HACKENSACK, N.J. — City officials have introduced a $108.5 million spending plan for the 2020 fiscal year with aim to provide the funding and plan for community improvements, redevelopment and tax relief.
The budget was first introduced on April 7 and amended on Tuesday, May 5 to reflect a couple of minor line item changes, notably including a 10% increase to the Parking Utility Debt Service account, City Chief Financial Officer Jim Mangin said.
Of the total operating budget of $108.5 million, $85.39 million will be raised in taxes, representing a 0% tax increase. The actual tax levy is decreased to offset the Hackensack Open Space Tax, which is currently $282,386. The Hackensack Municipal Tax Rate was 1.69 in 2015, and currently projected at 1.5.
On the average assessed home valued at $255,831, city taxpayers can expect a decrease of $115 on their tax bills. The 2020 budget reflects a $1.5 million increase from last year’s spending plan. This increase is attributed to Salaries, which rose 1.1%, or about $455,00, and Health Benefits, which increased 5.9%, or a little over $1.2 million.
Salaries and Wages, which are currently appropriated at $43.3 million, increased 1.06% over 2019. Health Benefits and Insurance are currently $21.48 million. Pensions and Statutory, costs of which peaked at around $11 million last year, decreased this year for the first time after the benefits of the decade-old Pension Reform Act are now reflected, bringing the current appropriation to $10.7 million.
As a precautionary measure during the Covid-19 crisis, the city manager, along with the chief financial officer and finance committee, is preparing what they dub a Covid-19 Financial Response Plan to prevent the occurrence of a potential $2.5 million deficit in the future. The city manager ordered $2.5 million in identified budget expenditures to be frozen for the duration of the crisis.
“The $2.5 million is my projection of 2020 lost revenue from tax collections, municipal court fines, fees for building permits, and interest on our bank balances,” explained city CFO Jim Mangin of the figure.
The expenditures were taken partially from programs that had to be canceled because of the crisis, or from budget expenditures with active reserves or Trust Funds, which can be utilized.
Later on this year, Mangin will review the city’s finances and order the cancelation of any affected budget appropriation. An example, he said, would be the summer concert series, allotted monies for which are now frozen. Due to this cancelation, the city will nix that appropriation later this year.
“The plan is to try and cancel budget appropriations in an amount equal to the lost revenue, and thus avoid a deficit,” Mangin said.
In 2021, the city will offset the one-time budget appropriation for the deficit with a one-time infusion of revenue from surplus to expunge any tax increase.
Hackensack’s 2020 municipal budget is slated for adoption on Tuesday, May 19 via Zoom, which can be accessed on the city’s official website at hackensack.org.
To view the budget presentation, click here.