By Brenda Flanagan
Correspondent
The empty boardwalk looked as lifeless this afternoon as the financial report from Atlantic City’s emergency manager indicated: no bankruptcy but Kevin Lavin says, “The city simply cannot stand on its own. … There is no reasonable likelihood that these headwinds will abate at any point in the near future.”
“There’s nothing new there,” said Sen. Jim Whelan.
Whelan said Atlantic City residents waited patiently when Gov. Chris Christie called special casino gaming summits in the fall, and then appointed two so-called bankruptcy experts as an emergency manager and consultant to diagnose the gaming town’s financial ills. It’s 60 days later.
“And now we have a report that really tells us what we knew all along: Atlantic City’s ratable base has collapsed and cuts have to be made. We have a very difficult situation,” Whelan said. “We have a sick patient but the first thing we have to do is stop the bleeding.”
The facts: Mayor Don Guardian’s original budget totaled $235 million with a $70 million revenue gap. By March, that widened to $101 million. To bridge the gap, Lavin and consultant Kevyn Orr called for a $10 million cut in operating costs and layoffs — up to 20 to 30 percent of the city’s 1,150-member workforce, perhaps 300 people.
That’s cause for alarm, says union rep Jenny Darnell.
“I imagine we could still function but you won’t get the same quality of services that are currently being delivered,” she said. “You know if you start cutting public works and public safety jobs then yeah we’re not gonna be able to market the city the way we should. So that will have an impact on tourism.”
Another report recommendation: delay or reduce $42 million in pension and benefit payments. To raise more revenue, the report calls for Atlantic City to divert $30 million in casino assessment payments from its PR agency, the Atlantic City Alliance, and also to take $17.5 million casinos pay annually to the state Casino Reinvestment Development Authority — both revenue-raisers from bills introduced months ago. And that’s frustrating for some.
“I think it’s a lack of action on the part of our legislators locally and in Trenton to really get the job done,” said Darnell.
The report states mediators will try to negotiate with unions and with creditors, including casinos. Atlantic City carries more than $270 million in bonded debt — most of it, property tax refunds it owes the casinos. The report says the teams need another 90 days to finalize a solution, but local pols are done with waiting.
“Let’s implement some things and get some things going. We really can’t wait for 90 days. We gotta get moving,” said Assemblyman Vincent Mazzeo.
“Atlantic City’s bonding rating went down as a result of just bringing these guys in — and the threat of bankruptcy. We hope that goes away now and we can focus on the job at hand,” Whelan said. “You know, Atlantic City’s like Dracula. They tried to kill us many times, but we continue to come back.”
So after calling the Code Blue on Atlantic City, financial experts have issued a grim prognosis. They say the treatment to bring this town back is going to hurt.