SIDEBAR BELOW
Mayor David Roberts began the process of preparing the coming year’s 2008-2009 budget on Wednesday by having his Finance Department present it to the City Council that night and explaining it personally to the press that same morning.
The proposed $92.1 million spending plan, which runs from this past July 1 through June 30, 2009, may result in a municipal property tax increase of 7 percent or more, according to Roberts. But he is still working on ideas to reduce spending or find other revenue sources, including possibly reducing the city’s work force by as much as 10 percent as a last-ditch measure.
Any financial proposals are subject to the will of the state, and could change before a final budget is approved.
The tax increase in the regular budget does not cover another possible increase that may come from the $10 million or more in spending that was underfunded in last year’s budget. That money will have to be made up in this year’s budget or in future budgets. State officials are talking about possibly spreading the impact over the next three years.
Last year’s budget was so late – having been passed on the very last day of the fiscal year – that the state was forced to come in and start making financial decisions for the city.
Now, the city now needs state approval for any financial decisions it makes, but it can make proposals.
A court will decide extent of state involvement
At Wednesday night’s City Council meeting, the council’s agenda was shortened considerably by the state oversight that limits their right to make decisions.
According to state Department of Community Affairs Spokesman Chris Donnelly, the DCA has petitioned the courts to begin the takeover process of the city’s finances.
A court will decide whether or not Hoboken is in “financial distress” according to guidelines already set.
If the court does find the city to be in “distress,” the DCA and the city will then appear before the state’s Local Finance Board to determine whether the state will simply provide oversight, or a complete takeover.
Council debates first quarter budget
Last Wednesday, the state allowed the council to vote on temporary appropriations for the first quarter of the new fiscal year – usually 26.5 percent of last year’s budget.
Some of the council members were not sure about giving the funds over to the administration.
Dawn Zimmer, 4th Ward Councilwoman, said she was hoping the council could delay the appropriations until checking with the DCA and hearing the Roberts’ spending plan.
“Our power is being eclipsed.”
– Peter Cammarano
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“We have the opportunity to cut anything from the mayor’s spending plan that you want to cut,” she added.
She noted that in the meantime, they should give the city some funding for recreation programs and other unfunded departments.
Peter Cammarano, a councilman-at-large and possible 2009 mayoral candidate, has been reminding the council of the watchful eye of the state as they make their decisions.
“We I think it’s pretty clear they’re watching over us,” he said. “Our power is being eclipsed.”
Peter Cunningham, 5th Ward Councilman, agreed with Zimmer. “Until we see the spending plan and some action, I’m really not interested in passing this [first-quarter] budget,” he said.
“We’re doing the same thing we’ve done before,” complained 2nd Ward Councilwoman Beth Mason, who also may run for mayor next year. “I’m asking that we have another meeting.”
Michael Russo, the 3rd Ward Councilman and another rumored mayoral candidate, offered up a compromise.
He recommended the council cut three months’ worth of appropriations down to two months’ worth, and come back to vote again after two months were up, if necessary.
The administration was asking for $30.9 million, and Russo said to cut that to $20.9 million.
Seven councilpersons voted in favor of Russo’s proposal, leaving Mason as the only ‘no’ vote. She said she wanted more time to examine the finances before doling out more money to an administration that overspent last year’s budget.
Councilman and Assemblyman Ruben Ramos Jr. was selected by his state colleagues to attend a leadership conference in Virginia, and thus was not at the meeting.
The only problem with cutting the money by a third was that some programs were “front-loaded,” said to city finance specialist Kathryn Kinney, who also presented the proposed 2008-2009 budget that night.
Kinney said that for instance, the recreation programs need the bulk of their funding for the summer.
The council said Kinney can work with the state to disperse the funds as needed, since they didn’t determine where to cut.
Roberts’ ideas for cutting
Roberts met with the press on Wednesday morning to unveil his 2008-2009 spending plan, one that has many ideas attached to it, without including them in the plan.
Some of the ideas included an increase in the number of parking meters, a restructuring of health care services for city employees, inter-local agreements with the Hudson County and Board of Education to reduce redundant services, and lastly, layoffs and taxation.
Roberts said he didn’t know if the council and the state would accept all of his proposals.
“But there’s no harm in digging in and creating a list of ideas,” he said.
The biggest items on his wish list are revenues from new development, including the NJ Transit rail yard redevelopment.
He also pointed out that the city has been dealing with problems at the automatic garage at 916 Garden St., and he hopes to sell it to reduce the ongoing costs it creates.
Roberts assured the press that city services would not suffer even if there were a drastic amount of layoffs, leading some sources to believe that the city is currently overstaffed.
Roberts said the state is currently auditing the structure and staffing of the police and fire departments.
Some council members criticized a few of these ideas when Kinney presented them for Roberts at the council meeting, calling them “pie-in-the-sky.”
They specifically called out the healthcare restructuring as an unattainable goal for this year, citing the need for union approvals – which they are unlikely to get – to make those changes.
“We’re being presented with all of these good ideas, but I don’t think we’re going to get to do them this year,” Russo said.
Other items
The council was asked by the state not to take any action regarding a resolution allowing them to review any public requests for service contracts sought by the city.
Kinney said she was told by a DCA official that the resolution should not be voted on at this time, and that it is possible that the state will review those requests directly and making their own appointments.
For questions or comments on this story, e-mail tcarroll@hudsonreporter.com.
SIDEBAR
After the City Council took its votes Wednesday night, various members of the public got up to give their comments.
Hoboken resident Charlie Mancini, whose impassioned speeches have drawn applause from the crowd in the past, complained about Mayor Roberts’ ideas for cuts.
“I heard in his statement that he is intent to only increase taxes slightly – I believe 7 percent was the amount mentioned,” he said. “Mr. Mayor, I am asking you to acknowledge reality, which is that there is more than enough revenue at the current tax rate to conduct the city’s business, when properly managed.”
Michael Lenz, former city CFO, said that it was important to start the budgeting process early. However, he said that voting on the temporary appropriations when just getting the numbers that same day was “insane.”
He also wondered how serious Roberts is about axing his City Hall staff.
“Have layoff notices gone out yet?” Lenz asked, referring to Roberts’ statement two months ago about noticing all city employees, “because until they do, this is just posturing.”
Hoboken resident Helen Hirsch held up a copy of last week’s Reporter with Roberts’ ad for his spending plan in it.
“Fantasy,” she said. “Charade, make-believe.”
Richard Tremitiedi, the former fire chief and current dollar-a-year advisor to Roberts, pointed out that in his recommendations submitted to Roberts in March, he included a public safety audit by an outside agency.
He noted that this was one of the first actions taken by the state, and he believed it should have been done by the administration long ago.
Maurice “Mo” DeGennaro, the other dollar-a-year advisor to Roberts, said again that the actions of the council will be resurrected at election time, if not by the public, then by him.
“I’m relishing the next election,” he said.
Former Councilman Tom Newman and resident activist Lane Bajardi brought up the fact that Zoning Board is planning at their next meeting to on hear variance requests from Trammel Crow, a development company hoping to demolish and rebuild the Neumann Leather Building on Observer Highway.
However, that area is part of a redevelopment plan that is the responsibility of the council.
“This is a major situation; there are major issues here,” Newman said, asking the council to look into the issue. – TJC