What's the Outlook for City Taxes in 2013? Morris Warns of Significant Hike, Jones Says Too Early To Tell
Thursday, September 27, 2012 • 8:29am
PATERSON, NJ – As city finance officials scramble to craft the preliminary 2013 municipal budget, Councilman Kenneth Morris says he thinks Patersonians may be facing more bad news.
The 2011 fiscal year brought a 29-percent tax increase and almost 400 layoffs. The 2012 budget produced a three-percent tax hike that actually felt larger to most homeowners because they had to pay an extra $200 on average to make up for the city’s dwindling tax base.
“My fear is that taxpayers may be looking at a double-digit percentage increase going forward,’’ Morris said at Tuesday night’s council meeting. In a subsequent interview, Morris said he calculated that taxpayers may get a minimum 10-percent hike and one that could go as high as 15-percent.
Mayor Jeffrey Jones dismissed Morris’ comments as premature. “There’s nothing legitimate about any of it,’’ said the mayor, “because we’re still early in the process. The picture is not clear yet.’’
The mayor criticized Morris of playing political games by trying to scare property owners. “He’s been doing this a long time and should know better,’’ said Jones. “To give people this sense of fear is inappropriate.’’
On Friday night, Patersonians may get some preview of the city’s fiscal picture. The City Council is scheduled to vote to introduce the budget for the 2013 fiscal year that started on July 1 at a special meeting at 7:30 pm.
But that introduced budget will be based on some crucial question marks. For example, local officials don’t know yet how much money in transition aid Paterson will get from Trenton. In fiscal 2011, the city received $28 million. In 2012, Paterson got $21 million. The Christie administration has said that cities should expect their transition aid to continue to decline. But by how much?
Also, the city is in labor negotiations with all its employee unions. The sizes of the raises included in those contracts will have significant budget ramifications.
Morris said city officials already know enough about the 2013 budget to know that it’s not going to be a good one for taxpayers. He pointed out that the city faces a $10 million structural deficit created by one-time budget savings in 2012 that can’t be duplicated this year. Moreover, he pointed out that the city has to make up a $3.7 million operating shortfall from the 2012 budget.
“All indications are that are revenues projections are coming up lower than what was expected,’’ Morris said.
Morris criticized the Jones administration for not moving fast enough on the budget and for not providing the council with status reports on issues that could have impact on the budget, like the labor union contract negotiations.