HUDSON COUNTY —Gov. Christopher Christie has told municipalities that he intends to drain the Urban Enterprize Zone accounts to help balance the state budget. Normally, cities who have a state-designated UEZ get to charge 3.5 percent sales tax. Then, some of the tax from the zones is returned to Urban Enterprize Zone boards to be used to help clean streets, advertise local businesses, or even help pay the salary of police and fire people in those zones.
“It is our understanding that the governor has frozen expenditures and intends to use any uncommitted funds for the state budget,” said Bayonne City Business Administrator Terrence Malloy.
He said Bayonne is currently waiting to see how much the state will return to the city if any, after which the local board will have to determine what projects can be funded this year.
“We’re going to have to settle for what they give us and repriotorize the expenditure of the rest,” he said.
Fortunately, the city will not be forced to repay the $2.5 million loan it made to the Bayonne Crossing mall, which is to be repaid out of future UEZ tax revenues.
“That was already in place so it won’t be affected,” Malloy said.