Local Economic Acceleration Plan (LEAP)

Part Three: Cost Savers

The first and second installments of the Local Economic Acceleration Plan (LEAP) series featured the first eight opportunities for New York State and local government toaccelerate economic growth in our communities and generate new streams of revenue.
Part One: Economic Drivers
Part Two: Revenue Generators
Our third installment takes a look at actions 9-12 that could help cut costs for local government and increase the efficiency of taxpayer money.
It is important to remember that as County revenues are clearly connected to our local economic performance, there is a direct correlation between County government and kitchen table issues: including unemployment, childcare, healthcare, and housing - things that are very real and tangible.

We need to look to innovative and proven solutions that can help reinforce Nassau County as a place with opportunity for all residents and better align the County for the demands of the post-COVID economy.
Part Three: Cost Savers
Up to $309.8 Million in Efficiencies
*These savings do not solely apply to Nassau County. They are examples of possible savings and/or efficiency opportunities using the 4 strategies highlighted above*
In the Comptroller’s Office, much of our work is focused on what we call “The Deal” of living in Nassau County: the concept that people choose to build a life here so that they can enjoy an affordable and high quality of life-based upon our schools, services, beaches, parks, as well as access to New York City.
Nassau County’s long-term financial success is reliant upon ensuring that there are opportunities for all. By embracing the innovative and proactive solutions detailed within this report, we can help ensure Nassau County’s long-term financial success and avoid cuts to services or increases in taxes that would only exacerbate the gaps that exist in wealth, unemployment, home-ownership, and educational attainment in our communities.
Let's take a deeper dive.

9: Renters Choice Housing
As rents continue to rise, the upfront costs of moving into rental units have as well. Traditional security deposits often pose a significant barrier to housing affordability. An estimated $190 billion are tied up in security deposits across the country (1). Moreover, the May 2018 Federal Reserve study found that 40% of Americans lacked $400 to cover emergency expenses (2). These costs put immense pressure on renters, and therefore, it is critical to eliminate the outlay that creates housing barriers to renters while also protecting property owners.
Local Challenge
Rising housing prices and stagnating wages over the last few decades have forced Long Island households to spend a much larger share of their incomes on rent, mortgage payments, and other associated housing costs. Between 2000 and 2015, the amount of households that were spending 30% of their income on housing grew by 15% to nearly 45%
As a result, security deposits become a real hurdle for renters to navigate against the backdrop of Nassau County's accelerating housing affordability crisis. In 1970, fewer than 10% of the 25-34 age group on Long Island lived with their parents compared to 44.4% in 2016 (3). This represents a four-fold increase in young adults that live with at least one parent. Nationally, just 16% of this age group lives at home with their parents.
Proven Results
1. The City of Cincinnati passed the "Renters Choice" bill in January 2020. Under the legislation, landlords are required to provide one of the three alternative options in lieu of security deposit: low-cost insurance, a plan in which the tenants make equal payments of the deposit over the course of their first six months of a tenancy; a reduced security deposit that is no more than half of the first month's rent; or rental security insurance in which tenants pay an insurance company a low-cost, non-refundable monthly fee (4).
The legislation has made it easier for residents to move into desired rental units, and it has addressed the need of more affordable housing with more than 100,000 households paying more than 30 percent of their salary for housing in the City of Cincinnati (5). 
2. The City of Atlanta became the second U.S. city to pass "Renters Choice" legislation in October 2020. The city acts to put low-cost alternatives to the security deposit for renters using insurance programs amid the COVID-19 crisis (6).
What Action Steps Can We Take?
Breaking down these barriers to renting must be a top priority for lawmakers. "Renters Choice Housing" was proposed at a New Deal Leaders Conference to address housing concerns. The proposed policy would offer renters the option to enroll in low-cost insurance plans in lieu of security deposits (7).

Renters would pay a flat fee every month instead of a lump-sum upfront deposit. In exchange, insurance companies guarantee apartments against damages (8). For example, for a $2,500 apartment rent, the typical monthly insurance would be $19. Security deposits are traditionally equal to one month of rent, which would be an additional $2,500 upfront in this instance; however, the renter opting for the insurance policy would only pay $228 annually.
Passing "Renter's Choice" legislation requiring landlords to accept security deposit alternatives, such as monthly low-cost nonrefundable insurance fee and payment installments, which breaks the security deposit into various repayments, will lower move-in costs for tenants. "Renter's Choice" legislation may also include limits to the total amount of required coverage, including rental insurance coverage, to twice the amount of the monthly rent to make a rental house more affordable and expand the number of people who are able to rent.
Security deposit alternatives are a win-win for all tenants and property owners. These alternatives will lower the burden of upfront move-in costs for renters while protecting property owners against damages and unpaid rents. However, it is imperative that protections for property owners are also established in any alternative to ensure that tenants are compelled to pay insurance throughout the entire term of their lease.

10: Eliminate Improper Tax Exemptions
Conducting an overall review of property tax exemptions to determine if there are opportunities to eliminate or restructure will provide oversight. A comprehensive review of property tax exemptions will ensure that they are applied correctly to the applicants who qualify and provide transparency to taxpayers.
Proven Results
In May of 2019, the Comptroller's Office's released an audit report with recommendations for improvements to the Department of Assessment processes to ensure that exemptions are applied correctly to qualified individuals and properties.
The audit found about $33 million of questionable tax exemptions, which shifted the additional financial burden onto other County homeowners.
These questionable exemptions ultimately spread the cost of higher taxes onto other homeowners. The audit estimated that the resulting tax shifts cost Nassau County homeowners an average of $267 per household over a three-year audit period. Furthermore, these shifts disproportionately impacted lower-income communities, as homeowners in these communities are less likely to grieve their taxes and ultimately were faced with an inequitably higher tax burden. For more details of the audit, read more here.
Some specific findings included:
  • Over 8,400 Veteran Exemptions (18% of those granted) had service date information that was unrealistic, incomplete, and/or inconsistent, including 91, where the owner was said to be 133 years old or older.
  • Nassau’s low “level of assessment” led to a disproportionate “personally owned clergy property” exemption which inadvertently resulted in the tax base being deprived of over $272 million in annual taxable value. 
What Action Steps Can We Take?
The Comptroller's Office audit of the Department of Assessment made a number of specific recommendations to increase security, prevent fraud, and correct the issues found. Some recommendations included:
  • Implement a one-time verification and update of all existing exemption categories that are not recertified annually to ensure that all previously certified exemptions are still eligible and valid.
  • To assure that exemption applications are properly and equally processed, update and/or create operating procedures for the applications for various exemption types used in Nassau County and provide adequate training to staff on policies and procedures.
  • All future County Executives and Legislatures should appoint only qualified individuals with proper certifications to be County Assessor.

11: Reduce Reliability on Paper-Based Processes / Shared Service Agreements and Facility Enhancement to Reduce the Cost of Materials
As many businesses and individuals began to work remotely, the COVID-19 pandemic has allowed us to transform the way we work with technology. There is a substantial cost to governments of all levels to purchase, print, and store paper. An elimination of paper in government operations can help governments save purchase costs of paper, ink, printers, file cabinets, postage to mail the paper documents created, and personnel costs associated with handling paper documents.
Many governments now allow electronic signatures and records, increasing efficiency and streamlining the creation to contract finalization. More and more local governments use electronic banking as a faster and less expensive alternative to paper transactions.
According to data published by the White House Office of Information and Regulatory Affairs, paperwork costs the government $38.7 billion and the public $117.0 billion each year (9). Moreover, Intellicap reported that the average savings per electronically signed document is $22.18, and the average turnaround time is reduced by 13.5 days (97%).
Furthermore, municipalities can curb expense growth while maintaining service levels through shared services. Shared services reduce operational costs or “back-office” services, remove unnecessary red tape, and deliver greater service reliability. Similarly, facility enhancement can provide potential savings by eliminating unnecessary back-office services, standardize fuel costs, and ensure that fleets are cost-effective and efficient.
Proven Results
Local Highlight 1
Enterprise Resource Planning
For decades, Nassau County has used a now-obsolete computer system to manage more than $3 billion annually in County spending, including the payroll for 14,000 employees of the County and Nassau Community College. This system, based on computer coding from 1992 and no longer supported, wastes staff time, creates inefficiencies, and would severely hamper the ability for the County to operate in the event that the system fails.
Over the first three years, the Comptroller's Office made successful advances toward:
  • Replacing the County's legacy mainframe-based financial system
    • In 2019, the Comptroller's Office issued a request for proposals as part of a plan to replace this mainframe-based financial system, which has been in use since 1999 and has been classified as a "material weakness," a significant deficiency in financial reporting.
    • In 2020, awards were made for pre-implementation services, as well as project management and quality assurance services to ensure that there is proper oversight and ongoing monitoring throughout the financial system replacement project.
  • Implementing a new Human Resource application
    • In 2020, recognizing the amount of time and millions of dollars in costs that it was taking to implement a new Human Resource application, the Comptroller's Office immediately worked with the County Executive's Office to prioritize getting this project across the finish line. The application, facing years of delays, is user-friendly, modern, and intuitive to use.
Local Highlight 2
Electronic Claims & Vendor Portal
Working with the County Executive's Office and in furtherance of the effort to maximize the County’s technological and human resources, our Office has developed an electronic claims processing program which is currently being used by a number of large County vendors and will soon be utilized by all vendors.
The new vendor claims process eliminates paperwork, enabling vendors to submit claims electronically through an online portal and have them reviewed and approved electronically by County Departments and the Comptroller’s Office. These changes make doing business with Nassau more transparent and business-friendly by allowing vendors to track their payments in real time. The initiative also introduces more efficiency into the claims process, while providing additional oversight and audit trails built into the functionality.
All vendors can now electronically register with the County, giving vendors more transparency into opportunities to do business with the County, increasing the number of vendors who do business with the County, more efficiently vetting vendors and allowing for quicker payments to vendors.  More competition among vendors creates competitive prices for taxpayers.
Local Highlight 3
The Comptroller's Office completed an audit of Nassau County Take Home Vehicles in 2019 and revealed a number of internal control issues.
The audit made several recommendations. The Administration agreed with the majority of the findings and have already undertaken a number of corrective actions based on the report. For more details of the audit, read more here.
Nassau County Executive Laura Curran joined with the shared services panel in December and approved the 2020 Nassau County Shared Services and Taxpayer Savings Plan. The Plan's key initiatives consist of: creating “Nassau Saves” online portal to expand the use of joint purchasing and the sharing of equipment and personnel; shared information technology services; shared vehicle maintenance facilities and fueling stations; and enhanced energy efficiency programs (10).
Many of the 2019 projects remain in the initial stages of implementation and comprise a significant portion of the 2020-21 Shared Services and Taxpayer Savings Draft Plan. The proposals outlined in the 2020-21 draft plan are expected to save an estimated $6.1 million in taxpayer dollars (11).
  • Erie County, New York, implemented a shared services technical infrastructure in the late 2000s, as most departments and agencies were previously responsible for their own technical infrastructure. This effort was divided into five infrastructure layers: workstations, networks, server, storage, and enterprise resource planning (ERP). As a result, standardized workstations provided a $6.7 million savings over a five-year period and the replacement of six legacy systems with an ERP system resulted in a $3–4 million annual savings (12).
  • Forsyth County, North Carolina, saved $800,000 by right-sizing their Fleet and sharing vehicles by eliminating 8% of their total fleet, all of which were eligible for replacement. The County also greened their fleet by putting the right vehicles in the right areas and putting mileage on older model vehicles rather than have them remain unused; streamlined fleet management processes to save time and reduce cost; and collected data to make essential right-sizing decisions (13).
  • The Massachusetts Department of Health and Human Services freed up 36% of its warehouse by scanning and digitizing paper documents (14).
  • Denton County in Texas implemented a new content management system to digitize the community’s records. The system has provided an estimate of $1 million in savings and 24-hour access to records (15).
What Action Steps Can We Take?
Nassau County has paved the way for other counties and municipalities in cost-saving by shared services with the initiative implemented by County Executive Curran since December 2019. With the economic challenges amid COVID-19, below are efforts where more possible savings can be found:
1. Place various departments that share similar services in one building to clear unneeded office space. This will create user-friendliness for residents and enhance communication, coordination, and problem-solving between agencies;
2. Conduct workforce surveys for shared services and analyze results to consolidate or eliminate unnecessary back-office functions;
3. Right-size fleets that are eligible for replacement;
4. Replace fleets with green vehicles through the implementation of the Green Fleet Policy. By greening County and municipal fleets, local governments support the infrastructure needed to allow more sustainable transport options and pave the way for a broader systemic mobility transition;
  • The Ulster County Sustainable Green Fleet Policy was adopted by the Ulster County Legislature in August of 2015 and approved by the County Executive in September of 2015. The Green Fleet Policy sets forward requirements to inventory the fleet, monitor fleet fuel usage, and optimize the usage application of existing vehicles. The law further mandates the purchase of new green fleet vehicles to meet a green fleet goal, ensuring that a minimum of 5% of the fleet by 2020 are Green vehicles, and 20% of passenger vehicles purchased, leased, or otherwise obtained thereafter will be Green (16). 
5. Services between the city or town and the schools can be shared, possibly in the financial, IT services, and human resources arenas, for potential savings.
6. Establish a task force to examine the feasibility of transitioning to digital records.
  • A bill sponsored by Democratic State Senators Nilsa Cruz-Perez and James Beach has been introduced in the New Jersey State Legislature. The bill would create a task force consisting of 15 members from different departments. The task force would guide the transition of a paperless government and examine cybersecurity protections and technology update across all departments. The bill is pending a vote and would need to be approved by the New Jersey State Legislature (17).

12:  Green Investments: Wind and Solar
Green roof investments are an economic opportunity to utilize unused rooftop space across the County. Green roofs not only add aesthetic appeal to otherwise bare rooftops but also provide a plethora of benefits, including: saving on energy costs, air quality improvements, storm-water management, moderation of urban heat island effect, water diversion, and local job creation.
American Rivers posits that a $10 billion investment could create 190,000 jobs by building 48.5 billion square feet of green roof area (18). The 2011 Congressional report from General Services Administration highlighted that extensive green roofs would provide $0.084 per square foot in annual savings compared with conventional roofs. Conservative analysis places the average life expectancy of a green roof at 40 years, compared to 17 for a conventional roof (19). In addition, the U.S. Environmental Protection Agency (EPA) reported that green roofs could reduce building energy use by 0.7% compared to conventional roofs, reducing peak electricity demand and leading to an annual savings of $0.23 per square foot of the roof’s surface (20).
According to the solar community, Long Island has the potential commissioning of about 19.5 mW of solar energy systems. For the past year alone, EmPower Solar completed several major projects on Long Island, including a seven-building installation for the Long Beach School District and the addition of a 1,457 kW ground-mounted solar system to an existing 634 kW rooftop system at Estee Lauder in Melville (21). 
Green roofs can also be used as sites for urban farming, which creates jobs, increases local food production at locally owned businesses, and stimulates more local economic transactions. Without a complicated distribution network, local farmers are more connected to their market and avoid the extra costs and supply chain delays associated with intermediaries, which allows them to adapt quickly to changing demand and pass the savings on to their customers while still maximizing profit. 
Proven Results
  • The green roof at the Jacob K. Javits Convention Center, one of the largest green roofs in New York City absorbs up to seven million gallons of storm-water run-off annually and has reduced the facility's annual energy consumption by 26 percent (22).
  • The Department of General Services (DGS) in Washington, D.C., launched a comprehensive roof asset management program on the entire DC Public Schools (DCPS) roof portfolio in late 2010. DGS has converted 25% of its roofs into SmartRoofs, which produced renewable energy, prevented storm-water runoff, and created hundreds of green jobs for D.C. residents (23).
What Action Steps Can We Take?
1. Municipalities can use many tools and incentives to encourage the implementation of green roofs and stimulate the local market. 
  • Financial incentive programs would encourage developers to build green roofs. Incentives could be direct, such as grant or subsidy, or indirect, such as rebate of some of a fee.
    • New York City's Green Roof Property Tax Abatement Program offers a one-year tax abatement for green roofs built on residential and commercial buildings in New York City (24). An enhanced abatement of $15.00 per square foot will also be provided to construct green roofs on properties located within specifically designated New York City community districts.
2. Community Choice Aggregation (CCA) is a municipal energy procurement model that allows participating local governments to procure energy supply services and distributed energy resources (DER) for eligible energy customers in the community. Customers not wishing to participate may opt-out.
  • By grouping multiple towns or municipalities, local governments can negotiate lower prices. The programs can lower gas and/or electric rates for community members by as much as 10-15% (25). CCA can also drastically reduce communities' carbon footprint by bringing in clean energy and decrease communities' reliance on national energy markets, providing more flexibility to adapt as times change.
  • In 2019, the Suffolk County Legislature created the CCA Task Force to explore the possibilities, challenges, and make recommendations for creating CCAs within the County. The task force released a report in 2020 to guide towns and villages in Suffolk County on how to create CCAs (26).
  • The Comptroller’s Office encourages the shared coordination of a countywide task force comprised of municipalities across Nassau County to pursue this opportunity.
Don't Forget About Wind
The Biden administration's multipronged effort to jump-start the nation’s offshore wind industry sets a target for 30,000 megawatts of offshore wind energy, enough to power tens of millions of homes, by 2030, and the creation of 80,000 jobs. This plan (27):
  1. Contemplates new lease areas and complete reviews of at least 16 construction and operation plans for other wind-farm plans by 2025;
  2. Includes new port upgrade investments totaling more than $500 million;
  3. Calls for up to two new U.S. factories for each major wind-farm component, including blades, towers, and foundations;
  4. Access to $3 billion in debt capital to support the industry through the U.S. Department of Energy’s Loan Programs Office.
Here on Long Island
  • There are eight identified areas of around 80,000 acres in the New York Bight, which is a coastal area between Long Island and the New Jersey long. A bight is a gradual bend/recess in the shoreline that forms a large, open bay and the New York Bight is part of a larger geographical area called the Middle Atlantic (or Mid-Atlantic) Bight, which extends from Cape Hatteras, North Carolina, north to Cape Cod, Massachusetts.
  • These 8 areas could produce 7,600 megawatts of wind energy, enough to power 2.7 million homes. Two contested offshore wind-energy areas off of the Hamptons area were removed due to conflicts with commercial fishing, shipping and lack of commercial viability.
  • Most are nearer the New Jersey coast, while two, called Hudson North and Central Bight are nearer to Long Island.
  • The Federal Bureau of Ocean Energy Management already has leased around 80,000 acres in the Bight for Equinor’s Empire Wind project, scheduled to be built by 2024. It will be around 15 nautical miles from the coast, starting near Jones Beach (28).

Looking Toward the Future
These are just several ways in which local governments can make smart decisions to improve municipal finances, help real people make a real difference and also lead to a more sustainable economy.
Although this is the final installment of this three-part series, the Comptroller’s Office will continue to highlight innovative and proactive solutions like these that can help ensure Nassau County’s long-term financial success.
In the meantime, if there are issues that you think the Policy and Research Team should look into, or you have comments on our office’s work, please feel free to reach out to us directly at ReportItReformIt@nassaucountyny.gov.

Special thanks to all the stakeholders for their contribution to this project:
Long Island Business Council; Nassau County Council of Chambers of Commerce; Long Island Builders Institute; Association for a Better Long Island; Nassau County Village Officials Association (NCVOA); the Executive Board of Nassau County Village Officials Association (NCVOA); EmPower Solar; Long Island Association; New York Solar Energy Industries Association (NYSEIA); the U.S. Green Building Council-Long Island Chapter; Edgewise Energy; Vision Long Island; and Ernst & Young LLP.

Work Cited
1."About Us." Rhino, 2020, https://www.sayrhino.com/about.
2."Report on the Economic Well-Being of U.S. Households in 2017." Board of Governors of the Federal Reserve System, May 2018, https://www.federalreserve.gov/publications/files/2017-report-economic-well-being-us-households-201805.pdf.
3.Long Island Association. (Fall 2018). Long Island Association Business Fact Book: A Comprehensive Guide to Business and Public Sector Activity on Long Island. Retrieved from https://chambermaster.blob.core.windows.net/userfiles/UserFiles/chambers/2181/CMS/LIA-Business-Fact-Book---Fall-2018.pdf-2.pdf.
4.Johnson, Marty. "Cincinnati Passes Landmark 'Renter's Choice' Bill." The Hill, 15 Jan. 2020, https://thehill.com/homenews/state-watch/478479-cincinnatis-passes-landmark-renters-choice-bill-that-could-solve.
5."Stories of the Housing Crisis in Cincinnati: The Urgent Need for a Better Path Forward." Cohear, June 2019, https://docs.wixstatic.com/ugd/0f5c66_6609a1b19f034d8e9324f10f1e347a08.pdf.
6.Stein, Jordan. "Rhino Statement on Passage of 'Renter's Choice' Legislation by the Atlanta, GA City Council." Business Wire, 8 Oct. 2020, https://www.businesswire.com/news/home/20201008005963/en/Rhino-Statement-on-Passage-of-%E2%80%9CRenter%E2%80%99s-Choice%E2%80%9D-Legislation-by-the-Atlanta-GA-City-Council.
7."NewDEAL Applauds Passage of Renters Choice Legislation in Cincinnati." The NewDEAL, 2020, https://newdealleaders.org/news/newdeal-applauds-passage-of-renters-choice-legislation-in-cincinnati/.
8."About Us." Rhino, 2020, https://www.sayrhino.com/about.
9."Information and Regulatory Affairs." Office of Management and Budgethttps://www.whitehouse.gov/omb/information-regulatory-affairs/.
10.The Office of the Nassau County Executive Laura Curran. "Nassau County Unveils Shared Services Panel." Long Island Weekly, 10 Jan. 2020, https://longislandweekly.com/nassau-county-unveils-shared-services-panel/.
11."2020-21 Nassau County Shared Services and Taxpayer Savings Draft Plan." Nassau County Executive Laura Curran, The Rockefeller Institute of Government, The Benjamin Center, Nov. 2020, https://www.nassaucountyny.gov/DocumentCenter/View/30931/2020-21-Nassau-County-Shared-Services-and-Taxpayer-Savings-Draft-Plan?bidId=.
12.Burns, Timonthy J., and Kathryn G. Yeaton. "Success Factors for Implementing Shared Services in Government." IBM Center for the Business of Government, 2008, https://taxpayersci.org/wp-content/uploads/Success-Factors-Shared-Services.pdf.
13.Fleet, Agile. "Case Study: How One County Saved $800,000 by Right-Sizing Their Fleet & Sharing Vehicles." American City & Council, 13 June 2019, https://www.americancityandcounty.com/2019/06/13/case-study-how-one-county-saved-800000-by-right-sizing-their-fleet-sharing-vehicles/.
14."Shared services Agreements Save Local Governments Money and Resources." Moody's Investors Service, U.S. Public Finance, 11 Dec. 2019, https://d1ung6i9j8i9xc.cloudfront.net/wp-content/blogs.dir/123/files/2019/12/New-Jersey-Municipalities-in-Shared-Service-Agreements-are-Curbing-Expenses-Saving-Money-and-Resources-1.pdf.
16."Ulster County Green Fleet Policy." Ulster County Department of the Environment, Ulster Countyhttps://ulstercountyny.gov/environment/sustainability-energy/green-fleet-initiative.
17.State of New Jersey 219th Legislature. Senate, No.1955.  25 Feb 2020, https://www.njleg.state.nj.us/2020/Bills/S2000/1955_I1.PDF.
18."About Green Roofs." Green Roofs for Healthy Citieshttps://greenroofs.org/about-green-roofs.
19."The Benefits and Challenges of Green Roofs on Public and Commercial Buildings: A Report of the United States General Services Administration." The United States General Services Administration, May 2011, https://www.gsa.gov/cdnstatic/The_Benefits_and_Challenges_of_Green_Roofs_on_Public_and_Commercial_Buildings.pdf.
20."Using Green Roofs to Reduce Heat Islands." United States Enviornmental Protection Agencyhttps://www.epa.gov/heatislands/using-green-roofs-reduce-heat-islands.
21."EmPower Solar Opens Operations Center in Flourishing Farmingdale Community." EmPower Solar, 17 Nov. 2020, https://www.empower-solar.com/wp-content/uploads/2020/11/2011-17-FarmingdaleWarehouse_PressRelease.pdf.
22."Explore Green Roofs in NYC." Green Roofs NYChttps://www.greenroofsnyc.com/explorenyc.
25."Community Choice Aggregation Overview." Southern California Edisonhttps://www.sce.com/partners/partnerships/community-choice-aggregation.
26."Community Choice Aggregation Task Force: Report to the Suffolk County Legislature." Energy and Climate Action, Suffolk County Department of Economic Development and Planning, Dec. 2020, https://www.scnylegislature.us/DocumentCenter/View/74893/122020-Suffolk-County-CCA-Task-Force-Final-Report-PDF.