The City Council voted unanimously to reject a 15 percent tax hike, leaving Jersey City without a budget and scrambling to close a $254 million deficit.
Jersey City has no adopted budget and faces an August target to adopt one, after the City Council unanimously rejected Mayor James Solomon's proposed 15 percent property tax hike on July 1. The 0-9 vote came at a long, tense special meeting where public comment ran roughly two hours. Council President Denise Ridley and all eight colleagues voted no. Officials now scramble to close a $254 million inherited deficit. News 12 New Jersey reported the council has targeted a 12 percent increase instead.
The city's Interim Budget Report, released June 16, shows the deficit equals roughly 28 percent of Jersey City's operating budget. Unpaid bills from the prior administration total $109 million. Deferred costs — a Via rideshare settlement, debt service and reserves — account for $50 million. Another $59 million reflects overspending on healthcare, borrowing and other liabilities. The surplus fund collapsed from $27 million to nearly nothing.
City records document roughly $667 million in one-time revenues since 2019. Land sales and deferred obligations masked annual shortfalls, with the pattern repeating each budget cycle.
Lawmakers approved bailout package in Trenton as Council weighs tax increase
State and county lawmakers approved a $120 million aid package on June 29. Senator Raj Mukherji (D, 32nd District) and Hudson County Executive Craig Guy secured the measure in Trenton. The package splits into $105 million in low-interest borrowing and $15 million in transitional aid grants. Jersey City had sought $150 million.
The aid still leaves an estimated $90 million recurring structural deficit, according to News 12 New Jersey. The $105 million loan adds to the city's debt service obligations, which already totaled $29.7 million in the 2026 temporary budget. Statewide, the state FY2027 budget increased Transitional Aid to Localities from $161.9 million to $256.5 million. The $15 million grant to Jersey City is included in that total.
Jersey City's general tax rate stood at 1.604 in 2021. It jumped to 2.118 in 2022, then 2.247 in 2023, then dropped to 2.233 in 2024. The 2025 rate brought a slight increase to 2.335. A 15 percent hike from the 2025 rate would push the general tax rate to approximately 2.69. Jersey City's equalization ratio is 72.82 percent, meaning assessed values trail market values. At that ratio, the effective tax rate against full market value is roughly 1.70.
Solomon originally floated a 20 percent tax increase, which would cost the owner of a $650,000 home an extra $1,066 annually, according to ABC 7 NY. On June 22, three council members signaled they would back the 20 percent rate for third-quarter tax bills. Hudson County View reported that Joel Brooks (Ward B), Jake Ephros (Ward D) and Eleana Little (Ward E) released a joint statement citing "extenuating circumstances." The View captured their rationale: "The tax increase and the $150 million in transitional aid are designed to work together."
The June 22 statement came before the legislature approved the state aid package, at which point Solomon trimmed his proposal to 15 percent. Nine days later, the three council members voted no on the 15 percent hike. They and the rest of the council are now aiming for 12 percent.
The city administration confirmed 31 provisional employee layoffs on July 10, according to Hudson County View. City spokesman Nathaniel Styer told the View that the city would have avoided the cuts had the original 20 percent rate hike passed. Five council members — Denise Ridley, Frank Gilmore, Rolando Lavarro, Michael Griffin and Thomas Zuppa — responded to the cuts in a joint statement: "This council doesn't scare easily."
Ex-Mayor Fulop called deficit story "fugazi”
Former Mayor Steven Fulop, who now works as head of the Partnership for New York City, that city's leading big business advocacy group, defended his fiscal record. In a March 19 interview with the New York Editorial Board, Fulop called the deficit narrative "pure politics and fugazi." On June 24, he told Hudson County View: "Had I chosen to run for re-election, we would have introduced another budget with no tax increase." He added, "James [Solomon] served on the City Council for eight years with full budget responsibilities."
City records show deficits during Fulop's tenure, including a $93 million deficit in 2021. Fulop has not publicly addressed the $109 million unpaid-bills allegation since June 17.
Upon taking office, Solomon issued Executive Order 2026-002 on January 21, launching a comprehensive audit of all active PILOT agreements. PILOT (Payment In Lieu of Taxes) agreements allow developers to pay negotiated fees instead of standard property taxes, shifting revenue away from school districts and toward the municipal budget.
Law firms Skoloff & Wolfe and Genova Burns published advisories about the audit, warning their developer clients to brace for retroactive assessments stretching back more than two decades. The order set a July 1 deadline to complete the audit, but no public results have surfaced as of July 11.
Two crises converge on one tax base
Jersey City Public Schools, which levies property taxes separate from the city budget, faces a $3.88 million state aid cut for 2026-27, the largest dollar drop in the state.
The cuts stem from the state's S2 funding formula, which redistributes aid from property-rich districts to poorer ones. The formula, enacted in 2018, phased out so-called adjustment aid that had overfunded districts like Jersey City for years. Since 2020, the district has lost more than $68 million in annual state aid, falling from $168.5 million to $100 million.
In March, the school board signed off on a 17 percent tax levy increase. Two crises now converge on one tax base.
The council meets July 13 at 4:00 PM for a caucus at City Hall, 280 Grove Street. The public may attend the meeting but the council will not take public comments. Meanwhile, Solomon's office has scheduled the municipal budget introduction for July 15. The city has operated on temporary appropriations since January and now targets August for adoption.
Until then, Jersey City has operated without an adopted budget since January, 31 provisional employees have lost their jobs, and homeowners face tax pressure from both the municipal government and the school district.
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Sources
• City of Jersey City, "Financial Emergency Report" (Feb 4, 2026)
• City of Jersey City, "Mayor Solomon Releases Interim Budget Report" (Jun 17, 2026)
• City of Jersey City, Resolution No. 26-006, "2026 Temporary Budget" (adopted Jan 15, 2026)
• City of Jersey City, Resolution No. 26-093, "Transitional Aid Application" (adopted Feb 25, 2026)
• City of Jersey City, Resolution No. 26-371, "Comptroller Audit Request" (adopted Jun 24, 2026)
• New Jersey Department of the Treasury, "2026 Hudson County Equalization Table" (2026)
• New Jersey Department of the Treasury, "Budget in Brief FY2027" (Mar 2026)
• New Jersey Department of the Treasury, "General Tax Rates by Municipality" (2024)
• New Jersey Department of the Treasury, "General Tax Rates by Municipality" (2025)
• ABC 7 NY, "Jersey City Mayor Proposes 20% Tax Hike" (Jun 24, 2026)
• Akash Mehta, New York Editorial Board, "Steven Fulop on Fighting for Business" (Mar 19, 2026)
• David Wildstein, New Jersey Globe, "Mukherji, Guy Push for Jersey City Funding Gets Solomon $120 Million in Aid" (Jun 29, 2026)
• Hudson County View, "Brooks, Ephros, & Little Will Vote for Q3 Jersey City Tax Bills With 20% Rate Hike" (Jun 22, 2026)
• Hudson County View, "Interim Jersey City Budget Report Alleges $109M in Unpaid Bills From Prior Admin" (Jun 17, 2026)
• Hudson County View, "Jersey City BOE Narrowly Approves $1.1B Budget" (May 2, 2026)
• Hudson County View, "Jersey City Budget Battle Erupts Over 31 Layoffs" (Jul 10, 2026)
• Hudson County View, "Jersey City Council Unanimously Votes Down 15% Rate Hike on Q3 Tax Bills" (Jul 2, 2026)
• Hudson County View, "Jersey City Council Votes for N.J. Comptroller to Audit Finances During Fulop's Tenure" (Jun 25, 2026)
• Hudson County View, "Solomon Signs Exec. Orders to Audit All Jersey City Tax Breaks, Lowering Parade Fees" (Jan 21, 2026)
• Hudson County View, "Solomon Smacks Fulop for $254M Deficit, $667M in One-Shot Revenues" (Feb 4, 2026)
• James E. McGreevey, New Jersey Globe, "Overspending — A Way of Life in Jersey City" (Apr 10, 2025)
• News 12 New Jersey, "Jersey City Council Rejects Proposed Budget Increase" (Jul 2, 2026)
• News 12 New Jersey, "Jersey City to Receive $120 Million in State Aid" (Jun 29, 2026)
• Patch NJ, "NJ State Aid: 2026-27: See Biggest Increases, Reductions" (Mar 13, 2026)
• S&P Global, Jersey City GO Bond Rating Lowered To 'A' (Jun 26, 2025)
• The Bond Buyer, "Moody Cites Jersey City's Short-Term Notes in Downgrade" (Dec 15, 2025)
• Genova Burns LLC, "Jersey City Issues Executive Order on PILOT Audits: What Developers and Owners Need to Know" (Feb 2, 2026)
• Hoboken Girl, "Jersey City 2026 Budget: Things to Know" (Jun 30, 2026)
• Jersey City Association of Agencies, "Council Mtg. Wed. April 22, 2026 Regular Mtg. of Jersey City Municipal Council" (Apr 22, 2026)
• Skoloff & Wolfe P.C., "Jersey City PILOT Audit: What Taxpayers Need to Know" (Mar 4, 2026)