NJ Turns Thumbs Down On AC Financial Plan
by KYW's David Madden
TRENTON, NJ (CBS) -- The New Jersey Department of Community Affairs has rejected Atlantic City's 5 year plan to gain fiscal stability.
This is step one in what could be a state takeover of Atlantic City's day to day operations. DCA Commissioner Charles Richman, in a 75 page report, found the city's plan did not meet the state's requirement for a balanced budget next year, leaving the city in a hole that would grow to 106 million dollars over 5 years.
The report makes no recommendation on whether Governor Chris Christie should proceed with a state takeover. The measure now goes to the state's Local Finance Board for a second review, Christie Press Secretary Brian Murray, in an e-mail, said "We are reviewing the extensive report, along with everyone else, and will not be making any statements at this time."
Mayor Don Guardian, in an interview with KYW Newsradio last week, wasn't quite sure how he'd deal with a rejection. "Although it says they can strip the city of everything and do away with the unions and do away with collective bargaining and civil service, they don't have to do that," Guardian said.
But he also believes a state takeover could well be unconstitutional, depending on its scope. And if it goes too far, said an appeal in the courts would be likely.
Looking to the possibility of a rejection, Guardian added, "The alternative is the state comes in with no plan and it's going to cost them from the beginning 100 million dollars a year. That never addressed the 500 million dollars in debt. It just keeps us running."
The city's financial plan, developed by three private consultants over the last few months, was endorsed by Wall Street bond rating company Moody's as well as members of the Assembly Judiciary Committee who hold a hearing last week.
