A report by a turnaround team tasked with reviving struggling gaming resort Atlantic City said possible options would be to cut costs, jobs and extend bondholder maturities, but did not foresee bankruptcy as a solution.
“Bankruptcy is not something that we are contemplating,” said emergency manager Kevin Lavin on a conference call on Tuesday. “We think that this process can be done without that necessity.”
The report proposes to negotiate with stakeholders until the end of June and sees fiscal sustainability at some point after that. It says the city’s current projected budget deficit is $101 million and that without significant change, the cumulative deficit will be $393 million over five years.
The city has seen its municipal finances decline with the fortunes of its local casino industry, which has suffered steep losses from competing casinos in nearby states. According to city figures, casinos in the past paid roughly 75 percent of the city’s property taxes.
Four of the city’s twelve casinos closed in 2014. A fifth, Trump Entertainment’s Taj Mahal, narrowly averted closing and remains in bankruptcy. Caesars Entertainment, the owner of three other casinos in Atlantic City, filed for bankruptcy in January to cut its debt by $10 billion.