PATERSON, NJ – Balking at the possibility of a 36 percent tax increase, the City Council Tuesday night voted down the preliminary 2012 city budget.
Under the proposal, the total amount of property taxes collected could have jumped by more than $47 million, to $178.8 million.
City finance officials emphasized that the preliminary budget was merely a starting point and that the document was crafted to highlight Paterson’s fiscal problems in an attempt to get as much state transitional aid as possible.
But a majority of the council members weren’t accepting that strategy and argued that the administration already should have made cuts in the budget.
“Let’s make this crystal clear: there’s no way – insert the proper bleeps – that I am approving a (tax) levy of $178 million,’’ said Councilman Kenneth Morris, the finance chairman. “We need to cut down to the bone marrow – not to the bone – the bone marrow.’’
After Paterson endured a 29 percent tax increase last fiscal year, council member said they not approve another hike for 2012.
The linchpin to the city’s financial fortunes seems to be its state transitional aid application. Paterson is asking for $47 million, enough to eliminate the budget shortfall without requiring a tax increase.
But council members say the request is unrealistic because at present there’s only $10 million in transition aid money available statewide as a result of a budget cut imposed by Gov. Chris Christie back in the early summer. Christie has said he would be willing to boost the transitional aid allotment back up to $139 million where it was last year, but only if the legislature adopts tougher monitoring rules, which has not yet happened.
Last year, Paterson received about $28 million in transitional aid. At their meeting Tuesday night, several council members said they thought the state would be less likely to give Paterson the money it needs now that the state is reviewing city overtime records and other employee payments in the aftermath of the improper overtime checks issued to the mayor and members of his Cabinet.
“It’s unrealistic,’’ said Councilman William McKoy.
“It doesn’t make sense to ask for money that’s not going to be given to you,’’ said Councilman Julio Tavarez.
“I’m still waiting for a sensible budget,’’ said Councilman Andre Sayegh. “If we keep going down this path, state takeover is inevitable.’’
Councilman Rigo Rodriguez joined Morris, McKoy, Tavarez and Sayegh in voting down the budget. Council President Anthony Davis and council members Aslon Goow and Benjie Wimberly voted for it.
City Budget Director Russ Forenza warned the council that he believed the city’s state aid would end up being reduced if Paterson officials made budget cuts before submitting their spending plan to Trenton. He pointed out that the tax levy included in the preliminary budget was far from being the final number.
“This is just the start of the budget process,’’ Forenza told the council.
The city council still has to holding hearings on the individual departmental budgets. The preliminary budget likely will come up for another vote within the next couple weeks. The administration may modify the budget to appease the council, or continue to try to change the council members’ minds. As of Tuesday night, it wasn’t clear which side would prevail.