Atlantic City has suffered another loss of a casino tax appeal as a state appeals court has upheld a million ruling in favor of the Borgata Hotel Casino & Spa.
With interest, the casino will get an about $63 million payment from the city for the tax years 2009 and 2010. The ruling affirms the $48 million tax refund, and about $15 million in interest.
The refund is separate from an $88 million tax settlement the casino reached with the city last year for other tax years.
Atlantic City has faced a number of tax appeals from casinos as gambling revenue has been declining in the resort for several years. Four city casinos also shut down in 2014.
A bill designed to stop the long string of appeals and allow Atlantic City’s casinos make payments in lieu of taxes for the next 15 years has been passed by the state Legislature and awaits a decision by Gov. Chris Christie. The Governor, however, has still not said whether he supports the bill or will veto it.
The appeals court ruling upheld a 2013 tax court ruling that reduced the Borgata’s taxable valuation from $2.2 billion in 2009 and 2010 to $880 million and $870 million for those years.
Borgata officials said they were relieved, but not happy about the ruling.
“We’re not really pleased at all,” Borgata President Tom Balance told the Associated Press. “We would rather the city charge us the correct amount of property taxes in the first place.”
Atlantic City Mayor Donald Guardian said the continuing appeals are destroying the city’s finances and called on Christie to sign the payment in lieu of the taxes bill.
“Today’s ruling does not change the fact that the city cannot afford to pay assessment rebates as currently constituted,” he said. “These ongoing tax appeal challenges from casinos reinforce the fact that the Casino Property Taxation Stabilization Act legislation is urgently needed to help stabilize taxes in Atlantic City.
“The enormous amount of refunds that the city must pay back on successful tax appeals is simply unsustainable,” Guardian said. “We continue to make cuts and run city government more efficiently, but it is the taxpayers who will suffer in the long run without tax stabilization.”
Last year, the Borgata and Atlantic City reached a settlement on disputed taxes under which the casino would receive a tax refund of $88.25 million for tax years 2011 through 2013, as well as an estimated tax credit of $17.85 million for the tax year 2014. But Balance told the AP that the city has yet to pay any of that money.