Atlantic City Council adopts budget

A crowd attends Atlantic City Council’s meeting Wednesday night at which the governing body unanimously adopted a $225 million municipal budget that does not call for a tax rate increase.

ATLANTIC CITY — Property owners will not see an increase in their municipal property-tax bill for the second consecutive year after City Council unanimously adopted a $225 million budget Wednesday night.

The 2018 budget represents a $1.7 million increase in the city’s operations but maintains the 2017 tax rate of $1.79 per $100 of assessed property value. Last year’s budget was the first adopted since the state takeover in late 2016 and decreased property taxes for the first time in more than a decade.

Meanwhile, the overseer of the city’s finances since the takeover announced he would be leaving his position next month.

Marc Pfieffer, assistant director of the Bloustein Local Government Research Center at Rutgers University, said the biggest reason Atlantic City was able to slightly increase its budget while keeping the tax rate stable was a $27 million reduction in the number of property-tax appeal refunds, which is a direct result of a state-directed settlement with Borgata Hotel Casino & Spa. That decrease “enabled everything else to happen,” Pfieffer said.

The savings was applied to the increased operational costs along with losses in state Transitional Aid and other variable revenue sources, allowing Atlantic City to maintain service levels while keeping costs under control, he said.

“I think it’s fair to say that this year’s budget is a reset for Atlantic City and gets the city back on a normal budgeting path,” Pfieffer said.

The state’s involvement in the city’s finances also prevented a tax increase this year. By the state selling off $49 million in bonds in April to pay down employee pension and health care obligations from 2015, the city did not have to raise taxes to pay down the debt.

Council President Marty Small Sr. said the alternative was to inject nearly $16 million into this year’s budget and pass the increase on to property owners.

“This was a difficult budget year,” Small said before offering praise to the finance departments of both the city and state.

The state Department of Community Affairs estimated that absent the sale of the municipal bonds, Atlantic City property owners would have been looking at a $700 property-tax increase on the average city home assessed at $140,000.

Timothy Cunningham, director of the department’s Division of Local Government Services, will step down from the job — and his oversight of the city — in August. Cunningham told The Press he would be returning to the private sector and continue practicing law at the firm of Archer and Greiner.

An announcement on Cunningham’s replacement is expected soon.

Pfieffer said the state’s representatives, including Cunningham and former designee Jeffrey Chiesa, have laid the foundation for the city to continue to make financial progress and practice sound planning practices.

“The main thing now is to keep from lapsing into bad habits from the past,” he said.

Editor’s Note: An earlier version of this story incorrectly stated the 2018 Atlantic City municipal tax rate. The 2018 municipal tax rate is $1.79 per $100 of assessed value.

Contact: 609-272-7222 Twitter @ACPressDanzis

Staff Writer

I cover Atlantic City government and the casino industry since joining The Press in early 2018. I formerly worked as a politics & government reporter for NJ Herald and received the First Amendment: Art Weissman Memorial NJPA Award two years in a row.

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