The city of Paterson is facing a financial crisis and could run out of money unless drastic action is taken.

Rumors have swirled around the city about how officials would fix the budget issue. There has been word of police increasing citations to generate revenue, laying off over 200 municipal employees and even the possibility of raising taxes.

The Paterson City Council held a meeting Tuesday night to discuss the issue.

Paterson residents who attended the meeting say that they fear the city won't be able to hold such events as the Dominican Day Parade. They also fear that recreational programs will be cut.

"It's unfair everything's getting cut," says resident Randa Darwood. "What's making it worse is our kids are the ones that are suffering; our youth, our teens and our elderly because rec is not just for our youth."

Many other residents say that they can simply not afford an increase in taxes.

"People are already losing their homes...I can see the city becoming like Detroit if the taxes continue to go up," says resident Corey Teaugue.

The City Council and Mayor Joey Torres can't agree on whether taxes will increase for the city.

"The mayor should be ready with a plan," says City Councilman Luis Velez. "If he knew the taxes were going up at the county level...he should have a plan, not go after the taxpayers."

Mayor Torres has been on the record opposing the council's plans to ask for a lower tax levy. He says that the council's budget cuts would prove to be a problem for the city.