Atlantic Metropolis casinos have been dealt a profitable hand by the New Jersey Legislature in 2021 when the state agreed to considerably decrease the 9 resorts’ annual property tax.
New Jersey Gov. Phil Murphy delivers his 2023 State of the State Deal with in Trenton on January 10. Murphy says his administration will be sure that the 9 casinos in Atlantic Metropolis proceed to pay their fair proportion in taxes. (Picture: Bloomberg)
Atlantic Metropolis casinos have paid a collective property tax since 2016. The tax association, often called payment-in-lieu-of-tax (PILOT), was orchestrated after 5 casinos on the town closed between 2014 and 2016. The remaining casinos argued that their property worth assessments have been far too excessive after the native financial system unraveled.
PILOT requires casinos to pay a tax primarily based on their annual gross gaming income (GGR).
In 2021, the casinos efficiently satisfied state lawmakers — with outgoing state Senate President Stephen Sweeney championing the trouble — to decrease their PILOT accountability. The decreased tax got here from lawmakers agreeing to take away iGaming and on-line sports activities betting income from the calculation used to find out the PILOT cost.
The adjustment resulted within the 9 Atlantic Metropolis casinos saving about $55 million in taxes final 12 months. A authorized problem to the constitutionality of the PILOT modification stays ongoing. Nonetheless, New Jersey Gov. Phil Murphy (D) mentioned lately that he’ll be sure that the casinos “pay their fair proportion.”
State Backs PILOT Change
Conservative nonprofit Liberty & Prosperity 1776 is behind the authorized problem to the 2021 PILOT regulation. The group contends that the state can not present a tax profit to a particular trade until it gives a “public goal.”
New Jersey Superior Court docket Choose Michael Blee in August agreed. He issued a keep of the PILOT calculation adjustment whereas the authorized matter performs out. State attorneys are interesting Blee’s ruling.
Whatever the end result, Murphy informed listeners on his “Ask Governor Murphy” radio present on WNYC earlier this month that he’ll maintain the casinos liable for their full, authorized tax payments.
“Tax equity is actually necessary to us, and it has been from day one. And if we don’t fairly get it proper, we’ll come again at it and do every thing we are able to to get it proper,” Murphy mentioned.
The governor believes Atlantic Metropolis is alive and effectively regardless of continued competitors all through the northeast and a current pandemic.
“Once I consider the place Atlantic Metropolis was in 2008, 2009, 2010, and the place it’s immediately, and once you put a pandemic in the midst of that timeline, town, together with the casinos, is on a very spectacular trajectory,” the governor defined. “We’ll be sure that as a state that the casinos pay their fair proportion.”
Trade Appropriately Sized
A key buzzword in Atlantic Metropolis throughout the metropolis’s resurgence is that the city wanted to “right-size” itself. State and native officers, together with Murphy, consider the city is lastly there at a nine-casino market.
Exhausting Rock and Ocean — previously Trump Taj Mahal and Revel — opened in June 2018.
We would like the casinos in Atlantic Metropolis, however we wish it right-sized,” Murphy defined. “I believe one of many points we had again earlier than the Nice Recession of 2008 was that there have been too many casinos.”
“I believe in the mean time it feels prefer it’s in the appropriate neighborhood,” the governor concluded.
