The budget is up from an original $57.4 million spending plan proposed a month ago. At the time, the mayor touted having cut spending. There were city layoffs planned, but now there are not.
The budget does not have to raise taxes because of a controversial bond ordinance that allows more money to remain in the city's coffers now but will cost more in the future (see related story inside).
Bad weather, an unusual time slot and a growing sense of frustration among the mayor's critics combined to keep attendance sparse. As the meeting began, only four members of the public, five city employees and five city professionals were in the City Hall chambers to watch the action take place.
Even though there was only a small crowd present on Monday, outrage erupted when without notice, the city clerk called for a final vote and adoption of the city's budget. Previously, public notice had only been given for a vote on the amendments, not on the final budget.
"We can't vote on this," cried out Councilwoman Carol Marsh as the clerk conducted the roll-call vote. But the vote continued.
Marsh later said she could not believe the city's business administrator and attorney watched on without protest as a vote was taken on the $59.9 million budget without proper public notice.
"I don't know what I'm voting for, so I have to vote no," said an equally perplexed Councilwoman Theresa Castellano.
The next morning, the vote was invalidated by City Business Administrator Robert Drasheff.
"Please be advised that, regrettably, there was a technical deficiency in the public notice for the special City Council meeting of Monday, October 27," said Drasheff in a memo to the City Council. "Because of this technical deficiency, we were unable to hold a proper vote for the final adoption of the SFY2004 Budget."
The next day, he said he takes full responsibility for an "honest mistake" where "we forgot to add two words in the public notice - final approval."
He added that a final vote is now scheduled for the next regularly scheduled meeting on Nov. 5.
But not everyone was buying the business administrator's apology and explanation. "They knew exactly what they were doing," said Councilman Tony Soares, who is a vocal critic of Mayor David Roberts' administration. "They got snagged trying to slip this through and don't understand that there are very smart people on this City Council and very smart people in the audience that won't get the wool pulled over their eyes."
Approving the amendments
While final vote on budget amendments were invalidated, the council did adopt four amendments to add revenue to the 2003-2004 fiscal year budget.
Soares, Marsh and Castellano voted against the amendments which passed by a 6-3 vote.
The amendments raise the budget from $57.4 million to $59.9 million. According to city Business Administrator Robert Drasheff, the $2.5 million increase is due to new revenue from two liquidated funds and savings from a pension refinancing bond issue the council approved.
The new revenue allows the council to mitigate $2.7 million in proposed layoffs. For the past couple of months, the administration warned that there might be the need for upwards of 100 layoffs. In fact, layoff notices were sent out twice. Now, according to Business Administrator Robert Drasheff, only "four or five" employees might lose their jobs, and those would be performance-based firings, not layoffs.
Last year, the city passed a $62.6 million budget, but the city ended up spending approximately $65 million, including more than $2 million in mid-year emergency appropriations.
At the meeting, the mayor praised the council for its diligence in alleviating the need for layoffs. He added that budget is also successful in maintaining the level of services "that the community has come to appreciate."
Critics of the budget and its amendments complain that mayor was using the employees' jobs as leverage to push through a controversial debt restructuring package.
"This year's budget was a planned out step-by-step series of events to portray this mayor as a 'day-saving hero,' " said Councilwoman Theresa Castellano. "It's all about getting the headlines to be used in his next re-election literature."
She added that Roberts has sent the city employees "on a fool's mission." "He [Roberts] created this layoff scenario and tapped into the nerve center of every single city employee," said Castellano.
Marsh contended Wednesday that adding new revenue at this late date was a way that Roberts could introduce a preliminary $57.4 million budget that really wasn't a $57.4 million budget. She said that the pension refinancing bond issue, which will generate around $1 million, was approved well before the preliminary budget was presented in August and should have been added then. By leaving it out and including it later in an amendment, she claims that the mayor gave the "false" impression that the city was spending less than it really was.
The 'five-minute' debate
According to New Jersey law, local governments have the right to set and enforce reasonable limits on speakers as long as the rules don't exclude a particular viewpoint. Since becoming city council president, Ruben Ramos Jr. has set a "five-minute" rule for speakers to speak on a single issue.
The intent of the policy is three-fold. It keeps meetings from running into the wee hours of the morning, it allows everyone who wants to speak on an issue the opportunity even if the meeting is crowded, and finally it stops the public from delaying legislative action by filibustering.
At Monday's special City Council meeting, there was a controversial enforcement of the five-minute policy. At the meeting, there were only four members of the public in attendance, and only two people signed up to speak. The second person to speak was Elizabeth Mason, a former Roberts ally who broke with the administration last year. She has run for the City Council in opposition to Mayor David Roberts' candidate, and has been a critic of the mayor's fiscal policy.
During her time at the microphone, Mason asked Business Administrator Robert Drasheff to explain different aspects of the budget amendments. After five minutes expired, a small bell rang; Mason continued to question Drasheff. She asked questions for another five minutes. When the bell rang again Ramos said, "Thank you, Ms. Mason. Clerk - call the vote."
"I object," responded a visibly shocked Mason. She stated that because this was a special meeting, copies of the amendments to the budget were not made readily available. She said that because the budget amendments are numerous, she should be given some more leeway in voicing her opinion. She added that with only four members of the public in attendance, she was hardly preventing others from speaking. She also said that she has requested a copy of the amendments but that the request had not been met. She did acknowledge that the seven day period to fulfill that request had not passed.
Ramos stated that he "respectfully disagreed" and called for a vote a second time, which cut Mason's questioning short.
Ramos said Tuesday that he believes he has been consistent with the enforcement of the five-minute policy. "If I let someone talk for 25 minutes at one meeting, then someone at the next meeting will complain that they should be allowed to talk for 25 minutes also," he said.
From the council chambers to the courtroom
A group of citizens is going to court in an attempt to overturn a controversial bond ordinance that restructures the city's $42 million debt. The ordinance saves the city money now but will cost almost $15 million extra in the long run.
The proposal was backed by Mayor David Roberts and approved by a 6-3 vote in October. It will lower the city's debt payments by $12 million over the next four years.
The plan surfaced because the city had faced a jump in debt payments from $3 million a year in previous years to $6 million a year starting this year. The restructuring lowers present payments while causing longer-term payments at significantly higher interest rates.
This contentious issue has exacerbated an already-wide fissure between Roberts and his critics.
The lawsuit against the restructuring was filed last week by former city Chief Financial Officer Michael Lenz, who was fired by Roberts earlier this May, Maurice DeGennaro, the manager of a local senior housing complex, local resident Helen Hirsch, and Pasquale DeStefano, former Mayor Anthony Russo's father-in-law.
In an interview Wednesday, Lenz acknowledged that the city has the right to refinance the city's debt, even if he might disagree. The suit does not directly challenge the authority of the council to refinance, but it alleges that the council failed to follow due process and therefore, according to the suit, the final vote should be nullified.
"[Approving] the bond issue is terrible decision, but the council has legal right make terrible decisions," said Lenz. "But they were in such a hurry to rush this through that they completely forgot about due process and denied the public the opportunity [to ask questions or state their opinions]."
Lenz pointed to several instances where he alleges that the public notification and hearing process was "mishandled."
He alleges that public speakers were only allowed five minutes to comment on the issue, and were cut off before being able to finish making their comments.
Second, he said an advertisement in this paper contained a false representation of the refinancing. The ad implied that the refinancing would only cost $7 million extra, when in reality it is going to cost $15 million extra. The next week the city, after being pressed by the Reporter, issued a statement that acknowledged that the "ad inaccurately portrayed the cost of the differential" between the upfront savings and the overall cost of the bond.
"It is our assertion that the public was misinformed throughout the entire faulty public hearing," said Lenz. Roberts responded sternly Thursday by saying that lawsuit is nothing more than "sour grapes."
"Michael Lenz is conducting himself as a political zealot who over the past several months has been willing to talk to anyone that shares a hatred of me," said Roberts. He added that all four of the citizens who filed are an overtly political "group of fanatics."
He noted that the interest payments on the series of bonds, which date back to 1991, were set to "balloon" this year, increasing to $6.2 million, up from $3.5 million last year. Roberts said that any business that had their debt payments double in a single year would "not even think twice" about refinancing the debt.
Roberts also said that Hoboken is in better financial shape today than it has been in many years and should have no problems in the future in meeting its debt obligations.
"If you were to look at the situation closely," said Roberts, "you clearly see that Hoboken is in wonderful shape with a bright future. Our tax rate is stable, are streets are cleaner, there are more police officers patrolling our streets, and highly respected corporate tenants like Marsh and McLennan now call Hoboken home." - Tom Jennemann