Christie Says He’ll Oppose North Jersey Gaming if AC Takeover and PILOT Go Down

Christie

Pivoting from an a.m. fusillade of criticism over his efforts to block and tackle for billionaire real estate tycoon Donald Trump, Gov. Chris Christie this afternoon unleashed a new round of ire – complete with charts and graphs – against the local leaders of Atlantic City and Speaker Vincent Prieto (D-32) in a hastily called press conference.

At the heart of it, Christie made the argument that North Jersey gaming – which the speaker supports – would perish at the hands of the voters when the voters see Atlantic City continue to tank without state intervention.

“There’s no way people will approve North Jersey gaming,” said the governor, urging the speaker to post both bills next Thursday. “They should tell the speaker to stop setting up a situation where North Jersey gaming has no chance of winning.”

If the Atlantic City takeover bill and PILOT bill don’t pass, Christie said he would oppose North Jersey gaming, which is set to go on the general election ballot this year.

In his press conference, Christie target bloated AC municipal government, which now has the gambling resort town staring at a $100 million budget deficit this year. He noted that capital spending is two to three times smaller than Atlantic City in other New Jersey cities.

“Atlantic City is heading for disaster and North Jersey gaming is heading for defeat if we don’t get our act together,” Christie said. “Enough theater from the speaker. He’s done his theater for his public sector [allies].”

Prieto wants public sector union endorsements for his Hudson County political boss, Jersey City Mayor Steven Fulop, the governor reiterated, an image he’s used throughout his spat with Prieto.

“That’s what’s happening, folks,” said Christie, who noted that Atlantic City would face deficits of hundreds of millions more if the legislature refuses to give Christie authority.

“The mayor doesn’t want to see Senate President Sweeney succeed,” he added. “It’s clear the speaker and mayor are working in concert to hurt the senate president and advantage themselves.”

Then Christie rattled a sword in the direction of a supposed Fulop ally: Union City Mayor Brian P. Stack, noting that Atlantic City in further tatters could jam up the city’s debt rating.

Later in the press conference, Christie potshot Atlantic City Mayor Don Guardian, specifically taking him to task over the mayor’s use of the word “fascist” to describe the state’s takeover of the city. Christie described the term as an insult to those people who suffered real fascism. He also made the case that the city’s government left the people a long time ago, by virtue of their collective mismanagement of Atlantic City.

Prieto issued a statement in response to the governor’s remarks.

“Gov. Christie has overseen Atlantic City since 2010, and he even admitted today that the city’s situation has since worsened,” he said. “The governor also has the power to compel financial actions by the city through transitional aid agreements. Despite his many excuses, Gov. Christie owns the failings of Atlantic City since 2010. He needs to accept responsibility and stop blaming others. The fact remains that Gov. Christie has sufficient authority to save Atlantic City from financial catastrophe, but instead of action, he makes excuses, spouts conspiracy theories about the next gubernatorial election and makes up stories about alleged promises. He should focus on doing his job.

“And whether the governor likes it or not, he cannot break collective bargaining without likely violating federal and state constitutional rights,” Prieto added. “Government should not be in the business of taking rights away from people. As for North Jersey gaming, Gov. Christie can campaign as he chooses. It wouldn’t be his first flip-flop, and he would just be risking hurting Atlantic City by denying it funding it sorely needs from North Jersey gaming to transition into a resort destination. I am still willing to compromise, and welcome the governor’s call. I will see what the governor has in mind, but it must be a real compromise that protects core principles.”

Below is the accompanying sheet issued by the governor’s office:

Atlantic City’s Math Does Not Add Up

The Numbers Are Clear: The Solution To AC’s Problems Requires State Intervention

 

The State of New Jersey Does Not Have The Tools It Needs Today

 

Despite the claims made by the Speaker and other state and Atlantic City leaders, New Jersey does not possess the tools needed to stabilize Atlantic City’s finances without the intervention bill. The Assembly must pass the two pieces of bipartisan legislation, as written, that have been overwhelmingly approved the State Senate.

 

·         After years of financial mismanagement by city government, Atlantic City leaders do not have the credibility or creditworthiness to negotiate its debt issues.

 

·         Although the State does have the creditworthiness, without the full ability to manage the City’s finances, make decisions and back up commitments to creditors and investors, the State is unable to effectively negotiate and implement solutions to Atlantic City’s enormous debt problems.

 

In Order To Effectively Negotiate, All Options Must Be On The Table

 

As the situation stands now, public employees in Atlantic City exist as a protected class, unique among the many stakeholders in the city in being exempt from the shared sacrifice needed to fix these problems. Unless the Assembly passes both the proposed bills, this special class of citizens will remain protected and true reform cannot be accomplished.

 

Public Employee Excess, By The Numbers

 

Unless the Assembly takes action on the intervention bill, these are the types of municipal extravagances that will remain on the books, protected by the powers of special interests even as taxpayers, bondholders and private businesses contribute to a solution:

 

 

119 The number of city employees with salaries over $100,000, 93% of which are either police or fire.

 

$6.6 Million The amount in 2015 alone that Atlantic City paid out in terminal leave to retiring public employees, primarily in unused sick and vacation days.

 

$320,000 The amount owed this year to the retiring deputy fire chief and deputy chief of police alone.

 

$300,000 The budget for the collective salaries received by the part-time councilmembers
93% The percentage of AC’s full time employees that are enrolled in NJ Direct 10 – the extremely generous, “Lamborghini”-level plan that was done away with for active state workers in 1997.

 

 

PILOT Alone Is Not Enough

 

The greatest threat to Atlantic City’s success is its decades long inability to deal with its finances in a responsible and fiscally sound manner. The City’s remaining forecasted deficits must be eliminated and its budget must be brought into structural balance. This means making tough choices.

 

In January 2016, Governor Christie did not sign the PILOT legislation. On its own, this bill is not a solution to the problems that plague AC.

 

·         Had the PILOT legislation been signed in January, without the fundamental changes needed in the City’s budget and operations, AC would face an immediate $23 million budget shortfall.

 

·         That deficit would grow to $35 million by 2020. These are the sober, mathematical realities of the situation and that is before factoring in any solution to the significant debt problems facing the City, including the nearly $200 million owed to the Borgata and MGM and the $38.8 million in deferred pension and health benefit payments which the City has not paid since 2014.

 

 

Getting Specific: The State Does Not Have Full Authority To Cut Costs, Curb Abuse, And Fix The City’s Finances

 

Unless the state steps in and deals with the cost side of this problem, the hope that this problem will be resolved by the PILOT bill alone is just plain wrong. Greater intervention by the state is unquestionably needed.

 

Despite the rhetoric of some, the simple reality is the powers to fix Atlantic City’s structural fiscal problems can only be exercised if the intervention bill is passed.  And the power to do any of them does not exist if the PILOT bill is passed on its own. These actions include:

 

·         Ending the practice of granting excessive terminal leave to non-unionized employees.

·         Modernizing and out-sourcing waste hauling services to a private contractor or the county.

·         Eliminate the platinum-plus-plus health insurance plan that was done away with for active state workers nearly 20 years ago.

·         Direct involvement in the labor management of the City.

·         Renegotiating with the City’s public sector unions to get the exorbitant costs of the city work force under control.

o   New collective bargaining agreements that the Assembly Speaker says the Director of Local Government Services has the authority to approve are actually still subject to arbitration awards and are constrained by existing labor agreements

·         Executing a plan to dissolve the Municipal Utilities Authority.

·         Negotiating a settlement with Borgata – or any of the City’s creditors – using state bargaining power.

 

Anything short of passing the intervention bill amounts to putting the problem off to another day, allowing the bloated budget issues to persist for months or years longer until the same issues AC faces today resurface on a greater scale – more debt, more mismanagement and greater deficits to overcome.

Christie Says He’ll Oppose North Jersey Gaming if AC Takeover and PILOT Go Down