Under Gov. Murphy, state runs Atlantic City behind closed doors

ATLANTIC CITY — When Lt. Gov. Sheila Oliver took control of Atlantic City under a state takeover, it's likely she did not anticipate overseeing a mayor and councilman caught up in a 2:30 a.m. brawl in a valet area outside a casino nightclub.

Atlantic City, it must be said, always delivers.

And so Oliver found herself gracefully moving through the annual League of Municipalities Convention held in Atlantic City last week being grilled by television reporters about an altercation involving host Mayor Frank Gilliam and Councilman Jeffree Fauntleroy II, late-night accusations involving assault and harassment inside and outside the Haven nightclub, with lots of lingering questions.

Such as: Was Gilliam using his city-issued vehicle (reports from the video appeared to show that) and if so, was an officer assigned to his 24/7 detail driving the car when they left the valet area? Was Gilliam the aggressor (one report had him "swinging and missing")? He seems to have taken punches — he reported to City Hall on Tuesday for two meetings with Oliver with bruising under both his eyes, obscured by thick-rimmed glasses.

On a possibly related note, why did the left rear of the SUV appear scraped as it sat outside the ribbon-cutting of the South Jersey Gas building  Wednesday, an event that allowed Gilliam to amiably hobnob with Gov. Murphy and other bigwigs,  as if all were cool?

And maybe it was. As none other than former Gov. Chris Christie pointed out, the mayor has almost no power anyway under the terms of the takeover that just entered its third year, its legal bills surpassing $5.8 million, its inner working no more transparent under Gov. Murphy than they were under Christie.

"The good news is they're not in a position to make any major decisions anymore," Christie said of the city's top elected official and his predecessor, Don Guardian, who battled Christie and called the takeover, which gives the state control over city assets, payroll, and operations, "fascist."

Under Christie, who took the reins in November 2016 after the Legislature passed the Municipal Stabilization and Recovery Act, decisions were made in a West Orange law firm helmed by longtime Christie ally Jeffrey Chiesa, whose law firm, Chiesa Shahinian & Giantomasi, billed expansively from top ($400 per hour) to paralegal ($90 an hour).

Under Murphy, who took office Jan. 16, special counsel Jim Johnson is getting paid peanuts for taking over the job ("I have another 25 to 30 cents to earn," he quipped last Tuesday outside City Hall, where the second closed-door meeting of the Atlantic City Executive Council had just been held). The proceedings were under lockdown, with agendas shown furtively to reporters, and "official" photos posted by government employees.

And while Murphy gave a speech later in the week touting his collaborative approach to a takeover he promised to end during his campaign (derisively described by Christie as "putting lipstick on it"), the state was ordering the termination of the city's longtime financial guru, Michael Stinson, who kept the city just this side of fiscal calamity in scrounging for change pre-takeover days.

Murphy, meanwhile, established a second "executive" council, the Atlantic City Coordinating Council, composed of state agencies who might assist Atlantic City.

Against the backdrop of another mayoral misstep in a city with a history of them, the long arm of the state's current takeover became obvious as state officials, advisers, and stakeholders moved through the city last week with their "flood the zone" play-calling.

Oliver said she had not spoken about the Haven incident with Gilliam, nor would she.

"I will not muddy up the waters," she said. "What I can tell you about this city is there are a strong, diverse group of stakeholders who are working with the state and our administration to improve the quality of life for everyone here. "

Unlike under Christie, whose high-priced lawyers slashed police and fire union staffing and pay, negotiated big deals with casinos over tax debts, and flirted with an attempt to privatize the city's coveted Municipal Utilities Authority,  the takeover approach under Murphy and Oliver  is focused on issues affecting the city's residents, particularly the 37 percent who live in poverty.

Asked about the public safety unions, Johnson said: "That's not been part of my remit. I can't help you on that."

The Chiesa law firm is still being used to fight the police union in court, he said, but he said its billings have tapered.

A recent batch of invoices, obtained by the Inquirer and Daily News under the state's Open Public Records Act and mostly submitted in 2018, after Murphy became governor, showed an additional $1,078,974 in billings, bringing the law firm's take for its Atlantic City work to more than $5.8 million.

And while the Christie takeover bore the influence of South Jersey power broker George Norcross, who famously met with lawmakers at the governor's Drumthwacket mansion to pitch the intervention,  the takeover under Murphy and Oliver, who is a product of Essex County politics, not Camden, seems, of late,  to be light on Norcross.

"Sheila Oliver has brought a new dynamic," said Councilman Kaleem Shabazz, who praised the state's recent efforts. "They've really blotted out the sun."

(Asked about Norcross' current involvement in the takeover, spokesperson Dan Fee said via email: "None, although he continues to support it.")

Johnson's focus is improving conditions for residents, including social services, public health, youth, economic and employment opportunities, and police relations. The city is creating a civilian review board, he said, and wants a full-service supermarket.

Shabazz, who attended the closed-door meeting, said the police would be opening a substation near Atlantic and Pacific Avenues, which have become overrun with the homeless and addicted who converge on Atlantic City.

Shabazz wants to open the meetings of the council, whose members include local leaders like AtlantiCare president Lori Herndon and well-traveled consultants like George Hampton, former executive at the University of Medicine and Dentistry of New Jersey, whose focus is achieving collaboration among a city's anchor institutions.

"If people heard about it, they would be encouraged," Shabazz said. "We're talking about public safety, education, focus on infant mortality."

Johnson said he would look at the transparency issue, acknowledging a need to counter less flattering news about the occupant of City Hall's seventh-floor mayor's office with information from the state's do-gooders also gathered on City Hall's seventh floor.

"We need to get the word out," he said.

He said the difference under Murphy was the emphasis on the Atlantic City community, not the high-wire finances, which are improving. "I'm speaking to parents of kids at Head Start and people always at casinos," he said.

He likened the relationship with the city as "sort of a senior and junior partner."

"As a matter of law, the state is responsible for many of the operations that go on in the city," he said. "It's the way you exercise those interactions."

City Council President Marty Small said the influx of people to City Hall was welcome. "We're going to try to tap into resources we previously didn't have available," he said.

State Attorney General Gurbir Grewal, meanwhile, also in town for the league convention, ordered the mayoral fistfight case transferred to the Cape May County prosecutor, and spoke the obvious if unfortunate punch line when asked about the city's reputation.

"It certainly is a black eye," he said.

He then spoke of New Jersey's history of official bad behavior, which he noted has left few municipalities untouched. Gilliam had agreed to stay away, which left the traditional "host city welcome," with no one from Atlantic City there to offer it.