Despite warnings from Mayor Dawn Zimmer and her allies, the anti-Zimmer City Council majority voted 5-3 on Wednesday to give the city’s $4.1 million unrestricted budget surplus back to the taxpayers. Zimmer and her allies instead wanted to maintain a reserve to possibly improve the city’s bond rating.
The council also addressed the release of employee e-mails, cutting the mayor’s salary, and a delayed 9/11 memorial during their June 1 meeting.
The return of the surplus is good news for taxpayers this year, as the next round of tax bills will likely see a decrease. However, Zimmer and her allies worry about the long-term ramifications.
During the campaign season, some council members not aligned with Zimmer campaigned on returning the surplus to the taxpayers, while Zimmer’s allies called for maintaining at least a 5 percent cash surplus. Besides improving the bond rating, they wanted money set aside in case of an unforeseen financial emergency.
‘They have put us on a fiscal train wreck for years to come.’ – Mayor Dawn Zimmer
“The taxpayers stuck with us when we had [financial] problems; it’s time we stick with them and we give this money back,” said Councilwoman Theresa Castellano at the meeting.
In 2008, the state brought in a fiscal monitor to oversee Hoboken’s finances.
Mason has been adamant about returning the surplus, to the point of printing shirts for the St. Patrick’s Day Parade advocating the return of the surplus.
“If you leave the money in the politicians’ hands, they’re going to find a way to spend it,” Mason said.
Zimmer worries that using the cash surplus is a one-shot gimmick that could put the city in financial trouble in the future.
“Zero surplus? Are they kidding? The level of irresponsibility by this council majority is beyond belief,” Zimmer said in an email on Thursday. “Sadly, it is the people of Hoboken who will suffer with higher taxes, and potentially massive layoffs. No family in Hoboken would do what this council is doing to our city and purposely choose to not save a dime. They have put us on a fiscal train wreck for years to come.”
Before the budget was introduced this year, the city had a total cash (unrestricted) surplus of $14.7 million. Of that amount, $10.5 million will be used as revenue in the budget. Zimmer hoped to put the remaining $4 million aside.
Zimmer said the city is finishing union negotiations with the Hoboken Fire Department, which could result in retroactive pay being awarded. The city may not have enough money due to the lack of a cash surplus, she said.
“It’s so unbelievably irresponsible,” Zimmer said. “They’re choosing to sabotage the city for political purposes. I’m stunned, and I’m sorry to say to Hoboken city employees that I can’t guarantee anybody’s job. I don’t know what’s going to happen.”
Councilman Ravinder Bhalla called using the entire cash surplus “a budget trick.”
“It’s a short-term decrease and a long-term increase [in taxes],” Bhalla said.
Councilman David Mello said he wasn’t comfortable with the fact that a “lame duck council majority” was making the decision on the surplus, since Zimmer’s allies will return to the majority after the council reorganization in July. (However, they are unlikely to reverse Wednesday’s decision, which sends the budget to the state.)
Castellano responded to Mello’s statement by saying, “To the councilman’s comment about this being a lame duck council, watch us vote.”
Hoboken resident Scott Siegel, who often speaks about budgetary issues and is usually aligned with Zimmer, told the council members that voting to give back the cash surplus is really like voting to give residents “a big fat tax increase.”
Will mayor’s salary decrease?
At the meeting, Mason and Councilman Tim Occhipinti introduced ordinances that would lower the salaries of Zimmer and her directors.
Zimmer voluntarily took a pay cut when she rose to office after the 2009 arrest of former Mayor Peter Cammarano, and currently earns $116,950. The ordinance introduced on Wednesday by a 5-3 vote would lower Zimmer’s salary to $100,000 if it passes at the next meeting and is signed into law.
Mason said she is advocating for ways to cut salaries at the top.
The council came within one vote of cutting their own salaries in 2009, but an ordinance at that time to cut 10 percent from the approximately $24,000 salaries failed. Instead, the council passed a non-binding resolution in which they pledged to give 10 percent of their salaries to charity.
An ordinance to cut directors’ salaries was also introduced, and now requires a public hearing and final vote at the June 15 meeting, the last meeting at which Zimmer’s opponents will have control of the council.
However, under Hoboken’s rule of government, a mayor can veto or refuse to sign ordinances sent to her office from the council. Zimmer has only used the veto power one time, overturning the council’s decision to repeal a recreation fee in December.
The council also passed a resolution, not subject to a mayoral veto, to lower the “not to exceed” number on city attorney Mark Tabakin’s contract. Tabakin was originally hired at $103,000, and the council also awarded his law firm a contract to be special litigation counsel for $200,000. The two contracts’ “not to exceed” limits were reduced to $70,000 and $125,000, respectively, by a 5-3 vote.
E-mail resolution passes, amended
Mason has also led the charge to release e-mails of two of the mayor’s aides. She wants to see whether they have used city time for campaign-related matters.
However, an ongoing Federal Bureau of Investigation (FBI) criminal investigation into a potential breach of the city’s electronic communications may complicate the matter. Agents were in City Hall two weeks ago removing computers from the third floor Information Technology office. The city has said that they notified the FBI about the potential breach, but has not officially said who or what is being investigated.
Originally, Mason’s resolution had called for all e-mails from the two staffers to be released, but Tabakin said having an attorney review all of the e-mails prior to the release could cost the city approximately $200,000. Mason re-worked the legislation to include only e-mails to and from 12 specific people, including members of the local press, bloggers, and campaigns.
Roman Brice, who runs a blog in Hoboken that is often critical of Zimmer’s adversaries, called the list a “hit list”, and asked why his name wasn’t first on it. He referred to several stories he had broken that were detrimental to Mason and Russo, the bill’s sponsors.
Siegel spoke again, adding that he feared that the resolution would interfere with the FBI investigation.
“We should defer to the FBI right now,” Siegel said.
Resident Margaret O’Brien also spoke about what she called Hoboken’s “smut blogs” and their “sexually explicit videos,” saying she has filed complaints against bloggers in Hoboken with the FBI.
After some members of the council reluctantly entered into closed session under the advice of Tabakin, the council passed an amended version of the resolution that would release e-mails that the FBI deemed appropriate. However, many sources believe the FBI will not become involved with the council’s request, thus keeping the e-mails out of the council’s hands – at least until the investigation is over.
• The proposed 9/11 memorial in Pier A Park may not be completed in time for the 10-year anniversary of the Sept. 11, 2001 attacks, according to Director of Community Development Brandy Forbes. However, Forbes said she expects it to be under construction by that time. The committee recently received a piece of steel from Ground Zero for the memorial.
• Some council members inquired about the opportunity to use the city website to post messages, as well as have their messages used in city publications.
• The council asked if a member of the Hoboken Municipal Hospital Authority could provide the council with an update on the sale of the hospital. The HMHA reached an agreement with a group from Bayonne, known as HUMC Holdco, LLC, in April for a sale of Hoboken’s hospital. But before the sale can be completed, the state must give a stamp of approval in the form of a certificate of need.
The next council meeting is June 15.
Ray Smith may be reached at RSmith@hudsonreporter.com