Bayonne has adopted its calendar year 2022 municipal budget, with a slight municipal tax increase this year.
The City Council adopted an ordinance approving the budget at its August 17 meeting. The total is $160,467,986, up from the final 2021 budget of $152,961,751.
The public hearing on the budget largely consisted of a back-and-forth between former city employee and outspoken resident Gail Godesky and Chief Financial Officer Donna Mauer. Godesky first asked about Bayonne’s representation at the county budget hearing, which City Council President Gary La Pelusa confirmed was Mauer.
On that topic, Godesky later asked why the increase in taxes by the county for Bayonne was larger in comparison to Jersey City and Hoboken. Mauer explained that there is a formula to calculate the county taxes.
“It has to do with the equalized value in the ratio,” Mauer said. “Basically, they take the county budget and it gets divided up by this ratio of each town. Each town has their own ratio and whatever that percentage is, that’s the percentage that the town has to pay.”
Answering municipal budget questions
In the municipal budget, Godesky asked why there was a decrease in the capital improvement budget this year. “Why are we going from $850,000 to $300,000?” Mauer replied that it was higher last year due to down payments on bond ordinances. “We needed more money last year because we had bond ordinances.”
Godesky asked if the $300,000, included any capital improvements, to which Mauer noted that it can.
“It can all go into a fund,” Mauer said. “If we don’t use it, it stays in the capital improvement fund and can be used for future use on capital improvements.”
Next, Godesky asked about the Municipal Relief Fund for $480,000, to which Mauer noted it was state aid.
“That’s just simple revenue that comes from the state,” Mauer said. “It’s offsetting revenue.”
Mauer also explained the other $8,451,132 in state aid under the line item Energy Receipts Tax.
“For years, the Energy Receipts Tax was cut,” Mauer said. “Then legislation was passed that brought the money back in. Like a month ago, we received Local Finance notice that we’ve got it to put this into the budget.”
Salary increases across departments
Godesky asked about salary increases in certain departments of the city, naming the Health Department, the Finance Department and the Office on Aging among others. Mauer responded that was because CARES Act funding had been depleted earlier this year for the Public Safety and Health Departments.
“Health went up because last year we still had CARES Act money,” Mauer said. “A lot of these salaries and wages for January, February, and March, we still had charges against the CARES ACT. So their salaries were covered under the CARES Act, Public Safety and Health.”
As for the Finance Department, Mauer explained, “We had new employees transfer, no new hires.”
Of note, the only major change to the otherwise small fluctuations in salaries and wages was a nearly $3 million boost to the salaries and wages of the uniformed police officers. It increased from $20,115,000 appropriated in 2021 to $23,200,000 anticipated in 2022.
When asked by Godesky about if there are any increase for the police “patrolmen” in the budget, Mauer confirmed there was amid ongoing contract negotiations. According to Mauer, the budget contains approximately 2.5 or 2.75 percent salary increase overall included “just in case the contract is settled.”
Budget amendments approved afterward
After the budget was adopted, the council approved amendments to the budget. When Godesky returned to the podium to ask about them, Mauer explained it was necessary to show American Rescue Plan (ARP) money and where it was distributed.
“Why are the amendments just coming forward tonight?” Godesky asked. “The public did not have a chance to even look at them. Some of these numbers are going from zero to thousands. What’s going on?”
Mauer explained, “The numbers didn’t really change. The total stayed the same. When our budget was sent to the state for review, they came back with comments that they’re asking all the towns to separate the ARP money. Instead of putting it in one line, they want to see what it’s offsetting.”
According to Mauer, the reason was because the state asked to delineate where exactly the ARP funds went to, rather than just an over-generalization. She said the amendments were specifically asked for by the state.
“So when I say I’m using it for Public Safety salaries, they want to know where in Public Safety,” Mauer said. “The state requested these amendments. That’s the only thing. If you add it up, nothing changed.”
Major changes would require public hearing
Mauer said that more or less the budget did not change. If it did change drastically, another public hearing would be required.
“It was actually just done yesterday,” Mauer said. “The state just sent me the final yesterday. The number in the end actually went down from the original budget. There were more revenues added into the budget. So the taxes, the amount we raised actually went down a little bit with the amendment. If any appropriation increases or decreases by 10 percent or more, we’re required to advertise and have a public hearing. We didn’t hit any of those figures because everything basically stayed the same.”
Second Ward City Councilwoman Jacqueline Weimmer said: “In layman’s terms, the amendments were not a reflection of any increase in the budget, they were simply a reclassification of how we were naming those dollars. The budget itself did not increase from the budget that published, it simply was a reallocation of those numbers.”
Resident Mike Ruscigno suggested publishing the amendments ahead of the meeting to avoid last-minute confusion. In response, Coffey said that the city “just received them yesterday from the state.”
The adopted budget may be amended throughout the year, marking the distinction between the adopted budget and the final budget of a given year. The council also adopted an ordinance exceed the municipal budget appropriations limit and establish a CAP Bank.
Revenues recovering somewhat
When the budget was introduced in July, the numbers were still being worked out and the exact percentage of the tax increase was not available. After the August meeting, Mauer told the Bayonne Community News that the tax increase that came with the 2022 budget was 1.4 percent.
Mauer said that this was coupled with a 2 percent increase in taxes from the school district. She added that there was actually a 2.8 percent increase in taxes from the county. These would all be present in residents’ annual overall tax bill.
Taxes are increasing this year after a decrease in 2021. Rising costs amid the current inflation paired with revenue streams that are still down compared to what they were prior to the COVID-19 pandemic are some of the reasons behind the increase.
Things like revenue from parking in the city and at the cruise port are still down, but slowly returning to where they were around 2019. In the meantime, the city has used American Rescue Plan (ARP) money to overcome budget shortfalls.
For example, anticipated miscellaneous revenues are expected to increase from $49,203,807 to $61,685,158. This accounts for the largest share of the increase in revenues, with other things remaining more or less the same or slightly decreasing, such as the surplus from $7,528,380 in 2021 to the anticipated surplus of $3,000,000 in 2022.
Rising costs slow comeback
Meanwhile, operating expenses increased for salaries and wages from $60,189,680 in the final 2021 budget to $62,545,000 in the 2022 budget, and other expenses under the operating expenses category rose from $31,329,476 in 2021 to $33,457,600 in 2022. However, municipal employees decreased from 753 to 752.
In terms of other expenses, deferred charges and other appropriations rose from $49,036,448 in the final 2021 budget to $53,562,572 in the 2022 budget. However, there was a decrease in capital improvements from $850,000 in 2021 to $300,000 in 2022. Debt service decreased from $10,453,613 to $9,027,410, and the reserve for uncollected taxes remained more or less the same at $1,575,404 in 2022 as opposed to $1,102,533 in 2021.
The parking utility budget totals $1,816,159 in 2022, up from $1,703,957 in the final 2021 budget. In this budget, operating expenses for salaries and wages slightly increased from $925,000 in 2021 to $945,000 in 2022 and other expenses under operating expenses also rose, from $425,557 to $434,228. There were no capital improvements, down from $40,000 in 2021, and deferred charges were about the same from $313,400 to $309,200. However, in 2022 there is an anticipated surplus of $127,731.
For a full breakdown of the budget, go to hudsonreporter.com/2022/08/07/bayonne-council-introduces-2022-municipal-budget. For more information, go to bayonnenj.org.
For updates on this and other stories, check www.hudsonreporter.com and follow us on Twitter @hudson_reporter. Daniel Israel can be reached at disrael@hudsonreporter.com.
