Atlantic City considers filing for bankruptcy

After Governor Christie’s veto on a financial aid package, the city’s officials may ask the state of New Jersey permission to file for bankruptcy.

US.- On Tuesday New Jersey’s Governor, Chris Christie vetoed a financial aid package comprised in three bills, which left Atlantic City with a deficit of US$33.5 million in their budget. “Atlantic City government has been given over five years and two city administrations to deal with its structural budget issues and excessive spending,” said Kevin Roberts, Christie’s spokesman. “It has not. The governor is not going to ask the taxpayers to continue to be enablers in this waste and abuse,” he added.

After the opening of a casino in Pennsylvania in 2006, Atlantic City’s casino revenue has fallen from US$5.2 billion in that same year to US$2.56 billion in 2015. In 2014, four out of the city’s 12 casinos went out of business. If the three bills for financial aid had been approved, Atlantic City’s casinos would have been able to make payments in lieu of taxes for 15 years, allocating casino investment taxes and marketing money to help pay down the city’s debt.

Mayor Don Guardian and City Council President Marty Small met with Democratic Assembly Speaker Vincent Prieto yesterday and asked him to oppose a takeover of Atlantic City by the state. After the meeting, Guardian and Small called for a City Council emergency meeting next week to discuss a bankruptcy filing, which must be ultimately determined by the state of New Jersey. Small claimed that “we feel it’s extortion. If this was on the other side, we’d be indicted. It’s no secret we need money. Yesterday spoke volumes; it’s monumental hypocrisy.”

Senate President Steve Sweeney proposed to give the state the right to make most major decisions and sell off city assets and land. According to Sweeney, the state’s lawmakers are tired of the city’s repeated requests for money.  He expressed: “Now, the Mayor finally recognizes the severity of city’s problems, but his plan to declare bankruptcy is the worst possible outcome for Atlantic City and for the state of New Jersey. Putting the city into bankruptcy would have disastrous results for the city and could jeopardize the financial standing of other cities in New Jersey, resulting in credit downgrades and higher costs.”