By The Staff | The Save Jersey Blog
As the Game of Thrones-like fighting over the Atlantic City takeover bill continues to divide Trenton’s ruling Democrat Party in what is tantamount to an Election 2017 gubernatorial proxy war, Save Jerseyans, the state’s Republican Governor held a presser on Thursday afternoon to warn of severe consequences for North Jersey casino expansion if Atlantic City’s house isn’t put into order… by legislative force…
WATCH:
Transcript:
I do not understand why the Speaker continues to mischaracterize it. Except to say this, that what he is doing is placing the full faith and credit of, not just Atlantic City, but a number of other municipalities in this state at risk. Newark, Union City, Paterson, Trenton, Camden, will all be at risk for significant downgrade if this situation is allowed to continue going forward. Another thing that confuses me is this: the Speaker says he is an advocate for North Jersey gaming as I have been. This situation is ensuring that North Jersey gaming referendum will be defeated this fall. There is no way the people of this state will approve an expansion of gaming when the city government in the only city where gaming is allowed is ready to go down the toilet. And so, for all these legislators in the northern part of the state who have been on my back for six and a half years to approve North Jersey gaming- they should stop talking to me and go down the hall and talk to the Speaker and tell him to stop setting up a situation where this referendum has no chance of winning. And I will tell you this- if the Atlantic City takeover bill and the PILOT bill are not passed and sent to my desk in their current form, I will oppose North Jersey gaming. And I will use every bit of influence I have to make sure that the referendum is defeated. Because I cannot have the full faith and credit of municipalities in this state put at risk by a political power play by the Speaker.”
Transcript:
Even with the assistance and the advice of the Emergency Manager that we put in place in 2015, Atlantic City took only modest steps to rein in their costs. They face a $100 million budget shortfall this year, $100 million budget deficit this year, that is not including the debt, it is just their current deficit. And hundreds of millions more in the coming years, if there is no action is taken. The City has also lost all of its credibility with investors and creditors to negotiate a solution, and the only plan that has been proposed by the Mayor and the Council thus far is to buy time, to essentially change from a 14 day pay period to a 28 day period. You do not save any money that way. It just puts off the day of reckoning which has been a fairly simple direct theme by all the leaders in Atlantic City and now the Speaker of the Assembly as well who is adopting their position. The cash crisis is not only at their door step now, it is here to stay if they refuse to act, and if the state is not given the tools needed to act on its behalf. And it is not just me. Listen to what Moody’s said on Atlantic City last week, “If neither bill passes, Atlantic City will run out of cash in the next few weeks, leading to a potential default, distressed exchange, or bankruptcy filing. The state could take stopgap measures to help Atlantic City, such as a providing a loan or allowing the deferment of pension contributions, but this would not solve the underlying causes of the crisis.” That is from Moody’s. And Moody’s said, “If only the PILOT bill passes, the city will continue to face distress since the single bill is insufficient to restore Atlantic City’s fiscal health. While the PILOT bill produces additional revenues and avoids incurring additional casino tax liabilities, it is not enough to avoid crippling deficits of $30 to $40 million a year, over the next five years.” So let’s stop there for a second. The Speaker’s position on this is that only the PILOT Bill should be passed and that the tools should be taken away from the takeover bill. If just the PILOT Bill is passed, it will carry them through 2016. But immediately when we get to 2017, we will be running $30 to $40 million annual budget deficits. Completely unsustainable and they will just be broke in 2017 rather than in 2016. And it is not just my opinion, it is Moody’s opinion as well. Their view of the steps that need to be taken is that just passing the PILOT Bill is insufficient and that the cash flow situation is desperate.”
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