Ben Franklin said it best at the signing of the Declaration of Independence. “We must, indeed, all hang together or, most assuredly, we shall all hang separately.” These words are very applicable in Atlantic City and Atlantic County today, with the unconstitutional state intrusion, taking of tax revenue and giveaways in Atlantic City.
County Executive Dennis Levinson has been authorized by the Freeholder Board to sue the state in federal court over the flawed PILOT program. The city and county residents must lobby to support those efforts and expand the cause of action to include the necessary constitutional and civil rights claims against the state. How would this be done? What would it mean? Where, when and why should we do it?
How: The county files the appropriate claim in federal court against the state on behalf of all the residents of Atlantic County including Atlantic City, incorporating the flawed PILOT, constitutional and civil rights claims. The relief sought is the return of the luxury, room and parking tax to Atlantic City, with a set fixed percentage going to the county. This would offset any proposed tax increase and actually lower property taxes, sparking new home ownership and business development in addition to preserving and expanding public safety in the city and county. Once the complaint is filed, an immediate injunction is filed to prevent the state from any further unlawful or unconstitutional taking, coupled with a petition for a writ of mandamus, in which the federal court would direct the state to immediately return the luxury, room and parking tax to the county and county to pay for public safety in the state Tourism District, which is presently unfunded by the state, saddling the tax payers with the bill.
What: The luxury, room and parking taxes have been unaccounted for by the state, despite numerous requests. The state takes 100% of that tax revenue which is more than $90 million annually. This revenue stream can easily be shifted to a starving city and county that has the highest foreclosure rate in the United States. The fact that this has not been done by the state’s executive or legislative branches is reprehensible. Over 800 lots have been land-banked through the CRDA, which continues to pay six figure salaries to politically appointed administrators, circumventing the democratic process. The police and fire unions should join as well in that the Constitution is clear that “no government shall intrude or encumber contracts,” especially where public health, safety and welfare are involved. If the ACPD and ACFD ranks are further depleted what shall become of public safety and the tourism industry in Atlantic City and Atlantic County? If police and fire contracts are impacted and ranks are depleted, you will add to the foreclosures in the county as police and firemen would not be able to pay their mortgages or taxes. This has already happened in the Atlantic City Public Schools with over 200 teachers and staff being laid off two years ago, causing a ripple effect throughout the county. After all, these teachers, police and firemen do not all live in Atlantic City.
Where: This matter must be filed in federal court in Camden, as it touches and involves federal issues, more specifically the unconstitutional state over-reaching and taking. The civil rights component applies because the vast majority of residents being adversely effected are African-American or other minorities, of which seniors with fixed incomes who have saved all of their lives to retire are losing their homes, in addition to the children in A.C. being forced into overcrowded classrooms and having their after school and intramural activities cut. The state can find revenue to pay two state monitors six figures each yet not $20,000 to pay for intramural sports or after-school activities for our children. That is simply offensive. . People wonder why our children gravitate toward gangs or feel disenfranchised. The civil rights component in the complaint creates a strict level of scrutiny in the courts to which, pursuant to USCA Sec. 1983-84, only requires the prejudicial effect and not intent. However even a cursory review reveals one if not both are present.
Why: Because the state has failed to remedy the issues facing the taxpaying residents. Somewhere along the line the state administrators and legislators lost perspective that they are elected to serve the people. Over the past seven years of state oversight, the taxes in Atlantic City have increase 133%. But Governor Christie has the temerity to claim we should be grateful for a 5% reduction. And that is assuming the state is continued to be allowed to make cuts in pubic safety. If the problems and layoffs in the Atlantic City public schools are any indication of effective state oversight, then we are all in for a rough few years.
When: This federal lawsuit must be filed as soon as administratively possible, along with the appropriate injunctive relief and writ of mandamus, incorporating all viable causes of action from the city, county, residents and unions. What happens if a casino is on fire or a terrorist bomb hits a boardwalk parade while someone’s home is burning? This is a clear and present danger that we as hard working tax payers must not be exposed to.
PILOT Program: This should have been viewed as a failure from the beginning. Capping the casinos on a charged income-based formula? Maybe homeowners should get tax breaks as their income fluctuates. The main problem here is not the ceiling of the PILOT, at $120 million, but rather the floor. If anyone takes the time to actually read the PILOT program, it only tracks the gaming revenue not the non-gaming revenue. This is a problem. For years Las Vegas has had a successful formula of 80% non-gaming revenue and 20% gaming revenue, while Atlantic City has enjoyed 80% gaming revenue and 20% non-gaming revenue. Our elected officials admit we are transitioning to more non-gaming revenue. Logic 101 would indicate that in turn A.C. will be generating less gaming revenue. The PILOT then permits the casinos to pay less taxes as the gaming revenue approaches 20%. That would be a staggering hit to the entire county and South Jersey region.
Last season Cape May County enjoyed it busiest tourism season ever with over $1 billion in revenue. People are coming to the Jersey Shore but not to Atlantic City. Tourists are driving right past the A.C. exit and heading to points south. Why? Because Atlantic City is perceived as dirty and unsafe. While that perception has been questioned, it is a simple fact and cutting public safety is not the way to make people feel safer. After seven years of state oversight, enormous ad campaigns and paid salaries from the CRDA, ACA, ACCVA et.al. A.C. still flounders. Why? Because the state continues to take and we allow it. A line must be drawn in the sand both figuratively and literally. A call to action must be made by the residents of Atlantic City, the county in conjunction with the elected officials and legislators.
The comparison between Atlantic City and Camden does not hold water in that Camden generates very little in tax revenue whereas Atlantic City does, but the state continues to take. Cities like San Diego, New Orleans, Las Vegas and Miami retain their luxury, room and parking tax revenue and their communities are clean and safe and booming. No CRDA, DGE, ACA, CCC or any administrative alphabet soup exists to milk revenue away from appropriate tax relief. Property taxes in Vegas are very low because of the casinos, while the lion’s share of revenue across the Delaware River in Philadelphia go to schools and public safety.
Old Ben was indeed correct, “either we hang together or we will hang separately.” The state has been effective in dividing us as a city and county. Or perhaps, of the 30,000 people that could vote in Atlantic City only 15,000 are registered to vote, and on a good day only roughly 4,800 vote at all. This must change, and it must happen now if we are to save our county.
Writer Tom Forkin is a former Atlantic City Solicitor and Villanova Law Graduate. He served as the city’s Democratic Chairman and presently chairs the Alcohol Beverage Control Board. He resides in the Inlet section of Atlantic City with his family and owns two small businesses there.