The Casino Association of New Jersey (CANJ) issues this Statement in response to recent reporting on the status of the Atlantic City Economic Revitalization legislation (S2572/A3981, S2574-S2576/A3983-A3985) and questions as to what is delaying its enactment.
In response to Governor Christie’s request months ago to put this legislation on his desk, the legislature overwhelmingly passed the economic revitalization legislation in June, yet the bills are not signed and the city’s crisis continues unabated with the clock winding down if swift action is not taken.
Earlier this week, Atlantic City had its debt rating lowered further into junk by Standard & Poor’s. The downgrade reflects the rating agency’s concern about the city’s long-term fiscal stability and recovery as it responds to increasing liabilities from tax appeals and an eroding tax base. This is further proof that the passage of this legislation is essential to the city’s financial recovery.
Why is the process stalled? We don’t know for sure, but it can’t help that the city has not finalized the terms of an agreement with the state to assure that the state funding to the city is committed and that the city is doing its part to reduce its debt. It also does not help that the county, which historically relied so heavily on casino property tax valuations that are simply no longer there, is raising issues with the city because it believes it should be getting a greater share of the city’s payment in lieu of taxes (PILOT) funds.
Everyone agrees that without the implementation of the PILOT and the certainty it brings through the $120 million property tax contributions, the revitalization of Atlantic City is impossible as the current uncertainty in tax payments prevents further investment and jeopardizes even more jobs. Moreover, the reallocation of approximately $60 million in CRDA and ACA funding to the city as part of the plan is essential to help stabilize the tax rate for non-casino taxpayers while the city continues to correct the size of government to reflect the current economic conditions in the region.
The CANJ understands that there is no easy complete remedy for the city’s fiscal situation and none that comes without pain. For example, when you include the casino ACA payments that will now go to the city instead of marketing the casino properties and the money each casino property will be giving up from its CRDA account, the nine casino properties themselves will be paying about $50 million more to the city under this legislation in 2015 than they would pay under the current tax rates and assessments. However, despite this additional cost to the industry, the Association recognizes it’s a necessary expenditure to help stabilize the city and therefore the casino industry and the business environment in the region.
The CANJ calls on all officials in the city, county and state to stop the quarreling and take immediate steps to get this legislation executed. Every day the proposed legislation is not adopted is another day that the city remains at significant risk of additional casino closures, job losses and further business declines, threatening non-casino businesses and residents in the city and throughout the county. This legislation is a critical and, in fact, the primary component to the overall plan the city must pursue to help mitigate the financial crisis that looms larger as the legislation remains at a standstill.
We cannot afford to waste any more time. The economic stability of the city, region and state depend on it. Therefore, we urge all officials (city, county and state) to do what is necessary to work with the administration to implement the economic revitalization legislation, take the additional steps necessary to stabilize the city’s economy and move forward with a comprehensive solution to revitalize Atlantic City.