Trump Plaza’s demolition would make way for an “as-yet undetermined project.”
New Jersey Senate President Stephen Sweeney called on the redevelopment agency to reject a $5.6 million subsidy to billionaire Carl Icahn, who wants the payment to tear down the closed Trump Plaza in Atlantic City. Icahn has a controlling share of Trump Entertainment, the owner of the Trump Plaza.
Trump Plaza had fallen into disrepair for a while before its closure. Donald Trump, who held a 10% stake in Trump Entertainment in exchange for the use of his name, sued in August 2014 to have his name removed from the Trump Plaza. He claimed the company did not maintain the facility and its state of disrepair was ruining his brand.
Only a month later, the Trump Plaza closed, when Trump Entertainment began a bankruptcy process. Eventually, Carl Icahn — the top investor in Trump Entertainment at the time — bought the company in the bankruptcy process. He kept Trump Plaza closed, but planned to continue operating the Trump Taj Mahal. During a strike by the Local 54 of the UNITE Here workers union, Icahn closed the Trump Taj Mahal for good.
$13.2 Million Demolition of Trump Plaza
Now, Carl Icahn plans a $13.2 million demolition of the Trump Plaza. The demolition would make way for an “as-yet undetermined project”. To defray some of the costs of the demolition, Carl Icahn has asked the New Jersey Casino Redevelopment Agency to pay $5.6 million of the demolition costs.
On Monday, Stephen Sweeney, a Democrat from Gloucester, called on the agency to deny the payment to Carl Icahn. Saying Icahn has a “an antagonistic record of treating employees”, Sweeney said that New Jersey taxpayer money should not go to fund more businesses owned by the activist investor, who in the 1980s was considered one of the nation’s leading “corporate raiders”.
Stephen Sweeney: Calls Icahn a “Profiteer”
Sweeney explained his skepticism about Icahn’s good intentions for the people of Atlantic City in replacing the Trump Plaza with another business. He said in his Monday comments, “Carl Icahn is no friend to Atlantic City and he has a record of harsh treatment of working people.”
“I have serious questions about allowing him to take $5.6 million in funds intended to promote economic development for the city and its residents and instead use the money for his own property. He has a track record as a profiteer who denies fair pay and benefits to workers.”
Carl Icahn and Stephen Sweeney have a long history of antagonism. Carl Icahn still blames Senate President Sweeney for the demise of the Trump Taj Mahal. For his part, Sweeney believes Icahn’s closure of the Taj Mahal casino was a tactical move — that Icahn wanted to close, fire the union workers, and reopen under a new name with non-union workers.
Sweeney’s Bill to Punish Carl Icahn
To keep that from happening, Stephen Sweeney championed a bill in the State Senate which would retroactively keep a casino operator from holding a gambling license for 5 years on a property they had closed. The bill was designed specifically to keep Carl Icahn from executing the supposed plan to fire casino workers and reopen under another name — or cash in on the casino by selling to someone else who would.
Eventually, the New Jersey State Senate and General Assembly both passed such a bill, though Gov. Chris Christie vetoed the bill in December 2016. Though the move failed, Carl Icahn blamed the New Jersey legislature for creating an environment hostile to businessmen like himself. He sold the Trump Taj Mahal to Hard Rock International, which plans to turn the property into the Hard Rock Atlantic City.
Icahn: Sweeney Drives Away “Large Investors”
Carl Icahn had no comment on the Senate President’s advice to the NJ Casino Redevelopment Agency. When he announced his decision to sell Trump Taj Mahal in February 2016, Icahn said this about Stephen Sweeney: “I believe other large investors will similarly have no interest in investing significant amounts in Atlantic City or New Jersey as long as Sweeney is in control of the Senate.”
When Chris Christie vetoed Sweeney’s bill, he echoed Carl Icahn’s sentiments, saying it was a “transparent attempt to punish the owner of the Taj Mahal casino for making the business decision to close its doors after its union employees went on strike and refused to negotiate in good faith.”
Local 54 Blamed Icahn for Lost Jobs
The workers of the UNITE Here union argued it was Carl Icahn who did not negotiate in good faith. Armed with an October 2014 New Jersey bankruptcy court ruling that the Trump Taj Mahal did not have to maintain the health and pension benefits of its union workers, Carl Icahn refused to budge significantly on Trump Taj Mahal benefits packages. After a contentious 21-month standoff, the Local 54 called a strike on the Fourth of July weekend in 2016. After the strike carried on for several weeks, Icahn announced he would close the Trump Taj Mahal in October — at the time blaming the union’s leader for the casino’s closure.
At the time he took control of the Trump Taj Mahal, Carl Icahn promised to invest $100 million in renovations for the property. Later, he backed away from that promise, saying a North Jersey referendum vote changed the equation for investing in Atlantic City casinos. The North Jersey casino referendum lost by a huge 78%-22% margin on the November 2016 ballot. By that time, the Trump Taj Mahal no longer was open.
Carl Icahn: Regulatory Consultant to Trump
When Christie made his critical comments about Stephen Sweeney, it was the early days of the Trump Administration and Carl Icahn had been appointed as a special consultant to President Donald Trump on regulatory reform. Icahn stepped down from that role in August 2017, amidst accusations from Norman Eisen and Richard Painter that he would profit significantly by advocating an end to many regulations. Carl Icahn decried “partisan bickering” on the day he stepped down.
The New Jersey Casino Redevelopment Agency said it has no time table to decide on Carl Icahn’s request for a $5.6 million subsidy.
