Following years of decline and economic troubles, Atlantic City, N.J., may be on the path to avoiding bankruptcy and further political conflict thanks to a bailout agreement made Monday by state lawmakers.
The two-bill rescue package would grant the struggling resort town 150 days to come up with a budget plan for the next five years, as well as millions of dollars in loans to keep the city fiscally afloat in the meantime. The plan would require Atlantic City to pay off previous years' debts and correct an impending 2017 budget deficit of $80 million in order to avoid a government takeover, the strategy previously supported by New Jersey Gov. Chris Christie and Senate President Stephen Sweeney.
"I want to see this end," Mr. Sweeney said of the recovery efforts and takeover plans, according to NJ Advance Media. "I'm not happy that we wasted all this time. But we need to move on."
The new law would also relieve casinos of an official tax burden over the next decade, but allow Atlantic City to collect at least $120 million annually from the gambling establishments, "[i]n the interest of the revitalization of Atlantic City and the continuation of the casino industry."
"Atlantic City will now have time to take care of their own house," Speaker of the General Assembly Vincent Prieto said Monday.
The bills are set to be voted on by both houses of the state legislature Thursday, before heading to Governor Christie for a potential final approval.
Atlantic City's struggles, heightened by the closures of four of its 12 casinos in 2014 – the Revel Casino Hotel, Atlantic Club, Showboat, and Trump Plaza – and a shrinking casino tax revenue, a drop of around 70 percent, were partially brought about by a casino boom up and down the East Coast. States from West Virginia to Maine reached "a saturation point" as dozens of new gambling houses popped up across the northeast and took business away from major resort towns.
"A lot of people think Atlantic City got hurt because of the increasing competition – and that's certainly true," Izzy Posner, former executive director of the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton College, told The Christian Science Monitor at the time of the casinos' closing in 2014. "But the bigger story is that it wasn't about competition, really, it was about a fundamental restructuring of what the business is, from 'destination' casinos in places like Nevada and Atlantic City, to more of a 'convenience' type of place."
For years, legislators have argued over what to do with the declining coastal city, which has fluttered on the edge of becoming the state's first city to declare bankruptcy since 1938.
Christie has vetoed earlier attempts at a bailout and advocated the state takeover plan. New Jersey could still initiate the takeover if the city's finances appear mismanaged during the upcoming five-year recovery period, a process Atlantic City Mayor Don Guardian has said would result in a "fascist dictatorship".
But Mr. Guardian approved of the "very fair" measures agreed upon Monday, adding his hope that the move could draw additional tourism this summer and eventually revitalize the coastal resort.
"It's up to us now to keep our sovereignty," he said, according to NJ Advance Media. "The hope of partnering with the state helping us but holding our feet to the fire is the way to move forward."