Trump flounders, seniors worry

by: Jason Springer

Sat Nov 29, 2008 at 11:09:54 AM EST

Donald Trump's economy is not basically strong and it's been a bad week in New Jersey for him. First, the Jersey City Council voted down a plan to rename a street Trump Plaza for a project that has already been scaled back to half the original plan by the economy. Now there are more difficulties at the opposite end of the state for Trump:

In another sign of Atlantic City's casino slump, Trump Entertainment Resorts Inc. said Friday it will delay making a $53.1 million bond interest payment as it looks to conserve cash.
The company plans to use a 30-day grace period for making the payment, which is due Monday. It will now have extra time to negotiate with lenders on ways to restructure its finances.

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And what happens if they don't reach an agreement on re-structuring:

The bond interest payment is part of nearly $1.25 billion of Trump debt.
If the company fails to make the interest payment within the grace period, holders of 25 percent of the outstanding principal of the bond will be able to accelerate the maturity of the notes. Further, the lenders for a $490 million Trump loan would be able to accelerate payment of the debt, the statement said.

Trump's non-payment follows that of Resorts earlier this month who is also attempting to re-negotiate. Unfortunately however, the casinos struggling will have ripple effects in many areas as funding from the Casino Revenue Fund for programs and services will also take a hit:

Moneys in the Casino Revenue Fund shall be appropriated exclusively for reductions in property taxes, rentals, telephone, gas, electric, and municipal utilities charges of eligible senior citizens and disabled residents of the State, and for additional or expanded health services or benefits or transportation services or benefits to eligible senior citizens and disabled residents, as shall be provided by law.

The Casino revenue fund, which helps in all of these areas, totaled $413 billion in funding for 2008. People were already trying to get more of the casino revenue pie before this latest news. In 2007 alone, the Casino revenue fund generated $400 million for the PAAD program alone. The economy is reshaping the landscape of just about everything and not even Donal Trump or the casinos are immune. Unfortunately, they could be taking many other innocent people with them on the bumpy ride

Jason Springer :: Trump flounders, seniors worry