Newspaper article The Record (Bergen County, NJ)

36 Added to Payroll for Failed A.C. Campus

Newspaper article The Record (Bergen County, NJ)

36 Added to Payroll for Failed A.C. Campus

Article excerpt

Thirty-six employees of the former Showboat hotel and casino were added to the public payroll when Stockton University bought the property in December, the school confirmed on Thursday, as questions continue about the mounting costs of the ill-fated deal.

Stockton spent $18 million on the Boardwalk property in December, hoping to turn it into an Atlantic City satellite that would allow the school to grow beyond its campus in Galloway, just west of the city.

Now Stockton may be on the hook for millions more in carrying costs since a neighboring casino, the Trump Taj Mahal, has refused to waive a restrictive covenant requiring that the site remain a casino.

The snag has many -- including faculty and state lawmakers -- questioning whether the deal was properly vetted by Stockton's lawyers and University President Herman Saatkamp, who this week announced he will resign at the end of the summer.

Saatkamp is scheduled to appear next week before the state Senate's budget committee to answer questions about the rushed purchase.

"I had called this proposal bizarre from the beginning, and now that it has collapsed, there are a lot of questions," said state Sen. Paul Sarlo, the budget chairman, who Thursday asked Saatkamp to testify before the committee. "Clearly what has developed over the last three months is beyond bizarre."

Sarlo, D-Wood-Ridge, said he wanted Saatkamp to explain the rationale for the deal and proceeding with it despite the restriction. He said he also wanted to know if the president was aware that Showboat's owner, Caesars Entertainment, would declare bankruptcy the month after the deal closed.

In the purchase contract, Stockton got an assurance from Caesars that it would be responsible for resolving any issues with Trump and the deed restriction. But that has been complicated by the bankruptcy and means the school is likely to face protracted court hearings to resolve the issue.

Meanwhile, costs continue to mount at the 26-acre site. Saatkamp previously said that utilities alone range up to $400,000 a month. …

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