Jersey City Will Get $120M In State Aid To Help Close Budget Gap

JERSEY CITY, NJ — After struggling with a $255 million gap in Jersey City's proposed $874 million budget, officials said Monday the state of New Jersey will provide $120 million to help.

Mayor James Solomon had said that Jersey City residents may have to pay a 20 percent tax hike when the 2026 budget is passed.

The aid announcement came after the Senate Budget and Appropriations Committee and Assembly Budget Committee voted on the state's $60.1 billion general appropriations bill on Sunday night.

Solomon said that, combined with $55 million in savings previously identified, the aid reduces Jersey City’s remaining 2026 deficit to $80 million.

Solomon plans to introduce the budget proposal to the City Council on July 15, hoping it will pass by mid-August.

The proposed budget is $874 million. READ MORE: Jersey City Postpones Vote On 20 Percent Tax Hike

The budget covers spending retroactively back to Jan. 1 of this year.

"Since day one, my team and I were laser-focused on finding solutions to the city’s fiscal crisis that avoided worst case scenarios of a 31 percent tax increase and devastating cuts to core city services," said Solomon.

He added, "Today, Governor [Mikie] Sherrill, Senate President Scutari, and Assembly Speaker Coughlin demonstrated historic leadership as part of an historic partnership."

Solomon also said, "This $120 million enables us to pay off the former mayor’s debts over years and allows us to focus on fixing our structural deficit. The hard part comes next – we must close a $90 million gap between how much the city spends and what it takes in and strike a balance between reducing the burden on Jersey City families and cuts to city workers."

The aid package includes $105 million in long-term, low interest debt and $15 million in transitional aid grants, according to the city.

The city said the money will primarily be applied to payment of outstanding debt that must be paid this year.

Sen. Raj Mukherji, identified as the sponsor of the appropriations, said, "This critically necessary state aid package is an investment in the fiscal stability of New Jersey’s largest local tax base."

Sen. Angela McKnight said the announcement gives Jersey City "the breathing room it needs to move forward responsibly."

The administration said the aid builds on work already underway, including a transition to a new health insurance administrator, audits of PILOT agreements and tax abatements, updated developer fees and spending reductions by city departments.

READ MORE: Jersey City Postpones Vote On 20 Percent Tax Hike