Coronavirus pandemic may cost Jersey City $70 million

City projects $50 million in lost revenue and $20 million in emergency spending

The financial repercussions of the pandemic are severe.
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The financial repercussions of the pandemic are severe.

Due to the Coronavirus pandemic, which had infected at least 85 Jersey City residents as of March 24, the city will face an estimated $70 million loss of funding.

According to Mayor Steven Fulop, the city expects to lose $50 million in revenue taking into account significant impacts to the payroll tax, economy layoffs, businesses closing, and the lack of Municipal Court fines, construction code fees, and parking enforcement, among other critical financial factors.

The city has spent more than $20 million on unanticipated emergency purchases, increased health benefits, and overtime for city employees to safeguard the community during the COVID-19 crisis.

On March, 19 Fulop said the city is spending between $750,000 to $1 million a week because of the ongoing COVID-19 pandemic.

“There’s no playbook for us to follow on this, and we are looking to save money wherever possible to minimize the impact for residents,” Fulop said. “It’s going to take time for us to recover, for our restaurants and small businesses to bounce back from this unimaginable crisis. That’s why we need help at the state and federal level.”

As the city awaits financial support and guidance from the state and federal government, the city is also faced with the pressure of fixed statutory obligations such as pension payments, health benefits, and negotiated union salaries.

Assessing needs

In February, the City Council voted to introduce the administration’s proposed $613.9 million municipal budget for the 2020-2021 year.

The budget aimed to keep the tax levy stable while expanding services such as increased investments in public safety, new affordable housing resources, and expanded health services.

“Per the mayor’s direction, since day one of this crisis we’ve been carefully monitoring and reassessing potential implications of recent economic conditions,” said director of the city’s  Department of Finance John Metro. “We are working to re-evaluate our city’s needs in a thoughtful and practical way to continue to harness a stable tax rate, while maintaining the critical services our residents rely on.”

The Coronavirus comes three months after Jersey City dealt with a mass shooting in which four people were killed on Dec 10. According to the city, the mass shooting also had a big impact on the city’s overtime budget.

“We’ve had two major crises in the last few months here in Jersey City. The first, on December 10th with a mass shooting. And now, this international pandemic. I have no doubt that as long as we all work together, we’ll come out stronger on the other side of this,” Fulop said.

The Dec. 10 shooting cost the city roughly $1 million in police overtime over a seven-day period following the attack, according to a statement from Public Safety Director James Shae during a council budget hearing for the Public Safety Department.

“The City Council is focusing not only on our response to this current crisis and what our residents are going through, but we also need to plan for what lies ahead and that reality comes with some really tough decisions,” said Council President Joyce Watterman.  “I’m really proud of how Jersey City has been a leader for others to turn to during times of hardship, and I know we’ll tackle the next difficult phase that we all inevitably face.  It’s the unfortunate truth, but it’s better to be prepared than be blindsided.

For updates on this and other stories check www.hudsonreporter.com and follow us on Twitter @hudson_reporter. Marilyn Baer can be reached at Marilynb@hudsonreporter.com.