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Finances

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By Michael E. Russell

Michael E. Russell

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. 

Pixabay photo

By Michael E. Russell

Michael E. Russell

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. 

Pixabay photo

By Michael E. Russell

Michael E. Russell

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.

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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.

Bellone: County Looking at Potential $800 Million Gap in Next Budget Cycle

Steve Bellone (D) and fellow Democrats celebrate keeping the county executive position. Photo by David Luces

As Suffolk County Executive Steve Bellone (D) among other officials continue their crusade to get federal assistance to local government, he said come next month, Suffolk may have to create a budget around a $800 million hole.

Counties on Long Island may be some of the hardest hit financially compared to other New York State counties outside New York City. During a media call Aug. 10 where Bellone talked with two fellow county execs from Upstate New York about the need for federal relief, Dutchess County Executive Marc Molinaro (R) said his county was facing a lesser but no less devastating $60 million gap. This stacks up to the devastation caused by COVID-19 in each county. Whereas Suffolk County has seen over 43,000 cases and close to 2,000 deaths, the less populous Dutchess has seen 4,613 cases and just 153 deaths.

But overall, despite partisanship, all electeds are concerned with the impending financial cliff. The bipartisan National Association of Counties said in a release in late July that county budgets could see a total loss of $202 billion from the coronavirus pandemic.

“The outset of national disaster took us all by surprise, did not expect what has happened here, we knew from outset we would not only be dealing with a public health crisis, but followed by an economic crisis, a human services crisis and a fiscal crisis,” Bellone said. “I’ve been through fiscal crises before, but we’re calling this a fiscal emergency — we’ve never dealt with something like this before.”

Broome County Executive Jason Garnar (D) said it even more succinctly.

“I think the only worse thing you could do is drop a bomb on our county,” Garnar said during the Aug. 11 media call.

Hope rests on a federal bailout, but talks have been mired in political wrangling. The House of Representatives passed the $3 trillion HEROES Act almost three months ago that would have, among other stimulus, provided aid to state and local governments. The bill was universally supported by Democrats, though a select few Republicans including local U.S. Rep. Pete King (R-NY-2) also gave their support.

The Republican-controlled Senate refused to pick up the bill, and negotiations for its own stimulus bill stagnated. When negotiations later broke down between the While House and House and Senate Democrats, President Donald Trump (R) signed several executive orders Aug. 7. One such order authorized $300 out of $400 in additional payments to people on unemployment, though cash-strapped states who are facing their own financial crises are supposed to pick up the last $100. 

The bipartisan National Governors Association, led by Gov. Andrew Cuomo (D), has requested unrestricted $500 billion in state aid. The association criticized the president’s executive orders in a statement Aug. 10 for “the significant administrative burdens and costs this latest action would place on the states.”

Bellone and his fellow county executives said they were concerned that without federal assistance social services that have been overloaded since the start of the pandemic could be facing cuts and layoffs. The Suffolk County Executive said he is “having discussions with all our bargaining units” including the police union. 

“If you’re not going to provide assistance to local governments that provide public safety and public health … our public health workers, all services that we provide will be even more important,” Bellone said. “It will take a couple years at least to get back on our feet again. We are looking at extending this devastation and that’s just unacceptable.”

 

Stock photo

After returning from speaking with the Long Island’s bipartisan congressional delegation in Washington, Suffolk County Executive Steve Bellone (D) again reiterated just how imperative it is that Congress sends relief to local governments desperately in need.

Bellone’s plea also comes off the back of horrific financial reports, including that the U.S. gross domesticproduct has suffered a 32.9 percent shrinkage in the second quarter of 2020. The deadline for the additional $600 added on to unemployment will run out by the end of this week. While a House of Representatives bill would restore that, among other pandemic benefits, the Senate has proposed a replacement $200 on top of unemployment checks. Senate Republicans have not yet proposed a comprehensive plan to update coronavirus relief, which includes money toward local governments hard hit by the pandemic.

Suffolk has already frozen salaries for management, embargoed funds from various departments and utilized resources from the tax stabilization reserve fund, which has resulted in $100 million in mitigation. The county executive said they are looking at other things they can do to cut costs at a local and state level.

The county executive said without such federal relief, Suffolk will need to start slashing several departments that many needy depend on and would result in higher taxes on already overburdened Long Islanders who have suffered months of job losses and belt tightening.

And as school districts release plans this week for reopening in the fall, many are still unsure if they will receive the state aid promised to them in this year’s New York State budget. Gov. Andrew Cuomo (D) has said state aid may need to be cut at a point toward the end of this year if they do not receive any federal disaster relief.

“Schools putting their plans in place, and they’re doing that in an environment if they don’t know they’ll have the funding to do everything they need to do for our kids,” Bellone said.  “We need [Senate Majority Leader Mitch McConell (R)] to step forward and agree to a comprehensive plan here, give us the resources we need to get through this storm.”

Though the county files a budget in mid-September, Bellone said they can’t wait until then to get relief.

“Schools are weeks away from opening, we need a comprehensive package that faces all the challenges we face right now,” he said.

The pandemic has also created a crisis beyond the over 2,000 people dead from the virus in Suffolk County. Bellone said the number of suicide hotline calls are up 100 percent compared to pre-pandemic levels. COVID-19 has meant a huge increase in demand for food-service based programs, such as Meals on Wheels which has seen a 60 percent increase in demand, according to the county exec.

The potential for another wave of COVID is still on the table, Bellone said, saying that Suffolk feels like it is “in the eye of the storm,” whereas the rest of the country has seen severe spikes in the number of coronavirus cases. If a second wave does hit the county, it could result in

“We’ve been hit as hard as you can get hit and still be standing,” Bellone said. “We know swirling all around us the storm is raging.”

Bellone said Suffolk will need to be communicating with school districts as “[COVID-19] cases inevitably happen in our schools.”

Viral Numbers

Suffolk County is currently looking at 43,170 positive cases overall, and in the last 24 hours the county has seen 86 new positive cases.. This is out of 6,247 tests conducted, putting the county at a 1.4 positive test rate. The positive test rate has fluctuated around 1 percent for the past few weeks.

19,127 people have tested positive for antibodies, meaning they had the virus.

Hospitalizations have hovered around the mid to low 40s over the past week, and over the past day it dipped to 38. Bellone said it was the first time since March that new hospitalizations were in the 30s.

Meanwhile, five more people have occupied ICU beds over the past day to a total of 15 in Suffolk. With 3,020 beds in Suffolk andwith 772 currently available, it makes Suffolk’s capacity at 74 percent. As far as ICU beds, the county has 395, with 147 available, meaning a 53 percent capacity.

Over the past four days, Suffolk has experienced no deaths related to COVID-19.

Bellone said while the percentage capacity of available beds is higher than the state’s goal of 70 percent, he is not worried as the number has fluctuated as more people have willingly entered the hospital for non-COVID related injuries or ailments.

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Port Jefferson Village Hall. File photo by Heidi Sutton

With nine projects currently on Port Jefferson Village’s plate, the board decided July 20 to put over $2 million worth of beach, road and facility improvements into a 5-year bond anticipation note, known as a BAN, anticipating more surplus and grant funds in the following years.

The nine projects are worth $2,364,216, though all are in various phases of development and the end costs on several could change. With grants and the use of otherwise existing funds, the village anticipates it will need to pay off $1,241,416 over time.

Denise Mordente, the village treasurer, said a BAN is a 5 year loan that has lower interest rates than a normal bond, with this one being at 1 percent. In that time between when a BAN becomes a bond, the village is anticipating to have paid off significant portions of what they owe through the grant funds or other surpluses.

Projects include:

• $118,562 for the Highland Boulevard retaining wall project

• $519,745 (with a $450,000 grant) for an expansion of Public Works Facility and creation of a emergency command center

• $399,250 for the East Beach retaining wall

• $711,150 (with existing $350,000 bond and $350,000 grant) for Station Street project

• $141,056 (with a $49,000 grant) for Rocketship Park bathroom renovations

• $125,603 (with a $73,800 grant) for Village Hall bathroom renovations

• $180,000 for the Longfellow Road drainage project

• $814,069 (with an existing $300,000 bond, $200,000 grant and $314,069 in parking funds) for Barnum Parking Lot project

• $230,000 for the digitization of planning department records

For this year’s budget, Port Jefferson’s $9,992,565 in appropriations was a 3.19 percent decrease from last year’s total amount. Not only that, but Port Jeff’s settlement with LIPA over the assessed tax value of the Port Jefferson Power Station meant the village will need to raise $6,451,427 from taxes, a near $50,000 increase from last year.

Mayor Margot Garant said in previous years the village has had its surplus carried over from year to year, which has been used to fund these projects, especially when grants often take a significant amount of time before the village can be reimbursed on said projects. This year, with the loss of revenues from the first and second quarters due to the pandemic, the village anticipates much less of that surplus into next year.

“We have a lot of projects in the works, but what we don’t have is a lot of surplus money,” she said during the livestreamed July 20 meeting. “We are three years into the LIPA glidepath and last quarter losing $350,000 due to COVID, we still closed last year’s budget with a surplus, but it’s just not the money we used to have.”

The village is currently working to pay off two other existing bonds, while one other BAN on the village books will be made into a bond this August. That original $1,480,000 BAN was created in 2016 to finance the purchase of a vehicle for the department of public works, renovate Rocketship Park and purchase the dilapidated structure on Barnum Avenue that will soon become a new parking lot. As the BAN becomes a bond, that $1.4 million has been lowered down to $720,000, and will be a 2 percent interest rate. The first payment of $85,000 will be due in 2021.

The two older debt services the village is paying off include a 2011 and 2013 bond with a total outstanding debt of $4,040,000, which are expected to be paid off in 2029. Both of those bonds were refinanced in 2019, which saved the village about $37,000 a year, according to Mordente.

The village currently has an AA bond rating.

The board also tackled the difficult question of potential future staff layoffs due to the loss of funds this year. Trustee Bruce D’Abramo suggested the village makes active strides in its budget and potentially even borrow money to reduce layoffs.

“I would like to see us make up for the projected revenue from the courts, from parking and from the Village Center — I’d like to see us borrow that money and make our 2020-21 budget whole for the rest of the year and not lay any of our good employees off,” D’Abramo said.

Both Mordente, in speaking with the village’s financial advisers, and Village Attorney Brian Egan argued that current municipal finance laws wouldn’t allow for Port Jeff to borrow in that way. 

“Everyone’s in the same boat, they’re up against that same issue,” Egan said, who added the village will monitor bills in Albany that would allow municipalities to gain access to additional funds.

D’Abramo confirmed the village should be thinking about such in the future.

“I would like the board to think about this, so we can keep all of our employees,” he said.

Officials celebrate the installation of a denitrifying septic system in Nesconset in 2015. Photo from Bellone’s office

County Executive Steve Bellone (D) has made two proposals to the legislators that he believes will protect taxpayers and environmental programs in the wake of the economic effects of COVID-19.

He would like to use two existing tax stabilization funds to mitigate the budgetary impact of the virus.

These proposals, which he would like to add as a referendum for voters in November, would “protect taxpayers and essential employees and 100 percent protect environmental programs,” Bellone said on his daily conference call with reporters. “Any legislator who votes no on this legislation is only making layoffs more likely to occur.”

He urged legislators to give taxpayers the option of voting for these proposals, which he suggests will protect taxpayers, employees and environmental programs.

In addition, Bellone said he appreciated the efforts of U.S. Reps Tom Suozzi (D-NY-3) and Lee Zeldin (R-NY-1) to reverse the effect of an Internal Revenue Service ruling that taxes homeowners who participate in a septic improvement program, which was designed to protect Suffolk County’s waterways.

Suffolk County residents “care about clean water,” Bellone said. “These individuals should not be liable to pay taxes on grant money that never even touches their hands.”

The county executive applauded people who move beyond earlier versions of wastewater treatment systems, which, he said, “degraded” water quality and represented a mounting threat.

Separately, the county has no plans to provide any fireworks for the 4th of July celebration. Belone said some local municipalities have considered such an option.

Amid concerns about the illegal use of fireworks, Suffolk County Police Commissioner Geraldine Hart said the police have made two arrests to date and will be providing a public service announcement regarding fireworks and the dangers involved.

Residents who see or hear illegal fireworks, which can lead to injuries, fires or cause other damage, can call crime stoppers at (800) 220-TIPS.

“We want people to enjoy themselves,” Bellone said. “These fireworks are dangerous. The best thing you can do is to leave fireworks to the experts.”

As the county prepares to move into Phase 3 of its reopening tomorrow, Bellone called the continued reopening, which is occurring two weeks after the start of Phase 2, a “big milestone for us.”

Bellone will continue to monitor the viral figures that come out of upstate New York, where several counties are entering phase 4, to get an indication of whether the next phase of reopening could begin two weeks from now.

Viral Numbers

Even as other states, such as Florida, Texas and Arizona are encountering a surge in cases and hospitalizations, Suffolk County continues to move down the infection curve.

In the last 24 hours, an additional 46 people have tested positive for the coronavirus. That is a positive rate of 1.3 percent among those tested, which is above recent trends but still well below rates during the worst of the pandemic on Long Island. The number of people who have tested positive for the virus is now 41,056.

The number of people who have tested positive for antibodies to the virus stands at 18,188. These are people who didn’t have a COVID-19 positive result, but whose bodies have produced antibodies.

Hospitalizations declined by one to 89. People with COVID-19 in the Intensive Care Unit increased by one to 28.

Hospital capacity remained well below guidelines, with hospital beds and ICU beds at 63 percent and 60 percent capacity, respectively.

An additional six people were discharged from the hospital over the previous day.

Meanwhile, the number of people who died from complications related to COVID-19 increased by five to 1,970. During each of the previous four days, one person died each day from the virus.

The county distributed 4,000 pieces of personal protective equipment over the previous day.