Atlantic City-New Jersey lawmakers have proposed financial relief for Atlantic City casinos to help them continue to recover from the coronavirus pandemic by exempting the industry’s two fastest-growing sources of income. The cost of the city.
It will reduce payments to some casinos, including Borgata, while imposing higher payments on other casinos, including Hard Rock.
The bill was introduced by a state Senate committee on Monday morning and is a continuation of a measure that requires casinos to pay taxes to Atlantic City in lieu of taxes. Home in the casino.
There are currently nine casinos.
At that time, it was easy to prove that their business was declining in value in a declining market. The casinos succeeded in appealing their property tax assessments year after year, helping Atlantic City's budget to have huge loopholes.
Payments in lieu of the tax bill, called PILOT, are designed to give casinos and cities certain certainty about their financial status in return for prohibiting casinos from appealing their tax assessments.
"The Pilot Act actually saved Atlantic City," said Joe Tyrrell, the regional vice president of Caesars Entertainment, which owns Caesars, Harrah's and Tropicana in Atlantic City. "Without PILOT, you would not open Hard Rock, nor would you reopen Revel like Ocean did. Casinos are appealing their taxes."
The latest version of the bill, initiated by the outgoing Senate Speaker Steve Sweeney, will exempt Internet gambling and online sports betting revenue without calculating how much casinos must pay to the city, school system, and Atlantic County.
It will also reduce the total payment amount from approximately US$120 previously calculated to US$110 million per year.
The bill will provide substantial discounts to some of the city's most successful casinos, including the best performing Borgata.
According to data obtained by the Associated Press not specified in the legislation, Borgata’s payments will be reduced from $29 million this year to $22.8 million in 2025.
Caesars will increase from USD 17.5 million this year to USD 9.3 million in 2025; Harrah's will increase USD 25.6 million to USD 17.8 million.
On the other hand, Hard Rock’s PILOT payment will increase from US$7.7 million this year to US$15.9 million in 2025. Tropicana will increase from USD 8.3 million to USD 11 million; Bally's will increase from USD 5.3 million to USD 7.7 million; Golden Nugget will increase from USD 4.8 million to USD 6.2 million; Ocean will increase from USD 7.5 million to USD 11 million, Resorts It will increase from 3.5 million U.S. dollars to 8 million U.S. dollars.
The bill does not affect the substantial state taxes that casinos must pay on Internet gambling revenue (15%) and online sports betting revenue (13%), nor does it affect the 9.25% tax on live casino revenue.
The bill still needs to be considered by the entire Senate, and no action has been taken in Parliament.
Senator Troy Singleton, chairman of the Senate Committee on Community and Urban Affairs, said that given the rapid growth of these two categories, he is very concerned about removing Internet and sports betting revenue from the calculation of how much casinos should pay to cities and counties.
In the first nine months of this year, online gambling brought nearly $1 billion in revenue, a year-on-year increase of 44%. Sports betting revenues-more than 80% of which came from online gambling-reached US$557 million, a year-on-year increase of 150%.
But casino executives argued that they must share a large part of their online bonuses with technicians and other partners, and that they bear full tax liability while they only keep part of the funds, which is unfair.
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