Atlantic City, New Jersey's struggling gambling hub, will get a 60-day extension of a $40 million state loan that was due today, Reuters reported yesterday. A report last week by its state-appointed emergency manager, Kevin Lavin, called for cost-cutting, layoffs and possibly debt restructuring to stabilize the city's budget, which has a projected $101 million deficit. The report also said that without significant state support, the oceanfront resort town "cannot stand on its own." With increased competition from neighboring states, Atlantic City no longer has a monopoly on East Coast casinos. As a result, it lost nearly two-thirds of its property tax base in just five years. It is now down to $7.35 billion. Even with the loan extension, Atlantic City's cash flow is expected to go negative by May, according to Lavin's report. Several state lawmakers are working on a package of legislation aimed at stabilizing Atlantic City's tax base by having casinos make set payments in lieu of taxes.
