A state-appointed oversight board argued last week that it had ample power to take control of Nassau County’s finances (See Motion). The Nassau County Interim Finance Authority (NIFA) also contended that the injunction sought by the county to block its move is not justified because no irreparable harm would result from the action, which gives NIFA the right to approve contracts and borrowing. “The real harms at stake here are (1) further injury to the County’s financial condition and credit rating (risking a domino effect for other localities); (2) damage to the credibility of an essential State tool for healing troubled municipalities; and (3) loss of an opportunity for good faith collaboration to restore the County to fiscal health,” the oversight agency said in County of Nassau v. Nassau County Interim Finance Authority, 001455-2011.
NIFA’s action was triggered by what it says is a $176 million gap in a $2.7 billion budget. The county denied that its financial condition is that dire, and filed an Article 78 seeking to annul the decision (NYLJ, Feb. 1). It argued, among other things, that the authority had violated the county’s home-rule rights and was relying on statutory provisions that had expired. NIFA moved to dismiss on Thursday in papers signed by Christopher J. Gunther and Judith S. Kaye of Skadden, Arps, Slate, Meagher & Flom.
