Borgata Hotel Casino & Spa is suing to block Atlantic City from borrowing million in the bond market to repay a state loan due March 31.
The lawsuit contends that the borrowing plan violates a city ordinance allowing the city to borrow up to $140 million to pay property-tax refunds including $88.25 million owed to Borgata. The new plan pays the state, but not tax refunds, the suit says.
“Borgata is a significant creditor of the City of Atlantic City. As a creditor, we are pursuing this litigation solely to protect and preserve our rights,” Tom Ballance, Borgata’s president and chief operating officer, said in a press statement.
The city’s finances have been placed under an emergency management team appointed by New Jersey Governor Chris Christie. The team issued a preliminary report of the city’s finances, but did not discuss specifics on casino tax refunds. A full report is expected in June.
“We strongly prefer discussing this matter directly with city officials and the emergency manager. We have reached out to both,” Ballance said. “However, we have been advised by the emergency manager that he is not prepared to discuss the city’s plans with us until his report is filed.”
City officials have not commented on the lawsuit.
