Mayor Andre Sayegh’s administration presented a preliminary 2-percent tax levy increase measure to the City Council early Wednesday morning, triggering criticism from two of his opponents from the recent mayoral race.
Sayegh’s administration proposed a $158.36 million tax levy for fiscal 2019, up from last year’s $155.22, according to municipal documents.
Finance director Marge Cherone told council members the 2018 fiscal year ended with a $2.5 million deficit due to tax appeals. She also said tax collection was down in the past fiscal year that ended on Jun. 30, 2018.
“I’m shocked,” said William McKoy, 3rd Ward councilman. He said the man, who slammed him for voting on tax hikes throughout the election, is proposing an increase “right out the gate.” He asked what happened to the $11 million that governor Phil Murphy promised the city would receive at Sayegh’s inauguration event.
“Show me the money. Where did the money go? It was clear. Everybody heard it,” remarked McKoy.
“What is supposed to happen isn’t happening,” said Cherone. After July 1, the governor line-item vetoed a measure that would have moved Paterson from transitional aid to the Consolidated Municipal Property Tax Relief Aid (CMPTRA) which would have provided a fixed amount in aid and more. She noted, Newark, the state’s largest municipality was removed from the transitional aid program.
“He called your name at the swearing in. Let us know there’s money coming in,” said Michael Jackson, 1st Ward councilman, referring to Sayegh telling Cherone the city would receive more funds from the state at the inauguration. “You smiled ear to ear.”
Both Jackson and McKoy ran against Sayegh in the recent mayoral race.
“I heard it. I was there. When I heard it wasn’t happening, I was shocked,” said Cherone. There’s fewer cities competing for transitional aid dollars, she said. “There is more money in the pot. So, there is extra money available.”
Murphy has repeatedly said he has Paterson’s back.
Sayegh said he is still optimistic the city will receive more funds from the state. He said his administration will apply for a higher transitional aid amount this year. Last year, the state provided $27 million in state aid.
Cherone said the city will seek an additional $14 million this year.
“We can ask for more because there are fewer municipalities applying,” said Sayegh. “If we’re going to get Paterson’s fiscal house in order, we’re going to need a little more aid at this moment until we can get our ratable base to where it needs to be.”
McKoy and Jackson said Sayegh gave the impression to voters that once elected, he would not raise property taxes.
“I ran on stabilizing taxes,” said Sayegh.
McKoy also lampooned Sayegh’s campaign rhetoric, suggesting his “relationships” were not working to solve Paterson’s ailments.
The city faces a $24 million budget shortfall, even after $27 million in state aid is figured into the budget, in fiscal 2019, said Cherone. She suggested this gap will close as the year progresses. “The deficit is always very big when we start,” she said.
The city typically has an introduced budget in late fall. There are usually department budget hearings that take place in late September and October.
The council will take a vote on the preliminary tax levy next Tuesday which is needed to send tax bills out for the 3rd and 4th quarters.