Please see 5-27 p.m. update below
Governor Chris Christie was sent legislation to prevent Atlantic City from running out of cash by New Jersey lawmakers on Thursday, just in time for the first long weekend and the unofficial start of summer.
The measures were approved by the state Senate and the Democrat-led Assembly by wide margins. Earlier legislation that would allow the state to take over the city’s finances immediately was supported by Republican Gov. Chris Christie, who says that the bill provides the authority he needs. While the governor didn’t say whether or not he’d be signing the bill, he did say that he will decide quickly.
Atlantic City Mayor Don Guardian, also a Republican, said it was a huge deal and that the city wants people to know the shore is open for business, according to the Associated Press.
Senate and state Assembly leaders reached the deal on Monday ending a bitter political feud that has been going on since January and managed to push the struggling resort that much closer to bankruptcy. The measure also allows the city government five months to formulate a plan for balanced budgets that will cover the next five years.
Seminole Gaming and Hard Rock International’s CEO Jim Allen publicly denounced the almost five-month ordeal that led to Thursday’s votes, saying, “What went on in New Jersey the last 30 days, 60 days, 120 days is not good for New Jersey and not good for our industry.” If voters approve bringing two new casinos to northern New Jersey, Hard Rock has said it will be looking toward the operation of a proposed Meadowlands casino.
Assembly Speaker Vincent Prieto considered the bills an improvement over the earlier bill that was backed by the Senate and Gov. Christie, which provided for an immediate takeover. Prieto said it was a compromise that everyone worked out together and, “I think when you compromise it makes it a better bill.” Criticizing the delay, Senate President Steve Sweeney said last summer he tried unsuccessfully to encourage the city to reorganize its finances. He said, “This was very, very unnecessary,” and, “We’re coming up to Memorial Day. A very similar offer was made last July, and it was rejected.”
Under the plan, a temporary loan of approximately $60 million would be given to the city, it would be able to offer early retirement to all its employees, and it would retain its collective bargaining rights, which would have been lost under previous proposals. Even if voters choose to authorize casinos in northern New Jersey, casinos would not be permitted to opt out of payment instead of the taxes plan.
The original Senate aid package that caused the impasse would have given the state of New Jersey most of the authority over the finances of Atlantic City, which would include the right to renegotiate debt as well as break contracts, sell off any assets of the city, dissolve boards or agencies, and the option to file for bankruptcy, in just over four months. The state still has the power to do that, but its Community Affairs department would first have to determine that the plan Atlantic City formulates is not capable of delivering the desired effect. Before the state can take over, that determination would be able to be appealed by the city.
Update 5-27 p.m. On Friday, Gov. Chris Christie finally played his part to bring an end to the long-going dilemma to have the state help Atlantic City by signing compromise legislation that will keep the former #2 gambling destination in the world from going bankrupt. The Assembly and Senate passed the bills Thursday by wide margins.