PERTH AMBOY — Official records cast serious doubt on Mayor Wilda Diaz’s signature campaign issue, her claim that she reduced the municipal debt by $54 million.
“I’m the mayor who had to deal with a $250 million debt, which we paid down by $54 million,” said Diaz as recently as Tuesday, but reports on file with the state conflict with that assertion.
Annual debt statements filed by the city show that five months before Wilda Diaz was elected, the city owed $181 million. Perth Amboy now owes close to $230 million as the mayor heads into a hotly contested re-election effort.
The city’s debt never reached the $250 million mark but it is significantly greater today than it was when Diaz moved into City Hall, four and a half years ago. The same records also show Diaz never paid down by $54 million.
Observers speculate the incumbent Mayor is staking her false claim on benefits derived from refinancing old debt at lower interest rates, which is far different than ‘paying down’ principal.
Diaz Buried City In Debt
“Wilda Diaz buried Perth Amboy in debt, but she claims that she reduced the indebtedness by $54 million,” said James Devine, a political strategist for Diaz in 2008 who is now working for rival candidate Billy Delgado. “When a mayor does not know the difference between plus and minus, voters should suspect she is unqualified for the job.”
“With a record of signing five tax hikes in four years, Diaz did not even fight to stop an $8 million tax refund to Chevron ,” said Devine. “Only months after city officials agreed to reduce the oil giant’s assessed property value of $220 million by nearly half, the company sold its refinery for $260 million.”
Devine said Diaz also agreed to an $1.8 million give-back to real estate mogul Charles Kushner, who was convicted of crimes related to influence peddaling and extortion, instead of enforcing the developer’s agreement that called for a waterfront hotel and parks, marina, civic center and 2,100 residential units.
“The mayor’s financial literacy is insufficient for her to understand what it means pay off debt as opposed to replacing a high interest rate through refinancing,” said Devine, who was criticized by female politicians from outside the city because he advised Diaz not to seek re-election in a strongly-worded private email message that she made public.
Proof Posted Online
Copies of actual debt statements obtained from the state are posted on this newswpaper’s website and they confirm that five months before Diaz was elected on May 13, 2008, the city owed bondholders only about $181 million.
Today, taxpayers are in debt by about $230 million, including nearly $220 million shown outstanding on the last debt statement, which was filed Dec. 31, 2011, plus funds borrowed to refund nearly $10 million due as a result of tax appeals from Chevron and the Landings at Harborside.
Devine, who is credited with devising the strategy for ousting then-Mayor Joe Vas in 2008, confidentially told Diaz she is not smart enough to do the job and privately urged her not to seek a second term.
“A typical bond consists of a fixed amount of money, called the principal sum, loaned for a fixed period of time,” said Devine. “The price paid for borrowing is called interest. Changing the interest rate might influence the total cost of a bond deal, but it is not the same as reducing the principal.”
Mayor struggles with math facts
”So far, Wilda Diaz appears to be willing to set aside any credible explanations in order to serve the political interests of an election campaign that has steered clear of detail,” said Billy Delgado, the top challenger seeking to oust Diaz. ”This appears to be a case of either incredible confusion or simple deception.”
Delgado called on Diaz to come clean with the public and admit whether she was unable to understand the difference between refinancing to exploit lower interest rates or if she was intentionally twisting the facts.
“City debt increased by $17.6 million to $38.3 million during the Diaz era, while property taxes went up five times in four years,” said Delgado. “This is why Perth Amboy needs a change in City Hall.”
The Mayor’s office did not return requests for comment on this story. The city’s annual debt statements are available for review at www.njtoday.net/padebtscam