Recently, a state legislator announced plans for a bill to change the government structure of Atlantic City. His plan would decrease the city’s governing body from nine elected city council members to five and replace them with nonelected appointees, including the heads of Stockton University, AtlantiCare, the City’s largest nongaming employer and the Casino Association of New Jersey. None of these individuals live in Atlantic City, which surely would violate the New Jersey Constitution.
In recent years, two separate referendums to change Atlantic City’s government have been defeated by voters. Some people incorrectly believe that the city’s challenges can be solved simply by changing its government structure. This is an unsupported hypothesis that ignores Atlantic City’s political history of experiencing challenges whether the local government was nonpartisan or partisan, commission form or mayor-council. While the city is much better off with casino gaming than without it, even the legalization of gaming was not the panacea that it was promised to be in the 1970s.
Any reforms to how Atlantic City operates and the State of New Jersey’s role in that operation should be guided by three principles: attract more nongaming investment into the city, continue some of the positive momentum that Atlantic City has gained over the years and focus on the entirety of the city. To that end, there are six initiatives that we recommend policymakers enact right now to help Atlantic City in the short and medium terms:
- Extend aspects of the Municipal Stabilization and Recovery Act — the 2016 law which allowed for state intervention in Atlantic City — for another three years, allowing the positive partnership between the State of New Jersey and the City of Atlantic City to continue to flourish.
- Return planning and zoning power back to local government, making it easier to do business in Atlantic City. Currently, the Casino Reinvestment Development Authority is responsible for planning and zoning in the Tourism District even though the city is still responsible for permitting. This is unnecessarily burdensome for small businesses who want to develop in certain areas of the city.
- Establish a collaborative plan that fairly taxes casino properties while at the same time avoids costly tax appeals. We cannot go back to a time when costly casino property-tax appeals nearly bankrupted Atlantic City. The state, city and Atlantic County government must collaborate on a fair, responsible PILOT (payments in lieu of taxes) program that will make sure casinos pay their fair share while at the same time making sure the city, county and school district receive their fair share.
- Establish housing incubator zones that would offer tax abatements to grow middle-class owner-occupied housing. Atlantic City’s housing stock is very aged and the inventory for new homeowners is lacking. The success of Philadelphia’s tax abatement program is a model for Atlantic City to help renters become homeowners and to encourage new residents to move to the city. Last year, South Jersey Forward issued a report on how these zones would work and be funded.
- Begin a gradual return of investment alternative tax (IAT) money to the Casino Reinvestment Development Authority to help fund economic development projects. In 2016, state legislation was passed that diverted the IAT from the development authority to the city to help pay debt service. This diversion will end sometime in 2026. Given the city’s stronger fiscal situation, including multiple credit upgrades, we should now begin a gradual return of IAT money to the development authority so that it can fund transformative economic development projects. Policymakers could begin with a gradual return of 25% of IAT money to CRDA with a complete and permanent return in 2026.
- Abolish the distinction of the “Tourism District,” enacted by Gov. Chris Christie in 2011. While the city’s tourism areas are obviously critical to the region’s economy, these imaginary lines inadvertently created a segregation that has been detrimental to residents. By eliminating this district, policymakers can focus on the entirety of Atlantic City, whether its tourist areas, the boardwalk, residential neighborhoods or any combination thereof in order for the city to succeed. Making some areas of the city clean and safe but not others hasn’t worked for the past 10 years. We need to focus on the entirety of the city.
These initiatives respect the self-determination that local residents deserve, continue the collaborative relationship between the state and the city and provide real, immediate solutions to attract more economic development.
With the threat of New York casinos looming over the horizon, we will soon have a new set of challenges. Now is the time to implement solid policies that will assist the city, its residents and other stakeholders with making Atlantic City a safe, clean and affordable place to live and do business.