New Jersey should face reality on Atlantic City

By Frank Gilliam

The behavior of the New Jersey government toward Atlantic City in recent days can be compared to that of a mugger - a robber who takes his victim's money, demands his jewelry, and then threatens to shoot him for not having enough money.

Let me explain. While it's without doubt that Atlantic City faces difficult financial circumstances, much of the difficulty is caused by the state. For decades, the state and its agencies have treated Atlantic City as their own bank, taking more than $1 billion.

The state currently takes, through the Casino Reinvestment Development Authority (CRDA), more than $55 million each year:

$26.6 million in sales and luxury taxes;

$20.5 million in parking fees;

$9.25 million in hotel room taxes.

When Atlantic City was a unique gaming destination on the East Coast, this was tolerable. But as the state acknowledges, Atlantic City is no longer unique. The city must change to face this reality. But the state must also face this reality. It needs to allow Atlantic City to keep the revenue generated in Atlantic City. This alone will allow the city to finance city services.

The threat of a takeover by the state because of city finances is a cynical ploy. The state has set up Atlantic City to fail so that it can be plundered by outsiders. The reality is that the state is seeking to take away the constitutional rights of the residents of Atlantic City to choose their own leaders.

The state has had control of all hiring, firing, and contracts let by the city for several years through its appointed monitor

Again, let me explain.

Legislation passed last week that would allow casinos in North Jersey would further reduce revenue to Atlantic City and increase competition. It's a double whammy for Atlantic City.

The legislation creates $50 million in payments from the casinos, but the recipients are the Atlantic County government and city schools. No payment goes to the city. All payments from northern casinos would go to another CRDA-like state agency.

The state is seeking to reduce revenue to the city in a cynical manner to attempt a takeover. If revenue falls below 50 percent of expenses locally, the state has used that as an excuse for a takeover. Witness Camden.

For these reasons, those who know the city best have opposed the recent state moves. Republican Mayor Don Guardian called the takeover threat "our Pearl Harbor." Democratic State Sen. Jim Whelan, a former Atlantic City mayor, also opposes a takeover.

As Whelan points out, the state has had control of Atlantic City's tourism district for nearly five years. During that time, four casinos have closed and convention bookings have declined.

But it's not enough that the state has taken our money. It now wants our assets, including the Municipal Utilities Authority. These are wrong moves, and the state's own monitor and the Department of Community Affairs have said so.

The state is one of the biggest offenders owning assets that contribute nothing to Atlantic City. The CRDA owns 675 properties that pay no taxes. The state could sell these assets, get them back on the tax rolls, and help generate additional revenue for Atlantic City.

One of the most distressing thoughts related to a state takeover is the potential disenfranchisement of voters. It would be unfair, undemocratic, and un-American for the state to deny Atlantic City voters their constitutional right to choose their own government, a mayor and city council with real authority.

Atlantic City is vastly diverse, and to deny any voter his or her right would be wrong. But it would be particularly hurtful to deny African Americans, the largest group of residents in Atlantic City, the full value of their votes.

The best course of action for the state is to recognize that Atlantic City no longer occupies a unique place in the gaming market but is still unique in New Jersey. The state should allow Atlantic City to keep the revenue generated there and let those who know the city best - its locally elected officials - the freedom to determine the city's future.

Frank Gilliam is a member of the Atlantic City Council and served as its president. Fmgilliam@cityofatlanticcity.org