New Jersey seeks Atlantic City staff savings through early retirement

New Jersey Gov. Chris Christie signed a bill late Friday giving the state an alternative route to shedding Atlantic City public safety staff, hours after a Superior Court judge blocked efforts to cut 50 firefighters.

The legislation requites the state offer an early-retirement incentive program for Atlantic City’s police officers, firefighters and first responders facing layoffs. The incentive plan won’t impact existing contracts or collective bargaining rights, according to Senate President Steve Sweeney, D-Gloucester, and Assemblyman Vince Mazzeo, D-Northfield, who co-sponsored the measure.

“We don’t want to see any layoffs occur, but if a reduction in workers is required, early retirement should be offered first to the men and women who have served the city,” said Sweeney in a statement.

Kevin Coughlin/Bloomberg

The press office for Atlantic City Mayor Donald Guardian did not immediately respond for comment on the bill and how many of the city’s public safety staff may be impacted.

The state, which took over Atlantic City finances last November after rejecting the city's proposed rescue plan, had sought to reduce fire department staff from 198 to 148 as a cost-saving measure. The plan was rejected early Friday by Atlantic County Superior Court Judge Julio Mendez citing “irreparable harm” and comprised public safety if enacted. Judge Mendez had issued a temporary restraining order in February when the state was seeking 100 firefighter cuts.

The fight over firefighter staffing numbers marked the first legal test of the Municipal Stabilization and Recovery Act legislation for Atlantic City approved by New Jersey lawmakers last year that enables the state to alter outstanding municipal contracts. Moody’s Investors Service noted in a February report that the firefighters’ court challenge could lead to other city unions going to court.

“Today’s court ruling is a serious blow to the great progress Atlantic City has made over the past 10 months to get its financial house in order,” Tammori Petty, director of communications for the state Department of Community Affairs, said in a statement issued late Friday prior to Christie signing the early-retirement bill. “The City will now be forced to reexamine fire department salaries and benefits as well as other cost-cutting measures."

The DCA, which is overseeing the Atlantic City state takeover, has previously touted fiscal progress achieved this year including adopting a $206.3 million budget that is $56 million less than 2015 while achieving other savings from staff adjustments and outsourcing certain municipal services. The state's recovery effort, which is led by Jeffrey Chiesa, has also resulted in the city resolving outstanding casino tax appeals.

Atlantic City has deep junk-level credit ratings of CC by S&P Global Ratings and Caa3 by Moody’s Investors Service. The city has $224 million of bonded debt with sizable upcoming debt service payments including $6.1 million owed on Nov. 1, according to S&P.