State Superior Court Judge Joseph C. Visalli ruled the proposed referendum and ordinance are invalid and should not be presented either to City Council or the public for a vote.

A group of taxpayers collected enough signatures to put a question on the ballot that would tie city spending increases to the federal cost of living adjustment. They called their draft ordinance the Taxpayer Protection Initiative.

The intitiative would require a referendum for permission to exceed the cap in any given budget year.

The city sued the organizers in August before the measure could go to a public or council vote.

In his Oct. 25 opinion, the judge said the proposal would “lead to chaos, delay and expense” if the city needed more money than allowed by the ordinance.

“The voters and taxpayers should have control over their tax dollars. However, looking over the shoulders of elected officials in the performance of their sworn duties cannot be countenanced,” Visalli wrote. “The time to participate and exercise this financial control is at the election of each of the council members and the mayor.”

In his ruling, Visalli noted that city budgets are not subject to a public vote. And he said the proposal's prohibition against multi-year contracts with the city's seven unions would hamstring elected officials.

Pete Guinosso, one of the named defendants, declined to comment Wednesday, saying they would be meeting with their lawyer to discuss their next step.

In its lawsuit, the city argued that it could not pay pensions, employee benefits or debt service under the spending cap.

“I said in the spring that the ordinance suffered from a number of legal problems,” said Mayor Sal Perillo, a lawyer and former solicitor who opposed the ordinance.

“The judge felt the same way.”

Perillo said the ordinance's cap held no guarantees of prudent spending.

“Those are arbitrary measures,” he said. “The real issue is whether the budget is being spent responsibly. To tie it to an artificial ceiling gives a false illusion that if you're within that threshold, you're spending responsibly.”