Atlantic City is crafting a recovery plan to prevent New Jersey from taking over the distressed seaside gambling hub. Bondholders are betting it wont entail default.
Local officials have tapped three firms for a financial blueprint that must be approved in November or the state can assume unprecedented control over the citys finances. Mayor Don Guardian has said he wants to cut Atlantic Citys debt service, which totals about $37 million this year, or about 15 percent of its budget.
To avoid setting an unwelcome precedent, New Jersey, which last experienced a local default in the 1930s, wont approve any plan that hurts owners of the citys debt obligations, according to Dan Belcher, a senior municipal analyst at ColumbiaThreadneedle Investm…
Read the full article at: http://www.bloomberg.com/news/articles/2016-08-02/atlantic-city-s-push-to-cut-costs-seen-stopping-short-of-default