The New Jersey Casino Reinvestment Development Authority has a new source of funding as Governor Phil Murphy has signed a bill that will send 1.25 percent of sports betting revenue to the redevelopment agency.
However, the tax revenue will be used for marketing and promotion of Atlantic City and not redevelopment projects. The new tax is added onto the 8.5 percent revenue tax at land-based sportsbooks the 13 percent tax on online sports betting. The bill goes into effect in December.
The 1.5 percent tax on the state’s two racetracks that run sports books—the Meadowlands Racetrack in East Rutherford N.J. and Monmouth Park racetrack in Oceanport N.J.—will be distributed directly to each facility’s host municipality. The state’s remaining sportsbooks are in Atlantic City casinos.
The bill returns some funding to the authority since it lost its main source of funding from casino redevelopment taxes last year. That money has now been directed to help pay down Atlantic City’s municipal debt under a package of bills passed last year to save the city from bankruptcy.
Still, Atlantic City Mayor Frank Gilliam, who sits on the authority board, said he would rather have seen the new tax also go to the city.
“As mayor, I’m never going to be happy with revenue generated in Atlantic City going to a state agency when it could have been used to help the city,” Gilliam told the Press of Atlantic City. “History has shown that marketing money has not been spent wisely.”
Since sports betting started in the state in June, it has generated nearly $16.5 million in revenue through August with $8 million coming from Atlantic City casinos and their online or mobile partners.
“After a three-year hiatus, we are looking forward to filling the void with much-needed promotion of Atlantic City as a world-class vacation destination,” said Larry Sieg, CRDA director of communications and marketing in a press release. “Our team looks forward to having the opportunity to once again get the DO AC brand into the consumer market to increase visitation and economic impact.”
The bill signing comes about a month after a state audit report on CRDA was released which contained numerous criticisms of how the authority handles its finances and several deals it has made to promote the city through special events.
