We Bring The World To . ANNUAL REPORT 2001 new jersey sports and exposition authority James E.McGreevey Governor ofNewJersey Governor our parkinglotfacilitiesbecame astagingarea foremergencyvehicleson personnel cometothecause ofcommunityrelations. OnSeptember11, view oftheMeadowlandsSports Complex,againsawtheNJSEAandits The horrificattackontheWorld Trade CenteronSeptember11, infull outstanding performance. Advertising revenue topped$17millioninatougheconomicclimate,an ranked atthetopofNationalFootballLeagueinattendance. Giants Stadium’s capacity increased to80,242astheGiantsandJets Management was nameda2001PrimeSiteAward winner by Adding toitslegionofindustry-votedawards, Continental AirlinesArena 2001 andnearly$2billiondollarsofeconomicimpacttoNorth Jersey. ,andhundreds ofothereventsprovided world-classshowsin U2, BritneySpears,Andrea Bocelli,Aerosmith, *NSync,DaveMatthews, Lacrosse, SetonHallBasketball,theJimmyVClassic,Kickoff Classic, entertainment. TheGiants,Jets,Devils,Nets,MetroStars, Gladiators,Storm The MeadowlandsSportsComplexissynonymouswithmajorsportsand the HarlemGlobetrotters. shows andrecord grosses were recorded byanumberofevents,including ranked No.5inNorthAmericagross revenue from concertsandfamily to theStanleyCupfinals,courtesyofNewJerseyDevils.Thearena Continental AirlinesArena hosted205eventsandonceagainplayedhost for non-franchiseeventsby year, thestadiumwasrankedNo.1grossing stadiuminNorthAmerica 41-0.Forthethirdas theGiantscrushedMinnesotaVikings, straight Giants Stadiumhosted55events,includingtheNFCChampionshipgame $8 millionwaswagered onHambletonianDay. racing’s signature eventfrom EastRutherford, whilearecord handleof A worldwideaudiencewatchedanotherspectacularHambletonian,harness racingfacilityandatopnighttimethoroughbredharness racetrackaswell. distributing record pursesin2001.TheMeadowlandsistheworld’s leading mutuel facilitiesandittookinarecord handleof$600millionwhile Meadowlands Racetrackremains oneofAmerica’s mostprofitable pari- celebration. Authority’s otherproperties around thestatewas,initself,worthyof the three signature venuesoftheMeadowlandsSportsComplexand the 20thanniversaryofContinentalAirlinesArena. Theperformanceof And theMembersofStateLegislature oftheStateNewJersey Governor James E.McGreevey To TheHonorable anniversary ofGiantsStadiumandMeadowlandsRacetrack, of theNewJerseySportsandExpositionAuthority, the25th 001 markedtheendof30thanniversaryyearestablishment magazineforthefourthtime. Amusement Business. Facilities &Event 2001 annual reportreport President and President Joseph Buckelew Chief Executive Officer Chairman of the Board George R. Zoffinger class – s most impressive in 2001. s most impressive ’ Chief Executive Officer their way in to New York and a way station for stranded commuters being and a way station for stranded York their way in to New NJSEA employee The following weekend, Jersey. shuttled back to New supplies the collection of thousands of tons of needed volunteers managed a very dark time. It was a shining moment during effort. for the relief Monmouth year for the NJSEA statewide facilities. 2001 was a strong of over 47,000 for the Haskell crowd Park Racetrack attracted a record in attendance increase 11 percent Invitational, contributing to an impressive attendance, and a surge in total handle purses, strong Record for the year. made the Monmouth meet one of America attended races at Sports Authority million patrons A total of nearly three 14 handle, which has grown tracks generating $810 million in on-site since 1996. percent was completed Hall renovation the historic Boardwalk In Atlantic City, for Miss spectacular reviews on time and on budget and opened to a world got Boardwalk America 2001. The grande dame of the Joseph BuckelewChairman of the Board and President George R. Zoffinger makeover, placing it in the forefront of special events centers in the placing it in the forefront makeover, made possible Hall was Northeast. The new mission for the Boardwalk Convention Center in 1997, by the opening of the new Atlantic City Convention Center continues which the NJSEA built and oversees. The impact and new of bringing positive economic to deliver on the promise visitors to Atlantic City. new Wildwoods the virtual completion of the The close of 2001 also brought A gala grand opening will take place in May 2002. Convention Center. businesses of the of the core 2001 saw much debate about the future to look forward Sports and Exposition Authority and its venues. We on the challenges working with the new Administration and Legislature wagering and account wagering for racing, of implementing off-track stadium, and site development issues at the of arena, and the resolution the sports and entertainment industry in New Sports Complex to prepare Jersey for the 21st century. Sincerely, GIANTS STADIUM

iants Stadium hosted 55 events in 2001. The stadium received the MetroStars midfielder “No. 1 Stadium Award” for the third straight year from Amusement Daniel Hernandez

STEVE SMITH Business, an entertainment industry publication. This honor is bestowed upon the stadium with the highest box office gross for all non-franchise events.

The 25th Anniversary year of Giants Stadium was a history-maker as it became the only stadium in the country to house four professional sports teams. The Giants, Jets and MetroStars were joined by the NY/NJ Hitmen of the XFL. 2001 also marked the first year in history that Giants Stadium was fully operational from January through December.

The Jets finished the regular 10-6 and advanced to the playoffs for the second time in four years. They lost to the Raiders, 38-24, in the wild-card game. The Giants compiled a 7-9 record and finished in third-place in the NFC East.

The MetroStars finished the 2001 season with an appearance against the Los Angeles Galaxy in the quarterfinals of the MLS playoffs. They also hosted the Unity Games, a benefit double-header with the proceeds going to the victims of the September 11 tragedy.

The inaugural season of the XFL kicked off in early February as the NY/NJ Hitmen played the first of five home games at Giants Stadium. Unfortunately, the league was not as successful as anticipated and folded upon the conclusion of the 2001 season.

In , Georgia Tech defeated Syracuse Jets and Giants square off during pre-season game. 13-7 in Kickoff Classic XIX, while Hampton rolled to a 55-14 victory over Virginia State in the New

EVAN PINKUS EVAN York Urban League Classic.

Giants Stadium hosted its strongest summer concert season in seven years. New Jersey favorites Bon Jovi rocked the stadium with two shows to close out their tour and The Dave Matthews Band and pop group *NSync packed the stadium with three performances each.

Many improvements were made to the stadium itself, the most impressive being state-of-the-art video boards that provide crisp, movie-like quality. The NFL capacity of the stadium was increased to 80,242 with the addition of two front-rows of seating, making Giants Stadium the third-largest NFL stadium in the country. new jersey sports and exposition authority CONTINENTAL AIRLINESARENA

ontinental Airlines Arena hosted 205 events in 2001. The arena received the “Prime Site Award” by Facilities & Event Management magazine for the fourth time (1994, 1995, 2000, 2001) and Amusement Business ranked the Arena No. 5 for Top Arenas Worldwide (based on total ticket sales in 2001 for family shows, concerts and special events).

Devils Goaltender Continental Airlines Arena plays host to the NHL’s , NBA’s New Jersey Nets, Big East Basketball’s Seton Hall Pirates, ’s Gladiators, and the newest addition, Pro Indoor Lacrosse’s New Jersey Storm.

The Devils made it to the Stanley Cup Finals for the second consecutive year but just missed in their quest to bring the Cup back to New Jersey when they lost to the Colorado Avalanche in seven games.

The Nets finished their first full- season under Byron Scott and made some great off-season moves, including acquiring NBA NBA All-Star assist-leader and All-Star Jason Jason Kidd Kidd from Phoenix. The new-look Nets jumped out to their best start in franchise history and entered the second half of the season as the No. 1 team in the East.

Louis Orr was named head coach of the Seton Hall Pirates in April 2001, becoming the 17th head coach in Pirate history. With 10 years of collegiate coaching experience, Orr looks forward to returning Seton Hall to prominence in the BIG EAST Conference.

The arena played host to 17 concerts including performances by U2, , Aerosmith, Andrea Bocelli, Ozzy Osbourne, The Backstreet Boys and . Holiday Express, an all-volunteer group of musicians, held a holiday concert and dedicated it to the New Jersey heroes of September 11. made a surprise appearance and performed two songs for the appreciative crowd.

Family show entertainment included Disney on Ice “Beauty and the Beast” and “Toy Story 2”, WWF Wrestling, Ringling Bros. and Barnum & Bailey Circus, Champions on Ice, and record-setting ticket sales for the Harlem Globetrotters. Unfortunately, family favorite Sesame Street Live was cancelled due to the tragic events of September 11.

The NJSIAA returned to the arena to host wrestling, hockey, and basketball championships

for its high-school athletes. PHOTOS NBA 2001 annual report 2001 annual r The No. 1 ranked and defending national champion Duke Blue Devils defeated Kentucky in an overtime thriller before a sold-out crowd at the Jimmy V Classic. A check for $50,000 was presented to The V Foundation for Cancer Research bringing the total raised by the game to nearly $450,000. eport MEADOWLANDS HARNESSMEET

he Meadowlands continues to be the world’s leading standardbred racing facility and the home of the world-famous Hambletonian. On August 4, a crowd of 26,569 poured through the turnstiles to watch renowned Swedish racing photographer Stefan Melander trade in his camera for a sulky and drive Scarlet Knight to victory in the Hambletonian. The $8,028,480 total handle Real Desire (#6) wins the $1 was a Meadowlands track and harness racing industry record. million Meadowlands Pace. Overall, it was a record year for purse distribution with a total of $51,680,130 dispersed over the 2001 season. The daily average for overnight purses [excluding stakes] was $213,953. Purses [including stakes] were the highest ever, with an average daily distribution of $342,253.

The 25th anniversary of the Meadowlands Pace was a battle to the wire between a pair of divisional rivals and two Hall of Fame drivers. In the end, it was Real Desire who took home the lion's share of the $1,009,500 jackpot, giving driver John Campbell a record sixth victory in the track's signature event. Real Desire prevailed by a neck over last year’s freshman champion Bettor's Delight, driven by Mike Lachance.

A record-setting Breeders Crown Day

LISA PHOTO, INC. LISA PHOTO, on July 28 set the tone for the 2001 Hambletonian Festival, highlighted by the sensational performance of Italian trotter Varenne in the $1 million Breeders Crown Trot. In one of the more memorable performances in Meadowlands history, Varenne shook off all challengers and drew away to a four and a half length victory in a track, stakes and world record of 1:51.1. The total handle of $7,039,284 was the highest in Breeders Crown history.

The first fall harness meet at the Meadowlands since 1976 was held November 16 through December 15 and concluded with positive business and racing indicators. The highlight Scarlet Knight paces to victory of the meet was the inaugural edition in the $1 million Hambletonian. of the $1.5 million Fall Final Four. The sensational pacing colt Western Shooter equaled the world record for two-year-olds with a mile in 1:50 in the $500,000 Governor’s Cup. Total harness handle on the night was a meet high of $4,429,904. new jersey sports and exposition authority MEADOWLANDS MONMOUTH & PARK THOROUGHBREDMEET

he Meadowlands Racetrack concluded its 2001 Gander wins the thoroughbred season with across-the-board gains and Meadowlands Cup by a head. the largest daily purse distribution ever offered in the state of New Jersey.

The 44-day meet posted an average on-track handle of $604,622, a 14 percent gain over last year and the largest since 1998. Total average handle topped out at $2,255,622 nightly, an increase of 25 percent.

The $371,000 average daily purse distribution, a 74 percent increase over last year, was not only the highest in Meadowlands history, but it set a new mark for the State of New Jersey. Despite the brevity of the meet, $16.3 million was given away in purses, an all-time record that eclipsed the $12.46 million distributed in 1998. Attendance for the meet was up one percent, averaging 4,852 patrons a night. EQUI-PHOTO, INC. EQUI-PHOTO, Racing highlights from the Meadowlands meet 2001 Horse of the Year, Point Given, included a blanket finish in the $500,000 Grade enters track on way to victory in 2 Meadowlands Cup, with Gander finishing the Haskell Invitational. a head in front of Broken Vow and Include. The winner and the third-place horse both went on to compete in the Breeders' Cup Classic.

A record closing-day crowd of 24,357 capped the 2001 season at Monmouth Park that was the envy of the industry nationwide. The 72- day meeting saw an attendance of 783,335, the highest since 1989. Average daily attendance of 10,879 was 11.3 percent higher than in 2000, and was the highest since 1985, when the gate average was 11,478. Total handle, which includes on-track and simulcast wagers on Monmouth races, reached $337,187,018, an increase of 25.6 percent over last year. The record average daily overnight purses were $300,521.

The biggest crowd in Monmouth Park history turned out to watch Preakness and Belmont INC. EQUI-PHOTO, Stakes champion Point Given capture the $1.5 million Haskell Invitational in a dramatic half- length victory over Touch Tone. Point Given went on to become Horse of the Year for 2001. The crowd of 47,127 easily topped the 43,591 crowd recorded in 1962. Haskell Day total handle was $11,235,171, the second- 2001 annual report best ever. 2001 annual r eport AUTHORITY AROUNDTHESTATE

he reopening of Atlantic City’s renovated historic Boardwalk Hall in October 2001 transformed the National Historic Landmark Building into a modern event arena and provided the region with a flexible venue for a variety of entertainment events. The $90 million renovation, overseen by the New Jersey Sports and Exposition Authority over a three-year period, was much anticipated by the local community, which Views of and from the Wildwoods was supportive of the project throughout the renovation process. More than 2,000 Convention Center. people attended the opening weekend tours. The regional consumer media and the trade press have also given the Boardwalk Hall a great deal of attention, which continues to result in positive articles about the hall itself and about Atlantic City.

Boardwalk Hall is home to the new Boardwalk Bullies team, a professional team affiliated with the East Coast Hockey League, which attracted an average of 1,700 people per game in November and December for its inaugural season. As the team gains popularity, attendance into 2002 is expected to increase substantially.

Boardwalk Hall has also hosted acts as diverse as World Wrestling Federation matches, the Lippizaner Stallions, sold-out concerts of Britney Spears and Andrea Bocelli, plus family entertainment including Target’s Stars on Ice and Disney on Ice. These events bring audiences as large as 14,000 per night to Atlantic City’s Boardwalk, generating additional positive economic impact for the city.

The Atlantic City Convention Center, which opened in May 1997, hosted 91 conventions, trade shows and public shows during 2001. They were attended by 456,466 delegates and generated $193.8 million in economic benefits to the state.

Under the supervision of the NJSEA, construction of the new Wildwoods Convention Center is nearly complete. Grand Opening festivities are slated for May 9 to 11. The new venue will total over 260,000 square feet, including ballrooms, meeting rooms, and 75,000 square feet of unobstructed exhibit space. One of the center’s distinctive features will be 6,600 square feet of oceanfront deck and a boardwalk extension to the water’s edge. The new facility will extend the Wildwoods’ 2002, Katie Harman, season, create jobs and expand economic on runway of Boardwalk Hall. opportunity throughout the area.

Boardwalk Bullies debut at new jersey sports and exposition authority Boardwalk Hall. ABOUT THENJSEA

n May, 1971, the New Jersey Legislature created the New Jersey Sports and Exposition Authority. Eleven members on the Board of Commissioners are appointed by the Governor to four-year terms, subject to confirmation by the New Jersey Senate. Three "ex officio" members also serve on the Board, including the Authority President, state Treasurer, and a designated representative of the New Jersey Meadowlands Commission.

The Sports and Exposition Authority is the governing body that oversees the operations of Meadowlands Racetrack, Giants Stadium, Continental Airlines Arena, and Monmouth Park Racetrack. At the state's request, it constructed the State Aquarium at Camden. It built and operates the Atlantic City Convention Center, the recently renovated historic Boardwalk Hall, and the new convention facility for the Wildwoods. The Authority holds regularly scheduled meetings that are open to the public. The minutes of all Authority meetings are subject to approval by the Governor.

AUTHORITY MEMBERS Joseph Buckelew Carl Goldberg George R. Zoffinger Chairman President & CEO Joseph J. Plumeri, II Candace L. Straight John E. McCormac Vice Chairman Marvin Schmelzer Treasurer State of New Jersey Raymond H. Bateman Barbara Sobel Susan Bass Levin Joetta Clark Diggs Peter D. Sudler Representative New Jersey Meadowlands Commission Joseph M. Forgione

SENIOR MANAGEMENT George R. Zoffinger President and Chief Executive Officer

Robert J. Castronovo Bruce Garland Senior Executive Vice President Senior Executive & Chief Operating Officer Vice President Arena/Stadium Racing 2001 annual report Joseph Consolazio Christine H. Steinberg Richard C. Wolffe, Jr. 2001 annual r Senior Vice President Senior Vice President Senior Vice President Finance & Chief & General Counsel Business Operations Financial Officer

Timothy D. Hassett John Samerjan Senior Vice President Vice President eport Sports & Entertainment Public Affairs/ Development Communications

MISSION STATEMENT

he New Jersey Sports and Exposition Authority presents the finest in sports, racing, and entertainment and is committed to promoting T the multi-billion dollar industry it created in the state through its operated facilities in East Rutherford, Oceanport, Atlantic City and Wildwood.

The NJSEA maintains the world-class status of the Meadowlands Sports Complex, Monmouth Park Racetrack and the Atlantic City Convention Center through continuing facility re-investment and event development. Expanding and improving the entertainment product mix at NJSEA facilities and anticipating the demands of the marketplace in our core businesses is our continuing goal.

The NJSEA honors its continuing statewide economic development role through the Wildwoods Convention Center and the Atlantic City Historic Boardwalk Hall construction. They join the State Aquarium in Camden, Rutgers athletic facilities, and the Atlantic City Convention Center as projects of the NJSEA.

The NJSEA goal is for the state, its citizens, and our guests to reap the entertainment and economic benefits from NJSEA facilities and events for generations to come. 2001 annual r 2001 annual report eport We Bring The World To New Jersey. new jersey sports and exposition authority EXPOSITION oe oCnoiae iaca ttmns22 18 21 19 16 12 11 20 Notes toConsolidatedFinancialStatements 14 Consolidated StatementsofCashFlows Consolidated StatementsofOperationsandChangesinNet Assets 1 Consolidated StatementsofFinancialPosition Independent Auditors’Report Financial StatementsinAccordance with Statements ofChangesinFundBalances Statements ofAssets,LiabilitiesandFundBalances Statements ofRevenuesandExpenses Financial StatementsPrepared PursuanttoSportsComplex, Independent Auditors’Report Management’s DiscussionandAnalysis Table ofContents Years EndedDecember31,2001and2000 Financial Statements Independent Auditors’Reports Generally AcceptedAccountingPrinciples State Contract,andLuxury Tax RevenueBondResolutions NEW JERSEY AUTHORITY SPORTS AND Page 2001 annual report 1 to understanding the basic financial statements, such as the Authority’s to understanding the basic financial statements,

receipts, cash payments, and net changes in cash resulting from operations, investing, and financing from in cash resulting cash payments, and net changes receipts, activities. performance financial during the years ended Decem- of the Authority’s an overview (MD&A), presents or position has improved an assessment of how the Authority’s ber 31, 2001and 2000. It provides the Authority’s significantly affected view, in management’s deteriorated and identifies the factors that, man- opinions, assumptions or conclusions by the Authority’s overall financial position. It may contain in conjunction with, the and must be read for, a replacement agement that should not be considered other financial statements described above. Balance” and the “Statement of Changes in Net Assets” which account for all of the current year’s in Net Assets” which account for all of the current Balance” and the “Statement of Changes operations over the past year and can of the Authority’s the success and expenses, measure revenues has funded its costs. be used to determine how the Authority accounting methods and policies. Assets” which provide information about the nature and amounts of investments in resources (assets) and amounts of investments in resources information about the nature Assets” which provide (liabilities). and the obligations to Authority creditors The Notes to the Financial Statements provide: • Information that is essential owning, operating and The New Jersey Sports and Exposition Authority is engaged in the business of the state of New Jersey. managing sports, entertainment, wagering, and convention facilities throughout as a quasi-governmentalIt was created instrument of the State not only for the purpose of generating economic stimulus to the and provide these activities but also to generate sales tax revenues from revenues discussed activities are direct of the Authority’s the facilities. Of course, only the result surrounding regions in this annual report. • cash information about the Authority’s Flows which provides The Consolidated Statement of Cash • commitments and contingencies of the Authority. future Details of contractual obligations, • financial position. the Authority’s that could materially affect Any other events or developing situations Discussion and Analysis: Management’s • and Analysis Discussion financial statements, the Management’s this section of the Authority’s Finally, • of Revenues and Expenses”, “Statements of Changes in Fund The Income Statements “Statement This annual report consists of three parts; Management’s Discussion and Analysis, Financial Statements Discussion Management’s parts; consists of three This annual report Statements. and Notes to the Financial include: The Financial Statements • of Assets, Liabilities and Fund Balances” and “Statement of Net The Balance Sheets or “Statements The Authority’s Business The Authority’s MANAGEMENT’S DISCUSSION AND ANALYSIS MANAGEMENT’S Annual Report Introduction to the 2 new jersey sports and exposition authority The AtlanticCityConventionCenters–City, NewJersey Monmouth ParkRacetrack–Oceanport,NewJersey The MeadowlandsSports Complex–EastRutherford, NewJersey They are: and othersportingevents,familyshowsconcerts. license agreements withtheNetsprofessional basketballteam,theDevilsprofessional hockeyteam mately 466seats,and4,000ofitsownparkingspaces.Itsrevenues are generatedfrom leasesand Miss AmericaPageant. is expectedtohostconcerts, minor leaguehockey, familyshowsandother publiceventssuchasthe construct andrenovate thefacilities,andthento coveranyoperatingshortfalls. paid withinAtlanticCityare paidtotheAuthorityfirstmakedebtpayments onbondsissuedto Other operations are fundedbymarketingfeesimposed onhotels. boardwalk halltoprospective customersandpromotes tourisminthegreater AtlanticCityarea. Its Marketing Operations The HistoricBoar related labor, electricalandtelecommunication services. rental, parking,concessionandotherservices revenues, suchasproviding tradeshowandconvention 114,000 square feetofmeetingspace,anda648,000square footparkinggarage,whichgenerate The AtlanticCityConventionCenter the facility. Other sions, program andconcessionssales. enues are generatedfrom commissionsonliveandsimulcastpari-mutuel wagering,parkingadmis- for1,550horsesanddormitories for approximatelySupport facilitiesinclude40barns 900.Itsrev- clubhouse seatingfor18,000spectators,68luxuryopen-airboxesandparking14,000vehicles. Monmouth ParkRacetrack ing rightsatandaround thethree facilities. Other Continental AirlinesAr equally betweentheAuthorityandtwofranchises. Jets netrental revenues from thesesuites,afterexpensesanddebtservice payments,are distributed tower suites)were ontoGiantsStadiumin1998.Underanagreement constructed withtheGiantsand South SideSuites suites, aswellas,variouscollegefootballgames,concertsandotherevents. the GiantsandJetsfootballfranchisesMetrostars soccerteam,rental of72mezzaninelevel spaces adjacenttothestadium.Itsrevenues aregeneratedfrom leasesandlicenseagreements with Giants Stadium simulcast pari-mutuelwagering,parking,admissions,program andconcessionssales. buildings forapproximately 1,635horses.Itsrevenues are generatedfrom commissionsonliveand 2 restaurants, andthoroughbred aone-miletrackforbothharness andothersupport racing,16barns mately 8,000,anoutdoorrampandtracksideparkforapproximately 32,000 additionalspectatorsand Meadowlands Racetrack –luxurytaximposedbytheState onhotelroom rentals, covercharges,drinksandadmissions – additionally, the SportsComplexgeneratesrevenues from signageandnam- sellingadvertising - additionally, incomeisgeneratedfrom advertising signagelocatedatvariouslocationsaround dwalk Hall – provides approximately 80,200seatsonfourlevelsandincludes20,000parking – 46additionalluxurysuites(consistingof6supersuites,14terraceand26 ena –theAtlanticCityVisitors’Bureau activelymarketstheconventioncenterand -isa20,000seatindoorarena with29privatesuites,containingapproxi- – consistsofafive-levelglassenclosedgrandstandwithseatingforapproxi- –isarecently renovated 10,000to14,000seatspecialeventscenterwhich -consistsofaone-mileovaltrackforthoroughbred racing,grandstandand – consistsofa486,000square footcontiguousexhibitionspace, 2001 annual report 3 – consists of an existing convention center facility, and a new facility and a new convention center facility, – consists of an existing ildwoods Convention Center ildwoods Convention – similar to Atlantic City the towns of Wildwood, – similar to Atlantic North Wildwood, and Wildwood impose a Crest ing fees and tourism tax revenues decreased $1,100,000 or 3.8 percent due to lower occupan- $1,100,000 or 3.8 percent decreased ing fees and tourism tax revenues increased sales in 2001 than in 2000. Operating expenses, excluding depreciation, cies and retail due primarily to the capitaliza- 15 percent expense increased Depreciation $7,500,000 or 3.7 percent. Hall. tion of the Historic Boardwalk outstanding debt and the completion of major renovations at the Historic Atlantic City Boardwalk Hall, Boardwalk at the Historic Atlantic City renovations outstanding debt and the completion of major only $2,200,000 or increased payments and appropriations while capital contributions, state contract 3.5 percent. tourism tax on retail sales. 90 percent of these revenues are provided to the Authority to pay debt provided are of these revenues sales. 90 percent tourism tax on retail the facilities. as well as to operate, maintain and promote to the convention centers, related currently under construction and expected to be completed in May of 2002. The new facility situated construction and expected to be completed under currently and park- foot exhibition floor square a 72,000 will offer in Wildwood,on the boardwalk New Jersey, space of retail meetings and rental It is expected that trade shows, conventions, ing for 700 vehicles. revenues. will comprise the centers’ Other The W • to $59,800,000 for 2001. $380,000 or 0.5 percent expense decreased Interest • tax, market- Luxury $8,500,000 or 4 percent. increased revenues During the year the total operating The following sections will discuss the significant changes in the Authority’s financial position for 2001. financial position changes in the Authority’s The following sections will discuss the significant that have contributed to the trends of major economic factors and industry an examination Additionally, of this MD&A, summaries of the It should be noted that for purposes provided. operations are Authority’s financial Authority’s in conformity with the are presented financial statements and the various exhibits Accounting Principles. with Generally Accepted statements in accordance • in primarily due to a reduction $20,300,000 or 20 percent by net assets increased The Authority’s The Wildwoods Convention Center – Wildwood, New Jersey Center – Wildwood, New The Wildwoods Convention Highlights Financial Analysis 4 new jersey sports and exposition authority e ses$112100$100,962,000 $ 121,261,000 (1,206,139,000) $ 1,307,101,000 (1,012,159,000) 932,666,000 (1,162,098,000) 1,283,359,000 (193,980,000) (969,913,000) 1,003,535,000 374,435,000 (192,185,000) $ 279,824,000 $ Net Assets Total Liabilities Long-Term Liabilities Current andOtherLiabilities Total Assets Capital Assets Current andOtherAssets Condensed StatementsofNetAssets(BalanceSheets) EXHIBIT 1 Financial Summaries Authorities AssetsexceeditsLiabilities,asillustratedbelow. Net assetsamountedto$121,300,000in2001upfrom $101,000,000in2000.Thisindicatesthatthe Netinvestmentsinfacilitiesincreased $70,900,000due primarily tothecapitalizationofrenovation • An increase inaccountsreceivable of$9,700,000primarilyinanticipationbondproceeds of • Adecrease incashandinvestmentsof$111,900,000dueprimarily tothefundingofHistoric • Significant changesinAssetsinclude: the financialstatementsdescribedabove,whichare alsopresented infulldetailthisannualreport. The followingexhibitsandtablesprovide andbasicexplanationofthechangesin acondensedsummary which couldvary, andhas notbeendeterminedforthisreport. ment projects. Capital assetsare presented orbook valueasopposedtofairmarketvalue, atcarrying and constructionprojects andnormalcapitalmaintenanceimprove- inAtlanticCityandWildwood $8,500,000 tofundcapitalimprovement projects attheSports Complex. ConventionCenterConstructionProjects.Boardwalk HallandWildwoods 012000 2001 December 31, 2001 annual report 5 Year Ended December 31, Year 2001 2000 Authority’s revenue supported Sports Complex Guaranteed Bonds, $17,040,000 for State Contract Sports Complex Guaranteed Bonds, $17,040,000 for State supported revenue Authority’s Loan and $182,000 Bonds and $3,600,000 for the Stadium Suites Bonds, $3,450,000 for Luxury Tax for other bonds and notes payable. Total Liabilities decreased by approximately $44,000,000 and was due primarily to: by approximately Liabilities decreased Total • consisted of $15,800,000 for the Principal repaid during the year. Bonds and notes being paid down EXHIBIT 2 Assets Condensed Statements of Revenues, Expenses, and Changes in Net

Luxury Tax, Marketing Fee and Luxury Tax, Revenue Tax Tourism 27,805,000 28,891,000

Increase in Net AssetsIncrease $ 20,299,000 $ 19,582,000 Contributed Capital 17,635,000 14,765,000 Income before Contributed Capital 2,664,000 4,817,000 Interest Expense Net of Interest and Other Income Expense Net of Interest Interest (38,405,000) (42,570,000) State Contract Payments and Appropriations 46,055,000 46,688,000 Non-Operating Income and Expenses: Operating Loss (32,791,000) (28,192,000) Depreciation Expense (41,766,000) (36,266,000) Operating Revenues Net of Operating Expenses 8,975,000 8,074,000 Operating Expenses (214,106,000) (206,473,000) Operating Revenues $ 223,081,000 $ 214,547,000 6 new jersey sports and exposition authority Interest expenseistheinterest paidandaccruedontheAuthority’s debtnetofinterest incomegener- • Depreciation expenserecognizes thecostofcapitalassets,suchasbuildings,equipmentandimprove- • Operatingexpenses,whichare allthecostsassociatedwithrunningfacilitiesexceptforofa • Decreases inNetAssets consistof: Luxurytax,marketingfeeandtourismtaxrevenues whichare collectedbytheStatetofund • StateContractPayments,ContributedCapitalandAppropriations whichare debtpaymentsser- • Operatingrevenues, whichare thetotalrevenues generatedatallthefacilities. • Assets consistof: Expenses, andNetAssetsprovides answersastothenature andsource ofthesechanges.Increases inNet While theBalanceSheetsshowchangeinfinancialpositionofnetassets,StatementsRevenues, ated oncashreserves heldincashandshort-term investments. ments, overthelifeofasset,usuallybetween2and60years. capital nature thatare depreciated. Centers aswellrepay thedebtincurred ontheseprojects. construction, development,operationandpromotion Convention oftheAtlanticCityandWildwoods projects. viced bytheStateonbondsissuedAuthorityformajoracquisition,capital,andrenovation 2001 annual report 7 $ 214,106,000 Payment in Lieu of Taxes 4,957,000 $ 223,081,000 General & Administrative 17,099,000 $1,300,000 or 8 percent, but did include approximately $500,000 of one-time charges for special one-time charges $500,000 of but did include approximately $1,300,000 or 8 percent, studies that did not occur in 2000. decreased in 2001 by $2,400,000 compared to 2000. Although operating revenues were higher due were operating revenues to 2000. Although in 2001 by $2,400,000 compared decreased security and utility costs. in labor, exceeded by increases to new events held they were was up $3,300,000 compared to 2000 due primarily to more events held, including four stadium events held, including more to 2000 due primarily to compared was up $3,300,000 by nor- and sporting events, offset ticket sales and attendance at concerts and higher gross concerts, 11, 2001. in labor costs and substantially higher security costs after September mal increases was $1,700,000 higher in 2001 than in 2000 due to higher simulcast betting revenues and seven more and seven betting revenues in 2001 than in 2000 due to higher simulcast was $1,700,000 higher and advertising in labor, by normal increases to 2000, offset as compared race days held in 2001 a supplement to purses by the State, of largely funded by but were also increased security costs. Purses of New Jersey racing. the quality and popularity preserve $15,400,000 in 2001, to approximately The Authority’s business spans several industries which are affected by many different economic forces in economic forces by many different affected business spans several industries which are The Authority’s and success in its operations the Authority must to achieve maximum efficiency ways. In order different strategies to adapt to changing economic conditions. and continually implement identify economic trends • year by approximately previous higher than the General administrative and other expenses were • of operating expenses at the Atlantic City and Wildwoods net convention centers Operating revenues • Airlines Arena at Giants Stadium and the Continental net of operating expenses Operating revenues • and Monmouth Park Racetracks net of operating expenses at the Meadowlands Operating revenues Meadowlands RacetrackGiants StadiumStadium Suites Project $Continental ArenaMonmouth Park 84,582,000Atlantic City Convention CenterWildwoods Convention Center 10,594,000 9,826,000 Meadowlands Racetrack 625,000 47,131,000 39,179,000 Atlantic City Convention Center $ 31,144,000 Stadium Suites Project 24,284,000 Wildwoods Convention Center Giants Stadium 64,137,000 Continental Arena Monmouth Park 911,000 4,774,000 42,143,000 29,705,000 26,096,000 Economic Conditions EXHIBIT 3 by Facility Operating Revenues and Expenses Operating Highlights 8 new jersey sports and exposition authority Stadium andArena Events EXHIBIT 5 Racing Statistics EXHIBIT 4 ubro vns20282324278 254 293 4,269,700 4,019,900 268 4,580,500 17,910,200 $ 4,189,200 18,661,500 $ 260 16,815,300 301 4,293,100 $ 14,991,300 $ 17,178,100 $ 293 Net IncomeFrom Events Total Attendance Number ofEvents 3,126,300 268 3,173,300 2,939,300 278 regional economicconditions. 266,794,000 $ are oftendictatedbymarketfactorssuchascomparablecompetingfacilities,interest intheevent,and 256,024,000 event-promoters andtenantsnegotiateforagivenutilizationofthefacilities.Unfortunately, $ thesefactors 2,902,600 225,210,000 largely duetothevariablenature ofrental fees,participationagreements, andguaranteedpaymentsthat 475,597,000 $ 530,447,000 below, yearswithhigherattendanceandnumberofeventswere notnecessarilymore profitable. Thisis 222,359,000 $ 285 2,947,300 the amountofparking,concessionsandadmissionrevenues thatcanbecollected,but,asseen 511,358,000 230,980,000 641,239,000 $ Stadium andArena eventsalsopartly of dependonthelevelofattendancethatcanbegeneratedinterms 561,962,000 697,790,000 573,499,000 663,844,000 579,622,000 764,487,000 Simulcast Transmission Handle Simulcast ReceptionHandle Live Handle Attendance Live RaceDays on simulcastsignalsfrom otherracetracks,whichisoffered nearlyeverydayoftheyear. been decliningbutincreased handles (bets)havebeenachievedthrough theracetracksacceptingwagers and otherformsofgamingsuchaslotteriescasinos.AscanbeseeninExhibit4,totalattendancehas the sizeofpursespaidtohorsemen.TheAuthority’s racetrackscompetewithotherspectatoractivities can attract.Bothofthesefactorsbeattributedtothequalityracehorseswhichinturnisaresult of Live racingrevenues, forexample,dependuponthelevelofattendance andsizeofbetthattheAuthority for mostoftheyear. completely comparablewithprevious yearsshownastheHistoricBoardwalk Hallwas underconstruction they co-exist.Detailsofeventstatisticsare presented below. Itmustbenotedthat2001figures are not events theycanattractbutalsorely ofthetourismandgamingindustrieswithwhich ontheperformance Convention Centersalsodependheavilyonthenumberandsizeof The AtlanticCityandWildwoods vacant. Majorcostsrelated withthesuitesare mainlysalariesandmaintenance. Stadium Suiterevenues are relatively stableas allsuitesare currently rented andare notlikelytobecome Giants StadiumandContinentalAirlinesArena Meadowlands andMonmouthParkRacetracks 1,0,0 9,5,0 8,7,0 6,8,0 742,391,000 $ 767,382,000 $ 787,172,000 $ 795,858,000 $ 810,602,000 $ 0120 9919 1997 1998 1999 2000 2001 1997 1998 1999 2000 2001 2001 annual report 9 2001 2000 1999 1998 1997 $ 27,805,000 $ 28,891,000 $ 29,086,000 $ 27,483,000 $ 22,883,000 2001 2000 1999 1998 1997 Atlantic City and Wildwoods Convention Centers Atlantic City and At the end of 2001, the Authority had invested just over $1,000,000,000 in facilities, at a cost of At the end of 2001, the Authority had invested just over $1,000,000,000 in 7. of $391,700,000 as shown in Exhibit $1,400,000,000 net of accumulated depreciation Luxury TaxMarketing Fee TaxTourism $ 16,456,000 8,338,000 $ 17,679,000 $ 3,011,000 8,303,000 18,083,000 $ 16,827,000 2,909,000 $ 8,274,000 15,401,000 2,729,000 8,036,000 2,620,000 7,482,000 - Number of Event Days AttendanceTotal EventsNet Income from $ upon the tourism, hospitality and heavily rely luxury tax, marketing fee and tourism tax revenues Similarly, 5,209,600 of the centers is and promotion intensive marketing For that reason, gaming industries in the region. $ 577critical to the continued growth. 6,065,600 740,302 $ 5,916,700 $ 831,331 623 4,164,900 $ 2,128,600 926,100 606 857,210 825,800 605 531 Capital Assets EXHIBIT 6 Events Convention Center 10 new jersey sports and exposition authority Conclusion Budgetary Controls Capital Assets EXHIBIT 7 Finance DepartmentoftheNew JerseySportsandExpositionAuthority. you shouldstillhavequestionsaboutanyinformation inthisreport youare requested tocontactthe Authority’s business,financialpositionandfiscalaccountability forthefundsitgeneratesandreceives. If This sectionoftheAnnualReport hasbeenprovided toassistreaders ingettingageneraloverviewofthe and are reviewed andrevised, althoughnotformally, onamonthlybasisthroughout theyear. 25,000,000 start ofeachnewyear. Budgetsare ameasure oftheAuthority’s financialperformanceandaccountability The AuthorityadoptsOperatingandCapitalPlanswhichare approved byitsBoard ofDirectors priortothe - Giants Stadium. Finally, LeaseholdRightsrefer totheAuthority’s righttorent theClubBoxlevelsuitesduringeventsat tures, vehiclesandequipmentthatinmostcaseshadreached theirusefullivesduetoobsolescence. systems attheMeadowlandsSports Complex.Otherdeletionsrepresent thedispositionofvariousfix- 1,395,241,000 electrical andHVAC upgradesatMonmouthParkandtoelevators,escalatorsfire safety Other additionsconsistedofmostlycapitalmaintenanceandimprovement projects atallfacilities,suchas 3,398,000 146,800,000 67,642,000 Progress above. - both anadditionontheHistoricBoardwalk Halllineandacorresponding 46,268,000 deletionfrom Construction-in- 1,003,535,000 $ 189,835,000 City Boardwalk Hallwascapitalizedduringtheyearinamountof$107,100,000andcanbeseenas (391,706,000) 219,057,000 53,936,000 107,138,000 classified asConstruction-in-Progress above, andisexpectedtobecompletedinMay2002.TheAtlantic $ 107,138,000 - tic CityHistoricBoardwalk ConventionCenter, Hall,andtheconstruction ofanewWildwoods whichisstill 326,490,000 - (39,662,000) Additions tocapitalduring2001consistedsubstantiallyoftherecently completedrenovation totheAtlan- - 178,008,000 1,322,984,000 $ - 80,712,000 - (41,049,000) 932,665,000 25,000,000 $ 94,068,000 (390,319,000) AccumulatedDepreciation 43,000 Capital Assetsnetof 132,000 682,672,000 107,138,000 Less AccumulatedDepreciation $ 1,798,000 Total atCost 1,741,000 39,662,000 82,697,000 Construction-in-Progress $ 3,355,000 46,136,000 Leasehold Rights 52,138,000 27,493,000 324,749,000 $ Giants StadiumSouthSideSuites ConventionCenter Wildwoods Atlantic CityConventionCenter 694,841,000 Historic Boardwalk Hall $ Monmouth ParkRacetrack Meadowlands SportsComplex eebr3,December31, December 31, ,0,1,0 3,4,0 962001,302,599,000 39,662,000 138,345,000 1,203,916,000 00AdtosDltos2001 Deletions Additions 2000

2001 annual report 11 FPO 12 new jersey sports and exposition authority tt otatBnsDb evc ,4 - - - 3,641 - $ 18,542 3,610 - $ State ContractBondsDebtService Partners distribution Excess cashflowfund Construction funds Guaranteed BondFund1992Series Payment inlieuoftaxfunds(NoteB-6) Maintenance reserve funds Debt servicefunds Operating fundbalance,endofyear DISTRIBUTION TOASFOLLOWS(NoteB-8): ConventionCenter Wildwoods Atlantic CityConventionCenter Arena Stadium SuitesProject Stadium Monmouth ParkRacetrack Meadowlands Racetrack REVENUES FROMOPERATIONS: Wildwoods ConventionCenter Wildwoods Atlantic CityConventionCenter Arena Stadium SuitesProject Stadium Monmouth Racetrack Meadowlands Racetrack EXPENSES FROMOPERATIONS: itiuint tatcCt ovninCne - - - - - (11,498) BEGINNING OFYEAR OPERATING FUNDBALANCE, (Note B) EXCESS OFREVENUESOVEREXPENSES Distribution toAtlanticCityConventionCenter Stadium Suitesdistribution Payments inaidofconstruction State contractpayments Luxury tax,marketingfeeandtourismtaxrevenues Other expense State appropriation Interest incomeandother General andadministrativeexpenses OTHER INCOME,EXPENSESANDTRANSFERS: EXCESS (DEFICIT)FROMOPERATIONS TOTAL REVENUEAVAILABLE FORDISTRIBUTION TOTAL REVENUESDISTRIBUTED See notes tofinancialstatements. (In Thousands) (Pursuant toVarious BondResolutions) YEARS ENDEDDECEMBER31,2001AND2000 STATEMENTS OFREVENUESANDEXPENSES 140$8,665 $ 41,440 $ 8,665 $ 41,440 $ - $ 84,582 $ 7,9 8,755 170,892 3,8 653 135,985 ope Suites Complex 185238 11,865 - - 39,179 47,131 213- - - 42,143 29,705 64,137 1408,665 41,440 - 8,102 11,000 34,907 prsStadium Sports ud Project Funds ,8 5,210 3,782 ,7 - 563 1,072 6,149 10 - (190) - 3,217 - -- -- 8,755 ------653------2001 annual report 13 (190) (2,125) 3,2176,854 4,532 2,687 8,755 10,090 1,072 1,511 18,542 18,524 31,44447,13139,179 29,837 42,540 64,137 39,892 26,09629,70542,143 62,603 25,412 27,804 42,946 11,000 15,000 - - 911 187,929 181,551 ------December 31, 2001 December 31, 2000 24,284 Atlantic City Wildwoods ------1,562 - - 1,562 2,317 ------13,889 17,562 4,780 45,223 65,775 ------625625596 10,594------653758 ------911911756 - 24,284 ------8,338 - - 10,074 - - 16,456 10,594 (10,074) 1,562 - - - 9,898 - 16,920 24,284 - 3,011 4,605 27,805 - 21,272 - 21,525 1,562 28,891 - 42,417 2,317 ------349 155 11,335 642 334 19,527 15,654 467 - 3,828 - 1,532 17,930 18,450 400 2,285 - - 1,500 4,185 5,725 (400) (5,119) - - (1,322) (18,339) (16,570)

3,213 5,048 (13,690) - -1,317 (286) 34,081 - 33,327 - - 30 4,957 4,660 4,997 (242) 19,279 17,562 6,342 98,043 120,422

Park Center Tax Contract Center Total Total Funds Funds Funds Funds Funds Funds Funds 26,096 31,144 10,594 - - 625 222,010 214,878 26,096 31,144

Monmouth Convention Luxury State Convention

$ 5,397 $ 2,043 $ 19,279 $ 17,562 $ 7,842 $ 102,228 $ 126,147

$ - $ - $ - $ - $ - $ 84,582 $ 82,025

$ 400 $ 2,043 $ - $ - $ 1,500 $ 3,943 $ 9,202 $ 5,397 $ 2,043 $ 19,279 $ 17,562 $ 7,842 $ 102,228 $ 126,147 14 new jersey sports and exposition authority nmrte rgnlisedson (,2)- - (2,521) 6,738 3,158 $ 32,261 $ - - $ 7,162 59,742 $ Fund balance(deficit) - 20,816 Unamoritzed originalissuediscount Bonds payable(NoteF) Notes payable(NoteG) Other liabilities Deferred revenue Interest payableonbondsand notes Interfund payables Accounts payableandaccruedexpenses LIABILITIES ANDFUNDBALANCE Other assets(NoteB-10) Investment infacilities Interfund receivables Receivables tax,marketingfeeandtourismtaxreceivableLuxury (NotesAandC) interestAccrued receivable Restricted investments(NoteD) Restricted cashandequivalents(NotesB-9D) Cash andcashequivalents(NotesB-9D) ASSETS See notestofinancialstatements. (In Thousands) (Pursuant toVarious BondResolutions) STATEMENTS OFASSETS,LIABILITIESANDFUNDBALANCES 3,4 51,935 $ 630,841 $ 3,4 51,935 $ 630,841 $ 214,455 - 25,852 363,725 214,455 44,018 516,371 ope Suites Complex 859- 18,559 prsStadium Sports ud Project Funds 955- 22,797 3,700 9,535 - 9,064 ,4 - 2,948 755 5,700 48- - 428 161 128 - 2001 annual report 15 December 31, 2001 December 31, 2000 Atlantic City Wildwoods - - 8,600 - - 35,097 38,759 - 1,372 - - 6 10,913 10,319 - -- -- 1,319 - 441 2,107 3,497 - 30,308 -- 608 - - 518 42,869 - 3,944 - 769 110,890 869 3,809 2,726 11,068 300 - 441 - - 869 11,068 899 913 2,178 2,802 196 13,443 12,884 400 2,617 -- 5 21,581 12,272 (213)- (1,565) (7,840) (153) (12,292) (12,843) Park Center Tax Contract Center Total Total

2,117 - - - - 5,065 10,256 1,067- 6,334- 23 14,162 14,270 5,882 - 12,407 1,000 19,681 66,948 78,776 Funds Funds Funds Funds Funds Funds Funds

67,565- 199,810 447,665 57,046 1,016,541 1,051,771 42,157 828 259,215 280,131 59,916 1,202,636 1,128,714 (18,321) 3,487 67,694 (154,976) 21,422 308,883 299,018

Monmouth Convention Luxury State Convention

$ 56,991 $ 9,570 $ 291,602 $ 314,849 $ 89,393 $1,445,181 $1,485,290

$ 4,476 $ 4,711 $ 10,288 $ - $ 11,049 $ 65,943 $ 62,672

$ 56,991 $ 9,570 $ 291,602 $ 314,849 $ 89,393 $1,445,181 $1,485,290 $ 7,653 $ 3,452 $ 12,198 $ - $ 9,077 $ 92,122 $ 124,151 16 new jersey sports and exposition authority amn nle ftxs(oeB6 (,1)- 8,665 (3,610) - - - 41,440 - 347 (166) FUND BALANCE(DEFICIT),ENDOFYEAR Partners distribution Amortization ofcostsontheRutgersandHigherEducationProjects Write-off andamortization ofbonddiscountandissuancecosts Payment inlieuoftaxes(NoteB-6) Maintenance charges Interest onbondsandnotes Interest income(loss)onrestricted debtservicefunds Excess ofrevenues overexpenses FUND BALANCE(DEFICIT),BEGINNINGOFYEAR See notestofinancialstatements. (In Thousands) (Pursuant toVarious BondResolutions) STATEMENTS OFCHANGESINFUNDBALANCES 6,2 25,852 $ 363,725 $ 22,277 $ 357,394 $ (892 (132) (1,741) (18,992) (12,688) ope Suites Complex prsStadium Sports ud Project Funds -(3,217) - 2001 annual report 17 December 31, 2001 December 31, 2000 Atlantic City Wildwoods ------(715) - - - (715) (3,217) (652) (4,532) - - 1,094 1,512 - 2,953 4,538 (72) - (213) (447) (14) (912) (863)

Park Center Tax Contract Center Total Total

4,997 (242) 19,279 17,562 6,342 98,043 120,422 Funds Funds Funds Funds Funds Funds Funds (1,317) - - - (30) (4,957) (4,660) (1,800) (85) (1,656) - (43) (22,708) (29,162) (3,213) - (8,254) (29,614) (3,112) (58,622) (57,383)

Monmouth Convention Luxury State Convention

$ (18,321) $ 3,487 $ 67,694 $ (154,976) $ 21,422 $ 308,883 $ 299,018 $ (16,916) $ 3,814 $ 57,444 $ (143,274) $ 18,279 $ 299,018 $ 271,310 18 new jersey sports and exposition authority 2001 annual report 19 Total current assets current Total 205,998 liabilities current Total 247,793 192,185 193,980 See notes to consolidated financial statements. ASSETSCURRENT ASSETS: (Notes B-9 and D) Cash and cash equivalents cash equivalents (Notes B-9 and D) Restricted cash and Restricted investments (Note D) receivable Accrued interest State of New Jersey (Notes A and B-7) Due from accounts Receivables (net of allowance for doubtful of $1,391 in 2001 and $1,724 in 2000) 66,948 $ 92,122 13,441LIABILITIES AND NET ASSETS 78,776 $CURRENT LIABILITIES: 124,151 Accounts payable and accrued expenses payable on bonds and notes Interest 20,509 revenue Deferred 12,209 Advanced ticket sales 3,809 liabilities Other current of Notes payable (Note G) portion Current of Bonds payable (Note F) portion Current 769 2001 10,761 27,570 $ 2,726 70,064 2000 25,119 $ 6,207 67,204 36,100 25,186 30,206 4,880 19,609 3,437 33,508 36,547 25,745 2,353 CONSOLIDATED STATEMENTS OF FINANCIAL POSITION OF FINANCIAL STATEMENTS CONSOLIDATED 2001 AND 2000 DECEMBER 31, (In Thousands) LONG-TERM ASSETS: D) Restricted long-term investments (Note Investment in facilities (Notes B-5 and E) Other assets (Note B-10) ASSETSTOTAL 30,660 1,003,535LONG-TERM LIABILITIES: Long-term portion of notes payable (Note G) Long-term portion of bonds payable (Note F) 932,666 83,320 LiabilitiesTotal NET ASSETS: debt Invested in capital assets, net of related 43,166 Restricted for debt service Unrestricted net assets Total $ 1,283,359 LIABILITIES AND NET ASSETSTOTAL 43,322 28,625 941,288 $ 1,307,101 57,036 977,327 34,832 $ 1,283,359 36,108 - 1,162,098 $ 1,307,101 121,261 1,206,139 58,039 28,117 100,962 42,923 20 new jersey sports and exposition authority HNEI E SES2,9 19,582 100,962 $ 81,380 4,817 14,765 121,261 20,299 $ 33,009 (60,175) 100,962 2,664 (28,192) 17,635 17,605 42,946 35,455 (59,795) 33,094 (32,791) 88,015 21,390 22,028 242,739 42,143 15,730 4,660 46,688 39,892 34,479 52,299 90,233 255,872 25,195 214,547 NET ASSETS,ENDOFYEAR 10,494 17,099 4,957 46,055 NET ASSETS,BEGINNINGOFYEAR 111,862 39,179 36,266 $ CHANGE INNETASSETS 28,891 56,957 Capital contributions(NoteB-7) 223,081 Income before contributions 11,219 115,726 Total nonoperatingincome $ 41,766 Interest expense(NoteF-8) 27,805 Statecontractpaymentsandappropriations (NoteA) Luxurytax,marketingfundandtourismtaxrevenues (NotesA andC) Interest incomeandother NON-OPERATING INCOMEAND(EXPENSES): OPERATING LOSS Total operatingexpenses Paymentinlieuoftaxes(NoteB-6) Depreciation andamortization(NotesB-5E) Generalandadministrative ConventionCenters Arena Stadium Racetracks OPERATING EXPENSES: Total revenues ConventionCenters Arena Stadium Racetracks OPERATING REVENUES: See notestoconsolidatedfinancialstatements. (In Thousands) YEARS ENDEDDECEMBER31,2001AND2000 IN NETASSETS CONSOLIDATED STATEMENTS OFOPERATIONS ANDCHANGES 012000 2001 2001 annual report 21 2001 2000

See notes to financial statements. CONSOLIDATED STATEMENTS OF CASH FLOWS STATEMENTS CONSOLIDATED 2000 DECEMBER 31, 2001 AND YEARS ENDED (In Thousands)

Net cash (used in) provided by operating activitiesNet cash (used in) provided $ (7,863) $ 21,022 Deferred revenues Deferred (6,136) (235) Advanced ticket sales and other liabilities (3,814) (713) Accounts payable and accrued expenses 2,860 13,888 Increase (decrease) in liabilities: (decrease) Increase Receivables (9,415) 152 (Increase) decrease in assets: decrease (Increase) Change in allowance for doubtful accounts (333) (144) Depreciation and amortization Depreciation 41,766 36,266 provided by operating activities: provided Adjustments to reconcile operating loss to net cash Adjustments to reconcile Operating loss $ (32,791) $ (28,192) (USED IN) PROVIDED BY OPERATING ACTIVITIES: (USED IN) PROVIDED BY OPERATING RECONCILIATION OF OPERATING LOSS TO NET CASH OF OPERATING RECONCILIATION CASH AND CASH EQUIVALENTS, END OF YEARCASH AND CASH EQUIVALENTS, $ 159,070 $ 202,927 CASH AND CASH EQUIVALENTS, BEGINNING OF YEARCASH AND CASH EQUIVALENTS, 202,927 230,295 NET DECREASE IN CASH AND CASH EQUIVALENTS (43,857) (27,368) Net cash provided by (used in) investing activities Net cash provided 80,689 (53,669) Interest on investments Interest 12,668 16,927 Maturities of investments 72,718 84,152 Purchase of investments Purchase (4,697) (154,748) CASH FLOWS FROM INVESTING ACTIVITIES: Net cash used in capital and related financing activities Net cash used in capital and related (154,232) (27,378) Luxury Tax revenues Luxury Tax 11,800 11,420 State Contract receipts for payment of principal and interest on bonds of principal and interest for payment State Contract receipts 43,193 56,584 Interest paid on bonds and notes Interest (58,423) (60,318) Disposals of investment in facilities - 194 Additions to investment in facilities (111,918) (150,604) Issuance of bonds and notes - 146,955 Principal payments of bonds and notes (38,884) (31,609) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: AND RELATED CASH FLOWS FROM CAPITAL Net cash provided by operating activities by operating Net cash provided 37,549 32,657 State appropriations 11,000 15,000 Tax lease transactions Tax 7,945 - Historical tax credits 2,734 - Luxury tax, marketing fee, and tourism tax revenues Luxury tax, marketing fee, and tourism 15,870 17,657 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES: CASH FLOWS FROM NONCAPITAL Net cash (used in) provided by operating activities Net cash (used in) provided (7,863) 21,022 Payments to employees (69,431) (65,594) Payments to suppliers (113,976) (101,531) Payments to horsemen, bettors, and franchises Payments to horsemen, (736,204) (727,019) Receipts from customers Receipts from $ 911,748 $ 915,166 CASH FLOWS FROM OPERATING ACTIVITIES: OPERATING CASH FLOWS FROM 22 new jersey sports and exposition authority .SUMMARY OFSIGNIFICANTACCOUNTINGPOLICIES B. AUTHORIZINGLEGISLATION A. YEARS ENDEDDECEMBER31,2001AND2000 NOTES TOCONSOLIDATED FINANCIALSTATEMENTS .General 1. Convention Centerproject. amended toexpandthescopeofprojects eligiblefortheissuanceofbondstoincludeWildwoods tions bytheStateLegislature (seeNoteF-6).OnNovember24,1998,thecontractwasrestated and State necessarytopaythedebtserviceonbonds,subjectanddependentuponannualappropria- and theStateTreasurer. Thecontractrequires theTreasurer toprovide fundsfrom theGeneralFundof the issuance ofbonds,StateContractBonds,bytheAuthority, pursuanttoacontractbetweentheAuthority On January 13,1992,theNewJerseylegislature adoptedChapter375ofP.L. 1991,whichapproved the advice andconsentoftheStateSenate. the Governor, whoare membersexofficio, withthe andelevenmembersappointedbytheGovernor Authority, theStateTreasurer, andamemberoftheNewJerseyMeadowlandsCommission,appointed by resolutions, forthesecurity ofthebondholders.TheAuthority’s Board consistsofthePresident ofthe ceived mustbeappliedforspecificpurposesinaccordance withtheprovisions oftheAct,andrelated bond The Authorityhasnostockholdersorequityholders,andallbondproceeds, revenues orothercashre- sporting events,tradeshowsandotherexpositions. including stadiumsandotherbuildingsfacilitiesforathleticcontests,horseracing,spectator The ActempowerstheAuthoritytoownandoperatevariousprojects, locatedintheStateofNewJersey, is constitutedasaninstrumentalityoftheState,exercising functions. publicandessentialgovernmental New Jerseyof1971,Chapter137,enactedMay10,assupplementedandamended(the“Act”).It The NewJerseySportsandExpositionAuthority(the“Authority”)wascreated bythelawsofState the ConsolidatedStatementsof Revenues,Expenses,andChangesinNetAssets: Reconciliation ofBondResolutionExcessRevenuesOverExpenses totheChangeinNetAssetson accordance withtheBondResolutions. ceived; and(6)interest expenseonbondsisrecognized whentransferred tothedebtservicefundsin from theStateforprincipalpaymentsonContractBondsare recognized asrevenue whenre- enue Fundare recognized asrevenue intheyearreceived (5) contributions ratherthanwhenearned; accounted forasadistributionofrevenue; (4)certain receipts depositedinortransferred totheRev- from theOperatingFundorMaintenanceReserve Fundare notcapitalized;(3)certain expensesare Section B,asfollows:(1)depreciation andamortization isnotprovided; (2)capitalexpenditures funded financial statementsprepared inaccordance withgenerallyacceptedaccountingprinciplesincludedin visions oftheSports Complex,StateContract,andLuxuryTax Bond Resolutionswhichdiffer from the The Authorityalsoprepares financial statements,includedinSectionA,accordance withthepro- ConventionCenter.vention CenterAuthority”)andtheWildwoods thority includingMonmouthParkRacetrack,theAtlanticCityConventionCenterAuthority(the“Con- with orcontradictGASBpronouncements. ThefinancialstatementsincludetheaccountsofAu- the CommitteeonAccountingProcedure issuedonorbefore November30,1989,unlesstheyconflict pretations, Accounting PrinciplesBoard (“APB”)OpinionsandAccountingResearch Bulletins(ARBs)of nouncements ofallapplicableFinancialAccountingStandards Board (“FASB”) StatementsandInter- AccountingStandards BoardGovernmental (“GASB”).Inaddition,theAuthorityfollowspro- -Initsaccountingandfinancialreporting, theAuthorityfollowspronouncements ofthe 2001 annual report 23 (in thousands) 2001 2000 Years Ended December 31, Ended December Years - During the year ended December 31, 2001, the Authority adopted GASB - During the year ended December 31, . GASB Statement No. 34 requires changes to the basic financial statements . GASB Statement No. 34 requires Basic Financial Statements - and Management’s Discussion and Analysis - for State Basic Financial Statements - and Management’s - The GASB establishes the criteria used in determining which organizations should - The revenues of the Authority are deposited into the Revenue Funds and transferred to the Revenue Funds and transferred deposited into the the Authority are of - The revenues Amounts recorded in accordance with the Bond Resolution financial statements vary from financial statements vary from with the Bond Resolution financial in accordance Amounts recorded with accounting principles generally accepted in the United States in accordance statements prepared above. of America as disclosed in the reconciliation Excess of revenues over expensesExcess of revenues expenseInterest and amortizationDepreciation Payment in lieu of taxState Contract payments revenueStadium Suites license and other income Interest OtherChange in net assets $ 98,043 (41,766) $ 120,422 (4,122) 29,603 (36,266) (59,795) (4,957) 2,953 (6,374) $ (60,175) 20,299 (4,660) 1,719 5,110 $ 19,582 340 (194) be included in the Authority’s financial statements. Accounting principles generally accepted in the be included in the Authority’s the inclusion of the transactions of government for organizations United States of America require which the Authority is financially accountable. of a voting The extent of financial accountability is based upon several criteria including: appointment on a primary government and financial imposition of will, financial benefit to or burden majority, with operating agreement of the Authority’s As a result of fiscal dependency. accountability as a result financial Authority’s the Convention Center Authority and the above criteria, the Convention Center annual report. included in the Authority’s statements are the existing On February 23, 1998, the Authority assumed the assets and liabilities and undertook the Authority includes the financial As a result, operations of the Wildwoods Convention Center. The assets and liabilities were statements of the Wildwoods Convention Center in its annual report. to net assets, invested in capital facilities. was recorded at fair value and the difference recorded Operating Funds, Debt Service Funds and other funds on a monthly basis as required by the Bond a monthly basis as required Funds and other funds on Operating Funds, Debt Service been eliminated. Resolutions. All interfund accounts have and ex- revenues and Stadium. The gross held at the Arena certain events The Authority promotes reflected in the financial statements. penses of these events are when awarded recognized State agency grants are State and/or other restricted-purpose Revenues from in a purpose-specific fund. and recorded Statement No. 34, and Local Governments certain changes applicable to are for state and local governmental entities. Among those requirements a balance special purpose governments type activities. Those changes require engaged in business debt, re- - invested in capital assets net of related sheet, with net assets displayed in the categories assets; and a state- expenses and changes in net a statement of revenues, stricted, and unrestricted; a method. In addition, GASB Statement No. 34 requires using the direct ment of cash flows presented supplementaryinformation. required as presented management discussion and analysis to be 2. Change in Accounting 4. Reporting Entity 3. Revenues 24 new jersey sports and exposition authority .InvestmentinFacilities 5. .Distributions 8. CapitalContributions 7. PaymentinLieuofTaxes 6. .CashandEquivalents 9. 13.Valuation ofInvestments 13.Valuation RateSwapAgreements 12.Interest Vacation Time 11.Accumulated Assets 10.Other report. The AuthorityisacomponentunitincludedintheStateofNewJersey’s comprehensive annualfinancial interest onStateContractBondsanddirect appropriations are treated asnonoperatingrevenue. on theStateContractBondsandfundsreceived from otherauthorities.Amountsreceived topay ties tocompensateforlossoftaxrevenues byreason ofacquisitionreal property bytheAuthority. of theAuthorityare exemptfrom taxation.However, paymentsinlieuoftaxesare madetomunicipali- estimated usefullivesoftherelated assets. including debtservicereserve funds.Depreciation iscomputedbythestraight-linemethodbasedon expenses andinterest duringconstruction ontheunexpendedfunds, netofinterest incomeearned engineering costs,roads, constructioncostsandadditionstofacilities,administrativefinancial construction periodforacquisitionofland,rightsway, acquisitioncostofacquiringfacilities,surveys, General FundoftheStateNewJersey. any obligationsincurred bytheAuthoritytoState,anybalanceremaining istobedepositedinthe In accordance withtheAct,toextentnotrequired foranysuchprojects,andnotrequired torepay Jersey. Anyremaining excesswouldbeusedforotherprojects oftheAuthority. requirements fortheAuthority’s 1992GuaranteedRefundingBonds,guaranteedbytheStateofNew be helduptoMay1ofthesucceedingyear, atwhichtimetransfersare madetomeetdebtservice Bond Resolutions,anyexcessbalanceremains intheRevenueFund.Atyear-end theexcess,ifany, will dance withGASBStatementNo. 31, standing oftheAuthorityorother factors.Theseinvestmentsare recorded atamortized costinaccor- contracts whichmanagement concludes are notsignificantlyaffected bytheimpairment ofthecredit repurchase agreements andcertificates ofdepositare investmentsinnon-participatinginvestment interest expenseoftherelated bonds. est rateswapagreements isaccruedannuallyoverthelifeofagreement asanadjustmenttothe recorded inthefinancialstatements. Theinterest differential tobereceived orpaidundertheseinter- interest rateswapinthefuture andnetinterest expenditures resulting from theseagreements are modify interest ratesoncertainoutstandingdebt.Premiums received from optionstoexercise an lump-sum paymentoftheiraccumulatedvacationtime. Uponterminationofemployment,salariedemployees areearned. entitledtoreceive amaximum vacation timeforoneyear. Thisaccumulatedvacationtimemustbeusedwithin oneyearofthe ConventionCentermayaccumulatevacationtimeuptoamaximumoftheirtotal and theWildwoods related StateContractBonds. Projects are alsoincludedinotherassetsandwillbeamortized asprincipalpaymentsare madeonthe the lifeofissuanceonastraight-linebasis.Costsincurred fortheRutgersandHigherEducation limited to,legalandaccountingcosts.Thesecostshavebeendeferred andare beingamortizedover a maturityofthree monthsorlesswhenpurchased tobecashequivalents. carried atcost,whichapproximates market.TheAuthorityconsidersallhighlyliquidinvestmentswith -Otherassetsincludedeferred issuancecostsincurred toissuedebt,includingbutnot

- Eachmonth,afterappropriate transferstothedesignatedfundsasspecifiedby -Capitalcontributionsrepresent fundsreceived from theStatetopayprincipal -Investmentinfacilitiesisstatedatcost,whichincludesallcostsduringthe -Inaccordance withaprovision oftheenablingAct,properties andincome - Guaranteed investment contracts, state and local government securities, -Guaranteedinvestmentcontracts,stateandlocalgovernment -Cashandcashequivalentsincludeshort-term investmentsthatare -SalariedemployeesoftheAuthority, theConventionCenterAuthority -TheAuthorityentered intointerest rateswapagreements to Accounting andFinancialReporting forCertainInvestmentsand 2001 annual report 25 (in thousands) (in thousands) December 31, 2001 December 31, 2000 Book Bank Book Bank Balance Balance Balance Balance . - The 2000 financial statements have been reclassified to conform to classifications to conform statements have been reclassified - The 2000 financial - The preparation of financial statements in conformity with accounting principles of financial statements in conformity - The preparation

- The New Jersey legislature adopted a bill which authorized the Convention Center adopted a bill which authorized the Convention - The New Jersey legislature - Upon transfer of the Wildwoods Convention Center from the Greater Wildwood Tour- - Upon transfer of the Wildwoods the Greater Center from Convention - Pursuant to NJSA. 40:48-8.15 et seq. (the “Luxury Tax Act”), the City of Atlantic City has, Act”), the City of Atlantic Tax “Luxury - Pursuant to NJSA. 40:48-8.15 et seq. (the Cash on handDemand depositsN.J. Cash Management Fund AgreementRepurchase Certificates of Deposit 139,260 $ 139,260 24,234 (8,700) 4,276 $ 139,680 - 24,234 2,964 - 139,680 3,905 $ 670 - 3,587 3,905 $ 55,085 2,345 - 55,085 generally accepted in the United States of America requires management to make estimates and as- management the United States of America requires generally accepted in of contingent assets and liabilities and disclosure amounts of assets the reported sumptions that affect and ex- amounts of revenues reported date of the financial statements and the and liabilities at the those estimates. from could differ period. Actual results penses during the reporting used in 2001. by Ordinance No. 18 of 1982, imposed a 3% tax on the sale of alcoholic beverages by the drink in the No. 18 of 1982, imposed a 3% tax by Ordinance or other similar establishments and a 9% tax on cover charges bars, and other restaurants, and the sale of such an establishment, the hiring of hotel rooms of similar charges made to any patron and other places of amusement. tickets for admission to theaters, exhibitions authorized the Authority to under- adopted which Act were On January 13, 1992, amendments to the of the proceeds (see Note A) and authorized the State to transfer take the Convention Center Project deposited into the Revenue Fund and trans- are proceeds Luxury Tax to the Authority. the Luxury Tax fund the operating deficit and Bonds and on the Luxury Tax to other funds to pay debt service ferred for the Convention Center Project. capital expenditures The pro- on hotels in Atlantic City. per occupied room Authority to impose marketing fees of $3.00 paid into a special fund established and the fees collected pursuant to this legislation are ceeds from held by the Convention Center Authority. Note and Development Authority (“GWTIDA”) on February 23, 1998 (see ism Improvement A), the tax receipts retail of a 2% tourism related the proceeds 90% of Authority assumed the right to receive and Development District Law”) for Improvement “Tourism pursuant to NJSA 40:54D-1 et. seq. (the facility and the operation, maintenance of a new convention center the construction and promotion 10% of the funds generated by the tax is allo- The remaining of the existing center. and promotion The tax is imposed and collected in the area. of tourism cated to GWTIDA for its continuing promotion Wildwoods (i.e., North in the Greater and with the cooperation of the municipalities by ordinance Wildwood, Wildwood and Wildwood Crest). External Investment Pools External Investment Cash and cash equivalents: cash and cash equivalentsTotal $ 159,070 $ 166,458 $ 202,927 $ 201,015 15.Reclassifications 1. Luxury Tax 2. Marketing Fees 3. Tax Tourism 1. The components of cash, cash equivalents and investments are: 14.Use of Estimates C. FEES AND TOURISM TAX MARKETING TAX, LUXURY D. AND INVESTMENTS CASH, CASH EQUIVALENTS 26 new jersey sports and exposition authority oa netet 289$110,890 $ 42,869 $ ThevariousBondResolutionsoftheAuthorityspecifyinstitutions andtypesofinvestmentsthatcan 3. AtDecember31,2001and2000,approximately $70,690,000and$92,698,000,respectively, were 2. Total investments Investments (NoteB-13): mature semi-annuallycommencing onJanuary 1,2002through January1,2005. sued bytheU.S.Treasury, heldbytheTrustee andhaveinterest ratesbetween3.4%and3.75% which Securities(“SLUGS”)are specialnon-marketablesecuritiesis- The StateandLocalUnitGovernment the financialinstitutioninnameofAuthority. an agreed uponprice atafuture date. Theseinvestmentsare collateralizedatapremium andheldby tution inexchangeforsecurities.Thefinancialinstitutionagrees torepurchase thesame securitiesat Repurchase agreements represent investmentswhereby theAuthoritytransferscashtoafinancialinsti- the Authority. aggregate valueof105%theinvestmentcontractwhichis heldbyathird-party bankinthenameof obligationsthathave,asaminimum,an 2001, $24,496,000iscollateralizedwithU.S.government ity withafixedrateofreturn credited ReserveAccount.AtDecember31, toaspecificDebtService The guaranteedinvestmentcontractisanagreement withabankthatprovides theAuthor- nated bytheTrustee. AtDecember31,2001,alldemanddepositswere collateralized. lodging collateralsecurityofobligationssecured bytheUnitedStateswithTrustee orbankdesig- All demanddeposits,exceptdepositsheldbytheTrustee, ofanydepositorymustbefullysecured by Management Fund;and(i)guaranteedinvestmentcontracts. certificates ofdeposit;(f)commercial paper;(g)repurchase agreements; (h)StateofNewJerseyCash agency orcorporationcreated pursuanttoanActof Congress; (d)newhousingauthoritybonds;(e) any suchstate;(c)bonds,debentures orotherevidenceofindebtednessissuedguaranteedbyany tions ofanystatetheUnitedStatesoragency, unitof instrumentalityorlocalgovernmental following: (a)direct obligationsoforguaranteedbytheUnitedStates;(b)bondsobliga- be madewiththemoneyavailableforinvestment.Ageneraldescriptionofthoseinvestmentsis principal andinterest onbonds. held byTrustees inDebtService andDebtServiceReserveFundsare restricted onlyforpaymentof eucaeareet 69,912 19,979 20,999 $ - 18,373 securities(SLUGS) government 24,496 State andlocalunit $ Repurchase agreements Guaranteed investmentcontracts eebr3,20 December31,2000 December 31,2001 i huad)(inthousands) (in thousands) otCost Cost 44690,911 24,496 2001 annual report 27 (in thousands) 1,322,984 219,057 (146,800) 1,395,241 $ 932,665 $ 178,008 $ (107,138) $1,003,535 2000 Additions Disposals 2001 Balance Balance December 31, December 31, BuildingsMachinery and equipmentLand improvementsLeasehold rights 2 to 20 years 10 to 20 years 35 to 60 years 24 years The N.J. Cash Management Fund is a money market fund managed by the State of New Jersey Division Fund is a money market fund managed The N.J. Cash Management of the Division to invest in a variety subsequent legislation permit 1950, c. 270 and of Investments. P.L. obligations of the U.S. Government investments, in the case of short-term securities, including, and bankers’ agreements, certificates of deposit, repurchase paper, commercial certain of its agencies, must fall within the guidelines set forth participation notes. All such investments acceptances and loan in the N. J. Cash State Investment Council. Securities of the State of New Jersey, by the regulations the N. J. held by the Division or its agent in or securities or registered, insured Management Fund are name. Cash Management Fund’s LandBuildingsMachinery and equipmentLand improvementsLeasehold rightsConstruction in progress generally as follows: are Asset lives used in the calculation of depreciation 135,550 15,248 94,068 38,002 $ (28,331) 858,467 171,897 25,000 80,712 $ 7,274 122,467 115,823 (107,138) (9,014) - (2,317) - 67,642 $ 36,262 971,973 - $ - 171,897 25,000 Less accumulated depreciation (390,319) (41,049) 39,662 (391,706) E. IN FACILITIES INVESTMENT 28 new jersey sports and exposition authority .BONDSPAYABLE F. STATE CONTRACTBONDS REVENUE BONDS .Bondspayableconsistsofthefollowing: 1. State ContractBonds,1999 State ContractBonds,1998 State ContractBonds,1998 State ContractBonds,1993 State ContractBonds,1993 State ContractBonds,1992 State ContractBonds,1992 RevenueBonds,Series1996A Wildwood Sports ComplexSubordinated Refunding Sports ComplexRefundingRevenueBonds, Sports ComplexRefundingBonds .0-.0 u 00truh21 61/94,1 48046,995 11,240 44,810 9,920 1,280 49,915 86,665 13,665 655 06/15/99 86,665 12/15/98 194,960 5,000 26,285 86,665 6.00%-7.00% due2000through 2014 Series A,$49,915,000SerialBonds 193,766 191,755 26,285 4.96%-5.77% duethrough 2008 03/01/93 2,892 12/15/98 188,786 Series B,$13,665,000SerialBonds 209,990 $28,855,000 Term Bonds4.50%due2024 26,285 4.00%-5.50% due2004through 2019; 224,000 2,768 11/19/92 Series A,$57,810,000SerialBonds 2.50%-4.70%, duethrough 2002 03/01/93 03/02/92 Series B,$5,000,000SerialBonds 3,400 $13,600,000 Term 32,875 Bonds5.50%,due2023 63,765 $6,930,000 Term Bonds,5.37%,due2015 4.70%-5.40%, due2003to2009; Series A,$5,755,000SerialBonds, 09/06/96 32,875 63,765 5.86%, duethrough 2024 Series C,$209,990,000Term 86,070 Bonds $ 32,875 63,765 6.50%, due2013to2021 $177,045,000 Term Bonds,6.00%- 71,470 5.50%-6.50% due1998through 2007; $ Series A,$46,955,000SerialBonds 12/01/93 12/01/93 175,450 $ due seriallythrough 2016 1.50% interest through 2001then2.50% 11/01/85 Term Bonds6.875%,due2005-2017 Revenue Bonds,1993SeriesA$32,875,000 Bonds, 5.20%,due2021-2024 due 2017-2020;$18,425,000Term $14,990,000 Term Bonds,5.20%, 5.00%-5.125% due2005through 2016; 1993 SeriesA$30,350,000SerialBonds due seriallythrough 2005 State ofNewJersey)7.30%-8.30%, 1985/1992 Series(guaranteedbythe sudAon 012000 2001 Amount Issued aeOiia December31, Original Date (in thousands) aac Balance Balance 2001 annual report 29 $ 977,388 $ 1,010,835 - The Authority issued (in thousands) Balance Balance Date Original December 31, Issued Amount 2001 2000 - The State Guaranteed Bond Resolution pledges the excess revenues of the - The State Guaranteed Bond Resolution pledges the excess revenues 1992, Series A, $53,795,000 Serial Bonds 2007 and final 2.90%-6.00%, due through Bonds, payment 2013; $114,230,000 Term 20226.58%-6.60%, due 2012 through 1999, Series A, $128,270,000 Serial Bonds 20204.25%-5.125%, due 2003 through 11/12/92loss on refunding 02/15/99 168,025 128,270 26,730 128,270 30,180 128,270 (39,161) (40,928) Series A $82,520,000 Serial Bonds Series A $82,520,000 2020 through 4.75%-6.00% due 2001 Bonds Series B $39,380,000 Serial 2014 through 7.00%-7.375% due 2001 (Federally Taxable) 02/01/00Series C $12,325,000 Serial Bonds $ 20114.25%-5.00% due 2002 through 82,520Series D $12,295,000 Serial Bonds $ 2010 6.50% due 2001 through 80,975(Federally Taxable) 12/01/00 $ 82,520 12,325 02/01/00 12,325 39,380 12,325 12/01/00 37,405 12,295 39,380 11,090 12,295 $63,765,000 of Sports Complex Refunding Revenue Bonds, 1993 Series A (the “Senior Lien Bonds”). $63,765,000 of Sports Complex Refunding Revenue Bonds, 1993 Series A (the “Senior $63,790,000 issued by the Authority for the purposes of: (1) refunding The Senior Lien bonds were 1978 Series (the “Refunded Sports Complex Bonds, of the Authority’s principal amount aggregate Sports Complex as security for the 1992 Guaranteed Refunding Bonds after payment for the Senior Sports Complex as security for the 1992 Guaranteed Refunding Bonds after payment lieu of taxes. Pursu- and Junior Lien Bonds, funding of the Maintenance Reserve Fund and payments in principal and inter- ant to authorization contained in the State Guaranty Act, the punctual payment of of New Jersey. est on the Guaranteed Refunding Bonds is unconditionally guaranteed by the State Note F-6), the Au- Simultaneously with the issuance of the State Contract Bonds, 1992 Series A (see for the 1985 State as escrow thority issued the 1992 Guaranteed Refunding Bonds to the Trustee in the same amount, maturity issued Guaranteed Bonds. The 1992 Guaranteed Refunding Bonds were rate as the 1985 Guaranteed Refunding Bonds. The Authority will make debt service and interest of the the excess revenues from payments on the 1992 Guaranteed Refunding Bonds to the Trustee Complex of the Sports Sports Complex available at the end of the year after meeting the requirements then will make debt service payments on the 1985 State Guaranteed Bond Resolutions. The Trustee the 1992 Guaranteed Refunding Bonds. from amounts received Refunding Bonds from Convention Center Luxury Tax Bonds Convention Center Luxury Tax Refunding Bonds Convention Center Luxury Tax payable bonds Total Less original issue discount and deferred 1,016,549 1,051,763 State Contract Bonds, 2000 State Contract Bonds, 2000 State Contract Bonds, State Contract Bonds, 2000 State Contract Bonds, 2000 2. State Guaranteed Bonds 3. Sports Complex Refunding Revenue Bonds 1993 Series A - Senior Lien LUXURY TAX BONDS TAX LUXURY 30 new jersey sports and exposition authority 4. Sports ComplexSubordinated Sports RefundingRevenueBonds1993SeriesA-JuniorLien 4. .WildwoodsRevenueBonds1996SeriesA 5. the StateotherthanAuthority. Jerseyoranypoliticalsubdivisionof Senior LienBondsare notadebtorliabilityoftheStateNew standing SeniorLienBondsare transferred from theRevenueFundtoDebtService Fund.The security forthebondholders.Inaccordance withtheBondResolution,principalandinterest onout- 31,2001isinsured withaSurety BondissuedbytheMBIAInsuranceCorporationasadditional ber Lien Bonds.Inaddition,adebtservicereserve requirement intheamountof$5,228,440atDecem- Revenue BondResolutionpledgesthenetrevenues oftheSportsComplexassecurityforSenior These SeniorLienBondsare direct andgeneralobligationsoftheAuthority. TheSportsComplex 1993 SeniorLienBonds. Bonds”); and(2)payingthecostsofauthorization,issuance,sale,executiondelivery other thantheAuthority. Lien Bondsare notadebtorliabilityoftheStateNewJerseyanypoliticalsubdivision standing JuniorLienBondsare transferred from theRevenueFundtoDebtService Fund.TheJunior security forthebondholders.Inaccordance withtheBondResolutions,principalandinterest onout- 31,2001isinsured withaSurety BondissuedbytheMBIAInsuranceCorporationasadditional ber Corporation. Inaddition,adebtservicereserve requirement intheamountof$3,965,063atDecem- interest onthesebondsisinsured withapolicyissuedbytheMunicipalBondInvestorsAssurance The payment,whendue(otherthanforreason ofaccelerationoroptionalredemption) ofprincipaland ment ofthe1993SeniorLienBonds. the pledgeofSportsComplexRevenueBondResolutionsuchamountsassecurityforpay- Junior Lienbonds.However, suchpledgeofthenetrevenues issubjectto,andjuniorinallrespects to, Subordinated BondResolutionpledgesthenetrevenues Complexassecurityforthe oftheSports These JuniorLienBondsare direct andgeneralobligationsoftheAuthority. TheSports Complex the authorization,issuance,sale,executionanddeliveryof1993JuniorLienBonds. Sports Complex;(2)financingcertain improvements totheclubboxsuites;and(3)payingcosts of issued tofinancetheacquisitionofclubboxsuitesatfootballstadium,whichispart with anoutstandingprincipalamountof$29,345,000atthetimepaymentwhichwasoriginally bonds were issuedbytheAuthorityforpurposesof:(1)payingapromissory noteoftheAuthority Subordinated RefundingRevenueBonds,1993SeriesA(the“JuniorLienBonds”).TheJunior rently withtheissuanceofSeniorLienBonds,Authorityissued$32,875,000Sports Complex to therepayment ofthesebonds. fees, rates,chargesorotherincome derivedfrom operationsorownershipofany ofitsotherprojects, tion from theStateTreasurer tocoveranyshortfall.TheAuthoritydoesnotpledgethe revenues, rents revenues. If itshouldbedeemednecessary, theAuthoritymayrequest anexpress separateappropria- service amountanyunpaidportion tothefollowingyearbefundedbythatyear’s accrues available and paymentsinlieuoftaxes.Shouldavailablerevenues beinsufficient toprovide therequired debt Convention Centerafterpaymentofoperatingexpenses,funding ofthemaintenancereserve fund ment, repayment ofprincipalandinterest istobefundedbytheAvailable RevenuesoftheWildwoods tion underthebondsandreplaced theprevious BondResolution.Underthetermsofnewagree- Jersey. Thisagreement restated theoriginaltermsandconditions oftheAuthority’s assignedobliga- TourismWildwoods Improvement andDevelopmentAuthoritytheTreasurer oftheStateNew theGreater Crest, theBorough theCityofNorth Wildwood, the CityofWildwood, ofWildwood AgreementOn November8,1999,theAuthorityentered intoTheOmnibusIntergovernmental with Center in1996. Convention intheamountof$3,400,000foracquisition oftheWildwoods the CityofWildwood Tourismauthorized bytheGreater Wildwoods Improvement andDevelopmentAuthorityissuedto 23,1998asanobligationandliabilityoftheWildwoodsConvention Center. Thebondswere ary -Thesebondswere assumedbytheAuthorityonFebru- -Concur- 2001 annual report 31 - The State Contract Bonds are special obligations of the Authority, payable the Authority, special obligations of Bonds are - The State Contract solely from the State Contract (see Note A) and other pledged property. Notwithstanding the pledge Note A) and other pledged property. the State Contract (see solely from of the State State Contract by the Treasurer all amounts payable under the by the Resolution, effected State Legislature. by the New Jersey dependent upon annual appropriations shall be subject to and obligation to make any such appropriations. has no legal The State Legislature derived from and receipts fees, rates, charges, or other income rents, revenues, None of the Authority’s to the payment of or interest is pledged or assigned of any of its projects the operations or ownership bond agreements. Bonds unless specifically stipulated in the on the State Contract 1992 Series C funds to pay a The Authority issued $209,990,000 of State Contract Bonds, 1992 Series C to provide Convention Center Project. portion of the cost of the Authority’s Novem- Effective rate of interest. issued at a variable The State Contract Bonds 1992, Series C were ber of the for $209,990,000 rate swap agreement into an interest 12, 1992, the Authority entered the the Bonds. Based on the swap agreement, of State Contract Bonds 1992, Series C for the term counterparty to the swap of 5.86% to the rate of interest Authority owes a fixed overall effective the counterparty owes the Authority In return, inclusive of fees for liquidity facility and remarketing. in by the Bonds. Only the difference based on a variable rate that matches the rate required interest counterparty to the swap. The bond principal is payments is actually exchanged with the the interest calculated. payments are not exchanged; it is only the basis on which the interest if the swap is The Authority will be exposed to variable rates if the counterparty to the swap defaults, such as a bond or issuer downgrading. Management or if certainterminated other conditions occur, of the A termination remote. and has concluded that they are each of these occurrences has reviewed a termination payment. making or receiving in the Authority’s may also result swap agreement 1992 Series A Contract Bonds, 1992 Series A, in connection with a The Authority issued $224,000,000 of State applied to: (1) advance were debt. The bond proceeds outstanding of the Authority’s restructuring zero Series; (2) purchase Bonds - 1985 Complex Subordinated Sports in full the Authority’s refund State Guaranteed Bonds, on the Authority’s principal and interest rate SLUGS to fund certain interest for the Meadowlands Sports Program Capital Improvement 1992 Series; (3) pay certain costs of the and (5) pay costs of of the costs of the Rutgers Project; Complex and Monmouth Park; (4) pay a portion specific feasibility studies. Series A and B State Con- of 1998 proceeds funds, from In December 1998, the Authority transferred the advance agent (see Note I) to secure and B), to an escrow tract Bonds (see Note F-6. 1998 Series A bonds. of $25,235,000 of these refunding utilizing the International Swap and into an agreement April 5, 1999, the Authority entered Effective grants an option to the counter- This agreement Derivatives Association (“ISDA”) Master agreement. 29, 2002 will cause the Authority to issue approximately on January party which if exercised the callable State Contract Bonds the purpose of refunding $135,700,000 in variable rate bonds for also grants the 2002. This agreement the call date of March 1992 Series A (“1992 Series A Bonds”) at at the delivery date of January 29, 2002, to enter into the Authority the right to direct counter-party on the rate swaps the Authority will pay fixed rates of interest interest rate swaps. Under these interest variable rates on the the Authority will receive In return notional amounts totaling $135,700,000. index. The Authority received a predefined based on the counter-party same notional amounts from of $9,135,000 which consists of primarily the the agreement payment upon entering an up-front A Bonds. on the 1992 Series the original interest value savings, net of expenses, from present as explained in Note L-1, Subsequent its option exercised 29, 2002, the counter-party As of January Events Footnote. 6. State Contract Bonds 32 new jersey sports and exposition authority Revenue Fundare availableafterpaymentof operating expensesbutpriorto fundingtheMaintenance by MonmouthPark Revenue(asdefined).To theextentthatsufficient amountsintheMonmouth Park Pursuant totheStateContract, debtservicerelated tothe MonmouthRacetrackProject willbefunded ing andcoolingsystem;(3) costsofissuancethe2000SeriesCandDBonds. ment andmaintenance;(2)costs oftheMonmouthRacetrackProject related toinstallinganewheat- State ContractBondstopay:(1) costsofthe2000Sports ComplexProject related tocapitalimprove- On December1,2000,theAuthority issued$12,325,000ofSeriesCand$12,295,000 SeriesD 2000 SeriesCandD pay costsofissuancethe2000SeriesAandBBonds. Energy EquipmentinstalledattheSportsComplexandinitially leasedbytheAuthorityin1996;and(4) Projects; (3)fundtheLeaseBuyoutProject toexercise anequipmentpurchase optionofHVAC and Authority forcertaincapitalexpenditures incurred inconnectionwith1999SportsComplexCapital ConventionCenterProject;Contract Bondstopay:(1)costsoftheWildwoods (2)payorreimburse the On February1,2000,theAuthorityissued$82,520,000ofSeries Aand$39,380,000ofSeriesBState 2000 SeriesAandB signed orsecured bytheAuthority. defined) are received andavailable.SuchCRDAfunds,however, are notguaranteed,pledged,as- be usedtopay, orreimburse theTreasurer fordebtserviceonthesebondsifandwhenanyreceipts (as ment Authority(“CRDA”)andtheTreasurer oftheStateNewJerseyfuture receipts oftheCRDAwill In accordance withafundingagreement betweentheAuthority, theCasinoReinvestment&Develop- of thecostEastHallProject; and(2)paythecostsofissuance ofthe1999SeriesABonds. funds to:(1)payorreimburse theAuthorityforamountsexpendedby topayaportion On June1,1999,theAuthorityissued$49,915,000ofStateContractBonds,1999SeriesAtoprovide 1999 SeriesA Park RelatedStateContractBondsseparatelywithintheMonmouthFund. the StateContractDebtServiceFund.ConsequentlyAuthoritywillaccountfortheseMonmouth the MaintenanceReserveandpaymentsinlieuoftaxes,Authoritymustmakeamonthlytransferto Monmouth ParkRevenueFundare availableafterpaymentofoperatingexpensesbutpriortofunding will befundedbyMonmouthParkRevenue(asdefined).To theextentthatsufficient amountsinthe Pursuant totheStateContractdebtservicerelated totherefunding oftheMonmouthParkBonds Complex capitalprojects costs;and(4)paythecostsofissuanceBonds. burse theAuthorityforcertaincapitalexpenditures incurred inconnectionwith1998and1999Sports Authority’s outstandingMonmouthParkRefundingRevenueBonds,1994SeriesA;(3)payorreim- of theAuthority’s outstandingStateContractBonds,1992SeriesA;(2)advancerefund allofthe $13,665,000 ofStateContractBonds,1998SeriesBtoprovide fundsto(1)advancerefund aportion On December30,1998,theAuthorityissued$86,665,000ofStateContractBonds,1998SeriesAand 1998 SeriesAandB and tofinancethecostofAuthority’s HigherEducationSportsFacilitiesProject, respectively. Contract, 1993SeriesB,toprovide fundstopayaportionofthecostAuthority’s RutgersProject The Authorityissued$26,285,000ofStateContractBonds,1993SeriesAand$5,000,000 1993 SeriesAandB Corporation provides additionalsecurityforthebondholders. of thebondsale.Inaddition,aguarantypolicyissuedbyMunicipalBondInvestorsAssurance interest onthesebondsissecured bya debtservice reserve of$20,999,000setasidefrom theproceeds The payment,whendue(otherthanbyreason ofaccelerationoroptionalredemption), ofprincipaland 2001 annual report 33 (in thousands) 2001 2000 Balance Balance December 31, December 31, - Interest costs for the years 2001 and 2000 were as follows: costs for the years 2001 and 2000 were - Interest Interest expenseInterest Capitalized interest cost interest Total $ 59,795 6,075 $ 65,870 $ 60,175 $ 66,062 5,887 1999 Series Refunding 16, 1999, the Authority issued $128,270,000 of Convention Center Luxury Tax On March of which are the proceeds fund an escrow, funds to the Authority to: (1) Bonds, Series 1999, to provide Bonds, Series A; and (2) a portion of 1992 Luxury Tax to be used for the purpose of advance refunding Bonds. Tax with the issuance of the 1999 Luxury in connection to pay certain costs incurred of a luxury tax levied and the proceeds of these bonds will be payable solely from The repayment pursuant to the Conven- and other pledged property New Jersey collected in the city of Atlantic City, Bond Resolution. tion Center Luxury Tax 1992 Series A used to: bonds were of these Bonds. The proceeds Tax $168,025,000 of Luxury The Authority issued the old from of the new convention center and the by lease, the site (1) acquire, and (2) pay a portion Authority; with the con- of the cost associated Atlantic County Improvements City. struction of a new convention center in Atlantic the payable solely from and are special obligations of the Authority Bonds are The 1992 Luxury Tax of a luxury City of Atlantic City and paid to the Authority (see tax levied and collected in the proceeds levied and All luxury revenues the resolution. under property the other pledged Note C) and from to the Authority. directed collected in Atlantic City are or assets fees, rates, charges, and receipts or other income rents, revenues, None of the Authority’s is pledged or assigned to the Convention Center Project other than to any of its projects with respect Bonds. on the 1992 Luxury Tax or interest price, if any, the payment of the principal of, redemption of principal and of acceleration or optional redemption) The payment, when due (other than by reason Assurance Bond, issued by the Municipal Bond Investors Surety by a on these bonds is secured interest amount of $6,252,500 at December debt service reserve (MBIA) Corporation, on the required 31, also issued by MBIA. by a guaranty policy additionally insured 2001. Payments are Reserve and payments in lieu of taxes, the Authority must make a monthly transfer to the State Con- in lieu of taxes, the Authority must make Reserve and payments these Monmouth Park Related the Authority will account for Consequently, tract Debt Service Fund. separately within the Monmouth Park Fund. State Contract Bonds 8. Interest Costs 7.Bonds: Tax Convention Center Luxury 34 new jersey sports and exposition authority .NOTESPAYABLE G. .Notespayableconsistofthefollowing: 1. .TheAuthorityinSeptember 1996,entered intoanagreement withthemajorfootballtenantsof 5. OnFebruary10,1997,theAuthorityreceived theproceeds ofa$8,600,000loanfrom theCasino 4. OnDecember31,1996,theAuthorityreceived loanfrom anenergyconservation theNewJersey 3. OnMay12,1995,theAuthorityreceived anenergyconservationloanfrom theNewJerseyDepart- 2. esuaotzddson 25 (490) 38,759 35,097 (265) 8,600 8,600 8,600 02/10/97 Less unamortizeddiscount Total notespayable Term loan from bank,7.6%interest thereafter, dueFebruary 10,2007 through June2,1997then5.773% DevelopmentAuthority, 4.06%interest Loan from theCasinoReinvestment Loan from theStateofNewJerseyBoard Loan from NewJerseyDepartment of in eightannual principal installments.Interest, attherateof7.6% ispayablequarterly. completion oftheProject onAugust31,1998andisrepayable from revenues generatedbythe suites construction ofnewluxurysuites atGiantStadium.Theloanwasconvertedtoaterm uponthe whereby, thebankwouldprovide upto$35,000,000inconstruction cost financingrelated tothe Project). InOctober 1996, theAuthorityentered intoaLoanandSecurityAgreement withabank Stadium toshare thecostsandrevenues attributedtoluxurysuitesandclubseats(StadiumSuites Available CashFlowasdefinedintheagreement. or suchlongertermasshallberequired forrepayment oftheloanandinterest thereon from ment bondsbeingissuedbyCRDAtopayitsBondAnticipation Notes.Thetermoftheloanis10years through June2,1997.Theratewasadjustedto5.773%perannumon3,1997duereplace- Center Project asprovided forintheproject budget.Theinterest wascalculatedat4.06% perannum the LuxuryTax Revenues(seeNoteF-7).Theproceeds were usedtopayforthecostsofConvention Reinvestment DevelopmentAuthority(CRDA).Thesefundsconstitute subordinated debtpayablefrom this loan,theAuthority’s borrowing rateatthetimeofloan. 2006. Forfinancialreporting purposestheAuthorityhasassumedanimputedinterest rate of7%on Board ofPublicUtilities.Theloanbearsnointerest andhasanextendedduedateofDecember31, loan. assumed animputedinterest rateof7%onthisloan,theAuthority’s borrowing rateatthetimeof ments of$25,000commencingJanuary1,1996.Forfinancialreporting purposestheAuthorityhas ment ofEnvironmental Protection. Theloanbearsnointerest andisrepayable insemi-annualinstall- u uut3,20 83/83,6 27726,409 22,797 3,500 250 32,360 $ 3,500 200 08/31/98 $ 3,500 500 $ 12/23/96 05/12/95 due August31,2006 due December31,2006 of PublicUtilities,0%interest, through July1,2005 semi-annual installmentsof$25,000 Environmental Protection, 0%interest, sudAon 012000 2001 Amount Issued aeOiia December31, Original Date aac Balance Balance (in thousands) 482$38,269 $ 34,832 $ 2001 annual report 35 - Salaried employees of the Authority, Principal

Sports State Luxury Stadium

Complex Contract Tax Wildwood Suites Total Interest Total the Convention Center Authority and Wildwoods Convention Center are covered by the Public Employees’ the Convention Center Authority and Wildwoods covered Convention Center are of New Jersey (PERS), a multiple-employer public employee retirement System of the State Retirement by PERS for the years ended December for employees covered system. The payroll 31, 2001 and 2000 was the years ended 2001 and for total payroll The Authority’s $18,796,409 and $17,108,438, respectively. respectively. 2000 was $69,431,391 and $65,594,286, condition of employment to be members of PERS. A as a required All Authority salaried employees are as early as age 60; no minimum service requirement allowance retirement on a service member may retire equal to years of must be established. The formula for benefits is an annual allowance in the amount Final average salary means the average of the salaries service, divided by 55, times the final average salary. or retirement membership service preceding years of creditable by the member for the last three received the larger benefit. Benefits fully years of membership service, fiscal whichever provides the highest three reduced receive at or after age 55 and employees may retire Vested 10 years of service. vest on reaching established by death and disability benefits. Benefits are The System also provides benefits. retirement State statute. of their salary based on by PERS to contribute a percentage required Authority employees are Covered by State Statute to contribute the The Authority is required their age at the time of their enrollment. contribution is to pay benefits when due. The amount of the Authority’s amounts necessary remaining actuary who makes an annual actuarial of an certified each year by the PERS on the recommendation system. It includes valuation. The valuation is a determination of the financial condition of the retirement and the members payable to former dollar value of benefits and present the computation of the present to mortality among employer and employee contributions, giving effect dollar value of future present withdrawal, former service, salary retirement, members and also to the rates of disability, active and retired and interest. $595,916 for the years ended December 31, 2001 and 2000 were The employee contributions required The Authority has approximately $279,205,000 of bonds outstanding which are secured by investments secured which are $279,205,000 of bonds outstanding The Authority has approximately accounts meet the criteria under accounting principles gener- agents. The escrow held by various escrow the assets for an in-substance defeasance and, accordingly, ally accepted in the United States of America statements of the Authority. on the financial not reflected and obligations are Contributions Plan Description and Employer and Employee Principal and interest payments to be funded to the trustees on outstanding bonds and notes (in thou- on outstanding bonds and notes payments to be funded to the trustees Principal and interest are: five years and thereafter sands) during the next I. REFUNDED BONDS J. PLANS PENSION, RETIREMENT AND DEFERRED COMPENSATION H. ON BONDS AND NOTES MATURITIES Total $ 155,985 $ 690,670 $ 163,600 $ 2,762 $ 22,797 $ 1,035,814 $ 684,308 $ 1,720,122

2006Thereafter 85,400 7,455 591,215 21,870 131,750 14,095 1,952 170 - 4,577 810,317 48,167 422,094 1,232,411 48,445 96,612 2005 3,770 20,530 5,270 166 4,243 33,979 50,416 84,395

20032004 18,550 23,640 18,620 20,210 3,785 5,055 158 162 3,647 3,934 44,760 53,001 53,991 52,373 98,751 105,374 2002 $ 17,170 $ 18,225 $ 3,645 $ 154 $ 6,396 $ 45,590 $ 56,989 $ 102,579 36 new jersey sports and exposition authority .COMMITMENTSANDCONTINGENCIES K. .TheAuthorityhasentered Convention into contractsrelated totheconstruction ofanewWildwoods 6. OnJune26,2000,theAuthorityformedTheHistoricBoardwalk Hall,L.L.C. (the “LCC”),alimited 5. TheAuthorityisexposedtorisksoflossesrelated toinjuriesemployees.TheAuthorityhasestab- 4. TheAuthorityhaslicenseagreements withthemajorsport franchiseswhoplayintheArena andthe 3. TheAuthorityisthesubjectof,orapartyto,variouspending orthreatened legalactionsinvolving 2. AportionoftheAuthority’s operatingrevenues are attributable to leasingoftheSportsComplex 1. mately $274,000(for57retirees) and$272,000(for58retirees) in2001and2000,respectively. Medicare coverage.TheAuthorityaccountsforthesebenefitsonapayasyougobasisandpaidapproxi- for Medicare. TheAuthoritywillalso,atitsdiscretion, makeavailablemedicalbenefits tosupplement Medical benefitsavailabletoactiveemployeeswillbeeligibleretirees whoare notyeteligible with theAuthorityare eligibletocontinuecertainspecifiedbenefitssubjectanyrequired contributions. salaried service (foremployeeshired afterDecember31,1992,62yearsofageand25service) Sports Authoritysalariedemployeeswhoretire onorafterage60,withaminimumof10yearsfull-time Annual expenseforthisplanwas$423,435and$379,60020012000,respectively. deferred compensationplan.TheAuthoritycontributesamaximumof3%theemployee’s salary. spectively. Inaddition,salariedemployeesoftheAuthorityare eligibleforparticipationinasection401(k) seasonal racingpersonnel.Annualpensionexpensewas$42,662and$59,102for20012000,re- Other Benefits (3.17%) and$558,544(3.27%),respectively. Noemployercontributionwasrequired. be $68,370,000. mately $64,000,000,$59,000,000 ofwhichwasexpended.Thetotalcosttheproject isexpectedto Center. AtDecember 31,2001,theAuthorityhadentered into contractsandothercostsforapproxi- $18,195,797. In2001,theAuthorityreceived $7,710,765. 14,2000through a capitalcontributiontobemadeoverfourinstallmentsexpectedequal tember leasehold interest andcontractualobligationsoftheAuthority, admittedaninvestingmemberonSep- Hall oftheAtlanticCityBoardwalk ConventionCenter(the“EastHall”).TheLLC,whichassumesthe liability companyintheStateofNewJerseyforpurpose financingandoperatingtheHistoricEast these liabilitieswasapproximately $3,000,000. amount ofthatlosscanbereasonably estimated.AtDecember 31,2001and2000,thereserve for Claims expenditures andliabilitiesare reported whenitisprobable thatalosshasoccurred andthe Authority paidclaimsintheamountof$1,119,206and$1,809,02420012000,respectively. No claimhasexceededorreached the$350,000excesscoveragelimitduring2000and2001. The worker’s compensationclaimandpurchases commercial insuranceforclaimsinexcessof$350,000. workmen’s compensation.TheAuthorityprovides coverageuptoamaximumof$350,000foreach lished ariskmanagementprogram toaccountforandfinanceitsuninsured risksoflossrelated to it willbesupplementedbytheAuthority. during thetermofagreement. To theextentthatnewrevenue isnotgeneratedfrom newsources new revenue tothetenant(asdefinedinagreement) ofnotlessthan$5,311,000foreachseason that allowforearliertermination. One oftheamendmentstoalicenseagreement includesguaranteed Stadium whichexpire atvariousdatesbetween2007and2026.There are optionsintheagreements have amaterialeffect onitsfinancialpositionoroperations. outside interests. TheAuthoritybelievesthatanyultimateliabilityarisingfrom theseactionsshouldnot and $18,283,000fortheyearsendedDecember31,20012000,respectively. event orapercentage ofticketsales.Rentalincome,undertheseleases,wasapproximately $20,107,000 facilities forvarioussportingevents,tradeshowsandotherexpositions.Rentalincomeisaflatfeeper -TheAuthorityhasestablishedaseparatedefinedbenefitpensionplanforselected 2001 annual report 37 * * * * * * provide funds to pay or reimburse amounts expended on major capital improvement projects including projects amounts expended on major capital improvement funds to pay or reimburse provide approximately (2) provide safety and security upgrades and elevator and escalator renovations; fire and (3) pay the issuance projects; and renovation $7,400,000 for certain Rutgers campus construction costs of the bonds. Swap and Derivatives Association (“ISDA”) Master Agreement, the counter-party to the agreement the counter-party Master Agreement, Swap and Derivatives Association (“ISDA”) the Authority issue variable rate bonds for the its option, on January 29, 2002, to have exercised A (“1992 Series A Bonds”) and enter into the State Contract Bonds 1992 Series purpose of refunding swap transaction. rate an interest in an the Authority will (1) issue variable rate bonds of the agreement with the provisions In accordance Bonds, a portion of its 1992 Series A Callable to refund amount not expected to exceed $138,590,000 2002, (3) pay option payment to the counter party no later than May 1, (2) pay an initial exercise in exchange for the variable rates on the new bonds (effectively, fixed rates of interest predetermined January 29, 2002 and (4) pay issuance costs. rates with the counter party) effective swapping interest the convention center for a term of 99 years for a single payment equal to the appraised value of the for a term of 99 years for a single payment the convention center of 35 years. The for a term leasing-back the property and concurrently at that date, convention center, fund the Sports Authority’s sufficiently have been invested to received proceeds major portion of the the initial lease in 26 years without having option to repurchase its lease payments and exercise future The also available after 10 and 20 years. options are funds. Repurchase any additional to provide by contingent State Contract Bonds additionally secured are payment obligations Sports Authority’s as defined. Upon center revenues, legally available luxury tax and convention ($100,000,000) and $7,945,000. of approximately a cash payment received Authority the Sports entering this transaction 2. of State Contract Bonds, 2002 Series A to: (1) On January 1, 2002, the Authority issued $15,800,000 1. into on April 5, 1999 under the International the Authority entered In compliance with an agreement 7. leasing into an agreement and Exposition Authority entered 1, 2001, the New Jersey Sports On March L. SUBSEQUENT EVENTS 38 new jersey sports and exposition authority NOTES 2001 annual report 39 NOTES RemRememberingembering ththee VictimsVictims and Heroes of SeptemberSeptember 11, 2001