[toc]In a development that isn’t terribly shocking in the Atlantic City financial saga, Gov. Chris Christie’s administration announced it is rejecting a five-year budget from the city council that the the latter submitted in the hopes of avoiding a state takeover.
The AC plan ran into problems almost as soon as it was passed by the council, when Borgata took issue with the city’s insistence that it had agreed to a settlement on an ongoing tax refund deal.
What Christie told AC
Christie has long lobbied for a state takeover over the city, which has consistently run up against problems with paying its own bills as several casinos have shuttered. Bad blood continued even after the state and AC agreed to a compromise in which the city would attempt to balance its budget for the next five years in exchange for loans to help it meet its obligations.
AC came up with a plan, but Christie’s camp — the governor has final approval of the plan — threw a wet blanket on the AC budget. With just a week to review AC’s plan, Christie’s office managed to issue a 75-page report.
Charles Richman, commissioner of the NJ Department of Community Affairs, wrote the report, saying that the “City’s Plan is not likely to achieve financial stability.” The report also noted that the AC plan “contained some but not all of the information” required of the city in the state bailout package.
More from the conclusion of the Richman report, after examining the city’s plans for revenue and expenses:
Finally, I note that the City’s Plan is very ambitious, but lacks concrete evidence that the proposed steps are feasible or will actually be undertaken. … Based upon my review, there is little in the Plan to suggest what constructive actions have been initiated by the City since June 6th, to show that it has the fortitude and the resolve to make the hard choices and difficult decisions at hand.
A variety of lawmakers and even Moody’s Investors Services had said the AC plan did pass muster after it was formulated last week.
What’s next for AC vs. New Jersey?
A state takeover of Atlantic City government is possible but won’t be immediate. According to NJ.com:
Tammori Petty, a spokeswoman for the department, said the next step is for New Jersey’s Local Finance Board to “consider whether to assume powers of the governing body that may be substantially related to the city’s fiscal condition or financial rehabilitation and recovery.”
Christie has his own problems
Christie is sticking to his guns on Atlantic City, despite the fact that he has plenty of problems in the state.
For one, his approval rating sits at a dismal 21 percent; of course, that means he has little in the way of political capital that he could lose if he feels strongly about the AC issue.
He’s also in the middle of the Bridgegate trial, as members of his staff stand accused of a plot to shut down the George Washington Bridge in order to get revenge against Fort Lee’s mayor.