Gap Widens Between Newark Council and Mayor Over Budget
Five of Newark's council members called a press conference on Thursday July 22 to clarify their side of the story. Council President Donald Payne, Jr., councilpersons Mildred Crump, Luis Quintana, Darrin Sharif, and Ras Baraka joined hands together to protest the budget presentation or introduction by Mayor Cory Booker. They also said that Councilman Ronald Rice, Jr., who was out of town, is with them and conveyed a message of support to their group.
According to the councilpersons, the mayor did not give them enough time to study and make their decision. Now they have studied it for a bit, and opposed the mayor's proposal of creating a Municipal Utilities Authority. $70 million is already part of the mayor's proposal. According to the mayor, once the budget has been introduced, it is the council's responsibility to accept, reject, or come up with an alternative plan. That means the council has to come up with an alternative plan to fill in the gap of $70 million. The council stated in the press conference that they have a significant plan to fill the gap. But to my question, the council has not explained or exposed their plan. I asked some of the citizens, and they did not agree with the council. People want the reason and alternate plan for their opposition.
They have two main concerns: 1. Why should the council create a Municipal Utilities Authority (MUA), which in their opinion the chance of success is very low. 2. The mayor did not give them enough time to study and analyze this magnitude of action. When the city made an arrangement of extension of the port authority contract, they received 240 million dollars. However, they will receive only $100 million up front, plus $5 million in lease payments per year. As the MUA will not be a part of the city government, in their opinion there will be a lot of corruption without any control.
Another problem the councilpersons had is that there was a study done in January 2009, and the recommendations were not favorable. They believed it was a political move and they continued their battles in and out of the council meeting. The mayor stayed steadfast about his proposal, and he said that he already introduced the budget. The passage of introduction was approved by a majority (7-2) of the council on June 17, 2010. He stated that if they did not like it, they should have rejected it at the time of introduction. Now it is the council's duty to come up with a plan to fill in the gap of 70 million dollars of MUA revenue, which was part of the budget. The mayor stated that the council members are fiduciary agents, and if they do not come up with an alternative, then the state will come in and fine each and every councilperson.
Council President Donald Payne, Jr. said, "Councilman Ronald Rice cannot be here, but he has sends his wholehearted support... Let me be clear on that vote returned for the MUA. This is the mayor's issue. We are the Newark Municipal Council. We advise and consent on the budget. If we reject the budget, it is the mayor's job to come back with a budget we can approve. This situation on the council is wrong. The process isn't quite finished. We are tired and frustrated that the public and the media have made people believe that this is our issue. This is the mayor's issue. We are willing to work with him... Council members come up with ideas and solutions to extensively help us out with this crisis. There is press conference after press conference saying that the council are not doing their job."
Councilman Darrin Sharif said, "I ran for office and I made a pledge to protect the interest of Central Ward residents. I also made a pledge to make decisions, especially on matters of great importance based on information available to me, and finally I made commitment to provide the residents of the Central Ward information they need to make a decision. Well over a year, there has been a debate that the city of Newark should create a Municipal Utilities Authority to manage the water and sewer system. When residents asked what my position was in creation of the MUA, I indicated that I would need more information to make an important decision... So I called for a town hall meeting in the Central Ward... It is clearly understood that the creation of the MUA and its long term implication should not be taken lightly. The residents should also understand, the time frame of the creation of the MUA at the local finance board was in February 2009, almost 15 months ago. To my knowledge, the application was rejected and since then, 15 months later that reappeared on the radar for reconsideration. No efforts between that time periods were made to resubmit to the local finance board, Now at the local town hall meeting, it will be submitted to educate the public. The needs of the water and sewer system were so urgent, yet nothing was done. Something doesn't add up. That means the mayor made a constant political decision not to address the issue until after the 2010 elections. And also, this council is responsible for determining whether or not the MUA will be created. The fact of the matter is that the decision should have been made long before I came to the municipal council. All I am trying to do is to provide the public and myself the information we deserve. It is unfair to create an impression that this body is wholly responsible for the Draconian steps they are forced to take as this council failed to act quickly. As the mayor indicated yesterday this is not the time to point fingers, but it is critical that the public understands the chronology and the series of events to make decisions. As the mayor indicated, every member of this team is working together to address two issues that should have never been one. Issue one is the budget, and issue two is the MUA."
Councilwoman Crump said, "If we don't create the MUA, the blood of the city and its residents should be on our head? Not so. We are in this together. I am very disappointed this is a political issue. It's us against them. My objection is the information driven. The document presented to the council in January 2009 met certain submission requirements. One of which is that there is a presumption that it may not work. A new document was presented to us on June 17, 2010. A very important process is not included in the new document. A host of issues in the submission requirement did not go in on June 17, 2010. My question is 'Who docked the document? Who subtracted very important structural information of this document'... I continue to object the MUA. This is about information."
Councilman Quintana, "The most valuable thing to me right now is the water. We sell water to Belleville and Bloomfield. We should consult those towns, as they will be affected too... I don't think that this is the right thing to do. The better thing right now is to sell the arena, and get a hundred million dollars... The citizens of Newark have been told a different story. Tell the truth. You had four years when you came in. There was a plan ,and you missed it and that's your problem. Now, we have to find a solution? The solution is not the MUA."
Councilman Baraka, "Most of the information we received was in a matter of weeks. It is impossible for the mayor to believe that we should make a large decision of this magnitude in a very short period of time, without any information at all. As councilpersons, we should have the right information and any bad news about the year in advance. He should have hearings for the MUA. The mayor had a very clear picture. They had ample of time for another plan, another idea...and talked to the people for other options. The mayor wants the MUA anyway. The MUA is to fill the budget gap.
Councilman Baraka further said that the mayor promised to present two budgets, one with the MUA and one without the MUA. He said they had presented only one budget with the MUA, and never presented a budget without the MUA.
In response to my question, Councilman Sharif answered that they had a significant amount in an alternative proposal to fill the 70 million dollar gap. When I asked the mayor, he stated that the council came with plans, but that does not add up to the substantial amount of money needed to fill in the gap.
Mayor Booker answered questions after the councilpersons' press conference. He stayed steadfast in his decision and said, "We are beyond personal issues and tactics. It is the city budget that is relying on 70 million dollars revenue. In that budget already there are very Draconian cuts, and a massive reduction of police and fire personnel. In that budget, we have reduction of library hours and all our precious institutions are being hit. That budget alone, we felt that it was responsible to help navigate through a very difficult time and makes sacrifices from every corner of our city. This council has rejected that budget and pulled out over 10% of the revenue we have within that budget. That creates a massive hole. If I have to find a way right now to start dealing, I see one way is cutting deeper and further. This is reality...If the city of Newark does not present a balanced budget, the state will come and order a tax increase. The tax increase we'll see is well into double digits and it will cripple a lot of economic dynamism in our city. It will affect housing, homeowners, renters, business endeavors, neighborhoods, and the foreclosure crisis more than we are facing right now. It's not about scare tactics, it is about reality...We did not put out a plan for this year, but a plan for the next three years. Not only did the council pull out money for this year, but they pulled out money from the budget of next year as well. So I am in the worst fiscal crisis the city has faced in generations... Let me tell you one thing, the answer to this is not taxes... All cuts combined amount to ten or fifteen million dollars and 50 or fifty five million dollars still have to be found. I point this out to the council. The statutory obligation does not lie with the mayor. If the state does not get the budget introduced, the state will come in and start fining the city's council people. That has happened in other cities. It will hold each and every member of the council personally responsible out of their own pocket. So this is not something we are making up...We must act, and we must do more than I announced yesterday."
He further stated, "We have a water system right now that is half a billion dollars worth of capital need. The last rain storm we had destroyed homeowners cars... We have pipes that are in ancient condition, and cannot sustain rainfall. The Department of Environmental Protection ordered us to look at major infrastructure to cap our reservoir. We do not have the bond capacity to do those things. The creation of the MUA is critical... We are creating lease arrangements, a revenue stream for the city all the way through my lifetime and creating leasing arrangements with the authority, and we are using that cushion to our budget."
"The council gave an endorsement of that when they accepted a budget with that money in it. No councilperson said 'No mayor go back to drawing board. We are not accepting the budget with MUA.' We were sort of very disappointed and shocked... We were left with very few choices, and I will not accept that we tax our city to solve this problem."
The mayor further stated, "The job (of the council) is three things. Legislation, it is departmental oversight, and passing the budget every year. This a fundamental job, to pass the budget.
"I have a trail of text massages. Every day we have been inviting them down to be part of our dialogue of deliberation. We have actually opened the door to our council."
I said to the mayor that the council stated that they came up with a significant alternative to the revenue proposal. The mayor replied, "It is not true. Any plan that we receive, we can act upon. If council tells me where to cut, I have to do it. So, I am waiting for them to tell me what to do. Right now, we have not received instructions on what to do... We cannot allow the raising of taxes 20 to 30 percent. They have not come with a reliable plan for revenue."
As mentioned previously in his press conference, the mayor said that if the council does not approve the budget, the state department will come in and penalize the council and the city, and may order raising taxes. Booker was hesitant to take drastic steps, but if he has to, he might cut down and stop providing toilet paper and stationery to the employees. He might close down the swimming pools and cut help extended to libraries and other institutions. Mayor Booker said that these are not scare tactics, but reality.
There are five town hall meetings planned from July 26 to July 30 in each ward. The Council President called a special meeting on Tuesday July 27 and differed to take any action on MUA or Budget until an August 4 meeting.
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