BAYONNE — The Bayonne City Council is poised to take out $50 million tax anticipation notes to cover routine expenses until revenue from August tax bills and the transfer of funds from the Bayonne Local Redevelopment Authority can be received.
The BLRA is currently negotiating the final details of $235 million deal for the sale of three portions of the former Military Ocean Terminal.
The council resolution is slated to appear on the agenda for the July 28 meeting of the Bayonne City Council, and represents about one third of the city’s 2011 annual budget.
Chief Financial Officer Terrence Malloy said the city passed a similar resolution earlier this year to cover the expenses for the $134 million budget – which still short $27.5 million.
Tax anticipation notes are one type of notes that are issued by state or local government with the understanding that a certain amount of taxes will be collected within a short period of time.
Malloy said the anticipation notes from the sale earlier this year come due in August, September and October, and allow the city to maintain funding to pay salaries and other bills until the funds from the sale of a portion of the former Military Ocean Terminal can be transferred to the city.
The City Council will be voting to allow the city to send out its tax bills due in August, which will also help the city’s meet its obligations.
The city is technically under state financial monitoring although unlike Hoboken, Atlantic City, Paterson, Newark and Camden – which faced similar monitoring in the past — no local czar was assigned to oversee the finances. The Local Finance Board is largely responsible overseeing the correction of this, and has given the city until July 30 to ink the contract with the Port Authority to meeting 2010’s budget obligations.
This is the fourth year the city has not met budget obligations in pocket by passing of the budget in June, but managed to sell land at the MOTBY before June 30 end of the budget year. But this year the funds have not yet received by June 30, and received an extension.