TRENTON — The Christie administration is tossing an emergency life line to the New Jersey Sports and Exposition Authority in an effort to keep it temporarily afloat. The state, in a special budget resolution, will guarantee that the financially strapped authority does not run out of cash. But officials said control over any additional spending will be placed under...
Bon Jovi fans begin lining up outside the New Meadowlands, operated by N.J. Sports and Exposition Authority, on May 26, 2010.
TRENTON — The Christie administration is tossing an emergency life line to the New Jersey Sports and Exposition Authority in an effort to keep it temporarily afloat.
The state, in a special budget resolution, will guarantee that the financially strapped authority does not run out of cash. But officials said control over any additional spending will be placed under the direct oversight of the Division of Budget and Accounting.
Before any state money is appropriated, however, the authority must first go through the money it already has on hand — including an $18 million reserve fund.
"That should be enough to keep them going until the Hanson Commission completes its work," state Treasury spokesman Andrew Pratt said.
The authority operates the Meadowlands Sports Complex in East Rutherford — which includes the Meadowlands Racetrack and Izod Center arena — and Monmouth Park racetrack, and was seeking a $32.9 million operating subsidy from the state for 2010. It would have been in the red this year without a $15 million infusion in advance rent payments from the stalled Xanadu project, but that money is now gone.
The new appropriation was open-ended, with no specific amount earmarked. Under the language of the resolution added by the administration, the state will provide whatever sums may be necessary to satisfy debt service obligations on any borrowing, or to ensure the fiscal solvency of the authority.
"It’s an insurance policy; a bridge to prevent insolvency," said Michael Drewniak, a spokesman for the governor. "The money will be there under the discretion of the treasurer, but it is not an appropriation outright, which would mean it’s spent and gone. We’re putting them on a short leash."
The sports authority, created by the Legislature in 1971, is losing millions on its track operations. The State Auditor reported last week that it could be forced to shut down without a state bailout.
Authority spokesman John Samerjan said the additional money being earmarked will make up for funding lost with the closing of Giants Stadium. The old stadium had generated $20 million in income for the authority. Under terms of a deal with the Jets and Giants, however, the state authority will see only $6.3 million in lease payments next season when the two football teams move to the privately operated New Meadowlands Stadium.
Whatever recommendations the Hanson Commission proposes, Drewniak said the governor’s position is that the authority — or whatever form it may take in a possible restructuring — must be self-sustaining.