DON GONYEA, HOST:
We're going to check in now on Atlantic City, a community struggling to pay its bills and cover its debt. The word bankruptcy is being talked about as a possibility. Atlantic City's problems were exacerbated after four casinos closed last year. Emergency managers appointed by New Jersey Governor Chris Christie will soon release recommendations to get the city back on track. Jessica Gould of member station WNYC reports.
JESSICA GOULD, BYLINE: Ducking in and out of casinos on a Saturday night, I can still hear those typical Atlantic City sounds - bachelorettes flirting with bartenders...
UNIDENTIFIED WOMAN #1: How do you say your name?
MAURICIO: Mauricio.
UNIDENTIFIED WOMAN #1: Mauricio. That's a cool name.
GOULD: ...Gray-haired gamblers playing the slots. But take a few steps away from the Boardwalk, and a lot of people sound like this.
UNIDENTIFIED MAN: We're trying to, right now, figure out how we're going to survive here in Atlantic City, N.J.
GOULD: For years, this was the place to gamble on the East Coast. Then slick new casinos opened up in neighboring states, seducing customers away. Atlantic City, the town that inspired a board game, lost its monopoly. And when those four casinos closed last year, thousands of people lost their jobs.
BLAN STOW: My name is Blan Stow and I lived this. I have seen this city go up a little with the casinos and come down to nothing but poverty since they been closing up.
GOULD: I meet Stow at the public library, where she's updating her resume. She says she's been out of a job for seven months and needs the library more than ever. But the library is also struggling. As casino profits decline, so did tax revenue for city services. To make matters worse, the city kept taxing and spending at high rates, plunging it further into debt. And while the state has helped out before, it may not be able to again, because it's got big budget problems of its own. Walking along the boardwalk, Mayor Don Guardian says he's trying to save his city. Since taking office last year, he's slashed the budget by $30 million, frozen workers' wages and reduced their ranks through attrition. He says layoffs are coming. When he doesn't want is bankruptcy.
MAYOR DON GUARDIAN: It's OK. If I was running a business, screw everybody. Screw them. Don't pay them. Don't pay your bills. Don't pay your debt. That's the way business operates. That's not how you run a city. There's got to be some integrity and concern.
GOULD: Bankruptcy would give Atlantic City more time to pay its bills and more flexibility to reduce spending, maybe by paying bondholders less and cutting workers' benefits. It could also make it harder to borrow money and maintain services. Plus, it doesn't address those broader problems. About 12 percent of residents have graduated from college. The median household income is less than $30,000, and it's considered one of New Jersey's most violent cities.
HOWARD CURE: Being poor and having a high crime rate is something that bankruptcy can't solve.
GOULD: That's Howard Cure, a municipal bond analyst at Evercore Wealth Management. He says Atlantic City needs to diversify its economy, something Mayor Guardian says he's working hard to do.
GUARDIAN: We want to have gaming as just one of the options for entertainment. But dining and shopping and clubbing should all be part of that.
GOULD: The day we meet, the hotels are booked. The casinos are busy. There's new construction underway, and lots of people are out and about. New bills in the state house could help stabilize taxes and deal with debt. And Guardian says he's optimistic he can pay the bills due this month and avoid bankruptcy. At least we're not Detroit, the mayor said recently. Then, Governor Christie appointed two lawyers to study the situation. Both have experience in bankruptcies. One of them oversaw the process in Detroit. For NPR News, I'm Jessica Gould. Transcript provided by NPR, Copyright NPR.