Members of New Jersey Gov. Chris Christie’s administration were grilled Monday by the State Assembly Budget Committee over its role in causing Atlantic City’s distress.

With New Jersey Gov. Chris Christie pushing for a state takeover of Atlantic City, members of  the Republican governor’s administration were grilled by lawmakers for allowing the gambling resort to plunge into distress.

The State Assembly Budget Committee on Monday questioned Charles Richman, Department of Community Affairs under Christie, on how Atlantic City deteriorated financially since the Jersey Shore resort was placed on state supervision in 2010. The city is weeks away from running out of cash flow and needs to implement a 28-day pay period starting April 8 to allow time for May tax revenue to arrive to fund the next paychecks. Moody’s Investors Service slashed the city’s junk-level bond rating two notches to Caa3 on April 4,  citing default concerns and a $102 million budget deficit.

“Atlantic City’s financial problems were long ignored by the state and allowed to corrode to what we have today,” Assembly Budget Chair Gary S. Schaer, D-Passaic, said in a statement after Monday’s testimony by Richman. “It is the height of hypocrisy for the governor to argue that Atlantic City’s best bet is for the state to take over its finances, when the city’s financial failures were exacerbated under the supervision of the state.”

Richman said in his testimony that under state supervision, the Christie administration didn’t have power to contain all spending,  since it only had oversight on new hires without authority to implement layoffs. The Republican governor has said he won’t sign an Atlantic City rescue package that provides payment-in-lieu of tax money from casinos without a state intervention package approved in the State Senate. The bill empowers New Jersey’s Local Finance Board to renegotiate outstanding debt and municipal contracts for up to five years. State Assembly Speaker Vincent Prieto, D-Secaucus, has proposed an alternative bill, opposed by Christie, that would give a five-member committee increased control if certain benchmarks aren’t met.

Christie filed a lawsuit on April 4 against Atlantic City seeking to freeze its spending until it catches up on payments owed to the Atlantic City School District. Atlantic County Superior Court Judge Julio Mendez denied Christ’s request in a ruling Friday and set another hearing date for April 19.

Christie’s press office didn’t respond to a request for comment on Monday’s assembly criticism.

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