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(Associated Press) - Predictable tax bills for casinos and certain revenue for Atlantic City’s government are the goals of a plan unveiled this week by two New Jersey state senators looking to help the struggling seaside resort, which has seen four of its 12 casinos close this year.
The plan by state Senate President Stephen M. Sweeney, D-Gloucester, and Sen. James Whelan, D-Atlantic, would let casinos collectively pay $150 million in lieu of taxes for two years, and then $120 million a year after that, assuming gambling revenue stays at a certain level.
A spokesman for Atlantic City Mayor Don Guardian told The Associated Press the city’s casinos — excluding the Atlantic Club, which only operated for 12 days in January before shutting down — were charged $210 million in property taxes this year, though the final amount collected will not be known until after a tax certificate sale set for next week. That figure includes taxes paid for more than half the year by three casinos that have since closed and would not be counted in future years’ tax calculations — Revel, Showboat and Trump Plaza.
City officials said Wednesday they could not provide a breakdown of the taxes charged to each individual casino.
Kevin Ortzman, president of the Casino Association of New Jersey, said the bills are essential to letting casinos plan their finances effectively.
“Atlantic City needs this type of stabilization, which is critical to maintain the thousands of jobs and investment dollars in the market and enable further diversification to stimulate growth,” he said.
After two years of $150 million payments, the casinos would owe $120 million a year, as long as Atlantic City’s annual gambling revenue is between $2.2 billion and $2.6 billion. If it falls between $1.8 billion and just under $2.2 billion, the payment would be $110 million. If revenue is between $1.4 billion and just under $1.8 billion, the payment would be $90 million, and if it falls below $1.4 billion, the annual payment would be $75 million.
The plan also would redirect a casino redevelopment tax to pay off $25 million to $30 million of Atlantic City’s debt each year, and would create a new category of state education aid applicable only to Atlantic City to help hold down local taxes in return for school spending cuts.
The Board of Education has already begun that effort, voting Tuesday night to close an alternative high school it operates as of Dec. 31, and put its building up for sale.
Also Wednesday, a bankruptcy hearing on whether Trump Entertainment Resorts should be liquidated instead of reorganized was postponed for a week.
No reason was given for the delay in the hearing, which had been scheduled for Thursday. It is now planned for Dec. 11 — the day before the Taj Mahal casino is due to close.
But talks are ongoing among the company, its main union, would-be purchaser Carl Icahn, and New Jersey officials on possible ways to save the casino and its 3,000 jobs.
