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State taking Atlantic City to court as money crisis deepens

Gov. Chris Christie came to Atlantic City Wednesday, not to meet with its embattled mayor, but to denounce him as “a liar” who has “zero idea” what he’s doing.

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Prieto said he hopes to introduce the measure before Thursday’s voting session.

At his news conference afterward, Guardian disputed many of Christie’s criticisms and laid much of the blame for his city’s fiscal crisis on the doorstep of the state, which has appointed monitors to oversee the city and school system.

Guardian stood with Christie – as well as Senate President Stephen Sweeney – in January in support of legislation for the state to take broad control over the debt-ridden city’s finances. “So today at my direction, Education Commissioner (David C.) Hespe has filed a lawsuit to protect the property tax collections that rightfully belong to the Atlantic City school district and the children and families that they serve”.

“The city is in discussions with the state to avoid and forestall what may be an imminent financial predicament”, Guardian said in a statement.

“It is a recovery for Atlantic City, the way it should be”. Prieto’s bill will be discussed and voted on by an Assembly committee on Wednesday morning.

Christie and Sweeney support the measure allowing the state to run the city’s government and say that is the best way to rescue the city. But Gov. Chris Christie (R-N.J.) says Prieto’s version creates more bureaucracy and delay.

The warring mayor and governor did not break bread, needless to say, despite the city’s deepening cash crisis. Local media outlets including the Press of Atlantic City said that workers will eventually receive back pay, though the mayor’s office has not confirmed that to CNNMoney.

The move comes as Christie and Prieto trade barbs while pursuing different avenues to help the city and prevent ripple effects for other New Jersey municipalities.

The governor used his harshest language yet to criticize Mayor Don Guardian, a fellow Republican, as the seaside gambling resort draws closer to going broke. But Guardian has backed off his support, saying that the legislation that was proposed – and what Christie announced in January – is not what he agreed to.

“This is very reasonable”, said Guardian, who has strongly opposed a full state takeover.

Although Christie routinely promoted as a presidential candidate his leadership abilities and a record of bringing people together to find compromise, he’s refused to budge at all on the issue of an Atlantic City takeover. The speaker has called on the Christie administration to negotiate a compromise, but Greenwald voiced concern about what Prieto’s next step would be if the Republican governor refuses that offer. If the benchmarks are not met for a second consecutive year, the state could cancel or unilaterally modify union contracts; abolish any non-elected positions in Atlantic City government; and enter into shared services agreements with Atlantic County or other government agencies, among other powers.

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Assembly Speaker Vincent Prieto’s plan would give the city a year to reduce expenses before the state could dissolve departments or sell assets.

New Jersey Gov. Chris Christie addresses a gathering as he lays out the problems he says Atlantic City is not addressing Wednesday