ATLANTIC CITY — Gov. Murphy on Thursday appointed a former federal prosecutor who worked in the Clinton administration to lead the state effort to return Atlantic City to local control.
Jim Johnson will serve as special counsel to the governor’s office and will be paid $1 a year, a fee that stands in contrast to the millions billed by the lawyers Gov. Chris Christie appointed to the task.
But Johnson’s appointment does not mean an end to the work of former U.S. Sen. Jeffrey Chiesa as overseer of Atlantic City – a job that has paid him $400 an hour and his law firm in excess of $4 million since November 2016, said Murphy spokesman Dan Bryan.
“Chiesa is still the state monitor,” Murphy said. “Johnson will be the special counsel. He has a different role. He is looking into everything.”
Still, Chiesa’s law firm’s payday in Atlantic City could be coming to an end.
Johnson’s role will involve “an intensive review of ongoing litigation in Atlantic City, and providing recommendations for the process of returning the city to local control,” according to a news release from the Department of Community Affairs, which has vast oversight and control of Atlantic City finances, assets and operations under 2016 state legislation.
That litigation has formed the bulk of the billing and activities of Chiesa Shahinian & Giantomasi, which has battled the Atlantic City firefighters union over pay, staffing, and work rules, negotiated tax settlements with casinos, and fought to uphold the legality of the casino Payment in Lieu of Taxes law.
John Varallo Jr., president of Local 198 of the International Association of Fire Fighters, said Thursday that he looked forward to doing business with Johnson, a former undersecretary for enforcement at the U.S. Treasury under President Bill Clinton who oversaw agencies including the Bureau of Alcohol, Tobacco and Firearms, the Secret Service, and U.S. Customs.
He said Johnson’s $1-a-year salary was a welcome departure from the unlimited billing Christie authorized with the politically connected law firm based in West Orange and with Chiesa, a longtime ally and friend. Johnson ran against Murphy in the Democratic gubernatorial primary.
“I think it’s a great sign,” Varallo said. “Everybody knew what was happening in Atlantic City was a political grab for money. I think there’s better people with better hearts right now.”
Lt. Gov. Sheila Y. Oliver, the DCA commissioner who has opposed the state takeover of Atlantic City and has said the Chiesa law firm would come under review, said in a statement: “This administration is committed to getting Atlantic City back on its feet, and we will do so by working with its leaders, not by stepping over them.”
But Mayor Frank Gilliam said he had seen no sign that the state was moving toward local control, and said he was not involved in any discussion about the roles of Chiesa or Johnson. Under the state’s direction, the city is moving toward issuing bonds for $55 million in debt to repay state pension and other obligations.
“It still doesn’t give me any comfort in terms of being able to hire my own cabinet, bring in my own professionals,” Gilliam said. “It appears to be the same old state and city relationship, as if Christie’s still here.”
In the statement, Murphy said: “Atlantic City is poised for a comeback and I am sure that Jim’s guidance will play a critical role in the growth and economic revitalization of the city. Jim has years of governmental experience and knows how to work with tough budgets, traits that will serve him well in this role.”