Atlantic City’s government still hasn’t received a needed loan from the state to keep operating, but officials are confident that the money will be in place before the city runs out of cash.
But while the city waits, it may have to use capital and terminal-leave funds to pay its bills through the rest of June, according to a report in the Press of Atlantic City.
Under a state takeover bill approved in May, the state treasurer would direct the Division of Budget and Accounting to transfer money from any department to provide the secured loan. But the state must find funds for the loan as it looks to close its own its own $486.6 million budget gap for fiscal year 2016, which ends June 30.
Atlantic City Mayor Don Guardian said the city does not have enough cash to operate through June without either the loan or the state’s permission to use cash in the city’s capital and terminal leave accounts. The city has $9 million in the capital fund and $3.2 million in the terminal-leave fund, Guardian told the Press.
Tammori Petty, a spokeswoman for the Department of Community Affairs, said the timing for the loan is uncertain, but said the funds are expected to be made available to the city before they default on any obligations.
Guardian said he believes the state will give the city permission to use the capital and terminal-leave accounts.
“That would get us through July 14 if we’re able to use either of them, if the state authorizes that because they hadn’t before,” Guardian told the paper. “The state would then have funding within their budget on July 1 for the bridge loan.”
The state takeover bill gives the city 150 days to draft a five-year fiscal plan. A companion bill will redirect $110 million in casino funds over 10 years to help the city pay debt and expenses. But that bill doesn’t take effect until after the city submits its fiscal plan, according to the Press.
