Audit Concludes New Jersey CRDA Hasn’t Used Casino Funds Effectively, Miss America Ratings Flop
Posted on: September 12, 2018, 07:24h.
Last updated on: September 12, 2018, 07:24h.
The New Jersey CRDA, or Casino Reinvestment Development Authority, hasn’t been utilizing its funds as effectively or efficiently as possible, a state audit finds.
The New Jersey Office of the State Auditor published its review of CRDA’s financial management for January 1, 2014, through the end of last year and found that the agency’s income, which is derived at Atlantic City casinos, was not used to its full potential. “We found that the financial transactions included in our testing were related to the authority’s programs,” State Auditor Stephen Eells said.
However, we did note certain transactions were not always reasonable or properly recorded in the accounting systems,” Eells continued. “We also found the CRDA did not always ensure an effective and efficient use of its funds.”
Founded in 1984 to facilitate economic and community development in Atlantic City, the CRDA is primarily funded through a $5 per night hotel fee and $3 per day parking charge that is collected by casinos. The agency was also previously awarded 1.25 percent of gross gambling revenue, but those monies were redirected to pay down the city’s debt during its bankruptcy.
The CRDA audit found that the agency spent tens of millions of dollars annually during the review period on various projects designed to benefit Atlantic City and the state as a whole. But Eells concluded that the agency failed to properly oversee the money it was spending.
“The authority lacked a process to monitor compliance with contract terms resulting in overpayments, lost revenue, and potentially lost deliverables, as well as not being able to use measurable results in future contract negotiations,” the audit declared.
Eells’ office said it also found the CRDA awarded contracts to the highest bidder in times of emergency situations, and wrongly calculated proper sponsorship fees.
CRDA Chairman Robert Mulcahy said in response to the review’s findings, “The OLS audit covered a period of unprecedented challenge for the Authority as the State twice significantly changed the Authority’s focus and finances with major legislation. Despite these challenges, the Authority redoubled its efforts to achieve the Legislature’s mission for Atlantic City.”
Mulcahy concluded by saying the agency welcomed the OLS’s critiques and will continue to improve its processes.
Miss America Tanks
One of the CRDA’s biggest investments currently is the Stockton University Atlantic City Campus, which is set to hold its formal ribbon cutting on September 20. The casino agency directed $17 million to help fund the complex that comes with housing for 500 students, academic building, office space, greenspace, and parking garage.
While certainly not its richest investment, the CRDA’s continued relationship with the Miss America Organization has generated plenty of critics. Despite the pageant’s recent public scandals that included the revelation that its former CEO and board members made disparaging remarks about former contestants and winners, the CRDA decided to carry on with its $4.325 million contract.
Miss America 2.0, as the swimsuit-less version is now called, was held last week at Atlantic City’s Boardwalk Hall. The Sunday live telecast on ABC garnered just 4.3 million viewers, which placed it No. 21 on the night. The event drew 5.6 million viewers a year ago.
NJ Assemblyman Vincent Mazzeo (D-Atlantic) said earlier this year that the CRDA “needs to seriously rethink and prioritize how it spends its money.”
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