Atlantic City Takeover Yields Ambitious Scheme to Speed Turnaround

Implementation plan targets neighborhood revitalization, workforce development, community policing, public-health initiatives — among other goals

Credit: Chris Goldberg/flickr
Atlantic City
The latest plan to come out of the state’s ongoing Atlantic City takeover details a series of ambitious goals for rebuilding the community and improving quality of life in the seaside resort, including neighborhood revitalization, workforce development, community policing, and public-health initiatives.

Issued earlier this week, the state’s 21-page “implementation plan” builds on recommendations originally made last year when Gov. Phil Murphy, a first-term Democrat, announced the state takeover would continue under his administration. Murphy had criticized the state’s intervention before taking office.

The takeover began during the tenure of former Gov. Chris Christie with a goal of keeping the city from going bankrupt after economic decline and casino closures ravaged the local tax base. But with the resort’s finances now improving — the bond rating was upgraded last fall and the latest municipal budget holds the line on property taxes – Murphy’s administration has been broadening the focus to address more than just the city’s balance sheet.

State taking local tack

For example, the new plan calls for the state to work with local civic associations to revitalize neighborhoods and their small businesses. Coordinating with local schools and colleges to improve job training and educational opportunities for city residents are other key goals outlined in the plan. Community policing would also be boosted with funding from the Community Reinvestment Development Authority, and public health improved to address concerns about infant mortality, drug addiction, and obesity.

Some of the proposals will require new legislation in Trenton, including a plan to include Atlantic City in the state’s Urban Enterprise Zone program, which allows businesses to charge a reduced sales tax in an effort to generate economic development. But as the plan was rolled out during a public event that drew both city and state officials, the Murphy administration stressed the importance of the local community accepting their intervention and vision.

“I have confidence in this plan because it has critical buy-in from the community, city stakeholders, and anchor institutions that have agreed to be mutually accountable for getting the work done, which makes for enduring progress,” said Lt. Gov. Sheila Oliver, who leads the state Department of Community Affairs, the agency that is in charge of the takeover.
The deep fiscal problems that led to the state takeover became widespread during the Great Recession, when five casinos closed, costing the city thousands of jobs and billions of dollars of tax ratables. At the time, the city also faced an estimated $500 million in unpaid debts, as well as a projected $100 million budget deficit. In fact, just weeks before bipartisan legislation for the takeover was enacted in 2016, Atlantic City narrowly avoided defaulting on a debt payment.

Atlantic City revival

The takeover legislation enacted by the Republican Christie gave the state wide powers, including control over city labor contracts for up to five years. The intervention officially started in late 2016, and it began with pay cuts for police officers and firefighters and an emphasis on resolving outstanding tax appeals with several casinos. Eventually, the city earned the credit-rating upgrade and, with the help of lucrative state-tax incentives, is seeing an economic revival.

Murphy’s embrace of a prolonged state takeover that is now likely to last the full five-year term authorized by the legislation marks a reversal of sorts from the position he took while running for office in 2017. But he’s also used the takeover to highlight the consensus-building brand of governing that he prefers. For example, the state organized a three-hour town-hall meeting in the city before issuing the implementation plan, and the plan highlighted the influence the event had on the final product.

The plan is divided into two sections, with the first focused on spelling out the specific strategic recommendations, such as further reforming city government and finances, improving public health, and revitalizing neighborhoods. The second section sets the timeframes for accomplishing the recommendations, with yearly and quarterly progress goals listed for each area of emphasis.

For example, in the land-use section, the plan’s goal is to reduce home foreclosures; the current default rates are the highest in the state. As part of the effort, the plan calls for a new foreclosure-relief program and for the convening of a “foreclosure town hall” for local residents.

The economic-development section also emphasizes improving the job opportunities for local residents as it calls for more coordination among city government, schools, higher education, and state agencies to establish more “pathways” to good-paying positions.

“Focus on the support structure and overall health/growth of small businesses in Atlantic City,” the plan said.

Defining funding sources

While funding sources for some proposals aren’t clearly defined in the plan, the goal of improving community policing calls for the CRDA to provide $7.5 million in funding over the next five years to hire 15 officers. They will be assigned in pairs to each of the city’s six wards, with the remaining three tasked with “addressing homelessness and vagrancy” within the main tourism district, the plan said.

Public finance also remains an area of emphasis despite the city seeing its bond rating boosted last year to a B2 grade. The plan’s public-finance section calls for the creation of an inventory of all state and federal grant programs that the city could benefit from, and also lists promotion of the city to philanthropic organizations and nonprofits as a key goal. It notes that Atlantic City has four federally designated “opportunity zones” within its borders that could be leveraged to spur redevelopment.

While Atlantic City’s former mayor was unhappy with the final legislation that authorized the state takeover during Christie’s tenure, current Mayor Frank Gilliam appeared with Oliver and other Murphy administration officials as the latest plan was rolled out this week.

Jim Johnson, a former U.S. Treasury official from Montclair who Murphy tasked with drafting the original list of recommendations that were released last fall, suggested the more collaborative approach is “changing the narrative of this vibrant city.”

“There are so many positive things happening in Atlantic City because of the efforts of organizations across the city,” Johnson said.

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