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Christie turns on county as Atlantic City’s budget slims down

For the first time in a decade, city residents will see a decrease in their taxes. But Atlantic County is crying foul. In the odd political theater of the state takeover, alliances are shifting.

ATLANTIC CITY — A year ago, Gov. Christie held a news conference in Atlantic City and snubbed the mayor. It was the Atlantic County executive, Dennis Levinson, who was riding shotgun as the governor grabbed the steering wheel of Atlantic City's government.

Christie, after calling the mayor a liar, promised his pal "Denny" that he would make sure the county got its desired 13.5 percent share of the much-ballyhooed PILOT — the $120 million annual payment in lieu of taxes that the surviving casinos will collectively pay for the next 10 years.

But this week, alliances and strategies seemed to have shifted under the odd political theater of the state's third version of dominance in seven years of control over the struggling Atlantic City's municipal government.

Mayor Don Guardian was the one to introduce the budget to City Council with an exuberant PowerPoint presentation trumpeting a slimmed-down $206 million near-miracle that calls for a 5 percent decrease in the residential tax rate.

"We have a Legal Balanced Budget," the PowerPoint proclaimed, a fact that in this town does not go without saying.

The budget is $35 million less than last year's and $56 million less than 2015's, aided by tax-appeal settlements with Borgata and slimmed-down payrolls and costs. The state imposed new work rules and pay cuts on city's firefighters this month and is seeking to do the same with its police union.

Guardian, in a collaborative frame of mind, gave credit to the state, including its two monitors, past and present, a business administrator, and the current overseer, Jeffrey S. Chiesa, for playing "an important role in helping us turn things around."

Christie issued a statement applauding himself and his designee Chiesa for "quickly put[ting] Atlantic City on the path to financial stability."

"It took us merely a few months to lower property taxes for the first time in the past decade," his statement said.

Guardian noted that the budget has been slimming down for three years.

It was the county's turn to feel misunderstood.

The city's budget included just a 10.4 share of the PILOT for the county, required by the law. Levinson says the difference will cost county taxpayers $4 million a year for 10 years and will mean the county will have to raise taxes, including on residents of Atlantic City itself, possibly negating the tax decrease from the city.

The city says taxpayers will pay an average of $136 less than last year, when the typical home, valued at $141,500, carried taxes of $2,685 per year.

Explaining the denial of the county of its bigger PILOT share, Christie spokesman Brian Murray issued a statement saying the county "has not lived up to its commitments to the state to help Atlantic City achieve efficiencies and savings."

Those "failures" make it "unfair and impossible" to provide the increased level of aid, Murray said.

He did not respond to a request for more specificity Wednesday.

Levinson, reached Wednesday, said that the county had been unwilling to assume the cost of services such as trash collection for Atlantic City but that no specific offer was ever rejected.

Several county mayors accused the governor of reneging on his promise to give the county a 13.5 share of the PILOT. "We were taken for a ride," Galloway Township Mayor Don Purdy, a Republican, told the Atlantic City Press.

Levinson compared the situation to a homeowner who has saved money by being frugal (the county) being asked to mow the lawn of a less disciplined neighbor unwilling or unable to mow his lawn himself (the city).

"Be a good neighbor. You're well off. You've been frugal. You haven't gone on vacation in years. Why don't you do their lawn?" Levinson said. "Everybody is taking their bows; it's a wonderful thing. They're balancing Atlantic City's books on the backs of the county taxpayer."

The county has been mentioned by the state in multiple roles for Atlantic City, including operating a possible regional police department (an idea that Levinson and the police union have been wary of), control of the city's water authority (a proposal that once seemed imminent, but Levinson says has not been lately discussed), and other shared services.

But Levinson said the state was more interested in the county assuming costs, not just sharing responsibilities. "We can't pick up Atlantic City's trash and have the county taxpayers pay for it," he said.

The county also had to turn over $65 million to the city last year to cover its share of tax-appeal refunds, Levinson noted. He blamed those refunds, which brought the city to its financial knees, on the city's improper assessments in the first place as well as its inability to properly defend those assessments in court. Borgata's $165 million refund was settled for less than half of that amount.

Levinson called the whole PILOT law freezing casino taxes a victory for the casinos at the expense of the county taxpayer. "The special interests won," he said.

At the City Council meeting, Timothy Cunningham, who oversees the state's takeover of Atlantic City, questioned if the difference for the county was as significant as Levinson suggested. He  said he would be "figuring out what that really equates to in an average household, as opposed to what the county executive has put out there."