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Is proposed state takeover of Atlantic City legal?

Monday, April 11, 2016   (0 Comments)
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Nj.com 4/10/2016

After three months of squabbling, Gov. Chris Christie, state lawmakers, local leaders and union officials remain locked in a battle over a plan for the state to rescue Atlantic City from financial collapse by having the state take over large parts of the local government. But even if the state Assembly breaks the stalemate and sends Christie a bill that would authorize the takeover he’s asking for, legal experts say the fight could continue in a different venue: a New Jersey courtroom. Labor unions and civil liberties groups are expected to file lawsuits challenging the takeover if it passes, arguing that it violates the state constitution by allowing the state to break union contracts and goes against provisions that say the state can’t actually run towns. Pat Colligan, president of the state Police Benevolent Association, said he expects to seek litigation if it comes to that. And Marc Pfeiffer, assistant director of the Bloustein Local Government Research Center at Rutgers University, suggested the unions might have a case. "There is a significant risk that parts of the takeover legislation could be deemed unconstitutional," said Pfeiffer, a former deputy director with the state Division of Local Government Services. Christie’s office insists that the takeover would pass legal muster. "We have every confidence in the bills providing the tools we need to fix the city's finances and that they are without a doubt legal and constitutional," said Brian Murray, a spokesman for the governor. Christie said he isn’t concerned. Christie and state Senate President Stephen Sweeney (D-Gloucester) have said they will provide aid as long as lawmakers pass the takeover legislation, which would give the state broad powers over the local government for five years. One key power? The state would be allowed to break and renegotiate union contracts — a move Christie says is necessary because the city has been unable to reign in spending and bloated salaries.But while the Senate has approved the takeover, state Assembly Speaker Vincent Prieto (D-Hudson) has refused to allow a vote on it in his house because he said it trashes democratic principles such as collective bargaining. Experts note that the state constitution says the Legislature shall not pass any bill "impairing the obligation of contracts, or depriving a party of any remedy for enforcing a contract which existed when the contract was made." Prieto on Thursday (Aprl 7) introduced a new bill that defies Christie’s call for a takeover. It would allow the city to try to reach benchmarks to receive aid, and if it doesn’t meet the goals within two years, tools similar to the takeover could be enacted-such as breaking contracts. But there is also concern among some Democrats that Prieto’s bill violates the constitution, as well, because it’s tailored to Atlantic City- even included the city’s name in its title. Assemblyman Ralph Caputo (D-Essex) suggested that the nonpartisan Office of Legislative Services examine both bills to see if they’re legal. Atlantic City Mayor Donald Guardian said this week he has “no doubt” the takeover is unconstitutional.


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