HOBOKEN, NJ — Hoboken Mayor Ravi S. Bhalla and his administration have introduced a budget proposal that will feature no municipal tax increase. The plan, which is being presented ahead of Wednesday night’s City Council meeting, will reportedly make judicious use of federal resources from the American Relief Fund to help offset substantial shortfalls caused by the COVID-19 pandemic. 

“Despite the unprecedented challenges of COVID-19, we’ve been able to right-size our finances and establish a budget with no increase in municipal taxes,” said Bhalla. “This budget is a critical step in our continued recovery from the pandemic, that provides much needed relief to residents, many of whom have been struggling over the past year. At the same time, we’re also ensuring that we continue to fund critical projects including the City’s water main replacements, repaving roads and advancing Vision Zero improvements, upgrading City parks, acquiring additional open space, and much more.” 

The Hoboken Administration estimates $6.4 million in lost revenue from various sources. Specifically, municipal court revenue is down $1.2 million, the Hoboken Parking Utility is down $2.3 million, and the parking tax is down $520,000. An overall COVID-related slow-down in economic development saw Construction Code revenue drop $560,000, hotel tax revenue down $365,000, and various permits/fees down $300,000. 

Sign Up for Hoboken Newsletter
Our newsletter delivers the local news that you can trust.

Meanwhile, the City claims it saw a rise in fixed costs—including a $1.2 million increase in pension payments, a $1.4 million increase in healthcare coverage for employees, and an increase of $1.16 million for previously negotiated union contracts. 

Despite these challenges, the City’s proposed spending plan, along with various COVID-19 expenses and revenue loss covered by the American Relief Fund would result in no municipal tax increase, pending scrutiny by the City Council. 

“I also want to express my sincere thanks to Senator Menendez, Senator Booker and Congressman Sires for ensuring the American Relief Fund included funding for states and cities, which will play an important role in our City finances in the year ahead,” added Bhalla. 

Hoboken’s proposed budget includes capital funding for quality of life projects, and claims to maintain or even upgrade City services, while reportedly reducing discretionary spending to provide relief to Hoboken taxpayers 

Among the capital improvement projects included in the budget are a plan to repave approximately 75 blocks of roads—including Vision Zero safety improvements, curb extensions, new crosswalks and bike-lanes. Construction will continue on the Northwest Resiliency Park and flood infrastructure, which will mitigate localized rainfall flooding in Northwest Hoboken. Upgrades to Hoboken’s water infrastructure will continue as scheduled through phase two of the water main replacement project. Improvement projects and open space acquisition—including the expansion of the Southwest Resiliency Park, and rehabilitation of the waterfront walkway near 16th Street—will also move ahead.

Upgrades to environmental services equipment, including one new electric garbage truck, routine repairs and upgrades to elevators in Municipal Garages B, D and G, will go ahead as planned.

Hoboken staff will continue to assist small businesses with outdoor streateries, parklets, and partner with the Hoboken Business Alliance to bring back “Summer Streets.” Furthermore, the proposed budget includes millions from the American Relief Fund for small business grants, a housing relief fund, and funding for non-profits, allocated through the American Relief Plan.  

“I’m pleased to share that my administration will soon be opening up an application process for our small businesses, residents who are in need of rental relief, and our Hoboken non-profits hit hard during the pandemic,” said Bhalla. These grants will serve as an important lifeline to our community members who are doing everything possible to overcome the significant financial challenges of the past year.” 

An online guideline for this grant funding will be established by the City and released by June 15th.

One significant stipulation of the American Relief Fund is that federal money cannot be used to simply plug existing holes in budget gaps. Money awarded to municipalities must be allocated for specific initiatives.

Funding will also be used for vaccination expansion, maintaining testing infrastructure, and other costs associated with mitigating the pandemic. Hoping to improve quality of life in Hoboken beyond COVID, the Administration has proposed exploring/upgrading alternative transportation options, including evaluating bringing in a transportation service similar to “Via”, which is currently utilized in Jersey City. The Administration had also proposed investments in water infrastructure upgrades, including additional water main leak technology that will allow the City to see a crack in a main before it becomes a break.

The budget also continues what the Bhalla Administration maintains is a trend of reduced budgeting on outside legal counsel. That amount was reportedly reduced by $100,000 from last year, and reduced $300,000 since 2017. The Office of the Mayor, Business Administrator, and City Clerk reduced spending by a combined total of $67,940, with staff in the Mayor’s office having been downsized from two full-time, at-will employees to one in December of 2019.

Beyond the administration and director positions, the City is hoping to implement a form of financial recognition for qualifying municipal employees who have been on the front-lines of the pandemic.  

Hoboken’s budget surplus—an ongoing concern—will be impacted, but less than it had been in the past. The Bhalla Administration’s budget proposes using $1.8 million less in surplus for the budget in 2021 as compared to a year ago.

Now in the hands of the Hoboken City Council, discussion and debate is set to begin on the city's future financial journey. In 2020 budget issues weren’t resolved until late September, and only after State and County relief similarly took the sting out of a municipal tax increase. In all, taxes have increased roughly 2% annually on average during the Bhalla Administration.

Sign up for TAPinto E-News alerts to be the first to read about all things local!

Download the FREE TAPinto App!  Click here for Android - Click here for iOS for breaking news, traffic/weather alerts and special offers.

Know a story we should share with readers? Email editor Steve Lenox and tell him about it.