How Stockton University Lost Its Atlantic City Gamble
Illustration by Matt Herring. (Saatkamp: Donna Connor Photography; Showboat: iStockphoto)
The first and only time I sat down with Herman J. Saatkamp Jr., the former president of Stockton University, he was very much the current president of Stockton University. A few weeks later, an avalanche of disastrous business decisions and horrific PR blunders would tarnish the school’s reputation, help bring an end to Saatkamp’s career there, and, for good measure, plunge the zombie metropolis that is Atlantic City into ever deeper chaos. But on that late afternoon in early March, all seemed fairly peachy.
Saatkamp, 72, is large-bellied and ruddy-faced and white-bearded, which makes it hard to resist the inevitable Father Christmas comparison. When he greeted me in his office at the school’s campus in Galloway Township, about a dozen miles north of A.C., his manner was warm and mirthful. Smiling broadly, he showed off a series of aerial shots of the college. “This is our main campus. There’s 2,000 acres, and it’s the largest campus in New Jersey,” he told me. “It’s in the Pinelands National Reserve, so I always say we’re in a national park.” He hovered around some more before settling his focus on an asphalt lot. “We have the largest solar-covered parking area of any college in the state,” he explained.
In fact, there was a lot more than solar panels for Saatkamp to boast about. Two weeks earlier, his school had gained university status for the first time, reflecting its growth under Saatkamp, who assumed the presidency in 2003. The student body had grown by a third, to more than 8,000; the university, meanwhile, was climbing up the U.S. News & World Report rankings. At the same time, the school’s significant expansion, on campus and in Atlantic City proper, made it something of a real estate godsend for the economically depressed region.
All this should have translated into a pain-free interview. It didn’t quite work out that way. Despite the school’s gains, I’d heard grumbling from several members of the university community that Saatkamp, bolstered by a sense of his own grandeur, had begun to focus a little too intently on solidifying his reputation. When I broached such criticism, his reaction was so defensive, so hostile, so bizarre, it should perhaps have served as an indication that all was not going so well at Stockton University.
Exhibit A was a recent NBC 10 report that Stockton’s 2014 annual fund-raising gala had doubled as a 50th wedding anniversary celebration for Saatkamp and his wife. Guests expecting the focus of the evening to be on student scholarships found themselves surrounded by images of the couple. Because of the evening’s unusually exorbitant costs, the gala raised far less money than usual. “It was false,” Saatkamp told me, flatly, nonsensically, when I asked about the report. “There was no party.” Reminded that footage of the gala had aired on TV, he dug in: “It’s a lie. An absolute lie. If you want to report that, get the hell out of here. I’m serious. I mean, you’re demeaning me, you’re demeaning my wife, you’re demeaning my family. When you have galas for a university, you honor people.”
Exhibit B was the school’s recent foray into high-profile real estate, notably Stockton’s December 2014 purchase of the shuttered Showboat casino. Again, some sources in the Stockton community were nervous about the cost and purpose of a move that essentially doubled the university’s size. “You have to tell me who’s complaining about the investments,” Saatkamp said. “Don’t make up stuff,” he continued. “I’ve been around a long time, but you’re making it up.” Eventually, after he told me, “You should be ashamed of yourself,” I was booted from his office.
Weeks after our interview, the Showboat deal unraveled. The faculty and the board turned against Saatkamp, and previously supportive politicians went mostly silent. By late April, he was gone.
My interview with Saatkamp, as it turns out, was a fitting microcosm of the school’s tenuous grip on success. What appeared at first to be a story of visionary triumph was, upon deeper inspection, an object lesson in overreach. And left hanging in the balance was not only a university, but the city it never quite managed to save.
SAATKAMP, WHO IS originally from Knoxville, Tennessee, established himself early on as a leading authority on the 20th-century Spanish-American philosopher George Santayana. When he began moving from purely academic work into administration, it was at large universities like Texas A&M and Indiana University-Purdue University Indianapolis. Stockton, then one of New Jersey’s tiniest (and least prestigious) public colleges, perhaps wasn’t an obvious fit for someone of Saatkamp’s temperament.
“I think he sees himself as grander than anything around here, and probably sees Jersey and South Jersey as quaint, parochial,” says a prominent faculty member who asked to stay unnamed. “He sees himself as someone who came into a fairly backwater place and is trying to elevate the natives.”
Saatkamp’s sense of self-regard was evident from the start. Upon his hire in 2003, his salary — $215,000 — was higher than that of any other president of New Jersey’s nine teaching colleges. (He also received a golf membership and a $4,000-per-month housing allowance. His total compensation sat at around $450,000 when he resigned.) Similarly, before the Showboat deal imploded, he had planned to move his office (and, tentatively, his residence) into the casino, with its not-too-shabby ocean view.
It seems puzzling, given his questionable interpersonal skills and massive ego, that Saatkamp lasted as long as he did. As one member of the school’s Foundation Board put it to me, “I dare you to find someone in South Jersey who says, ‘I like Herman Saat-kamp.’” That may or may not be true, but as Anne Pomeroy, an associate professor of philosophy and head of the school’s teachers union, says, having a pain-in-the-ass president was a small price to pay for the success he brought the university. “We have always thought, okay, you know, he’s a bit of a blowhard,” she says. But he also did “a lot of things that we desperately needed. We had [virtually] no foundation, no alumni association, really, to speak of.”
The most obvious beneficiary of Stockton’s expansion, beyond the school itself, was Atlantic City. Because it’s located in the Pinelands, Stockton is circumscribed from significant growth. As a result, upon his arrival, Saatkamp began expanding the school into downtown A.C., where space was both plentiful and cheap. In 2004, Stockton assumed control of the historic Carnegie Library. In 2012, it began to rent out the Dante Hall opera house for performances. One year later, it opened the Noyes Arts Garage, a space for local artists to sell their wares and offer classes. “When nothing was happening in A.C., we were the only ones building,” says an administration official. “The science center. The campus center. Twenty-something other projects on campus … People would have lost their jobs without us.”
But that savior narrative, the administrator believes, “got to Saatkamp’s head.” In 2010, Saatkamp led Stockton’s purchase of Seaview, a golf club and resort near campus, for $20 million. Seaview, which still operates as a resort and is also used for student housing, has netted a slight loss since the sale. More troubling is the source of the money used to buy it. The bulk of the cash used to purchase the Seaview — and later Showboat — came from a highly touted investment fund that Saatkamp created in 2005. The use of the special fund for real estate deals, Saatkamp told me during our interview, enabled the school to make major purchases without incurring excessive debt. Problem is, from 2005 to 2012, $42 million of the $54 million available in the fund was simply drawn from the school’s general operating account, according to documents obtained through a public-records request.
Likewise, the 2014 fund-raiser-cum-anniversary gala was problematic not simply because of the self-serving optics, but because of how much it cost. (The event’s price was unusually high thanks to the purchase of an outdoor tent that reportedly cost $134,000, which was needed because Stockton insisted on holding the gala at an overbooked Seaview.) After expenses, the gala raised just $180,000 for scholarships — about $100,000 less than it had in the previous two years. That PR hit only gets worse when you consider that Stockton’s students graduate with an average of $33,000 in debt — one of the state’s highest rates. “We just ate and left,” recalls one gala attendee. “The screens all over the place showing pictures of when they were young, when they were courting? I mean, give me a break.
“He did some really wonderful things with that campus,” the attendee continues. “But I think, also, there comes a time when you have to take credit for what you’ve done and be done with it.”
SAATKAMP WASN’T QUITE ready to do that. Throughout his tenure, he was obsessed with the idea of building a campus in Atlantic City. Some suggest he was padding his legacy. Others suggest the state was desperate for a feel-good story out of A.C., which is why it was promising millions in Casino Reinvestment Development Authority funds to supplement the Showboat sale. On a more straightforward note, the school was growing, the campus was nearing capacity, and A.C. real estate was dirt-cheap. Whatever the reason, Saatkamp apparently began telling people that without the construction of an A.C. campus, he’d done what he could for the school.
Ironically, it was Saatkamp’s zeal that ultimately killed his dreams of an Atlantic City campus. Last August 31st, the Showboat closed, eliminating more than 2,000 jobs and leaving a massive vacancy at the north end of the Boardwalk. In the fall, Stockton administrators began touring the property. On December 3rd, the board of trustees moved to convene a special meeting to discuss a possible purchase, “because of shortness of time.” “This is the biggest acquisition we ever made,” says a member of the Stockton administration. And yet, he says, because of the expedited timeline, “There was a lot more discussion about Seaview than there was about the Showboat deal.”
Around that time, says a source close to the board, Saatkamp hinted to board members that he would resign if the deal was not ratified. (Asked for comment, a university spokesperson says, “We are simply not sure with whom Dr. Saatkamp communicated and when.”) After nearly six hours in session, the board okayed the Showboat deal. Stockton, through its investment fund, would pay $18 million for the property, while the state CRDA would chip in an extra $17 million for expansionary efforts. Two of the casino’s three towers would be refitted for residential and academic purposes, while the third would continue to operate as a hotel, owned by Stockton.
A week after the vote, Barbara Morvay, a Stockton trustee and career-long educator, resigned from the board after voicing discomfort with the deal. Morvay became at least the fifth prominent university figure in recent months to part ways with the school, which also saw its general counsel, HR director and provost announce their departures. When Saatkamp released a statement implying that Morvay did so to spend more time with her family, she shot back in an email to the Press of Atlantic City: “His response is inappropriate and inaccurate. … I resigned in December for specific reasons, none of them personal.” (Morvay declined my interview requests.)
In theory, the Showboat deal had logic to it. “For a lousy $18 million,” says one faculty member, “you have the ability to double your campus for a price where you couldn’t build a small dormitory.” What didn’t ultimately make any sense was this specific agreement. When Stockton agreed to purchase the Showboat, Saatkamp was fully aware that the casino’s next-door neighbor, Trump Taj Majal, had signed a legal covenant with the Showboat back in 1988 mandating that the Showboat property would never be used for anything but a casino resort. Caesars Entertainment, Showboat’s parent company, had promised to indemnify the university against any possible damages resulting from the Taj’s attempt to enforce this covenant. But Saatkamp apparently forged ahead with the deal before resolving the issue. More crucially, the school’s top brass doesn’t appear to have been informed about the covenant.
Saatkamp’s apparent unwillingness to negotiate was laid bare in a letter Trump CEO Robert Griffin wrote to him on March 13th. “ … [P]rior to closing, we were called to request that we waive this restriction,” read the missive, which was first obtained by the Press. “We said no but also stated that we would be willing to further discuss the issue. You did not give me the courtesy of a phone call until [after the sale was completed]. Instead, and in your wisdom, you decided to close your transaction and ignore our rights.” State Senator Jim Whelan, who represents A.C., told me he approached Saatkamp with an idea that would have given Trump access to the Showboat space. Griffin, in turn, told Whelan he’d be willing to sit down with Saatkamp and Caesars to discuss a compromise. Saatkamp never acted on the offer.
ON MARCH 24TH, Saatkamp declared in a melodramatic press release that the deal had hit an impasse. “With immense sadness, I am announcing today that Stockton University’s efforts to create a residential branch campus in Atlantic City have reached a stalemate,” he wrote. “Stockton tried to establish a full campus in Atlantic City six times during my tenure as president and got kicked in the teeth each time. This time, we were stabbed in the heart.”
The “Island Campus” implosion was an embarrassing setback for Stockton, but it was what happened next that ultimately wound up dooming Saatkamp. The very day the release was sent out, according to internal emails, Florida developer Glenn Straub, newly minted owner of Atlantic City’s bankrupt Revel, emailed Saatkamp about a deal in which Saatkamp would flip the Showboat to him. Straub said a contract would be ready in eight to 10 days. Forty-five minutes later, at 6 p.m., Saatkamp wrote back: “I would prefer to keep our negotiations confidential for now,” adding, “I would like to work on a very positive announcement of the sale if it all comes about.”
On April 3rd, the very positive announcement was made that Straub would tentatively be taking the property off Stockton’s hands for $26 million, leaving the school the option of buying or leasing it down the road. What was hailed as good news by the university administration, however, immediately backfired. Straub, who in September said part of his $500 million plan to “save” A.C. included a university for students who are “free, white, and over 21,” wasn’t exactly the business partner the Stockton community was hoping for.
Over the course of Saatkamp’s tenure, his autocratic decision-making had often paid off, but it seems in this instance to have seriously damaged the university’s reputation. “ … [T]he inept, disrespectful, and seemingly incompetent behavior of President Saatkamp and the Board of Trustees compels me [to] speak up,” wrote Tim Haresign, a faculty member and the president of the Council of New Jersey State College Locals, in an email to Saatkamp and the entire university staff and faculty. He added, “It is unacceptable to enter into secret deals that have the potential to dramatically change the course of our beloved home without the full involvement of faculty, staff, and students.” The faculty would eventually vote “no confidence” in Saatkamp.
Meanwhile, Saatkamp was stubbornly clinging to the dream of an Atlantic City campus. First, he touted a proposal to rezone the former Showboat property for non-casino purposes. The feasibility of the plan was immediately thrown into doubt when the Taj, steered by activist investor Carl Icahn, implied it was ready to sue the city if it went through. Then, on Saturday, April 18th, according to a source close to the board, Saat-kamp spoke with four board members. For several hours, the source says, Saatkamp insisted he could save the Island Campus. Two trustees wouldn’t hear of it, telling him to give it up. Eventually, Saatkamp relented and decided to submit his resignation. (No board members agreed to comment for this story; Stockton declined to comment on the details of the resignation.) In early May, the board of trustees agreed to spend up to $350,000 for a “comprehensive investigation” of the Showboat deal. Says one administrator, summing up his view of the ordeal, “It’s called narcissism at the most significant level.”
FOR NOW, STOCKTON has been placed under the stewardship of beloved longtime provost Harvey Kesselman, but it’s unclear whether his presidency will be made permanent. The Showboat, which is costing the college $400,000 a month to maintain, will likely soon be in the hands of Straub, who was last seen trying to use its generators to pump electricity into Revel. Beyond that, it’s not exactly clear how it, or any of Straub’s other investments, is going to lift Atlantic City out of its misery.
Whatever his record as a president, Saatkamp’s credentials as a Santayana scholar are solid. But that’s what makes his ravenous appetite for expansion so puzzling. George Santayana, after decades at Harvard, left for Europe and spent the rest of his life rejecting a barrage of lucrative offers. Academia, he insisted, wasn’t really interested in academia.
Saatkamp, ironically, seemed more than a little self-conscious of this. “Santayana retired from Harvard in 1912 at the ripe old age of 48. His account was, ‘Harvard was becoming too businesslike, was not fostering intellectual curiosity,’” Saatkamp said when we met in his office. A portrait of the philosopher hung above his desk. “That’s a drawing done by Santayana’s grandnephew,” he said. “So I sit here at the desk having Santayana look down on me, basically saying, ‘What are you doing? Why are you doing this?’”
Originally published as “The Gamble” in the June 2015 issue of Philadelphia magazine.
