TRENTON — The state Assembly and Senate passed an Atlantic City rescue package Thursday that gives the city time to avoid a state takeover.

The bills now go to the desk of Gov. Chris Christie, whose signature would end more than a year of wrangling over how to save the city. Christie said Wednesday he would quickly review the legislation and said the takeover bill gives him the powers needed to fix the city’s finances.

The takeover bill would give the city 150 days to draft a five-year fiscal plan that includes a balanced budget in 2017 to avoid a takeover. A companion bill bars casinos from appealing property taxes by allowing them to make fixed payments in lieu of taxes (PILOTs) for 10 years.

“I’m glad this is done,” said Senate President Stephen Sweeney, D-Salem, Gloucester, Cumberland, who first unveiled a PILOT bill in November 2014 and later a takeover bill in January 2016. “We need to move forward, and Atlantic City needs to get moving and start to fix their problems.”

The Assembly passed the takeover bill by a 60-12-1 vote and the PILOT bill 61-12-1. The Senate, which approved earlier versions of both bills in March, then approved the takeover bill (31-5) and PILOT bill (32-4) with the Assembly’s amendments.

If a state official determines the city’s five-year plan won’t achieve fiscal stability, the state could sell city assets, break union contracts and assume major decision-making powers from the city’s government for five years.

The state could also take over at any time during the five-year period if the Department of Community Affairs commissioner deems the city in violation of the fiscal plan or determines the plan will no longer stabilize the city’s finances. The city could appeal such a decision to the Appellate Division of Superior Court.

“I think these are fair bills to the city, city government, city employees, taxpayers of Atlantic City, as well as from the state’s perspective,” said Sen. Jim Whelan, D-Atlantic, a former Atlantic City mayor. “Frankly, it’s just frustrating that it took this long.”

The city has $550 million in total debt and a $100 million deficit before state aid, according to the state. The gambling hub’s ratable base plummeted from $20.5 billion in 2010 to $6.6 billion in 2016 as casinos opened in neighboring states.

Under the PILOT, casinos will collectively pay $120 million per year to the city so long as casino revenues stay at current levels. In addition, the casinos will pay the state $110 million over 10 years that will go toward helping the city government’s finances. The takeover bill guarantees the city levels of certain state aid.

Mayor Don Guardian, who described an earlier takeover proposal as a fascist dictatorship, said Thursday he was glad all parties could come to a compromise.

“This certainly gives us some cash right now as we get excited to open the Jersey Shore for the Memorial Day weekend, and it puts the onus back on the elected officials locally to find the solutions. And starting on Tuesday, that’s exactly what we’re going to do,” Guardian said in the State House.

It’s still unknown exactly how much of the city’s budget must be cut to be balanced in 2017. The city runs annual deficits of $100 million, but the aid package would give the city about $56 million in 2017. The city still doesn’t know how much Transitional Aid it will see. It received $13 million in 2015 and applied for $40 million in 2016.

To avoid layoffs, the takeover bill lets the city offer early retirement incentives to its public employees. The city’s buyout plan would be subject to state approval, and positions couldn’t be replaced for five years without state permission. The city would have to pay for the buyouts.

Assembly Speaker Vincent Prieto, D-Hudson, Bergen, who introduced a rival takeover bill in an effort to protect collective-bargaining agreements, said the amended takeover gives Atlantic City an ability to take care of itself.

“The bill that was in the Senate was an immediate takeover on day one. Nothing else,” Prieto said.

Council President Marty Small said the amended takeover bill was the best option presented, gives city officials time and protects the vote of city residents.

“It’s going to be painful. It’s going to be tough,” Small said of the coming budget cuts. “However, this is the situation we’re dealt ... and this is the reason why we were elected: to make the tough and unpopular decisions for the betterment of Atlantic City.”

Contact: 609-272-7215

Twitter @_Hetrick

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