Atlantic City Mayor Says Aug. 1 Debt Payments Will Be Madeby
Moody’s warned Wednesday of possible bond default by city
State lawmakers have already approved city’s bridge loan
Atlantic City Mayor Don Guardian said the distressed gaming hub will make its $3.4 million bond payment due Monday, rebutting a report from Moody’s Investors Service that said default was likely.
"We’re absolutely making the bond payment on Monday," Guardian said by telephone.
Moody’s said Wednesday that the payment was in doubt because the state and city were still working out details of a bridge loan. Guardian said even without the funds, the city would meet its obligations. Agreement is close on the conditions of the loan, which is around $73 million to $74 million, he said.
Governor Chris Christie, at a school-funding forum in Fair Lawn on Thursday, said Atlantic City officials are looking for better terms and are in ”no position” to do so.
“They’re marking up the loan agreement,” Christie told the audience. He also said the city has “no chance” on an extension beyond the 150-day deadline for a financial plan. City Council President Marty Small had said the request was a possibility in a meeting with the editorial board of the Atlantic City Press, a daily newspaper.
State lawmakers had approved the loan as part of a rescue package in May that calls for the community to come up with a fiscal plan by Nov. 3 or fall under New Jersey’s control.
Investors didn’t appear to be flustered by the Moody’s report. A bond due February 2022 that pays interest on Monday traded with a yield of 11.6 percent, in line with the average of 11.2 percent for the past 10 days, data compiled by Bloomberg show.