news

Atlantic City Council to vote on plan to avert Friday shutdown

Amy S. Rosenberg

Updated: Monday, April 4, 2016, 12:06 PM

Mayor Don Guardian, left, and Council President Marty Small discuss the looming shutdown of Atlantic City.

With the city government running out of cash on Friday, Atlantic City City Council will vote Wednesday on a delayed payment plan for city workers that will allow the city to remain open, said Council President Marty Small.

The city had announced it would shut down its government April 8 to May 2, except for essential workers, who would work on an IOU to be paid after second quarter taxes are collected in May.

However an alternative plan, in which the unions agree to a 28-day payment schedule instead of a 14-day schedule, was proposed and received the support of the unions, Small said. The plan, which needs to be ratified by City Council at its meeting Wednesday, will allow the city to delay paychecks until May 6, and keep the government running as normal.

"From what I understand, everybody's on board," Small said Monday morning. "This allows us to run our government for the people of Atlantic City."

Small said the delayed payment system would buy the city time until June or July, when it is expected to run out of cash again.

One businessman, Perry Arsenis, who owns the Howard Johnson Inn and Perry's, a restaurant and noted breakfast spot, told the Press of Atlantic City he had decided to pay his $24,000 tax bill early to help the struggling city. Borgata Hotel & Casino, meanwhile, got a judge's permission to withhold its first quarter $7.2 million tax payment as it is trying to resolve the $150 million the city owes it as a result of successful tax appeals.

Meanwhile, the standoff in Trenton continued, as Assembly Speaker Vince Prieto was being pressured to post a bill authorizing a state takeover of Atlantic City to a vote on Thursday. The bill was passed in the state Senate, along with an aid package for the city and a new tax system for casinos. Gov. Christie, who has twice vetoed the aid package, has said he will not sign an aid package without a full takeover.

Prieto objects to the takeover bill because it authorizes the state to rip up union contracts. Over the weekend, a group of South Jersey Democrats, including Vince Mazzeo of Atlantic County, who has said he opposes the takeover.

UPDATE: Gov. Christie scheduled a 2:30 p.m. press conference.

UPDATE: Mazzeo said in an interview Monday afternoon hat he would vote in favor of the takeover bill if it gets posted because, “we’re at the 11th hour now.”

“I just think we’re in a different spot right now than we were in January,” Mazzeo said. “I still don’t want the takeover, but we’re running out of options. Meanwhile, the city doesn’t have any plan.”

He said the delayed payment option being voted on by council is “just prolonging the agony.”

“Is this the way we want to do business?” he said. “You’re not fixing the financial problems of the city.”

He said Christie’s insistence on both bills or no bills left him with no other choice than to support both bills.

“It’s not that I wanted the takeover,” he said. “At this point, we’re at the end here.”

Amy S. Rosenberg

Read full story: Atlantic City Council to vote on plan to avert Friday shutdown

More Coverage:

Moody's downgrades AC's debt, citing 'political stalemate'

Atlantic City's fall could drag down other cities

Inquirer editorial: Helping Atlantic City by not hurting it