revel casino
Revel is suggesting improvements not only to the Inlet, but to surrounding infrastructure. Ben Fogletto

ATLANTIC CITY - One of the city's most neglected sections could receive about $150 million in infrastructure and construction improvements in an effort to aid Revel Entertainment Group's future casino business.

The deal, still in its early stages, would use a hefty portion of the city's and county's annual tax revenue from Revel to finance various improvement projects in the resort's Inlet section and other areas that would affect the $2 billion megacasino.

Construction is under way on Oriental Avenue, and officials have said the project will be completed in 2011.

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The latest drafts of the proposal include improving a decaying section of the Boardwalk, expanding Lighthouse Park to the Boardwalk, renovating the ailing Garden Pier, installing a long-awaited citywide surveillance program and improving Baltic and Arctic avenues, one-way roads that lead to the casino site and stretch to the center of the city.

"We all agree that in order to get to the next level, money needs to be spent," Revel's chairman and CEO Kevin DeSanctis said Friday. "There is no other funding mechanism that is viable at this time."

How it would work

In order for Revel to obtain funding, the city would have to pass two measures: One would have to approve Revel's application to the state's Economic Redevelopment and Growth grant program, which was established by outgoing Gov. Jon S. Corzine as part of the New Jersey Economic Stimulus Act of 2009. The second would have to establish a local version of the grant program as required by the state program, which helps support costs related to publicly owned infrastructure improvements connected to redevelopment projects.

The Press of Atlantic City obtained a draft of a city ordinance that would approve Revel's application to the program, but the administration stopped short of placing it on the agenda.

"It's still a work in progress," Business Administrator Michael Scott said last week and declined further comment.

If the city does approve both measures, Revel may become eligible for a state-issued bond to fund the $150 million in improvements. However, that bond would be financed through Revel's annual property taxes.

Preliminary documents obtained by The Press of Atlantic City show the resort, the Atlantic City Board of Education and the county would each contribute a portion of the $32.5 million they are expected to generate from Revel's annual property taxes. Normally, that revenue is split in half, with 50 percent for the city and the other half divided evenly between the county and the city school board.

However, under the proposal, the county and school board would not receive their traditional cut. Draft proposals show the arrangement would last for 20 years, but the time frame has not been finalized.

Atlantic County Executive Dennis Levinson said he is aware that the county would receive a smaller percentage of tax revenue, but he threw his support behind the plan Saturday.

"Everything being equal, I would have some difficulty with it," said Levinson, who did not say how much the proposal would cost the county in Revel tax revenue. "But the way things are right now, we have to be creative here. There's too much at stake. I wouldn't do anything to throw a monkey wrench into this."

Officials with the city and Revel declined to discuss the exact amount of city and county revenue that would be dedicated to financing the work, insisting the proposal is still a moving target.

'We've never done this'

Over the past 80 years, the city's Inlet section has changed from a densely populated area to a section with various patches of vacant land and abandoned buildings.

DeSanctis insisted the money would be an investment in the city, not his casino, at one point even saying, "We get nothing out of this."

But others are worry the reduction in tax revenue would hamper efforts to balance the city's ailing budget, which is expected to face at least a $25 million deficit next year.

Planning Director Bill Crane raised concerns about the proposal at a recent closed Planning and Development Committee meeting, according to minutes. Crane predicted taxpayers would ask, "Why would we do this?," and that many would be critical of the immediate costs and question whether the infrastructure improvements are necessary.

Crane is on vacation and could not be reached to elaborate. Assistant Planning Director Regina Armstrong was also out of the office until Monday and could not be reached.

Other members of the administration, including Mayor Lorenzo Langford, also opted not to discuss the plan publicly because the specifics are not finalized.

"We've never done this before," said state Sen. Jim Whelan, D-Atlantic, a former Atlantic City mayor. "We never had this tool before, nor did we need it. Development opportunities in Atlantic City were so strong that we didn't need this type of incentive. Times have changed. Now we need it."

Union opposition

Bob McDevitt, president of Local 54 of UNITE-HERE, criticized the effort Friday without viewing the proposals details. He said it would be irresponsible of the state and the city to finance improvements around Revel since the casino "still hasn't defined what jobs are going to be available."

McDevitt and his labor union have had a rocky relationship with the casino developer, including a lawsuit filed against Revel and the city over its previous attempts to obtain tax-exempt bond financing from private investors through the city. McDevitt has claimed the company and its attorneys have an unethical relationship with some City Council members.

Others have argued McDevitt's criticism is simply a tactic to leverage union negotiations. McDevitt admitted as much in a recent court deposition.

"You can't just keep saying no," DeSanctis said, speaking generally. "Sooner or later they're going to have to give their ideas. It's about time people need to either get in the game and make the city better or sit on the sidelines."

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Potential improvements

A draft agreement obtained by The Press of Atlantic City breaks down how the $150 million in infrastructure projects would be allocated. Below are some of the improvements featured in the documents. Officials with Revel and the city have warned that these numbers are likely to be altered.

Boardwalk Reconstruction

Demolition of Boardwalk from Melrose to Caspian avenues

Boardwalk renovation from Rhode Island to North Madison avenues

Price: $36 million

Expansion of Absecon Lighthouse Park

Expand park two blocks to Maine Avenue and the Boardwalk.

Price: $29.5 million

Garden Pier Renovations

Demolish end of pier

Renovate front of pier, Art Center and Historic Museum

Price: $10 million

Road Improvements

Arctic Avenue from Atlantic City Expressway off-ramp to Rhode Island Avenue

Baltic Avenue from Rhode Island Avenue to Atlantic City Expressway off-ramp

Price: $22.7 million

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What's next?

City Council is scheduled to vote Tuesday on an ordinance to create a local Economic Redevelopment and Growth Grant program, a technicality required to move the effort to obtain the infrastructure funding forward.

Contact Michael Clark:

609-272-7204

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