A battle over a potential $25 million bond may hold hostage the 2006-2007 municipal budget and may become the focus of combat at the Jan. 17 city council meeting.
While the city council is expected to discuss and take public comments on amendments to the city’s $106 million budget, the real topic of conversation may be the $25 million bond the city council is being asked to float in order to cover expenses to do infrastructure work at the former Military Ocean Terminal.
Part of a five year plan, the city council has used money received as down payments from companies looking to developed MOTBY. Because of restrictions imposed by the federal government when turning over the property, the city of Bayonne cannot yet sell the land and use the money to balance the budget. So instead, developers give the money to the Bayonne Local Redevelopment Authority, which in turn gives the money to the city for use in balancing the budget. The city then floats a bond for the same amount, allowing the BLRA to use the borrowed money to do work at the base.
This practice may stop if Councilman Anthony Chiappone and Gary LaPelusa vote against the bond. The city council needs four out of five votes to pass a bond.
As introduced in September, the $106 budget was $2.4 million higher than the previous municipal budget. But council cuts and the receipt of $1.5 million from the state in extraordinary aid has reduced the expected increase dramatically, with additional cuts expected to be generated out of the amendment meeting.
Health benefits, pensions and increases in salaries are the largest contributing factors to this year’s increase.
Chiappone, however, said the budget depends on the $25 million from the BLRA, and said that he seriously questions this.
“How can we be $25 million short every year?” he asked, saying that he is opposed to the bond. “Bonding is not fixing the problem. We have to look at why we are overspending.”
Chiappone is also concerned about source of revenue since the money for the budget actually comes from the BLRA and developers.
“The last two bonds we passed were tied to specific development deals,” he said. “This one is not.”
Last year, Chiappone raised concerns when the city council voted for the bond prior to the BLRA signing an agreement with H. R. Horton. When H. R. Horton backed out of the deal, the city budget was short $11 million because the BLRA did not have the down payment to give the city.
“I want to know where the money is coming from before we agree to pass a bond,” he said.
Yet if Chiappone and Gary LaPelusa vote against the bond, the city council budget could go into default.
Chiappone to set up budget review committee
In order to get input from others outside the city council, Chiappone is looking for people will join a budget review committee.
Although he and others were part of a similar committee two years ago, Chiappone said the new committee is not appointed by Mayor Joseph Doria.
“This has a different slant,” he said “The mayor had control over the last one. I am asking the mayor’s representation on this one as a courtesy.”
Chiappone said he is looking for a committee that can up with creative ways to deal with the city’s budget problems.
“We want to look throughout the county to see what other people are doing,” he said. “This is completely positive.”
The ad-hoc committee, which is expected to hold its first meeting next month, would see ways to explore avenues of revenue producing ideas to help offset municipal budgetary expenses.
“With Bayonne leading the county in taxes, I felt that it would be beneficial to solicit the input of our residents to help provide suggestions to help supplement municipal budgets and lower taxes,” he said. “The best resource for suggestions are our residents, and I believe that we can collectively brainstorm to ‘think outside the box’ and come up with innovative ideas to help the city generate revenues and supplement the municipal budget.”
Chiappone previously chaired the city’s Financial Budget Review Committee which made suggestions primarily targeted towards budget cuts, but explained that this committee would be different in that this committee would focus not on budget cuts, but will explore ways that the city can creatively fund programs and generate revenues.
“I believe that we have a vast pool of knowledgeable and talented residents who are be able to come up with creative suggestions,” he said. “I am sure that there are people who are able to research through the internet, the success stories of other communities as well as provide suggestions of a different slant. I want to call upon these Bayonne residents who feel they have ideas to offer to help our city at this time of fiscal crisis where there is an extreme budget deficit.”
Chiappone said that he has discussed this idea with the mayor in a meeting on the budget, and has asked Mayor Doria to provide administration representation on this board. LaPelusa has agreed to participate on this committee as well and will serve as co-chair.
“I believe that every option and every idea should be explored to help provide much needed tax relief for the residents of Bayonne,” LaPelusa said. “I am a firm believer of running City Hall like a business, and like a good business, we should be looking for new ideas to help generate revenues that can offset rising taxes. I am hoping to providing important input on this committee as well as look forward to hearing the recommendations of the public.”
Some of the ideas might include developing Friends of Recreation that could raise funds for city recreation programs the way Friends of the Library do for library programs.
Chiappone encouraged interested residents to contact him at (201) 697-2170 or email him at achiappone@yahoo.com. Chiappone also invites residents who are not able to physically attend the monthly meetings (first date to be announced) to serve on a special “internet committee” which will provide online research and which will hold special cyber meetings to discuss possible revenue sources and budget revenue generating ideas.