TRENTON, N.J. (AP) — The Latest on legislation to allow New Jersey to take over Atlantic City's government (all times local):

4:15 p.m.

Atlantic City Mayor Don Guardian says his city has been making payments to its schools and for other expenses when they were told to do so by state overseers.

Guardian says a state monitor for the schools confers almost daily with a state monitor for the city, and the two tell Atlantic City when to make required payments.

The mayor spoke after New Jersey filed a lawsuit against Atlantic City to stop it from making a payroll payment Friday because it owes its school district more than $30 million through July.

Guardian says the city will continue to find ways to reduce expenses and increase revenue.

He adds a planned shutdown of non-essential city government has been avoided at least through May.

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3:20 p.m.

Assembly Speaker Vincent Prieto wants his Senate counterpart to negotiate a new Atlantic City aid bill that would be acceptable to Gov. Chris Christie.

Prieto called on Senate President Steve Sweeney to jointly negotiate a bill to help the struggling gambling resort, which is due to run out of cash soon.

His comments came after New Jersey filed a lawsuit against Atlantic City to stop it from making a payroll payment Friday because it owes its school district more than $30 million through July.

Prieto says he has not been able to provide input into a state takeover bill, and says "the Assembly has to be relevant."

Christie and Sweeney support the measure allowing the state to run the city's government and say that is the best way to rescue the city.

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2:30 p.m.

New Jersey has filed a lawsuit against Atlantic City to stop it from making a payroll payment Friday because it owes its school district more than $30 million.

The lawsuit announced Monday by Gov. Chris Christie increases the pressure on Atlantic City Mayor Don Guardian and Assembly Speaker Vincent Prieto to support a takeover measure.

Atlantic City is set to run out of money on Friday.

Christie and Senate President Steve Sweeney support the measure allowing the state to run the city's government and say that is the best way to rescue the city.

Christie's news conference comes on the same day that Moody's downgraded the city's debt citing the ongoing political stalemate in Trenton.

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1:50 p.m.

A ratings agency has downgraded Atlantic City's low-rated debt once again.

Moody's cited the "ongoing political stalemate" in the statehouse and a possible default within the next year.

A measure to allow the state to take control of the city's finances is stuck in the Assembly. Democratic Speaker Vincent Prieto has refused to bring it up for a vote, saying it gives Republican Gov. Chris Christie too much power to cancel collective bargaining rights.

Senate President Steve Sweeney and Christie agree that the measure allowing the state to run the city's government is the best way to rescue the city,

Moody's warned that it expects bondholders to lose up to 35 percent of their principal because of the city's large structural deficit.

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1:25 p.m.

Assembly Speaker Vincent Prieto is calling on Senate President Steve Sweeney to change legislation allowing the Christie administration to takeover Atlantic City's government.

Prieto wrote Monday to his Assembly Democratic colleagues that collective bargaining rights, which could be canceled under the legislation, should not be on the chopping block.

Sweeney and Gov. Chris Christie agree that the measure allowing the state to run the city's government is the best way to rescue the city, which faces financial insolvency later this week.

Prieto has objected that the bill unfairly gives Christie the authority to end union contracts.

Christie is holding a news conference later on Monday.

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12: 45 p.m.

Assembly Speaker Vincent Prieto says there's no progress yet with Gov. Chris Christie over a state takeover of Atlantic City.

Prieto told NJTV News on Monday that he and the governor met for about an hour but that they haven't reached an agreement on the legislation.

The measure would allow the state to take control of the city's finances as it teeters toward financial failure later this week.

Prieto objected to the measure, which Christie backs and the state Senate has already passed, because it could allow the state to end collective bargaining agreement.

Christie is set to hold a news conference later on Monday.