In an effort to resuscitate the financially struggling Atlantic City, New Jersey Gov. Chris Christie announced on Thursday that he is installing an emergency manager and counsel to oversee the once-booming gaming destination.
The Republican issued an executive order naming Kevin Lavin, a New York corporate finance lawyer and adviser, as the city’s emergency manager. In addition, Kevyn Orr – the former emergency manager who helped Detroit out of bankruptcy -- will be a special consultant on the team.
Christie’s announcement comes as some criticized his recent state of the state address, which was filled with national innuendo, but did not mention Atlantic City's struggles. While Atlantic City showed decline before the governor’s arrival, Christie in 2011 committed the state to a five-year plan to revive the iconic city. With the city on the decline, some have suggested it could be a sticking point should the governor run for president in 2016.
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The goal of the emergency team is to help bring financial stability to the city in addition to helping the approximately 8,000 workers who lost their jobs after four casinos closed their doors last year. Three other casinos, meanwhile, are in bankruptcy, and gaming revenue continues to plummet. The team has been tasked to come up with a financial game play over the next two months. Exactly what powers they will have is unclear.
“Gov. Christie believes that expert and objective leadership is needed to restructure the operations, finances and culture of its government,” his office said.
The move comes even after Atlantic City lawmakers backed a plan for steep budget cuts -- $40 million over the course of four years, or about 15% of its $260 million budget. The city’s mayor had previously rejected suggestions for an emergency manager, arguing instead for local control of the city’s budget.
Officials have called talk of the city filing for bankruptcy premature.
Thursday’s announcement was met with some criticism, including from the lawmakers who have put forth their own plans in addition to the state Policemen’s Benevolent Association. Pat Colligan, president of the group, called the move “unnecessary and disturbing.”
“Atlantic City does not need an emergency manager to guide it through this difficult period. The managers to be appointed are not there for the economic development vision or their insight on how to rebuild the city into a year round resort,” said Colligan. “They have been appointed simply to slash the city budget and to give the governor the hatchet men he needs to further ruin anyone who dares to make working for the public their career.”
City Council President Frank Gilliam, a Democrat, also told the Star-Ledger newspaper that the move was unnecessary, saying, “I find it very imposing that we will basically have outsiders come into the city and dictate the direction of the city without sitting down with the city fathers and getting their input. We’re open to working with them. But at the same time, any time that they usurp our power, we will definitely have problems with that.”
Atlantic City Mayor Don Guardian -- who has previously expressed reservations about the possibility of an emergency manager -- released a statement Thursday, saying that after "expecting the worst" and meeting with Lavin and Orr, he's optimistic. "They made it clear that they recognized myself and City Council as the locally elected representatives of the people of Atlantic City and that they wanted to work together with us in the spirit of cooperation," said the Republican. "Although no time table was given, they communicated to us that they wanted to get in, help us fix the City’s finances and get out. From my perspective, Governor Christie has given us more tools to help bring Atlantic City out of its financial distress and restore its long term viability.”