The Majestic Star Casino in Gary, Indiana will receive a .2 million refund of taxes and interest under an agreement recently reached with the Lake County assessor’s office that settles all pending tax appeals. The amount is .2 million less than what a federal court ordered in December 2013. As part of the arrangement, Majestic Star has agreed to assessed values for its real property for 2015 through 2017.
Assessor Jerome Prince said, “This settlement concludes over five years of litigation and provides assurance of a steady stream of tax payments for the next four years. I am pleased that these matters have been resolved on a reasonable basis.”
In a statement, Majestic Star officials said, “Majestic Star Casino has worked closely with Lake County officials to reach a compromise and resolve many years of litigation. We believe the settlement strikes a fair balance.”
The matter dates back to 2013 when U.S. District Judge Leonard P. Stark affirmed a ruling by a bankruptcy court, which declared the county assessor had overvalued the casino’s two boats moored in Gary from 2006 through 2010. Majestic Star filed for bankruptcy in 2009.
The county argued the bankruptcy court inaccurately assessed the market value of the gaming boats. County officials said the boats should have been assessed at about $55 million, instead of the much lower salvage valuations of $6.29 million for Majestic Star I and $5.58 million for Majestic Star II.
As a result of the settlement, Majestic Star will receive a payment of $4 million to be paid now and another $1.2 million in tax credits over two years after adjustments are made for 2012-2014 taxes.
In return, Majestic Star has agreed to dismiss all tax appeals for all years prior to 2015. Furthermore, the owners have agreed to a value of $67 million for its two casino boats for 2012 and 2013. That property will be valued at $55 million per year for tax years 2014 to 2017 following the sale of about 190 acres by the casino in the summer of 2014.
