In the culmination of a decade-long legal battle, the Alabama Supreme Court has ruled that the owners of the Greenetrack racing and bingo facility in Eutaw, Greene County owes $76 million in unpaid taxes.
Under state law, counties may authorize nonprofit bingo parlors. However, an audit between 2004 and 2008 showed that most of the bingo profits went directly to Greenetrack, instead of the facility’s licensed nonprofit partners.
Those partners, licensed by the Greene County Sheriff, included numerous clubs from nearby Greene County High School, such as the athletic booster club, band booster club, math team, choir, Junior Reserve Officers’ Training Corps, library club, Future Homemakers of America, Future Business Leaders of America, National Honors Society, parent-teacher association and student government association.
Lower courts previously ruled in favor of Greenetrack, which claimed its bingo games were nonprofit and its status as a racing licensee made it exempt from certain taxes. However, the supreme court disagreed, stating Greenetrack’s racing license did not apply to other activities, like bingo. The court said if Greenetrack’s argument were true, any business could apply for a racing license to avoid paying taxes. The court also ruled Greenetrack’s partnerships with non-profit bingo lessees were illegal.
The court opinion stated, “For the low cost of $4,850 a day, Greenetrack was able to use the nonprofit organizations’ licenses as a fig leaf for its own illegal but extremely profitable bingo activities. The idea that the racing license law reaches so far beyond that narrow subject matter that it grants licensees of the commission a sweeping entity-based exemption from taxes on any and all activities they undertake, even activities completely unconnected to dog racing, is simply not plausible.”
Alabama Attorney General Steve Marshall added, “Every day, all across our great state, the people of Alabama get up, work hard to make an honorable living, obey the law and pay their taxes. And then there are the likes of Greenetrack, which schemes to make a dishonorable profit, break the law and evade their taxes. Such a sordid state of affairs is more than merely unjust. It is hateful to the rule of law. And, under my watch, it will not be tolerated.”
Greenetrack has not yet commented on the recent ruling.
