New Jersey has tried before to take over the entire financial responsibility of running Atlantic City in an attempt to turn around the financial woes that the city is facing, which has driven it to the verge of bankruptcy. Now, the Governor has seen to it that a lawsuit has been filed to try and stop the city from spending funds they just don’t have.

The seaside gambling destination made a huge chunk of its revenue from the once thriving casino industry but over the last decade, casinos in Atlantic City have faced a sluggish market that has halved its gambling revenues by more than fifty percent. The lack of revenue generated from the casino industry has caused the city to accumulate over $100 million in debt, created a slow economy and reduced the number of employment opportunities.

An earlier attempt for a takeover was resisted but New Jersey Governor Chris Christie is now pushing harder for a state takeover. On April 4, the Governor decided to turn up the heat on the city’s municipal government and also the public employee unions in Atlantic City. Governor Christie instructed the commissioner of education to file a lawsuit against the city to stop it from rolling out a payroll payment on April 8 due to the fact that the city owes $34 million through July to the school district.

The earlier takeover was resisted by Republican Don Guardian, Mayor of Atlantic City and Vincent Prieto, Democratic Assembly Speaker. Prieto has objected to the takeover as he believes that a state takeover will put an immediate stop to collective bargaining agreements.

In a statement, Governor Christie said “What I’m looking to do now is manage a series of bad situations. I think the situation is ratcheting up the pressure on all of us. This administration is putting itself in line with the people of Atlantic City. If they want to test me, they can test me.”

While Democratic Senate Speaker Steve Sweeney has thrown his support behind Christie’s takeover plans, Prieto has downplayed Christie’s lawsuit and his plan of campaigning against moving casinos outside of Atlantic City should the state takeover continue to be resisted.

The governor has accused Prieto of not voting in favor of two critical bills because he has the interests of the public employee unions at heart instead of the school children of Atlantic City. The first bill was one that will allow New Jersey to have a major control over Atlantic City’s financial resources and its decision making process while the second bill wanted pre-agreed annual casino payments in return for dropping casino property taxes.

Prieto has argued that a state takeover is not required as Governor Christie already has the legal authority to turn the city around. He is willing to consider a state takeover provided the earlier bill is amended and called on Sweeney to help amend the existing bill. Sweeney is yet to confirm if he would take up the challenge.