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Hard times in the cash-strapped Hamptons

Jonathan Owen
Saturday 09 August 2008 19:00 EDT
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It is the last place you would expect to find close to bankruptcy. But the millionaires' playground of East Hampton, on New York's Long Island, is $12m (£6.25m) in debt.

At one stage the town council is said to have had less than a thousand dollars in ready cash – not far short of what a restaurant waiter might expect in a tip from some East Hampton residents, who include Steven Spielberg and Jerry Seinfeld.

An economy drive means that the billionaires and celebrities who flock to the resort each summer could soon have to sunbathe on unraked beaches and may even have to tidy up their own garden rubbish.

The cash-strapped town council may also have to consider its policy of keeping the harbour stocked with clams, oysters and scallops.

The US rap star Sean Combs, financier Ron Perelman and businesswoman Martha Stewart are also among the rich residents who could face a tax rise of 25 per cent to close the deficit.

Average property prices in East Hampton are almost a million dollars, yet the multimillionaire locals pay just 1.1 per cent property tax.

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