.
The district originally asked the community to support a $8.5 million bond in 2017, where $7.25 million would go to the construction of the new firehouse. Gallino said they originally included about 7% contingency of over $500,000. This new $1 million bond is looking at a 25% contingency of about $250,000. Gallino added that any unused funds of the new bond will be put to paying down the bond.
“We realized that [original contingency] was not enough to cover obstacles so we put a little more in there for this building,” Gallino said.
On Saturday, Oct, 10, district officials made a full breakdown of the project budget available. Documents show the district lacks $752,310 to complete the firehouse. That number is out of a remaining $1.5 million on a firehouse that is 75% complete. The district still has $500,000 in contingency bond funds and $293,814 left in money taken from the general fund.
Click here to see the budget breakdown, which includes the remaining amount of money left from the districts last bond.
There were issues on the project from the start, officials said during the call. The project manager they originally hired put out bids which were routinely around $1 million over budget. In Aug. of 2018 the district terminated its contract with its original construction manager. In February, 2019 they hired a new project manager, Devin Kulka, the CEO of Hauppauge-based Kulka Group, and were able to get started with asbestos abatement in May, 2019 and demolition followed in June. Materials and labor costs, especially with New York prevailing wage, also increased from when the bond vote was passed. The pandemic made things even more complicated.
Documents show there were items that came in way over what they were originally budgeted for several years ago, resulting in the $752,310 shortfall. HVAC, for example, was slated for $600,000, but is now awarded at a $925,000. While a few items came slightly under budget, those overages make up the total of the $1.5 million the project is over by.
Kulka said during the Zoom call there was one contractor company that went under during construction due to COVID-19. He confirmed a surety company would be cutting a check for the cost between the work the contractor already did and what it wasn’t able to complete.
Gallino said materials costs increased by 10%. Some community members questioned what the cost could be on what has already been constructed, which now resembles a cinder block exterior, but officials said the price of prevailing wage kept costs high.
District officials said the increase of the yearly fire district tax bill will increase about $18 or $19 for the average house within the district. The idea of forking over more money during a time of austerity due to the pandemic might not be appetizing, but Gallino said this was the only means to construct the firehouse. Currently the station 2 company is housed in the old Thurber Lumber property on King Road, which is owned by local developer Mark Baisch. The developer allowed the company into the property free of charge, but plans to turn that property into a slate of 55-and-older rental pieces, and would need the company to be out by the end of the year.
“We’re also residents of the community, we understand that this was not an easy decision,” the chairman of the board of fire commissioners said. “We tried alternative methods, but we found if you want to finish this building on time, you need another $750K to get it done, I think it was the only decision we can make at this point.”
Kulka said the firehouse should be finished by the end of the year if things keep at the current pace.
Some residents are still not convinced, perhaps even less so because of the Zoom meeting. Shoreham resident John Searing, who lives in the district and himself works as a project manager, said he does not feel they were given all the information needed to make a decision as he listened to the Zoom meeting.
“I went into this meeting with an expectation that the Fire District would be able to clearly articulate the need for the additional 13.8%, or $1 million, increase in this project,” he said via email. “However, neither the fire district nor their construction manager or engineer could even provide a rough estimate of expenditures thus far, which raised many more questions in my mind about the future need.”
The bond vote is set for Tuesday, Oct. 13. Polls will be open from 3 to 9 p.m. at the Shoreham Firehouse, located at 49 Route 25A. Voters are reminded to please wear masks and adhere to social distancing guidelines.
This article was updated Oct. 12 to correct the spelling of a name as well as add additional information from the budget document.
Debra Bowling of Pasta Pasta talks to County Executive Steve Bellone. Photo by Kyle Barr
This past weekend, President Donald Trump (R) was in Suffolk County, raising money for this reelection. During his time on Long Island, he called requests for financial aid amid the pandemic a bailout, repeating some of the language he used two years in response to Puerto Rico’s request for financial aid after Hurricane Maria.
“I couldn’t disagree with this more,” County Executive Steve Bellone (D) said today on a conference call with reporters. “We need federal disaster assistance to respond to, and recover from, COVID-19.”
Bellone said the county abided by guidelines from the U.S. Centers for Disease Control and Prevention and that it shut down its economy to protect the health of its population, lowering the death toll at the cost of the economy.
Approaching an argument the president has made against the reaction to the murder by police of Minneapolis resident George Floyd, Bellone suggested that the lack of financial support from the federal government would be a form of defunding the police, taking away salaries from public health workers and removing the financial support necessary for the safe return of students to in-person learning this fall.
“This should have nothing to do with politics,” he argued. “We are still in the middle of fighting a pandemic.”
The county executive urged the federal government to provide vital financial resources to fund these recovery efforts.
“When President Trump talks about federal disaster assistance as a bailout, this is flat out wrong,” Bellone said. The money he has requested, including during a recent trip to Washington, DC, he argued will pay for police officers. Bellone also pointed out that Long Island has provided ample financial resources to the federal government during more prosperous years through tax dollars.
By taking away state and local property tax deductions, the federal government has added billions to what Long Island sends to Washington as a region every year, Bellone said.
“The notion of a bailout suggests we did something wrong in Suffolk County,” the county executive continued. “The fact of the matter is, we all did our jobs here.”
Viral Numbers
Separately, Bellone said Suffolk County has managed to keep illnesses and deaths down in the public health battle against COVID-19.
In the last day, the number of people who have tested positive for the virus was 55 out of a total of 5,030 people who received a test. The rate of just over 1 percent is tracking with the positive tests for the last few weeks and is well below the 5 percent threshold schools have for reopening.
The number of residents who tested positive for the antibody to COVID-19 stands at 24,392.
Hospitalizations, meanwhile, continued to be well below the worst of the pandemic, when the health care system strained under the weight of sick residents.
The number of people hospitalized with COVID-19 stands at 33, which is an increase of 2. The number of people in the Intensive Care Unit was three.
Hospital bed occupancy stood at 72 percent overall and at 67 percent in the ICU.
The number of people who have died from complications related to the virus stands at 1,998. Four people were discharged the hospital in the last day.
