According to sources, the Hoboken Municipal Supervisors Association has sent a 59-page letter to the New Jersey Civil Service Commission accusing Hoboken Mayor Ravi Bhalla and his administration of negligence in their handling of recent layoffs.
Hoboken’s fiscal woes had been apparent since December, when former Business Administrator Stephen Marks sent the Mayor a memo highlighting a combination of healthcare costs ($1,513,450), elevated pension costs ($578,345), and anticipated annual salary increases in the face of collective bargaining negotiations with the City’s six municipal labor unions ($3,200,000).
Those increases are being met by anticipated revenue shortfalls on court fines, investments, debt service increase (bond repayments), departmental budget increases, higher waste disposal fees, and an increase in New Jersey’s Joint Insurance Fund premiums.
According to Marks, “The grand total for anticipated increases for personnel costs and other expenses is $7,420,795,” adding “which does not include the impact of the projected decrease in the municipal surplus regeneration.” That surplus—essentially a municipal savings account/rainy day fund, which can be used by the City to cover shortfalls, unexpected expenditures or catastrophic events (i.e. storm damage)—is said to be in arrears to the tune of an additional $6 million, putting the overall budget shortfall somewhere near $14 million.
On March 2, weeks prior to the local COVID-19 outbreak, 79 city employees received layoff notices as a direct result of an alleged multi-million budget shortfall which preempted the pandemic. On April 17, the Bhalla dministration announced in its daily COVID-19 Nixle alert that the City would eliminate 26 positions.
In an April 22 letter to Deidre L. Webster Cobb, Chairperson of the New Jersey Civil Service Commission, the Hoboken Municipal Supervisors Association maintains that it has “identified over $111 million in the Open Space Fund, which prior to August 2019 was just $8 million.”
According to Dawn DeLorenzo, President of the Hoboken Municipal Supervisors Association, “It is our firm belief that the layoff list presented by Mayor Bhalla was contrived, orchestrated and planned to target individual employees.”
On April 15, the Hoboken City Council passed a measure asking the administration to suspend all layoffs until a budget was submitted for review. According to DeLorenzo, “instead the Mayor has ignored this directive to protect the jobs of his current political appointments, with the long-term goal of giving taxpayers jobs to his other political allies.”
A March 4 Hoboken City Council meeting saw a strong and vocal opposition to the the layoffs from a packed house full of municipal employees. Less than two weeks later, the City called on may of those employees to take extraordinary measures in combating the spread of COVID-19.
“A number of our members are being forced into an early retirement at a time when their institutional knowledge of city operations is so desperately needed to keep Hoboken running efficiently,” said DeLorenzo in a statement. “None of these people deserve to feel like they are being punished and treated like a piece of garbage and that is exactly what this administration is doing, tossing them to the curb.”
First Ward Councilman Michael DeFusco tells hMAG, “The administration continues to delay presenting the City Council with a budget and I’ve repeatedly asked that we postpone layoffs so we can properly analyze where to make cuts in all areas of spending. The rush to eliminate jobs, that will only account for a very small fraction of our multi-million dollar budget deficit, seems to be a micro approach to a significantly larger problem.”
hMAG has reached out to the Bhalla Administration for comment on the Hoboken Municipal Supervisors Association allegations, and will update this story accordingly.
“I cannot sleep at night because I’m constantly worried about my members,” said DeLorenzo. “I take all their pain and suffering to heart and I wish I could say the same for the Mayor and his administration.”
“The City will vigorously defend its position and is confident it will prevail in the court of law,” says Brian Aloia, Corporation Counsel for the City of Hoboken.
From Mayor Bhalla’s April 17 Nixle Alert:
As a result, we had to make the unavoidable decision to submit a plan to lay off 26 positions, which makes up approximately 4% of the total workforce. I hold a responsibility to the taxpayers of Hoboken to do everything possible to mitigate a large tax increase due to these factors and must act on that obligation. I recognize the impact this decision will have on some of our employees and their families, and we will do everything possible to assist them with their next steps. During these challenging times, unfortunately, difficult decisions have to be made to protect the long term fiscal health of our City.”
As mentioned yesterday and last week, COVID-19 has had a significant impact on Hoboken’s finances, like many municipalities and States across the country. According to Governor Murphy, The State of New Jersey itself is facing billions of dollars in revenue shortfalls. I believe it’s important to communicate about the impact of the virus not only on public health, but also to the City as each week the crisis creates additional stress on Hoboken’s finances.
Comparing the revenues of mid-March to mid-April to a year ago, the City is down over $1 million in typical revenue received. This does not include all of the added COVID-19 expenses such as COVID-19 testing, disinfecting of senior and Hoboken Housing Authority buildings, meals for seniors in need, and additional public safety costs.