Atlantic City makes $1.8 million bond payment, avoiding default

Atlantic City Councilman  Kaleem Shabazz

Atlantic City Councilman Kaleem Shabazz

What wouldn’t warrant as much as a tweet in most New Jersey cities was cause for celebration in Atlantic City on Monday.

Mayor Don Guardian announced that the city had made its monthly bond payment totaling $1.8 million, avoiding what would have been a historic default by the seaside gambling mecca.

Atlantic City was able to cobble together enough money to make the payment, because quarterly tax receipts began rolling in this week.

Now Guardian will have to turn his attention to two other budgetary deadlines — which he expects to meet — $6.5 million in city workers salaries by Friday and $8.5 million for public schools next week.

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“We’re on the brink,” he said. “We’re trying to get through day to day. We stopped making purchases weeks ago. We certainly haven’t replaced any staff.”

A cautiously optimistic Guardian said the city had “about $6 million or $7 million” on hand as of Monday morning, but tax payments were coming in at a clip of about $1 million per day.

Gov. Chris Christie, who supports a state takeover of the financially failing resort town, said fulfilling a required bond payment should not be cause for celebration.

“To tell you how bad off Atlantic City is — that something that 565 municipalities do on a regular basis, which is make their debt payments, is worthy of a press release and a press conference,” said Christie. “What’s next? Does he want a gold medal for that?”

A bill sponsored by state Senate President Steve Sweeney, D-Gloucester, would have given the state broad authority to operate Atlantic City’s government, including the ability to sell city assets and cancel union contracts.

A counterproposal, which may go up for a vote in the state Assembly on Thursday, would give the city a chance to fix its finances first by meeting certain benchmarks and would more closely involve local leaders.

In urging state politicians to approve the latter proposal at Monday’s news conference, Atlantic City Council President Marty Small invoked a quote from the Rev. Martin Luther King Jr.

“The ultimate measure of a man is not where he stands at moments of comfort and convenience, but where he stands in times of challenge and controversy,” said Small. “These are both challenging and controversial times. Do the right thing.”

Guardian hopes to have money for the next bond payment in early June, but he would not promise that the city would pay it.

“I think it would be foolish as you realize our dwindling supplies for me to guarantee any payments,” he said.

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