Before the Union City Board of Commissioners was able to adopt the $70.8 million municipal budget for the soon-to-end 2001 fiscal year May 10, the board first passed amendments to the budget. The amendments were necessary due to a typographical error made by the state.
In a letter dated April 6, the state said that the city would receive $2.9 million in state Distressed Cities’ aid. However, in a letter dated April 9, the amount was changed to $2.5 million.
“The state said that we were actually receiving $2.5 million all along,” said Union City Mayor Brian Stack. The $2.9 million was apparently a typo, but the city thought it was correct and budgeted the $2.9 million.
Rather than allowing the taxpayers to pick up the burden of the $400,000, Stack said that the city has cut expenditures in all departments to make up the difference.
“We made sure that every department felt some of it,” said Stack. “We went across the board.”
Former Gov. Christine Whitman suggested $11 million in state aid to Union City in her budget address before leaving office. However, with the change of administration, Union City was only able to receive $2.5 million in Distressed Cities Program aid and $1.4 million for the Police and Fire Pension Savings Act, which is funding that all municipalities receive.
“I’m not happy with the amount of state aid we received,” said Stack at the hearing and final vote on May 10. “We could have done better on state aid.”
The board passed the amended budget with a vote of 5 to 0.
Lowering taxes
While Stack is not happy with the amount of state aid that the city received, Stack and the board were happy to pass a budget that called for a slight decrease in municipal taxes.
Last year, the city voted to increase taxes by $3 million, causing many resident complaints and leading to the recall and resignation of former Mayor Raul “Rudy” Garcia.
Last year’s budget was introduced 10 months late and relied on $6.7 million in one-shot revenues, some of which did not go through, adding to the city’s $15 million structural deficit.
“This is a bare bones budget,” said Stack. “We do not rely on any one-shot revenues or sale of property.”
This budget calls includes a $37.8 million tax levy, lowered from the $38.7 million levy set last year. Taxpayers will see a $70 decrease per quarter in the tax rate per $100,000 of property owned. This totals a $280 decrease for the year per $100,000.
“This is only the beginning,” said Stack who would like to see taxes lowered even more in the upcoming years. “We are working very hard to reduce the budget even further.”
Stack credits this decrease to the hiring freeze in the city and a decrease in overtime for city employees. The police department alone lowered their overtime from $500,000 in 2000 to $260,000 this year. Stack added that the hiring freeze would continue at least into the next year.
This budget also completely wipes out a $2 million cash deficit that the city has accumulated. However, it still leaves a $15 million structural deficit, which is a deficit that will recur every year and be plugged up with new revenue sources until a regular revenue stream is found to fill it.
The financial team that worked on this budget was Weehawken Mayor Richard Turner, Robert McKechnie, Kathy Stack, Abe Antun, and Commissioner Michael Leggiero.