Atlantic City, N.J., breathed a sigh of relief last month when Gov. Chris Christie signed a badly needed and long-delayed financial rescue package for the resort town, but that legislation goes only so far, according to financial analysts and state lawmakers, NorthJersey.com reported on Saturday. Even with a new $60 million loan from state taxpayers, the threat of bankruptcy still looms over Atlantic City, where the $262 million municipal budget has a $100 million deficit, and where roughly $400 million is still owed to bondholders and local casinos that filed successful |tax appeals. How the city could generate enough money to fill those yawning fiscal gaps remains an open question. Just weeks ago, before getting the $60 million loan, city officials were delaying paychecks to workers and taking other emergency steps to scrounge enough funds for schools and bond payments. Atlantic City Mayor Don Guardian said after the rescue bills passed on May 26 that he expected to cut health care and prescription medication coverage for workers, and costs at the police and fire departments. The cash infusion from the state would allow local officials to pay off $50 million to $60 million of their debt and “refinance” the rest “so that it’s nice and solid.” However, some doubt that his math would work. Financial analysts say the rescue legislation that Christie signed does not address the larger economic currents that hobbled the casino town over the past decade: A rapidly shrinking property tax base that is going from $20.5 billion in 2010 to an estimated $6.5 billion by the end of next year.
