[toc]After a state takeover, New Jersey put out the call for a business administrator to help the state shepherd Atlantic City out of its current debt and deficit crisis. In the end the state settled on a familiar face in Atlantic City politics, Jason Holt.
According to the Press of Atlantic City, “The Department of Community Affairs hired city Business Administrator Jason Holt” to function as the business administrator for the takeover team.
The hire is somewhat unusual because Holt has been serving in the same capacity, working for Mayor Don Guardian’s administration since 2014. Holt has held the title of business administrator since 2015.
As Assemblyman Chris Brown put it, the move doesn’t make much sense on a number of levels.
“They sent down Chiesa who is supposed to be the expert, who rejected the experts’ plan in part put together by Holt,” Brown told Philly.com. “and is now hiring Holt because he doesn’t have the expertise to do what they said Holt doesn’t have the expertise to do. He winds up hiring the city’s expert.”
Or, as the Press of AC put it:
“The hire is ironic. Holt was often at Guardian’s side in trips to Trenton when city officials were trying to avoid the state takeover. And state officials, pushing for the takeover, argued that city officials were incapable of fixing the city’s finances.”
Inside the NJ takeover of Atlantic City
The takeover by the state was a long time in the making, but the final nail occurred after the state gave Atlantic City 150 days to come up with a five-year plan to deal with its budget deficit of $100 million and some $500 million of debt. To help, the state offered tens of millions of dollars in loans.
The city came up with a plan (with the assistance of Holt) that included among other things, cutting jobs and selling some city assets.
Unfortunately for Atlantic City, the proposal was rejected and the state takeover of Atlantic City was approved by the Local Finance Board.
The Department of Community Affairs was tasked with reviewing the proposal and concluded that the city’s proposal “is not likely to achieve financial stability,” according to NJ.com.
The Department of Community Affairs is also in charge of the takeover, which is being led by former US Senator Jeffrey Chiesa and Local Government Services Director Timothy Cunningham.
State now has sweeping control
According to NJ.com, following the takeover, “The state now has the authority to assume a vast amount of power usually held by the city’s leaders.”
Among the things the state has command of:
- The ability to break union contracts;
- hire and fire workers;
- sell city assets;
- enter into shared services agreements;
- restructure debt.
Some of these powers could impact New Jersey casinos, particularly the now-closed Taj Mahal, which was shuttered last year following a lengthy labor dispute between Local 54 Unite Here casino workers union and Carl Icahn, who rescued the Taj Mahal from bankruptcy just months prior, and is now trying to figure out what to do with the property.
Icahn is also the owner of the Tropicana Casino in NJ.