Jersey City

Independent Audit Of Jersey City’s 2025 Finances Identifies 17 Material Weaknesses & Findings

Posted on 08/14/2026

INDEPENDENT AUDIT OF JERSEY CITY’S 2025 FINANCES IDENTIFIES 17 MATERIAL WEAKNESSES & FINDINGS

Solomon Administration commits to transparency and a Corrective Action Plan to improve Jersey City’s accounting and fiscal practices

JERSEY CITY, N.J. (August 14, 2026) — The City of Jersey City today released the independent audit of its 2025 finances, prepared by the certified public accounting firm Donohue, Gironda, Doria & Tomkins, LLC. The audit covers calendar year 2025 — the final year of the previous administration — and does not cover any portion of 2026. The audit can be found at JCNJ.org/audit.

The auditors issued seventeen findings, identified two material weaknesses in internal control, and identified the absence of an inventory of fixed assets (properties, buildings, equipment) that has not been maintained as State regulation requires since 2014.

Independent financial experts verified the auditor’s findings: 

“CUNY ISLG commends Jersey City for the frank assessment of its finances and releasing this public audit. The audit identifies some significant and meaningful actions that will help move the City toward its goal of long-term financial sustainability,” said Marc Shaw, Senior Advisor, CUNY Institute for State and Local Governance. 

"This audit is a serious document, and it deserves a serious response, not just from the administration, but from the entire governing body. The Chief Financial Officer will submit a corrective action plan to the Council and the state Division of Local Government Services, as required. That's a necessary first step, but it can't be the last one. A corrective action plan that sits on a shelf accomplishes nothing. Public finance in Jersey City is complicated. Nobody expects any Council member to be an accountant. But understanding the critical issues, asking hard questions, getting clear answers from the City’s professionals, and staying engaged between audits is part of the job. The Mayor and Council need to act prudently and effectively as the City realigns its fiscal condition and moves forward,” said Marc Pfeiffer, Associate Director, Rutgers’ Center for Urban Policy Research. 

An audit opinion addresses whether financial statements accurately report what happened and examines the City’s budget practices, internal controls, and accounting policies. On that second question, the report is detailed.

Key finding: costs moved into future budgets

The audit documents $94,124,946 in deferred charges, or costs incurred in prior years that were not paid for when they arose and must instead be raised in future budgets.

The auditors address the practice directly. Writing about the City’s use of emergency appropriations, they state that financing current operating costs in future budgets “shifts the financial burden to future taxpayers who did not receive the related services or benefits.” They further note that emergency appropriations are intended under the Local Budget Law for “unforeseen expenditures requiring immediate action,” and that employee health insurance costs — the largest use of the mechanism in 2025 — are “recurring and reasonably estimable.”

Specific practices documented in the report

• Health insurance was budgeted below its cost. The 2025 budget appropriated $147,385,033 for employee and retiree health insurance. In November 2025, six weeks before the year closed, the City Council adopted a $22,500,000 emergency appropriation, financed by notes, to cover health insurance and tax appeal costs the budget had not funded. The auditors separately identified $2,504,539 in October and November 2025 health insurance costs — including medical, prescription and stop-loss charges — that were not recorded as year-end obligations. In 2024, the City overspent its health insurance and related appropriations by $11,701,836.

• One-time revenue was used to balance the operating budget. The audit records $33,136,809 in proceeds from the sale of municipal properties and $27,929,353 in cash reserves as 2025 operating revenue.

• Borrowing was used to cover operating expenses. The City entered 2026 with $78,663,122 in emergency and special emergency notes outstanding, including $33,200,000 for contractual severance obligations and $22,963,122 remaining from the 2021 operating deficit. That deficit totaled $92,939,388 and is being repaid in annual installments of $11,481,562 through 2027.

• Operating costs were charged to the capital budget. The auditors found that microtransit service costs have been charged to capital improvement authorizations over multiple years without established statutory authority, and warned that those expenditures “may be subject to reclassification and reimbursement to the capital fund” if determined ineligible.

• Older obligations were left unaddressed. The report identifies $13,041,080 in completed capital projects — some dating to the 1970s and 1980s — for which funding was never provided and which can no longer be financed through bonds. It also confirms that a $3.1 million payroll tax overpayment originating in 2019 is now uncollectible and must be funded through the budget. Like other findings, this issue was identified in multiple prior reports and was never addressed until this year. 

Records the City could not produce

Several findings concern documentation that was unavailable to the auditors.

• The fixed asset inventory (properties, buildings, equipment) has not been updated as State regulation requires. This finding has recurred in every audit since at least 2014. At the August 19 City Council meeting the City is putting forward a Request for Proposal (RFP) for a third-party vendor to create the asset inventory. 

• Overtime payments lack record-keeping. In a sample of 20 employees receiving overtime, one payment covered ten hours against records supporting six, and seven of the twenty samples included no description of the work performed.

• Poor systems led to severance overpayments. A review of 25 severance payments identified a $32,240 overpayment caused by a manual data-entry error that was not detected before processing.

Next steps

Under State regulation, the City must prepare a corrective action plan addressing each finding, approved by resolution of the City Council, within 60 days of receiving the audit. The Administration has completed that plan and is transmitting it to the Council along with the audit. 

The plan assigns every finding to a named City official and sets a date for completion. Three findings are already resolved, and the rest have a fixed date for resolution. The City taking the first step towards resolving the largest finding, establishing the City’s inventory of fixed assets (buildings, vehicles, and equipment), by issuing an RFP for a third-party to assess the City’s inventory at the next meeting of the City Council.  

Many of the findings identified in the 2025 audit are repeat findings – issues identified over a period of years that went unaddressed by Jersey City, including some dating back to 2014. The Solomon Administration is committing to the City Council and public to implement the auditor’s recommendations as part of the Administration’s work installing modern, professional financial controls, led by Finance Director Bill Viqueira. 

The Corrective Action Plan can be found here.

“Jersey City taxpayers deserve a government that responsibly manages its finances, pays its bills on time, and is able to account for its assets,” said Finance Director Bill Viqueira. “The findings identified in the 2025 audit point towards long-overdue actions that this city will immediately act on, and we are committed to meaningful improvement throughout the city’s fiscal management.”

About the audit

New Jersey municipalities are required to have their financial statements audited annually by a Registered Municipal Accountant. The 2025 audit was conducted in accordance with generally accepted auditing standards, Government Auditing Standards issued by the Comptroller General of the United States, and the requirements of the New Jersey Division of Local Government Services. 

The full report is available at JCNJ.org/audit.