Mayor Solomon Announces 20% Tax Rate Increase for Q3 as Part of Plan to Close Inherited $255 Million Deficit
FOR IMMEDIATE RELEASE
Contact: Nathaniel Styer | Communications Director
[email protected]
Mayor Solomon Announces 20% Tax Rate Increase for Q3 as Part of Plan to Close Inherited $255 Million Deficit
City to cut costs, generate new non-tax revenue, and pursue state aid to hold the increase as low as possible
JERSEY CITY, N.J. (June 18, 2026) — Mayor James Solomon today announced that the City is proposing a 20% increase to the tax rate. This increase represents a difficult but necessary step toward stabilizing finances after the Administration inherited a structural deficit of roughly $255 million, equal to about 28% of the City's annual operating budget.
"I know this tax increase is painful, especially for people on fixed-incomes and the working families of Jersey City," said Mayor James Solomon. "The City’s deficit is without recent precedent in New Jersey. We did not create this hole, it was created during good economic times through years of one-time gimmicks, hidden bills, and deferred costs, but it is our job to climb out of it responsibly. Alongside reductions in government spending and pursuit of non-tax revenue, a tax increase is part of that solution. What I can promise is that we have fought to make it as small as it can responsibly be, and that we will keep fighting to stabilize our budget next year and the years after."
Since taking office in January, the Administration has already reduced the inherited gap by approximately $55 million through administrative action, lowering the remaining structural shortfall to roughly $200 million. The Mayor stressed that the proposed increase reflects only what remains after every available alternative has been pursued.
Presented on June 17 in the City’s Interim Budget Report, the Administration's strategy rests on three pillars, each designed to reduce the burden on taxpayers:
Cutting Costs and Saving Money. The Administration has secured roughly $55 million in savings without compromising core services. Measures include:
1. Ending wasteful commitments. The Solomon Administration reduced spending by:
- Ended the Centre Pompidou museum project, which saved $40M about to be spent. Additionally, it had already consumed more than $20 million in consultant and licensing fees for a museum still years from opening,
- Withdrew from an annual $2 million commitment to funding the county-wide Liberty High School.
Reducing spending on services previously improperly paid for with capital funds.
- Health insurance — the largest single measure. Effective March 1, 2026, the City switched its benefits administrator from Horizon to Aetna, reducing costs by approximately $25.8 million in 2026 with no reduction in the coverage employees receive.
- Healthcare Claims Audit. A dependent-eligibility audit and a full claims audit are underway to ensure the City stops paying for ineligible enrollees.
- Mayoral Salary. Mayor Solomon believes in leading by examples and is taking a $1 for 2026.
The Mayor has directed department leaders to reduce spending by 10% over time through efficiencies and cost-cutting that will not harm public services. At this time, the City is saving at least $3.5 million by implementing tighter controls on unnecessary overtime, eliminating vacant positions, and tightening staffing practices.
2. Generating Non-Tax Revenue. Before asking residents to pay more, the City is collecting what it is already owed and ensuring developers and corporations pay their fair share. Initiatives projected to generate at least $15 million in new recurring annual revenue include modernized code enforcement to clear a backlog of roughly 50,000 compliance cases, updated construction and permit fees, camera-assisted parking enforcement, a rebuilt JCPD Traffic Enforcement Unit, an audit of existing PILOT (payment-in-lieu-of-taxes) agreements, and updated water and sewer interconnection fees charged to developers for the first time in 25 years.
3. Pursuing State Aid and Loans. The Administration is seeking approximately $120 million in state financial assistance — a combination of aid and low- or zero-interest loans modeled on the precedents established for Atlantic City and Newark. This is not a bailout, but an investment in a city that contributes disproportionately to New Jersey's economy. Jersey City generates an estimated $1.3 billion each year in state income, sales, and business taxes, and its growth has given the State an estimated $400 million more in annual revenue than it would otherwise receive.
"We are doing everything within our power — cutting waste, collecting what we're owed, and going to the State for a partnership that protects both Jersey City and New Jersey," said Mayor Solomon.
The Estimated Tax Increase is being submitted to the City Council for approval at the June 24th meeting. If passed, the increase will be reflected in the Q3 a tax bill. The Administration intends to introduce a detailed budget to the City Council on July 15, with passage targeted for early August. The City will continue to report its progress openly and will deliver a multi-year plan to restore lasting structural balance to Jersey City's finances.
To calculate the estimated tax increase, the City created this online tool for residents: JCNJ.org/calculator.
"This is an important step toward stabilizing city finances." – Janet Penksa, Senior Fellow, CUNY Institute for State & Local Governance
"Jersey City's fiscal health is Hudson County's fiscal health — when our largest city succeeds, the entire county is stronger for it. Mayor Solomon inherited a serious crisis and is confronting it honestly and responsibly, doing the hard work of cutting costs and pursuing every alternative before turning to taxpayers. Hudson County stands with him in making the case to Trenton: Jersey City is one of New Jersey's great economic engines, and a targeted, time-limited state investment now protects not just this city, but the county and the state's own bottom line. I'll be advocating alongside the Mayor and our legislative delegation to get this done." - Hudson County Executive Craig Guy
“The families I represent are already feeling the strain of rising costs, and any proposed tax increase is something I take very seriously. I appreciate Mayor Solomon's transparency in confronting the fiscal challenges facing Jersey City and his efforts to identify significant savings before asking residents to shoulder additional costs.
At the same time, we must continue exploring every available option to minimize the impact on taxpayers. Jersey City is a major economic engine for New Jersey, contributing billions in revenue to the State each year. This is a moment that calls for partnership. I look forward to working with the Mayor, local leaders, and my colleagues in State government to identify solutions that protect residents, preserve essential services, and put the city on a path toward long-term fiscal stability.” – State Senator Angela McKnight
“We can’t let this budget deficit fall on Jersey City families alone. We need the state to step in. Helping close this budget gap would be one of the smartest investments New Jersey could make. Jersey City is building more housing than anywhere else, and that growth helps address our housing shortage while funding schools and public services across New Jersey. No one benefits if people are priced out of their homes.” – Assemblymember Katie Brennan
"Mayor Solomon is doing what responsible leadership requires: telling residents the truth and making hard choices. There are no easy answers to a deficit of this scale, but cutting costs, collecting what's owed, and coming to the State as a partner is exactly the right move. Jersey City is carrying weight for the entire state's economy, and Trenton has every reason to be at the table to help limit the burden on working families.” – Assemblymember Ravi Bhalla
"We've been building in Jersey City for decades because we believe in its future, and that future depends on a city government that is financially stable and honest about its challenges. The City must confront its endemic fiscal problems head on, and Mayor Solomon is doing just that. That kind of disciplined, transparent approach is exactly what gives the private sector the confidence to keep building here. We strongly support the call for state partnership, which protects the housing pipeline that benefits Jersey City and all of New Jersey, and we're committed to being part of the city's future success." - James LeFrak, Vice Chairman, LeFrak
"As one of Jersey City's largest employers and the premier healthcare provider to this community for generations, we know that the health of our residents is tied to the health of the city itself. Mayor Solomon is confronting a serious inherited challenge and is seeking partnerships with government and industry before asking more of residents. What we know from numerous public health studies is that a stable, well-run city is key to healthy families and a thriving community, and RWJBarnabas Health supports that goal. We remain committed to serving Jersey City and to being a partner in its continued strength." - George S. Helmy, Executive Vice President and Chief Corporate Affairs Officer, RWJBarnabas Health
"The working families our members come home to are already stretched, and they can't absorb a crisis they had no hand in creating. What we respect about Mayor Solomon is that he's telling the truth and doing the hard work first by cutting waste, going after revenue the city is already owed, and asking corporations and developers to pay their fair share before turning to residents. That's the right order of operations. Now Trenton needs to step up. A targeted state investment now protects Jersey City's workers, its services, and the State's own economy." – Ana Maria Hill, Vice President and New Jersey State Director of 32BJ SEIU.
"Unlike the federal government which can create debt in the trillions of dollars, Jersey City must balance its budget each year. Mayor Solomon is making the hard but necessary choice to fix the city's fiscal crisis, one he didn't create but must address.
To his credit, before turning to the taxpayers, he is working to cut costs, collect revenue owed to the city, seek new revenue sources, and is bringing in the State as a partner to aid in the city's financial recovery.
Speaking for our hundreds of members who live, work, and raise their families in Jersey City, we stand with the Mayor and urge state and federal officials to step up in support of Jersey City families." – Mike Hellstrom, Eastern Regional Manager, Laborers' International Union of North America (LIUNA)
"Our members know the difference between leaders who protect working people and leaders who balance budgets on their backs. Mayor Solomon inherited this crisis, and he's been straight with the public about it instead of hiding behind gimmicks. He's cut tens of millions in costs and is fighting to keep the impact on residents and workers as small as possible. We're standing with him, and we're calling on the State to be a real partner so that recovery doesn't come at the expense of the families who keep this city running.” - President Rich Maroko, HTC
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Nathaniel Styer
Communications Director | City of Jersey City
[email protected]