Mayor declares Ocean City is "as strong as ever"

Mayor Jay Gillian delivered an upbeat State of the City address Thursday night while largely focusing on an array of infrastructure projects carried out by his administration from the Boardwalk to the beach to the bay – with more to come.

“Ocean City is an amazing place to live, and the state of the city is as strong as ever,” Gillian said in the opening lines of his speech at a City Council meeting.

Somewhat tempering his sanguine remarks, Gillian also revealed plans for a tax increase this year under his proposed $118.5 million municipal budget.

The spending plan calls for a tax increase of 1.38 cents. Frank Donato, the city’s chief financial officer, will give a detailed presentation on the budget during the March 26 Council meeting.

Donato explained that his presentation will go much deeper into the impacts of the proposed tax increase on Ocean City property owners, including how much extra they would pay in their annual tax bills.

Under a timetable outlined by Gillian, the budget will next go to Council for introduction at the April 23 meeting and will be up for a public hearing and final approval on May 21.

In its role as the city’s legislative body, Council will collaborate with Gillian’s administration on the terms of the budget and has the power to make changes and spending cuts.

    As the city's legislative body, Council will have the final say in approving the proposed 2026 budget.
  

Donato said in an interview after Thursday’s meeting that inflationary pressures were one reason for the proposed tax increase.

“Inflation plays into it, for sure,” he said.

He also explained that the city’s cost for employee salaries, pensions and healthcare were other factors that have driven up budget expenses.

Labor contracts for city employees, along with healthcare benefits and pension costs, make up most of the annual budget, and they go up each year, Gillian pointed out.

“Despite all the fixed increases in labor and benefits costs, our proposed tax rate increase this year will be just 1.38 cents,” Gillian said.

Donato said the city has done a good job in limiting the overall size of the budget when compared to the rising costs of salaries, pensions and healthcare.

“I think this is a well-put-together and detailed budget,” Donato emphasized.

The budget proposal comes in an election year for Gillian, who has been mayor since 2010. He will be seeking his fifth, four-year term in the May 12 municipal election. His mayoral opponents will be Pete Madden and Keith Hartzell, who both currently serve on City Council.

During his State of the City address, Gillian said that low taxes overall are a major reason why Ocean City remains an attractive place to live.

“Taxes are low, and our services are the best. We have invested a lot in improving all the things we love about Ocean City. All the while, we have maintained perfectly clean audits and a double-A bond rating that highlight Ocean City’s ‘well-embedded management practices.’  Those are the words of Standard and Poor’s. These experts have no worries about Ocean City,” he said, referring to the Wall Street firm that rates the city’s bonds.

When residents and tourists consider the state of the city, some of the first things that come to mind are the beaches, Boardwalk and bay, Gillian said while transitioning into major infrastructure projects accomplished by his administration.

    Parts of the Boardwalk are undergoing a major reconstruction.
  

On the Boardwalk, the city is finishing up a complete reconstruction from St. Charles Place to Fifth Street. Next, the Boardwalk will be rebuilt from 14th Street to 16th Street after the summer. The work was funded in part by a $4.9 million grant from the state’s Boardwalk Preservation Fund.

The city was also able to add a separate project to reinforce and re-deck the Boardwalk from 12th Street to 14th Street this spring.

“Combined with work completed less than 10 years ago, these new projects will give us a new Boardwalk. That’s in addition to five new pavilions, three new restroom facilities and many ADA improvements,” Gillian said.

Turning to the bay, Gillian noted that the city continues with its multiyear program to dredge the shallow lagoons to keep them an attractive place for boating and other forms of recreation.

“On the bay, our contractor is currently at work on our annual maintenance program to keep our lagoons and waterways safe and accessible. When we restarted the bayside dredging program less than a decade ago, all of our lagoons needed major work. Now, we dredge as needed, so the lagoons will never get so bad again,” he vowed.

Gillian also said the city is hard at work to secure funding for beach replenishment in the north end and downtown area of the resort. Like other towns at the Jersey Shore, some of Ocean City’s beaches and dunes were severely eroded by a series of offshore hurricanes and coastal storms in the past several months.

“On the beaches, we’re working closely with all our elected officials to make sure our north end and downtown beaches receive an overdue replenishment project. We’re also stockpiling sand to shore up beaches in the short term,” Gillian said.

He added that Congressman Jeff Van Drew, whose district includes Ocean City, has said Ocean City will be first in line when funding comes through for a full beach replenishment. This would allow Ocean City to continue a program to protect lives and property “from tip to tip in Ocean City,” the mayor said.

    The city is seeking funding to replenish the beach and dunes badly eroded during recent costal storms.
  

In his remarks, Gillian also touched on the city’s plans for more flood-mitigation projects, a new public safety building for the police department, parking improvements and a series of community programs that will benefit residents, business owners and tourists.

“I look forward to working with the team, our businesses and all of our citizens to continue to build an Ocean City that everybody can enjoy for generations to come. We will always be ‘America’s Greatest Family Resort,’” he declared while wrapping up his speech.