NJ bill would pave way for Stockton sale of Showboat casino

Stockton University was betting big in December when it bought the former Showboat casino in Atlantic City to use as a satellite campus.

Since then, legal restrictions have hampered Stockton’s efforts to set up an academic hub there — and have also stymied its ability to sell off the aging property.

 

But a bill spearheaded by two South Jersey Democrats would exempt Stockton from conflicting land covenants and free up the university to more easily sell Showboat to a potential buyer.

“There just doesn’t seem to be any way to resolve this other than putting into effect something that would state that a public entity, which Stockton is, would not be subject to these kind of covenants,” said state Sen. Jim Whelan, who sponsored the bill. “And that the property would not be subject to these kind of covenants going forward.”

Democrat Vince Mazzeo will introduce the bill in the Assembly.

Land covenants written by the Trump Taj Mahal and Caesars Entertainment simultaneously say the property must be used as a casino and cannot be used as a casino.

A land covenant is an agreement between a property owner and a buyer that restricts the land use.

The bill would void any land covenants for properties owned by public entities in the Atlantic City Tourism District. In other words, land covenants would no longer remain attached to a given property.

Whelan said the legal situation at Showboat had gotten so problematic that a bill like this was the only way to solve it.

“It really is a mess so there are times when, rather than trying to untangle this, you just have to cut the Gordian Knot as it were,” he said. “That’s what we’re trying to do.”

Florida developer Glenn Straub recently agreed to buy the casino if Showboat first worked out the conflict between the covenants.

Skeptical of the proposed legislation, Straub said a better solution would be for Showboat to negotiate with the previous owners.

“They’ll get [the casinos] all together, have a nice meeting, and they’ll get it settled. It’s a simple, simple thing to do,” he said.

“But in the meantime [Stockton] doesn’t want to exert its efforts and energies to do that.”

Dr. Harvey Kesselman, acting president of Stockton, said the school has talked with the casinos but wouldn’t give details.

Selling off Showboat would finally allow Stockton to start building an Atlantic City campus in what Kesselman called a “thoughtful, planned” way.

“Ultimately this is about the students of the state of New Jersey,” he said. “We want to provide them with an educational opportunity not only on the Galloway campus but also in Atlantic City.”

Although the bill would allow Stockton to use Showboat as a campus, Kesselman said the university has no plans to do that.

The Senate State Government, Wagering, Tourism & Historic Preservation Committee will take up the bill Thursday. But it will be months before the bill could actually become law, because the Assembly won’t likely reconvene before the November election.