United Flights Were Part of Effort to ‘Save’ Atlantic City

28 Sep 2015 | Author: | No comments yet »

Tangled web surrounds United’s aborted Atlantic City routes.

Desperate to draw visitors to Atlantic City, New Jersey officials gave United Airlines more than $100,000 in incentives to fly to the seaside resort for at least a year. The Atlantic City flights and the debt forgiveness are just two elements of the tangled relationships between the Christie administration, the Port Authority of New York and New Jersey, and United Airlines — New Jersey’s eighth-largest employer. The authority had been using $3 million annually from toll revenues from its Atlantic City Expressway to support the airport’s $15 million yearly budget.

For instance, it was a public agency headed by Christie’s Transportation Commissioner Jamie Fox — a former United lobbyist — that forgave the airline’s debt. The airline was seeking major concessions at Newark — lower rent, lower fees and a $1.5 billion extension in train service between the airport and New York City on the Port Authority’s PATH rail line. It was much fanfare for flights that – on their best days – would bring only a combined 100 passengers to New Jersey, hardly enough to revitalize the tourism and gambling industries. But the plan had an enthusiastic cheerleader in a governor eager for any development – no matter how small – that could be seen as a victory in his efforts to turn around Atlantic City. During his tenure, the governor has fought unsuccessfully to overturn a federal ban on legalized sports betting in all but four states, an effort that has cost taxpayers several million dollars so far.

He committed the state to tax incentives that helped convince Wall Street to provide the final $1 billion needed to finish the $2.4 billion Revel casino, which shut its doors after two years without ever having turned a profit. And the Casino Reinvestment Development Authority – a group with 14 of its 17 voting members appointed by Christie- provided $836,145 that was ultimately spent on marketing Atlantic City in Chicago and Houston. Samson spokeswoman Karen Kessler said Samson, whose law firm handled the South Jersey Transportation Authority’s bond transactions since 2010, recused himself from any Port Authority vote that might have been a conflict of interest.

Andrew Cuomo, announced plans to extend the PATH line two miles from downtown Newark to the airport, which would create a faster and more direct ride from lower Manhattan. The United contract said that if the airline abandoned the flights in less than a year, it would be obligated to pay back the transportation authority’s marketing money and forfeit the fee refunds. According to minutes of that meeting, Deputy Airport Director Timothy Kroll advised the board that, under the airport incentive contract, the agency would “recover a portion of its marketing dollars since United did not provide service for a full year.” But a discussion with the authority’s general counsel ensued, and after “weighing all litigation factors, the SJTA determined at that time not to pursue reimbursement from United for the marketing funds,” Stephen Schapiro, spokesman for New Jersey’s Department of Transportation, said in an email.

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