Atlantic City Nears Bankruptcy as Aid Efforts Crash
Atlantic City, N.J., nears bankruptcy with just days left of funding while Gov. Chris Christie vows not to rescue the seaside resort until he has control.
By Wayne Parry with Michael Catalini
TRENTON, N.J. (AP) — Atlantic City is closer than ever to having to file for bankruptcy after state lawmakers' efforts to help it crashed and burned Thursday.
Assembly Speaker Vincent Prieto canceled a voting session at which his version of an Atlantic City rescue bill was to be up for a vote after weeks of promising he had the votes to pass it. He said he would try again to write a new bill by Wednesday.
Gov. Chris Christie and other officials said bankruptcy appeared to be a more likely threat to the teetering seaside gambling resort now that the Legislature is unable to agree on a rescue package.
"Bankruptcy is preferential to continuing to kick the can down the road," Christie said. "Not preferred, but preferable to continuing to write checks."
The governor said the city has about 10 days of cash left. He also said he will not lend or give the city any more money until the state passes legislation giving him the power to take control of Atlantic City's finances and major decision-making power.
"I won't happily pay you Tuesday for a hamburger today," Christie said, alluding to Wimpy, a burger-loving but cash-challenged character in the Popeye cartoon strip. "They want the hamburger today, they pay today."
Thursday had been expected to at least shed some light on where the aid package was headed. But if anything, the impasse grew even deeper. Prieto had planned to put his bill up for a vote at 11 a.m. But the speaker said three Assembly members who had pledged support for the bill were not present Thursday, forcing him to cancel the vote.
Prieto said he then asked Assembly members if they would vote for Sweeney's bill on Thursday.
"Not a single hand went up," he said. "Not one."
Prieto said he and other Assembly members would begin work Friday on a new bill with changes that would make it more palatable to Christie, who strongly favors Sweeney's bills. Possible changes could include altering the benchmarks Prieto's original bill would have imposed on Atlantic City and changing the amount the city is expected to cut from its budget.
The bills differ in how long they would give Atlantic City to stabilize its finances before the state would take over. Sweeney's gives Atlantic City 130 days to shape up, while Prieto's would give the city as long as two years before a full state takeover of its finances and major decision-making power would kick in.
Sweeney again called on Prieto to post the senate bill for a vote, but ruled out any further concessions to the Assembly speaker.
"I've had enough of the gamesmanship," Sweeney said. "I've got to get something out of the Assembly now."
In the meantime, Atlantic City's circumstances grow more dire. Thomas "T.J." Moynihan, head of the city's police union, said workers are feeling the strain.
"It's been really stressful," he said. "We haven't been paid in a month; we finally get paid tomorrow, which will be great. But to add this stress on top of the jobs we already do, putting our lives on the line, it's really frustrating."
Prieto has refused to back the Senate bill, largely because it would allow the state to unilaterally break union contracts. But even his own bill would allow that if the city does not meet certain performance benchmarks after two years.
Both bills include a provision to let the city's eight casinos make payments in lieu of taxes in return for not appealing their tax assessments. The casinos would benefit from cost-certainty in knowing what their annual expenses will be, and the city would benefit by not having to deal with the tax appeals that casinos have used to devastating effect over the past 10 years to blow huge holes in the city budget as the value of their gambling halls declined.
Atlantic City's finances have worsened over the past 10 years as its casino industry contracted; four of its 12 casinos shut down in 2014, and casino revenue plunged from $5.2 billion in 2006 to $2.56 billion last year.
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