Atlantic City Requests 60-Day Extension of New Jersey LoanRomy Varghese
Atlantic City, New Jersey, is requesting a 60-day extension of a $40 million state loan due March 31, said Michael Stinson, revenue and finance director.
The struggling gambling resort got the 0.75 percent loan in December instead of selling debt in the capital markets amid pending legislation to help the city, and bankruptcies of casino owners Trump Entertainment Resorts Inc. and Revel AC Inc.
“We’ve been working with the state,” Stinson said. “Verbally, it’s all approved. It’s been known for quite some time that the due date was going to be moved out.”
The emergency-management team overseeing efforts to stabilize the city’s finances said last week that it faces a $101 million deficit this year, which may require it to eliminate jobs or delay debt payments.
Moody’s Investors Service said last week that the proposals were a “credit negative” because default remains possible. The company said that without the extension of the state loan, it would be difficult for the city to refinance given “uncertain market access.”
The loan extension hasn’t been completed, said Tammori Petty, a spokeswoman for the New Jersey Department of Community Affairs, in an e-mail.