WAYNE, NJ - New Jersey Senator Bob Menendez hosted a call with Mayors from Wayne, Paterson, Hoboken, Cherry Hill, Rahway, Brick, Galloway and New Brunswick. They discussed the financial difficulties each township and city were experiencing due to COVID-19 and the Senator’s SMART bill that, if passed, would provide federal financial assistance to communities hit hardest by the virus. Most mayors admitted that their fiscal circumstances were dire.
Menendez started by saying: “As a former mayor myself, I appreciate the tough challenges Mayors have in normal times, but the unique challenges that each of you are facing to both combat the COVID-19 outbreak and continue to serve their residents doing unprecedented times.”
The challenge, as laid out by Menendez is for New Jersey's local governments to be able to continue to pay for the costs of essential services while revenues are dropping drastically.
Each mayor spoke briefly outlined their difficult financial positions, mentioning commercial and residential property taxes, court fees, construction permits, fines and several other usual city and township revenues were either decreasing or are already at zero.
“We are faced with the very difficult option of drastically cutting areas where we need services, whether it's police, fire, public works; or imposing a tax increase on residents in a very difficult economy,” said Hoboken Mayor Ravinder Bhalla. “We do not want to furlough or layoff any more workers than then we need to, but if we continue bleeding money then we're concerned that that is what the future holds.”
“We're going to be looking seriously at layoffs,” said Paterson Mayor Andre Sayegh when he spoke.
New Brunswick has already furloughed 225 hourly and seasonal employees as well as 46 salaried, non-essential employees. James Cahill, New Brunswick’s Mayor said: “The projected shortfall that we anticipate will be an excess of $35M.”
Another common area of concern expressed by the Mayors was whether they would receive their usual financial aid from the State.
“The availability of the state aid to the city of New Brunswick which is in excess of $15M, may very well be in jeopardy,” said Cahill.
As one, the Mayors supported Senator Menendez’s SMART BILL as a lifeline to keep their communities afloat.
Cahill said: “Without the funding of this bill, the only options that will be available to municipalities like New Brunswick are bankruptcy, which is not an option anybody wants to pursue, or massive, never-been-seen-before tax hikes, which will be paid by the same very same taxpayers who are unable to pay their taxes today.”
“We're facing the unknown here,” said Wayne Mayor Chris Vergano. “We don't know when this is going to end. We don't know how many people are going to be affected. We don't know how people are going to pay their taxes if they're not working. It’s a very dire situation.”
Menendez’s SMART Bill would provide $500B of federal aid to local governments based on a formula that includes population, infection rate and anticipated revenue losses. As the second hardest hit state, New Jersey and it’s municipalities would receive a larger share of this aid.
The bill will be formally introduced when the Senate reconvenes.
From a press release shared by Senator Mendez’s office:
The bipartisan State and Municipal Aid for Recovery and Transition (SMART) Fund builds upon the existing $150 billion set aside in the Coronavirus Aid, Relief, and Economic Security (CARES) Act to help states and local governments. It expands eligibility to include counties and towns with populations of 50,000 or greater—the current threshold is 500,000—ensures every eligible entity receives additional funding, increases flexibility for states and local governments to use the funds to plug revenue losses due to the COVID-19 outbreak, and targets additional funding toward coronavirus hot zones to combat the pandemic head-on.