Hoboken Mayor Ravi Bhalla has rolled out a preliminary $118 million budget which he says would come with an overall tax increase of just 1.4 percent, though some electeds contend that they weren’t given the spending plan until after the press.
By John Heinis/Hudson County View
“Like the rest of the country, Hoboken’s economy and finances have not been immune from the coronavirus pandemic. In the face of unprecedented budget challenges compounded by COVID-19 and continuing uncertainty about the virus and the economy, we are putting forward a responsible, balanced budget that provides the services our community expects and continues to invest in our future,” Bhalla said in a statement.
“Through a combination of difficult cuts and new revenue sources, we have chipped away at a nearly $20 million budget shortfall and are introducing a budget that would result in an overall property tax increase of just over one percent. I look forward to working collaboratively with the city council in the weeks ahead as they consider and ultimately adopt a budget.”
Entering the fiscal year, increased costs and revenue losses created a roughly $7.4 million budget shortfall, compounded by a $6.4 million reduction in regenerating surplus, and $5.9 million in added costs and lost revenue due to COVID-19 for a total budget impact of approximately $19.8 million, according to the mayor’s office.
The budget gap has since been reduced by approximately $10.9 million and the introduced budget proposes using $3.3 million of the city’s non-regenerating budget surplus, officials said.
The city council also approved the first reading of a $4.7 million bond agreement with the local library at their June 24th meeting.
Finally, the remaining $5.5 million gap would be closed by a 9.8 percent increase in the municipal purposes tax.
In Hoboken, municipal taxes are only 33 percent of the city’s total tax bill: county taxes are 36 percent, schools are 26 percent, the library is 3 percent and open space is 2 percent.
Furthermore, since the board of chosen freeholders approved a budget that has a 6.52 percent budget decrease for the Mile Square City, the overall tax impact on property owners from the introduced budget would be an increase of around 1.4 percent.
For the average assessed property in Hoboken valued at $522,000, that would equate to an annual tax increase of $115, or $9.50 per month.
1st Ward Councilman Mike DeFusco, who has taken shots at the administration for weeks over not releasing the budget, said in a statement that the administration shouldn’t be celebrating a modest tax increase made possible by the county.
“Hoboken’s long existing budget woes are a direct result of a pattern of gross misspending, awarding politically connected contracts and giving out patronage jobs that we are now facing the consequences of,” DeFusco stated after tweeting that he was still yet to see the budget.
“It is nothing shy of irresponsible for Mayor Bhalla to continue using a global health crisis as an excuse for years of poor financial planning, even after recovering $1.4 million in federal aid. Giving the council 48 hours to review the proposal before asking us to adopt it is the very gimmicky budget the mayor swore he’d never introduce and Hoboken taxpayers deserve better than this.”
Furthermore, 2nd Ward Councilwoman Tiffanie Fisher mocked the fashion in which the preliminary budget was revealed and, like DeFusco, reiterated that the city owes the county for putting together a manageable spending plan.
“Financial acumen, transparency and leadership is a weakness of this administration which is why the city council has been focused from the start on seeing the budget (which was sent to the Council for the first time after the press statement was sent),” she said in a statement this morning.
“We are hoping that in a year where many are suffering financially that the mayor’s budget reflects the best possible outcome for Hoboken residents. To date, what we have seen has shown few cost cutting measures, an overstatement of the impact of COVID, reliance on surplus and one time revenue sources and kicking 2020 costs into 2021 … Also, the mayor should be buying the county flowers given its significant rate reduction allows a 9.8% municipal rate increase to look much lower overall.”
She also said she looks forward to working with the council to deliver a fiscally responsible budget for 2020.
The Hoboken City Council will convene via Zoom on Wednesday at 7 p.m.