| NEW YORK
NEW YORK Newark Mayor Cory Booker says New Jersey's largest city is "surging" back, with a rush of development following a year of fiscal distress that included massive lay-offs in the public work force.
A city long seen as a symbol of urban decay now boasts about 30 projects that will generate $1.5 billion in construction activity and nearly 3,000 jobs over several years.
In addition, Facebook founder Mark Zuckerberg announced a $100 million gift for Newark's schools in September.
Newark, 8 miles from New York City, has an international airport and seaport and a significant rail hub, making it attractive to investors following decades of decline in which manufacturers fled a city whose image was dominated by crime and poverty.
"Despite the worst economy of our lifetime, and a lot of the budget challenges that have come as a result of that, the prospects for the city of Newark are simply incredible," Booker told Reuters in an interview on the eve of his annual State of the City address, to be delivered on Tuesday night.
Despite Booker's optimism, Newark continues to face hard times. Late last year, the city laid off 164 police officers, or more than 10 percent of force, to help close a $150 million gap on a nearly $800 million spending plan.
The budget gap still stands at $32 million, and Republican Governor Chris Christie offered no new municipal aide in his budget proposal last month. He also might cut existing programs, such as Urban Enterprise Zones.
Booker, a Democrat, has been as much cheerleader as mayor since he came into office in 2006 promising to reinvigorate Newark. Since then, he has struck deals with several companies to establish or expand their operations.
Kosher foods producer the Manischewitz Company will move its corporate headquarters to Newark and Bartlett Dairy will move its distribution center to the city.
The city has finalized a deal for central Newark's first new hotel in almost four decades, a Courtyard by Marriott next to the Prudential Center arena, said Stefan Pryor, Booker's deputy mayor for economic development.
Pryor said the deals show that Newark, which was hard hit by the recession, could attract financing for its development projects.
Booker has promised to attract more philanthropic investments for the city, including its beleaguered school system, and said he had raised $43 million in an attempt to match Zuckerberg's donation.
"I still remain confident that I'll be able to match it," Booker said.
Booker described last year's budget cuts as "draconian," saying they impeded the city's ability to buy basic supplies, even toilet paper.
The police lay-offs, which came after the police union refused to accept concessions, affected most of the officers hired since 2006 and led to fears of an increase in violent crime. Carjackings and shootings spiked at the start of this year, though Booker said crime has mostly "leveled off" to pre-layoff levels.
Booker said he may to increase the city's fee collections and other measures to raise revenue.
"We have a lot of levers," he said. "They may cause pain, but we'll be able to get through it without significant lay-offs and furloughs that we saw last year."
As part of a strategy to reduce costs in the longer term, Booker said he is studying the possibility of sharing services with neighboring towns, such as creating a shared county police force.
Newark will also be watching the example of Camden, another high-crime New Jersey city that announced police lay-offs last year.
"All of these small towns, all having their own fire departments, police departments -- there are inefficiencies in that, and we could be providing the same levels of service with less cost to the taxpayer," Booker said.
(Reporting by Edith Honan; Editing by Daniel Trotta and Dan Grebler)