Gov. Christie's fingerprints and cronies all over Atlantic City takeover
In Atlantic City, not all Christie connections are created equal
ATLANTIC CITY -- Never one to shy away from taking credit, Gov. Christie was eager to take a victory lap last week regarding the state's takeover of Atlantic City.
Just four months in, Christie was proudly showing off "the bump in Atlantic City's credit rating."
It was true. Standard & Poor's boosted the beleaguered city's bond rating from a very junky CCC to a not-as-junky CC -- with a caveat that default was still possible.
That, Christie said, combined with the blockbuster sale of the Trump Taj Mahal to Hard Rock International and two Jersey developers, and a settlement with Borgata over a debilitating tax appeal, are "early signs our efforts are working, that we will successfully revitalize Atlantic City and restore the luster of this jewel on the Jersey Shore."
Well then. Maybe so. But is that credit deserved? Does it matter?
One thing is clear: Four months into the takeover, Christie's fingerprints -- or at least those of people who influence Christie, have his ear, and also his blessing for billable hours -- are all over this town.
"It's no different than any other money grab that has basically been a part of Chris Christie's legacy," said City Councilman Frank Gilliam, who is running for mayor, for a term that begins when Christie's ends. "Another way to pay off his friends, make sure his friends have gotten tax abatements."
But not all Christie connections are created equal. Some build, some bill. Here's a guide to Christie's Atlantic City, currently being run by a law firm in West Orange.
TEAM HANSON: Christie adviser Jon F. Hanson has been striking out with ideas to fix Atlantic City since 2010. First, the state's Tourism District, a mostly unrealized effort that saw five casinos close under its watch. Next, two emergency managers named Kevin and Kevyn (Lavin and Orr) were supposed to take control and fix things. They did not.
But Hanson's other big idea, to bring his New Brunswick-style nonprofit Development Corporation model to Atlantic City, has stuck.
ACDevCo wrestled Stockton University from its Showboat purchase misstep, handed a no-bid contract to developer Joseph Jingoli, and amassed an impressively complex pastiche of public funding to jump-start a $206 million A.C. campus, with a South Jersey Industries headquarters thrown in as well.
Stockton also wants Bader Field for a Marine Science Center, and might make a move for a casino parking garage.
Who could argue with that?
Jingoli and developer Jack Morris then logged another win by partnering with Hard Rock to buy the Taj, a $300 million plan to buy and repurpose the mega-faded casino.
Jingoli likes to hire unskilled locals and apprentice them to unions. Morris is known to provide incentives for employees to live in the towns in which they're working.
Councilman Gilliam first proposed Jingoli and Morris as redevelopers of the inlet section around Revel, a plan shot down in part as being the bidding of outside influences the city was trying to keep from taking over the town.
But Gilliam says Jingoli's track record vindicates his philosophy of being open to developers, no matter which political bosses they may represent. "My hunch was right," he said. "The Jingolis of the world and any other developer of the world see the opportunity."
The blockbuster deal did not immediately trickle down. An auction Thursday saw beach block lots go begging. ("Anybody?" the auctioneer said. "Anybody want these on-the-beach blocks?")
Mayor Don Guardian says the bellwether will be the Boraie project: a 250-unit market-rate millennial-aimed, amenity-filled complex being built near Revel by the Boraie group, also of New Brunswick. If those apartments rent, that could signal that the center can hold in a new Atlantic City.
TEAM CHIESA The other band of Christie allies making money in A.C. are not as universally hailed. Former U.S. Attorney Jeffrey Chiesa was appointed the "director's designee" as outlined in the takeover law, but cut a deal for his entire law firm ($400 an hour for himself, $350 for lawyer Ron Israel, associates at $250 an hour, paralegals at $90 an hour).
Factor in accountants Ernst & Young, which has billed millions for work done for the state (and also for Borgata) dating back to the Kevin/Kevyns. The city's recovery plan was rejected by the state, which hired away its financial adviser and business administrator.
"It's the plan that we submitted that they rejected that they're now using," Guardian noted in an impromptu interview Thursday in his seventh-floor office. He noted that the city's $212 million budget all but closed last year's $100 million shortfall.
Chiesa and pit bull partner Israel work out of a fifth-floor office in City Hall formerly used by Risk Management.
The state has not responded to media Open Public Records Act requests for their billing, but Guardian noted requests for all kinds of documents for review. Boxes of worker's compensation files were reportedly shipped up to West Orange.
"They seem to be billing a lot of hours there," said the mayor, who says he no longer gets emails returned from Chiesa. "Everything from the library to the shade tree commission to the arts commission, they are now getting a copy of the agenda, approving the agenda, getting a copy of the minutes, and approving the minutes, lots of billable hours."
Anticipating the takeover, talk centered on South Jersey power broker George Norcross. The law gives the state power to ride herd on public unions, which some believe was one of Christie's -- and Norcross' -- main objectives.
Would Norcross bring a Camden playbook to the beach? Would the A.C. Police and Fire Departments be reconstituted into a regional force that had mixed results in Camden?
Was it about the water? Would Norcross-connected water companies gain control of A.C.'s water authority?
So far, Norcross has been quieter than fellow Christie super power Hanson, possibly saving his moves for the political arena.
The state's attempt to slash 100 firefighters is hung up in court, where an unapologetic Israel told the judge, "We have to be able to go after everybody," and questioned the judge's role at all.
The law gave the city a year before the state can move on the water. That clock runs out in May, and citizens of Atlantic City, smarting from a tax hike by the state, are expected, with help from the ACLU and NAACP, to go to court to make their move.