PLAINFIELD, NJ — Forty-seven Plainfield residents had succumbed to COVID-19 by the end of April; the first loss of life this month is a 29-year-old Hispanic male, according to Mayor Adrian O. Mapp's Monday update. The report also noted the number of positive cases in town stands at 1,734, with another 2,352 self-quarantined.
Additionally, City Council members virtually met for a special meeting to consider and act on two items. The first was a resolution to extend the grace period for property taxes from May 1 to June 1 instead of just the typical ten days.
Governor Phil Murphy had signed Executive Order 130 on April 28 to authorize, by resolution, municipalities to extend the grace period. The order does not, however, extend the statutorily mandated dates for the payment of taxes by a municipality due to county, school district, or any other taxing district.
Councilwoman Ashley Davis brought this point up, directing her line of questioning to Director of Finance Ron West. "There's no grace period for us to pay our obligatory payments to the Board of Ed as well as the County of Union. So how does this resolution impact those payments that we have to make to those entities?"
Director West noted, "You're absolutely right in saying there's no relief with regard to the Board of Education and the school taxes. You know, those are bills we are going to have to pay."
Councilwoman Davis continued, asking, "So, um, do we have enough money to pay them, or how does that impact us fiscally?"
"If I had to answer that today, at this point we do not have the cash to pay the Board of Ed and the County," Richard J. Gartz, Chief Financial Officer, responded.
"By Friday, we're expecting our biggest mortgage payer, CoreLogic, to have made a payment, we're in touch with them, and that should be about $9 million, and we should be okay at that point. But as of today, I can't, I don't have that in the bank, no. Friday, I'm supposed to have it."
Before taking a vote, Council President Steve Hockaday said most homeowners pay their taxes through an escrow, adding that the banks normally pay on time. But there are those who have to pay the taxes from their checking account, he said. "That is who this relief is for."
Resolution 164-20 was unanimously adopted.
The second agenda item was a resolution authorizing the issuance, not to exceed $15 million, of tax anticipation notes.
Davis asked, "So Mr. West, in your professional opinion, how likely do you think that we'll have to actually use these notes?"
"You want my hope, or professional opinion? My hope is that we don't have to use this. That's what I'm really pushing for," saying he hopes that all the large tax paying entities come through.
He continued, saying, "there's a strong chance we won't have to do it, but at least we're being, uh, smart enough to prepare in the case that we have to."
Around 89 percent of homeowners, West said, pay their property taxes through escrow. "We have less than nine percent of our tax-paying base who happen to be residential walk-ins to the tax office, and/or mail in a check." PSE&G and Verizon constitute another two percent, he noted.
Councilman Sean McKenna asked, "Do we have an estimation on potential shortfall, or is it just too early," referring to current tax collections. West confirmed it is way too early.
McKenna also asked, "How are these notes utilized?"
West said through the course of this year the City has the ability to go out to market for a total of $15 million. "Outside of this year, the tax anticipation notes would no longer be on the books."
The Councilman's next question centered on the borrowing power of the municipality. "In the resolution it mentioned $36.6 million in net borrowing power. Is that the balance of net borrowing power available, or total borrowing power?"
West said, "That happens to be the amount available to us for tax anticipation notes." There is a two-part formula, he noted, that is articulated in the resolution that works out to that amount.
Gartz chimed in, saying the notes are required to be paid "within four months of the following fiscal year, so by April 30," thus removing it from the city's books. He said the $36.6 million is what the maximum could have been; however, he stated they don't anticipate having to get to that point, and that the $15 million should be sufficient.
At this point, Mayor Mapp interrupted the Councilman who was reviewing figures on capital fund anticipation notes, bonds, borrowing costs for a pedestrian mall, and $3.9 million in bond financing that was approved by the council last month.
The mayor directed his comment to the Council President, saying, "This is a special meeting that was called specifically for the purpose of discussing the two resolutions, and those are the only two items that we can discuss."
But McKenna said he was within his bounds to get an overview on the borrowing of money. "But I do appreciate the mayor weighing in on the protocol."
"Mr. President, we are here to discuss two resolutions, and two resolutions only. We are not here to discuss the bonding of a pedestrian plaza," or any other bonding for that matter, the mayor said.
McKenna persisted, saying, "We're here to discuss borrowing $15 million and putting it on the taxpayers' backs, so we should have a conversation around what our total debt is at the moment, including the $5.5 million that we've added in the last two months." McKenna added, "I do appreciate you wanting to just stick to the agenda because it's easier for you."
In the end, the vote was 6-1 in favor of resolution 165-20, with McKenna voting no.
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