Wednesday, September 6, 2017

Council balks at Mayor Zimmer's political barbs, dumps Suez contract and demands answers on Watergate $8.3 million red ink

Flash analysis from your friendly neighborhood Horsey on the breaking Suez WaterGate crisis

The end of a political era occurred tonight. The Hoboken mayor who looked like a shoe-in just months ago for a third term before backing out and attempting to insert Councilman Ravi Bhalla her successor, saw her legacy take a major hit before the City Council tonight.

Mayor Zimmer's proposed Suez water contract wasn't dead-on-arrival; it was full-fledged roadkill.

The proposed new water contract with Suez led to some aggressive council questions directed toward the administration and its consultants wanting to know how millions of dollars in bills could be hidden for years without anyone being told on the council as it accumulated.

After her speech requesting the council vote and provide additional guidance on the Suez contract Mayor Dawn Zimmer put before them if rejected; the entire City Council responded in a calm, united fury with seething cold anger. Not for being placed in a position to vote without basic answers to a number of questions on the contract but also for the mayor's prepared political barbs against some of its members.  They listened to her prepared remarks waiting to get answers not forthcoming to date on a $8.3 million bill owed Suez that appeared out of thin air.

Beyond the $8 million plus bill that materialized in four years owed to Suez, the council members questioned other aspects of the proposed agreement and found it lacking. They didn't like anything they were fed. Or rather, the taste of what was being forced down their throats with the exception of Councilman Jim Doyle who obtusely said he and his colleagues were "not there to micromanage." (Doyle is running for re-election with Councilman Ravi Bhalla.)

Various professionals and members of the administration hedged and punted to one another as the council members tried to get to the bottom of who knew about the accumulating million dollar bills owed Suez and when did they know it?

Was it a year? Was it two months ago? The answers varied from professional to professional and only further outraged the council members who wanted to know why the million dollar liabilities were not being accounted for in this year's or any prior year's budget. City auditor Steve Wilcox said he had only learned of the massive seven figure debt yesterday. 

Flashbacks to how Hoboken found itself in a state takeover when Mayor Zimmer first became acting mayor back in the summer of 2009.

More to come with Mayor Zimmer's prepared remarks and the council grilling the administration for answers. In the end, City Council President Jen Giattino asked her colleagues if anyone was sponsoring the contract. Seeing none, she assumed her authority as council chair and removed the Suez contract ordinance from the agenda.

Not a single member of the council protested.

Mayor Zimmer listens with her husband as Councilwoman Tiffanie Fisher delivered a stunning rebuke to her prepared remarks on the proposed Suez Water contract. Fisher's remarks would be echoed by almost every council member who sought answers on how over $8 million in red ink accumulated before coming to light owed Suez. Ravi Bhalla left the dais as he was recused from participation.

Talking Ed Note: Councilman Ravi Bhalla left the dais and listened in the back of the room to the proceedings. He recused himself after questions about his partnership with law firm Florio Perucci came up last month. While not admitting to any conflict; he's clearly conflicted from participating.

After what was seen tonight, one can view his recusal as perhaps a blessing.

What was witnessed live and online was an implosion of Mayor Zimmer's mayoralty.

Councilwoman Tiffanie Fisher: SUEZ WATERGATE - $8.3 million bill exposed!

Official release:

Hoboken friends and neighbors –

Happy New School Year and welcome back!  I hope you all were able to have some enjoyment this summer.  There are a couple of important things I want to update you on, but one in particular in advance of tonight’s City Council meeting: the proposed terms for the extension and restatement of the contract between Hoboken and Suez Water for water services and the concerns I have with the proposal.

Overall my concerns with the proposal are as follows (more details below):
  • The profitability to Suez vs. Hoboken residents – the proposed contract still has Suez keeping the majority of our water revenues which will continue to grow.
  • The accounting, appropriation and/or disclosure treatment of the $8.3 million liability of the City that has been accruing for four years relating to increase in water rates and system improvement costs that has not been appropriated for.
  • The fact that our consultant did not speak with any other potential service providers as a potential alternative.

Why is this important to you?
  • Whether you own or rent, your monthly costs to live in Hoboken include the cost of water – indirectly through higher rent, or directly through your water bill, your maintenance bills (if you live in a condo) or in some cases your property taxes.  
  • As you are all aware, we have an old water system in Hoboken that requires substantial investment to fix and be sufficient for the next generations.  A water services contract can cover anything from operations and distribution of water to full repairs of the system, and everything in between.
  • This is a long term contract that we are asking to sign that will have implications to all residents of Hoboken for the next 17 years.  
  • If you just moved to Hoboken, you will be bearing the full financial impact of a liability that has been accruing, but not paid for previously, for the last four years.
Our current contract with Suez which expires in 2024 effectively provides Suez with 100% of the revenue from water bills (estimated at ~$9 million / year) and requires that Suez only pay $350,000 per year towards repairs which we know are estimated to be in the tens of millions of dollars.  And apparently Suez are able to push through all increases in the costs of water to the City of Hoboken, thus Hoboken taxpayers, as opposed to those who actually pay for water. 

If it doesn’t sound like a good deal, it isn’t.  A former mayor traded the future water revenues for one time payments totaling ~$18 million to fill then current year budget deficits on three different occasions.  And the contract says we would have to pay the unamortized portion of this payment back if we terminate the contract early.  So he effectively borrowed from our future to meet the needs in those individual years.   Suez clearly had no financial incentive to modify the contract until now when it wants to extend the term of it.

The proposal that our current administration has put forth to be considered on face value appears to be an improvement over the existing contract.  It effectively increases Suez’s annual contribution from $350,000 to $1.3 million in the first year, growing 2% annually.  Suez has also agreed to modernize its monitoring system to make billing more exact and user friendly for residents.  And they will “forgive” $8.3 million that the City owes Suez pertaining to increased water rates and system maintenance costs incurred over the past four years.  In exchange, Suez still gets all of the revenues which are expected to grow with our growing population.  And they get these revenues for 10 additional years through 2034.  Although the City supposedly gets $30+ million.  Suez will get much more.

Last night we had the third subcommittee meeting relating to this contract.  The first was the Infrastructure subcommittee meeting held at the end of July and was attended by Councilmembers Bhalla, Giattino and me.  Councilman Russo was invited, but did not attend.  At this meeting, when I asked the question "is the contract At, Above or Below Market", our consultant said above market.  And when I asked how much, he said he didn't know. 

Then, after the Council meeting in early August where a number of questions were raised by council members (and the vote on the proposal was carried), we had a second subcommittee meeting – this time an ad hoc meeting of finance and revenue and infrastructure subcommittees where I was joined by Council members Giattino and Cunningham.  Councilman Russo did not attend.  At this second meeting we became aware of and raised the concerns in more detail about the amount of profit going to Suez and the accounting treatment of the $8.3 million liability.  And in both meetings we asked for the underlying financial analysis for the proposed contract.    

Because of the complexity of the agreement and our lack of comfort with the responses given, I sent a letter to the administration the next day calling for a third subcommittee meeting and requiring the attendance of the City’s auditor as well as a closed session with the entire City Council so they could be educated on the contract in sufficient detail to comfortably vote.  This would be attended by the City’s financial consultant.

At the third subcommittee last evening, attended by councilmembers Giattino and Cunningham  and me (Russo was inadvertently not invited), we were told the auditor was not available, but that he will provide a letter prior to tonight’s meeting.  As of this writing, we have not received this letter.  Additionally, we asked for the third time to see the underlying financial analysis for the contract and were told by the administration that they would not provide it.  Also, the administration declined scheduling a closed session with the entire council prior to the vote.

As stated by the Mayor, we are governed by the Faulkner act which means the Mayor negotiates contracts on behalf of the City, and the city council just votes up or down.  One approach would then be to provide the city council with sufficient information so they could comfortably vote.  

Another approach is to deny the governing body such an accommodation.  The latter is not how I would approach something this critical to our City. But here we are.  At tonight’s meeting we will ask a lot of questions.  So I hope you will tune in to learn more about this critical contract for Hoboken.  Hopefully you can appreciate my concerns and that our attempt to understand the details of the proposal is so that we can ensure we are getting the best outcome for Hoboken.

Please feel free to send me any thoughts or questions.  All input is welcome.

Tiffanie Fisher
Hoboken 2nd Ward City Councilwoman

Engage. Inform. Advocate.
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Ready or not here it comes

Tonight it's the Hoboken City Council meeting and the countdown to Election Day means the old Mile Square City brawling will erupt sooner than later with all the marbles on the line.

Hoboken sits in a unique vantage point. Four major mayoral campaigns are vying for the top prize and three at-large council seats added to the mix makes for a volatile mixture.

Three of the four major mayoral candidates sit on the dais: Council members Mike DeFusco, Ravi Bhalla and City Council President Jen Giattino. An appearance by Freeholder Anthony "Stick"Romano can't be ruled out and Karen Nason has been a frequent visitor to the public microphone after she announced her mayoral bid.

There's literally millions of reasons for Hoboken residents to tune into the action tonight. One whopper of an agenda item: the Suez water contract. There's been lots of discussion through the Labor Day Holiday weekend. The problems in the proposed contract are about to come to light even as the complete financial details are anything but transparent.

More tonight at The Show.

 Talking Ed Note: This year's mayoral election will capture the attention of voters. The Mile Square City gets back in the swing of things as seen in this official traffic tally taken yesterday after the holiday. It will grow as the November election approaches.

Jen Giattino: Join My Team This Weekend!

Official release:

MSV readers,

It’s time!!  The push to November 7th is now.  To make it happen, it’s your time (and support) that we count on. 

We have been out campaigning all around the city this summer.  We submitted nearly 1,800 nominating petitions for Team Giattino last week and we opened our campaign HQ at 152 Newark St.  Come see us!

This week and especially this coming weekend we have plans to spread the word even further.  To do this, we need your help knocking on doors and handing out literature throughout the city to let people know how important it is to elect my team on November 7th.

Never knocked on doors before?  It’s really fun!  Especially with experienced doorknockers to go with you.  My entire team and other local active community members will be canvassing this weekend and will be happy to join you.    You can bring your children and even focus on your own neighborhood.  Whatever is most convenient or comfortable for you – we can come to you! 

Still not sure?  Councilwoman Tiffanie Fisher, an experienced and enthusiastic canvasser, will host “Canvassing 101” training sessions to help get you more comfortable and answer questions you may have like:
“What is the first thing you say when they open the door?” or
“What if they ask me a question I do not know the answer to?” or even
“If I don’t like door knocking, are there other ways I can help reach the voters in my neighborhood?”   

Whether you have knocked on doors before or not, please plan to come to one of the sessions.  She will host three, one-hour training sessions this week, all conveniently located at our HQ at 152 Newark St.:  6:30 pm on Thursday, 9:00 am on Saturday and 10:00 am on Sunday.   

Can you give just a couple hours after work or this weekend to help get out the message with us?  Bring a friend or two to HQ on Saturday or Sunday for two hour shifts at: 10am, Noon, 2pm or 4pm and let’s leave no doubt about who will be the next Mayor of Hoboken. 

Two other things you can do that take even less time:
1. Take a Team Giattino sign and hang in your window.  Team Giattino window signs are increasing throughout the city.  But there is always room for more.  Pick up your sign this weekend.  

2. Share my posts on Facebook and ask your friends to “like” my page.  Please do this by going to my page (link here), and clicking the “invite friends” link and inviting all of your Facebook friends to like my page.

Please call or text either Councilwoman Tiffanie Fisher at 201-208-1674 or Ann Graham at 201-424 -0485 or send an email to to schedule your time to help us canvass this weekend, RSVP for “Canvassing 101” training, and/or to request a sign – we deliver!  Or expect a call from one of us!

Thank you so much to everyone who has reached out and who has already volunteered.  We are excited to see more of you this weekend!!

-  Jen

Team Bhalla Files 2,796 Petition Signatures

Official release:

Councilman Ravi Bhalla, candidate for Hoboken Mayor, and his at large slate of Councilman Jim Doyle, Emily Jabbour and John Allen all together filed 2,796 petition signatures with the City Clerk, well-exceeding the number needed to qualify for the ballot.  Bhalla filed  1,004 himself.
Councilman Ravi Bhalla said, “We engaged voters throughout the City in our petition-gathering effort, using it as an opportunity to have thousands of conversations at residents' doors and in strategic locations.  Voters were responsive to our plans for fixing our aging infrastructure, comprehensively addressing our flooding problem, holding the line on taxes, and building on the successes of the Zimmer Administration.  Between now and election day, we will continue and step-up our active grassroots campaigning, assisted by dedicated volunteers.”
The Bhalla campaign is strongly encouraged by the positive responses it received in all corners of the City.