Jersey City Council rejects proposed budget increase
The vote could mean the city will lose millions in state aid.
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The Jersey City Council has rejected a proposed 15% tax increase, and the decision could affect a $105 million state aid package meant to offset taxes.
The decision was made during Wednesday night’s City Council meeting. It means the state could require a 31% tax increase instead of the proposed 15% hike. Officials initially suggested a 20% tax increase, saying the increase was necessary to help the city deal with a roughly $255 million budget deficit, which Mayor James Solomon has blamed on the previous administration.
“The choices that were before the city tonight were incredibly difficult — these are issues involving the long-term health of our city and tax increases that will hit our residents hard. We are facing a historic crisis, and we asked the City Council to join us as partners in responsible governing,” Solomon said. “The consequences of tonight’s vote for the city and taxpayers will be steep. This will put the entire increase — the combined BOE, county and city increases — on the year’s final tax bill. This will be devastating for taxpayers. This is the epitome of kicking the can down the road, and it will only hurt the residents of Jersey City.”
City Council members said they plan to try to lower the increase to 12% by finding additional cuts in the city’s budget. They hope that will make up the extra 3% the state is requiring to grant the $105 million state aid loan. They have until Aug. 1 before the Q4 budget needs to be passed.
Before Wednesday night’s meeting, the city cut $55 million on its own through measures including cuts to a transit service contract and audits of tax abatement agreements with developers.
But the money does not solve Jersey City’s deeper problem. The city faces a $90 million structural deficit — a gap between what it spends and what it takes in — that will recur every year until it is addressed. The city still plans to do that through a combination of tax increases and cuts to city services.
