Jersey City MUA tight-lipped over $11M advance franchise payment to the city

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The Jersey City Municipal Utilities Authority doesn’t seem interested in talking about an $11 million advance franchise payment to the city that was approved last month prior to the council passing the city’s $658 million budget.

By John Heinis/Hudson County View

” … The City of Jersey City and the JCMUA entered into a Franchise and Service Agreement that allows the JCMUA to operate the city’s water system,” says the resolution approved at the MUA’s July 23rd board meeting.

“Whereas, in exchange for the right to operate the City’s water system the JCMUA has agreed to make annual monetary payments to the City … the City has recently requested that the JCMUA make an advance franchise payment in the amount of $11,000,000.”

The measure, sponsored by Board Secretary Maureen Nally and seconded by Vice Chair Jeanine Zampella, and passed unanimously (5-0), according to a copy of the resolution and meeting minutes obtained via an Open Public Records Act request.

As of this writing, neither are available on the MUA’s website, despite sections being listed for both.

The meeting minutes say that the autonomous agency is currently in a position to assist, therefore “reducing any hardship on the city side.”

Board Counsel Frank Borin, of DeCotiis, FitzPatrick & Cole, LLP, added that there was precedent for such an action, which last occurred in 2009, based on the minutes of the meeting.

The MUA’s director, deputy director, and deputy director all did not return calls and/or emails seeking comment, and when asked about what the advance franchise payment would mean for their finances during Thursday’s meeting, no one bothered to answer the question.

Board Chair Maureen Hulings said that while there was no question and answer portion of the meeting, the board would consider any public remarks posed to them.

That didn’t yield any results, as the meeting adjourned after 20 minutes or so without any board member or official addressing the advance franchise payment.

In late 2014, Jersey City and the MUA entered into a new franchise agreement that would net the city over $32 million through 2027. The particulars of the agreement were not immediately available.

City spokeswoman Kimberly Wallace-Scalcione expressed gratitude in the MUA’s willingness to help given the financial strains of the current public health emergency.

“This represents an advance in payment of the franchise fee that the city took due to the pandemic and the strain on the municipal budget,” she said.

“This will be adjusted accordingly going forward as the pandemic has put unusual stress on the city budget, and the priority for the city was not to pass this hardship on to taxpayers with a tax increase.”

The Jersey City Council approved the budget introduced by the administration, which came with no municipal tax increase, at a nearly nine-hour meeting last week.

The majority of the time was spent listening to residents asking for the governing body to defund the police by 50 percent – which didn’t happen.

Mayor Steven Fulop had said previously that the city was anticipating a $70 million financial loss due to COVID-19.

1 COMMENT

  1. Sounds suspiciously like the deal former Hoboken Mayor Russo made when he sold off the water rights to plug a budget shortfall and the residents have regretted for decades.

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