Atlantic City has been struggling for some time now, with four casinos closing in 2014 and officials of the state trying to determine how to bring the gambling town back to its former glory – or at least save it from financial demise. As of late, there have been talks for the city to have their finances taken over by the state and it seems this talk is now becoming action. On Tuesday, Governor Chris Christie announced a plan that will be used to avoid bankruptcy in Atlantic City by having the state government take control of the city finances.
Don Guardian, the mayor of Atlantic City, threatened to seek protection from the creditors of the city with a bankruptcy filing, an issue that would have been embarrassing to Christie, who is currently campaigning for the Republican presidential nomination. The governor actually took a detour from his campaign trail to announce the plans with Guardian yesterday. Further muddying the waters is the governor’s refusal to sign an aid package for the city. The aid package was vetoed earlier when Christie told lawmakers certain changes needed to be made. Those changes were added to the bill and Christie effectively vetoed his own version by letting time expire on it.
The agreement created by Christie is not an outright takeover of Atlantic City, but pretty close. State officials would be left to make the important decision when it comes to reducing the debt of $240 million and cutting the size and cost of civil services. A report conducted by an emergency manager that was appointed by Christie showed that the city could run out of money by the spring if nothing is done.
According to Christie, there is an urgency of the current financial situation of Atlantic City, New Jersey that cannot be understated. Christie is hoping that the intervention by the state will help to stop the last resort option of filing for bankruptcy.
State Senate President Stephen M. Sweeney had pressed for a full state takeover, stating bills would have to be drafted to give the state control of the financials of Atlantic City. Sweeney stated the issues are not the city’s fault, but they are spending three dollars when they are only taking one in.
Christie and city officials have been trying every method possible to bring in revenues, but players seem to be going to newer gaming areas in surrounding states. Casino revenues have been cut in half over the last ten years, going from $5.2 billion in 2006 to $2.56 billion in 2015. The state is actually considering adding casinos in the Northern portion of the state, which would cut Atlantic City’s monopoly. Voters will decide in November whether to allow new casinos and direct some of the revenues to the floundering city.