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N.J. education chief warns A.C.schools may close

TRENTON - Thousands of Atlantic City students could find their school doors locked if City Hall does not remit tax revenues it owes the school district, a top Christie administration official warned Tuesday.

Union worker Marcell Moore, of Newark, chants pro-union slogans during a march to City Hall in Atlantic City on Tuesday April 12, 2016, in support of the city in light of a state takeover.
Union worker Marcell Moore, of Newark, chants pro-union slogans during a march to City Hall in Atlantic City on Tuesday April 12, 2016, in support of the city in light of a state takeover.Read moreMichael Ein/Press of Atlantic City via AP

TRENTON - Thousands of Atlantic City students could find their school doors locked if City Hall does not remit tax revenues it owes the school district, a top Christie administration official warned Tuesday.

"I need to ensure the Atlantic City School District receives the local levies that the city is obligated to collect on their behalf," Education Commissioner David Hespe told the Senate Budget Committee.

Otherwise, he said, "I will have to close the schools of Atlantic City."

"I'm not sure what that moment in time is," Hespe said, but he added that the process has already started, because, he said, the city has not paid certain vendors of the district.

About 7,100 students are enrolled in the city's public schools, according to state data.

A state judge last week denied a request by the Christie administration to freeze the city's assets until it makes its next school payment of $8.5 million on Friday. Gov. Christie last week said the city would owe the school district nearly $34 million by June 30.

Mayor Don Guardian said that he expected the city, which has about $8 million in its coffers, to make at least a partial payment Friday. He added that previous payments give the district enough to make its April payroll. The city will collect its next quarterly taxes May 2.

Superior Court Judge Julio Mendez said the city had complied with a payment schedule established by the city, state, and school district, which opposes the lawsuit.

The city was able to pay municipal employees last week. The next court hearing is set for Tuesday.

Senate Budget Chairman Paul Sarlo (D., Bergen) asked Hespe what the state would do if it were to close schools. Hespe said the state likely would not be able to move the students to other districts.

"This has never happened in the history of the state," he said of the possible closings.

"There's not much capacity in that area for moving large numbers of children. That would be very disruptive to their education," Hespe said. "That's exactly the reason we went to court, senator. There aren't any solutions."

Ninety miles southeast of Trenton, 300 union members from throughout the state marched in the rain from the Boardwalk, then gathered inside City Hall to show solidarity with Atlantic City municipal workers. A Senate bill backed by Christie would give the state the power to terminate the workers' union contracts.

"On behalf of the 10,000 members, we stand with Atlantic City," said Susan Cleary, head of District 1199J, the state's health-care workers union. "We will be back, and back, and back."

Charles Hall, head of the state's United Food and Commercial Workers International Union, said: "This is Atlantic City, a union town. We're going to say no to Christie."

After the rally, City Council President Marty Small noted that the New Jersey Constitution says the state "shall provide for the maintenance and support of a thorough and efficient system of free public schools."

"It's a shame they're trying to put this on the backs of the schoolchildren, who are innocent, harmless, and have nothing to do with this," Small said. "But that's how they govern. It's the Christie administration, using the kids in a political battle."

Wendell Steinhauer, president of the New Jersey Education Association, said in a statement that the union would "hold the state accountable to meet its constitutional obligation to provide a quality public education to the children of Atlantic City."

David G. Sciarra, executive director of the Education Law Center in Newark, said in an email that New Jersey law was firm: The state "cannot allow district schools to close because the municipality is facing [a] fiscal crisis impairing local aid payments to [the] district, but must act to ensure children continue to be educated in those schools."

For his part, Christie said last week that his administration's lawsuit was intended to prevent the city from making its students "collateral damage" to the city's "reckless financial games."

Christie's proposed budget for the fiscal year that begins July 1 includes $32 million in additional aid for the Atlantic City district. That money wouldn't be available to the district until the next fiscal year begins, assuming the Legislature includes the funding in the budget it sends to Christie.

The district is eligible for the new state aid, Hespe said, because the city's tax base has been decimated by the casino industry's contraction.

Lawmakers in Trenton are debating how to prevent a financial collapse in the seaside gambling hub. Christie's commissioner of community affairs said Monday that the city of 40,000 people was running a $100 million deficit on a budget of roughly $250 million and that it carried about $550 million in debt.

The Senate last month passed legislation that would allow the state to take over the city's government, as well as a bill that would require the eight casinos there to pay the city a collective sum of about $120 million annually for a decade in lieu of taxes.

Assembly Speaker Vincent Prieto (D., Hudson) has refused to hold a vote on the Senate takeover legislation, saying it would unfairly trample public employees' collective bargaining rights, and has instead introduced his own proposal that would require the city to meet certain fiscal benchmarks in order to maintain its autonomy.

Christie supports the Senate package and says he would veto Prieto's bill, arguing it would not give the state all the tools needed to cut costs.

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