July 19, 2016

State begins audit of the Casino Reinvestment Development Authority

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The Office of the State Auditor has begun scrutinizing the books and records of the Casino Reinvestment Development Authority, an official told Route 40 on Tuesday.

CRDA, an Atlantic City-based government agency responsible for investing casino taxes and other government funds for economic development, has spent $2 billion on state-wide projects since its 1984 inception but it has rarely been put under the microscope. A spokeswoman for CRDA declined to comment on the audit.

Some of its biggest projects in the last few years have paid for casino expansions, including $15 million spent on the Borgata night club and private pool project last year and almost $19 million spent on Tropicana’s boardwalk “enhancement” in 2014.

Adding to its influence in Atlantic City, CRDA has been tasked with land use regulation and enforcement in the Tourism District (which includes the casino areas) since 2011.

The Authority’s board regularly passes resolutions unanimously (in more than 50 resolutions presented to the board this year, we have counted just two* that drew any negative votes).

The Office of the State Auditor has not previously audited CRDA, according to Assistant State Auditor John Termyna, who added that there is no set scope for this survey. The audit will be confidential until the office publishes its report.

Last year, the same office issued a report that uncovered irregularities** at the Casino Control Commission (CCC) and the Division of Gaming Enforcement (DGE, including “improper use of state vehicles”. (NBCPhiladelphia covered the fun details).

*Those resolutions included a funding agreement of up to around $4 million for the Miss America Pageant and $15 million in cash and debt for an apartment complex in the South Inlet.

** Updated 7/21 to clarify that the improper use of state vehicles was a problem that auditors identified at the Division of Gaming Enforcement. The audit of both the DGE and the CCC also found the agencies had not coordinated to “promote operational efficiencies” with regard to a leased $1.6 million Atlantic City building.

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