January 26, 2016
New Jersey Gov. Christie announced his proposal for a financial takeover package on Tuesday for troubled Atlantic City with the mayor of the Jersey Shore town at his side, according to several reports.
The plan would give the state more control over the city's finances. According to the Press of Atlantic City, legislation to take this action would be drafted that gives two state-run boards the authority to restructure the city's municipal debt and consolidate or privatize municipal services.
"The bottom line now is, the only thing that is really holding Atlantic City back is its governmental structure and the debt and the cost of its government," Christie said in a statement released by his office.
Atlantic City Mayor Don Guardian said city officials opposed the takeover proposal but they agreed the city needs the authority that comes with such a measure to rewrite its union employee contracts and renegotiate millions of dollars in tax refunds, the New York Times reported.
Revenue from Atlantic City's casinos has been cut in half since 2006, the Times reported, falling in 2015 to $2.56 billion. More from the New York Times:
The city has about $240 million in outstanding debt and faces more than $150 million in tax appeals from just one of the casinos, the Borgata.
On Friday, Standard & Poor’s cut Atlantic City’s debt four levels to CCC–, a rating it reserves for borrowers that are “currently vulnerable to nonpayment.”
A state-appointed emergency manager for the city said recently that it could run out of money to pay its bills by April.