- Associated Press - Wednesday, April 8, 2015

ATLANTIC CITY, N.J. (AP) - The City Council in Atlantic City scrapped a vote at the last minute Wednesday that would have helped the former Showboat casino to re-open as a college campus.

The designation of the site as a redevelopment zone prohibits it from being used for a casino and allows Stockton University to establish a campus there. It also could end a rival casino’s attempt to block the conversion into a college.

City Councilman Rizwan Malik and a Stockton official both confirmed the council would not take a long-expected vote to approve the plan Wednesday, but would not say why the vote was canceled.

Trump Entertainment Resorts, which owns the Trump Taj Mahal casino next to the Showboat, is enforcing a 1988 legal covenant among it, the Showboat and Resorts, specifying that the Showboat can never be used for anything other than “a first-class casino resort.”

But the redevelopment zone being considered by the council takes direct aim at that, specifically prohibiting “casino hotels, whether first-class or other” from operating at the site. Many Stockton students turned out expecting to see the vote go through.

“After tonight, they have to realize there are too many people behind this to stand in the way of the progress that this college and this city need,” said Paul Iacovoni, a junior at Stockton. “Anybody who wants to stand in the way of this progress is foolish and stuck in the past.”

Shannon Herbst, a senior studying forensic psychiatry, decried the high-stakes battle between Trump Entertainment and Caesars Entertainment, the Showboat’s former owner, that is threatening the deal.

“It’s ‘Boardwalk Empire’ on a corporate level,” she said.

Trump Entertainment CEO Bob Griffin told The Associated Press the council’s action won’t affect his company’s opposition to a college campus next door. The company fears students under the legal age of 21 will sneak in to gamble and drink, exposing the casino to costly fines. It has suggested that Stockton use the former Atlantic Club casino at the southern end of the Boardwalk for their satellite campus.

Caesars Entertainment closed the still-profitable Showboat in August in the name of reducing competition in the Atlantic City casino market.

Stockton, whose main campus is several miles west in Galloway Township, has long wanted to establish a satellite campus in the city. It bought the shuttered Showboat in December for $18 million, and announced plans to use it for what it dubbed its “Island Campus.”

Stockton officials say they knew about the existence of the 1988 covenant, but were assured that it had been worked out. The university has refused to say who made that assurance to them.

Last Friday, Florida developer Glenn Straub bought the Showboat from Stockton for $26 million, and said he plans to let Stockton use it as intended. Stockton, expecting continued legal problems, included a provision in its deal with Straub giving it an 18-month right to buy the building back or lease it for educational purposes. It also included a 90-day escape clause, allowing the university “to continue with its plans to open a residential campus in Atlantic City beginning in the fall of 2015 while evaluating any possible legal challenges from Trump Entertainment.”

If both sides cannot resolve the dispute, it is likely the matter will end up in court soon, because Stockton needs to take steps to prepare for the arrival of students within a few months.

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Wayne Parry can be reached at https://twitter.com/WayneParryAC

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