Sweeney Wants County To Settle AC Debt

State Senate President Steve Sweeney said Wednesday he wants Atlantic County to use its excellent bond rating to finance Atlantic City’s tax refunds to the Borgata Hotel Casino & Spa, with the city making the actual payments.

But Atlantic County Executive Dennis Levinson, who had heard of the idea in conversations but never seen details in writing, said he cannot imagine a way to do that without putting all county taxpayers at risk.

The city could settle with Borgata for less than the $160 million the city now owes, if the county’s bond funds were available to it, Sweeney said.

The county’s bond rating is higher than either the state’s or the city’s, making borrowing much less expensive, Sweeney said. Atlantic City’s bond rating is so low it effectively can no longer borrow.

“If you could negotiate with Borgata and say, ‘If we can pay you this now, do we settle?’ The county could bond and the city could pay it back and give a little profit if necessary,” said Sweeney. The state could add a letter promising to pay if the city cannot, he said.

Sweeney also would like the county to purchase the Atlantic City Municipal Utilities Authority, he said, which some officials have estimated to be worth about $100 million.

But Levinson was skeptical about both proposals.

“What guarantee would the county have that the city would pay its debt?” asked Levinson about the bonding idea. “And what guarantee do we have that the state would come through on a guarantee?” he said, referencing the state’s own budget problems.

Levinson added that the freeholder board would be unlikely to support it.

“I’m completely in the dark about what that would entail,” said Levinson about the idea of the ACMUA purchase.

New legislation sponsored by Sweeney giving the state more control over city finances is expected to be introduced Feb. 11, said Sweeney.

He said the state intervention/takeover bill is still being worked on, but he is hopeful it will have all funding built into it so separate funding legislation is not needed.

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