Watch Sweeney discuss meeting in video
It was early December and Frank Formica was working at his family’s Ducktown bakery in Atlantic City when he got a call from Gov. Chris Christie’s chief of staff, inviting him to a meeting at the governor’s mansion, Drumthwacket.
“What for?” the Atlantic County freeholder director asked.
An Atlantic City intervention meeting, Formica recalls Regina Egea saying.
“You mean you want to take over the government of Atlantic City?” he countered.
Egea said they didn’t want to use the word “takeover,” but rather a “hollowing” of city functions, according to Formica.
But to Formica, the third generation of his family to run the bakery that opened in 1919, the meaning was clear.
A few days later, on Dec. 10, he and Atlantic County Executive Dennis Levinson drove together to Drumthwacket, outside Princeton.
There, they met with state Senate President Steve Sweeney and the 2nd District legislative team, Sen. Jim Whelan and Assemblymen Chris Brown and Vince Mazzeo. Egea and Christie Chief Counsel Tom Scrivo were also there, along with Camden County insurance executive George Norcross and Morris County real estate developer Jon Hanson.
Christie wasn’t there. Neither was Atlantic City mayor Don Guardian, or anyone else representing Atlantic City government.
For three hours, the group discussed Atlantic City’s issues, its problems, possible solutions and assets.
It’s quite possible the word “takeover” was never used that day. And Whelan and Mazzeo have since said they were surprised when, a month later, a draft takeover bill was circulated in Trenton. But Sweeney, who ran the Dec. 10 meeting, scoffed at the suggestion that everyone didn’t know what was being discussed, and what would happen next.
“Think about who was in the room. How dramatic and how serious we were about the problem,” Sweeney said. “So anybody thinking this was a surprise as everyone acted, everyone knew about this. They might not have seen the bill. But we all had a conversation about it.”
Parsing the guest list
A lot has happened in the nearly two months since the meeting at Drumthwacket.
Sweeney introduced legislation to take over Atlantic City’s governmental functions. Emergency Manager Kevin Lavin issued his final report on the city’s fiscal crisis and identified what he said would be a $303 million budget shortfall over the next five years if no state rescue occurs.
Angry at being excluded from discussions about the city’s future, Guardian and City Council threatened to take the city into bankruptcy.
Eventually, after the fingerpointing and posturing, city officials and state lawmakers started talking about what needs to be done. But resentment and distrust linger over how the city’s fate is being decided.
“How the hell is it that all white folks can go to Drumthwacket to decide what is good and bad for Atlantic City?” asked Atlantic County Freeholder Ernest Coursey, who is black. Coursey, a lifelong city resident and former councilman, said he found most galling the fact that power brokers and businessmen such as Norcross and Hanson were there at the table.
“To tell us what they can’t do?” Sweeney said when asked whether Atlantic City officials should have been at the meeting. “To tell us, ‘Just give us more money’? I’ve already heard their grievances.”
Norcross was invited by Democrats and Republicans to talk about what has succeeded in Camden, where the state, county and city are working on redevelopment and public safety, his spokesman said. Norcross is the chairman of Cooper University Hospital, a major Camden employer.
Hanson declined to comment.
It’s common for elected officials of both parties and representatives from the executive branch to meet when developing policy for complex issues, said Montclair State University political science and law professor Brigid Harrison, of Longport. Such meetings can be healthy and productive.
But she sees problems with the Drumthwacket meeting. The invitation of Norcross, a non-elected official with no relationship to the resort, and the exclusion of the city’s elected officials were bound to raise suspicions, she said.
“I think that when you look at how this takeover is occurring and how there are vested interests participating in the meeting in which this is planned, we know we’re in for another dose of the kind of corrupt and patronage-oriented development that tends to benefit a few vested interests but in the long term doesn’t bring broad economic rewards,” Harrison said.
Sweeney noted that Hanson was already involved in helping Atlantic City as part of the governor’s advisory commission on gaming, sports and entertainment. Norcross has helped in turning around Camden, which has similar issues as Atlantic City, Sweeney said.
“It’s not anything else but adding expertise and having someone that can help create a plan,” Sweeney said.
The Governor’s Office wouldn’t comment on the meeting, other than to say it was not a “secret” discussion, as Christie and Sweeney had announced they would meet with stakeholders about Atlantic City.
“It’s awfully smelly to me, like a dead cat on the lawn,” said Coursey, who said Atlantic City residents fear that a state takeover will mean the loss of their water utility, sold for cash to some politically connected operator to plug a budget deficit.
On the table, at the table
On the drive to Drumthwacket, Formica and Levinson talked about what might happen and agreed not to commit the county to anything before seeing all the details.
They were the last to arrive, going through a State Police checkpoint at the gate and parking in front on the long horseshoe driveway.
It was about 1 p.m., but despite the setting in the mansion’s dining room, no food was served other than almonds and cashews. Formica had with him a package of cannolis he brought as a gift to Christie, who campaigned at his bakeries in past gubernatorial elections.
But when they got there, they learned Christie wouldn’t attend, and that Egea and Scrivo would be representing the state’s interests.
“Why are you here? You’re not an elected official,” Levinson asked Norcross.
It was a tongue-in-cheek question. Levinson and Norcross recently had two get-acquainted lunches in Atlantic City, and Levinson had already said he welcomes Norcross’ business acumen and hopes he’ll get involved in the resort.
People remembered different details about those three hours, but most agreed Sweeney started the meeting saying outlining Atlantic City’s crushing debt and the $303 million deficit Lavin described in his report if no action was taken.
On the table was everything from the municipal utilities authority to police and public works, and selling assets to bankruptcy, Formica said. He argued for bankruptcy to restructure debt and lower the tax rate to attract residents and businesses, he said, but got pushback from Sweeney and Norcross.
Sweeney said more New Jersey cities would then move to file as well, Formica recalled.
“We went around and around and around, talking about taking over parts of Atlantic City for hours,” said Formica. The city’s recent decision to buy two trash trucks rather than hire the Atlantic County Utilities Authority to collect its trash and recyclables irked some, he said.
Formica said Lavin, who was not at the meeting, had told him the city would only save about $5 million a year if the county took over administering its police department.
“I’m going, ‘That’s like throwing deck chairs off the Titanic to stop it from sinking,’” Formica said. The city’s annual budget is about $262 million.
Formica also recommended getting more aid for the city’s school district and was told by others the timing was good. Formica said his read on the room was that North Jersey legislators were so anxious to get a posting for the North Jersey casino bill that they would be open to giving something to Atlantic City in return.
Whelan said a broad range of topics pertaining to Atlantic City and County were covered, but “nothing was decided at that meeting. My sense was there were going to be further, broader discussions with more people.”
Whelan declined to specify what was discussed but said the meeting did not lead him to expect a takeover bill to be thrust on the Legislature in the last days of its 2015-16 session.
“What I can say is that the two bills — it was not just the takeover but the amended version of the PILOT bills — when they were presented to the caucus at 6 o’clock at night in what was supposed to be the last session, it was a total surprise to me,” said Whelan, “particularly in context of, ‘We have to vote on these tonight.’”
Mazzeo said he doesn’t recall “any idea or any talk” about a state takeover, just about a lot of Atlantic City’s problems.
Levinson and Formica said that if the word wasn’t used, it was clearly understood.
Brown said he was asked to “hold hands” with Whelan and Mazzeo in making the takeover a reality but said he could not commit to anything until he saw how the numbers worked for Atlantic County’s residents.
Formica, like Whelan, said he believed there was going to be more discussion on the issues, perhaps another meeting. That was one reason officials didn’t actively go around talking about what happened, he said.
There have been more closed-door meetings when someone has complained about being left out.
After the takeover bill was introduced and after Guardian threatened bankruptcy, he met with Sweeney and Christie to work out plans for a new combination of state intervention in the city’s finances and a new PILOT bill package.
Absent from that meeting was Assembly Speaker Vincent Prieto, D-Hudson, Bergen, who pointedly referred to the exclusion in a press release.
“The fact is that no one speaks for the Assembly except for the Assembly,” Prieto said in a recent statement. “If the Assembly is not involved, then there is no agreement.”
More recently, Atlantic City Council went into a two-hour executive session during a special council meeting called to discuss bankruptcy.
As residents, reporters and others waited in a packed meeting room, Guardian and council members disappeared briefly from the room to talk to Sweeney about a new bill for intervening in city finances.
Few details have been released about how the new plan differs from the old. But when council members emerged from the elevator, they said they were happy to finally have a seat at the table.
That table, however, was still behind closed doors. And a seat at the table still required an invitation.