Atlantic City casinos might benefit tremendously from a tax relief plan that was proposed months ago by New Jersey State Senate President Stephen Sweeney (D-Gloucester).
The plan could also help the city itself by stabilizing revenues and removing the uncertainty the surrounds Atlantic City’s annual budget.
But with a key deadline approaching in just a few weeks, it’s still unclear whether the measure has the support of Governor Chris Christie, which in turn has caused Sweeney to delay voting on the package of bills he says will help aid an Atlantic City recovery.
“What’s the holdup?” Sweeney asked last week in reference to the governor’s delays in regards to the tax relief bills. “We have the votes to pass it. The Atlantic County executive and the freeholders are for it. They’re all on board. It’s the administration. They know what the bills are…but I’m not putting them on Governor Christie’s desk until I know he will sign them.”
Plan Would Trade Fixed Payments for Uncertain Property Taxes
The bills in question would allow Atlantic City’s casinos to avoid paying property taxes for the next 15 years. Instead, they would make fixed payments in lieu of taxes annually, giving both the casinos and the city a clearer financial outlook for the near future.
This could be critical, as property tax assessments have been a major issue for Atlantic City in recent years. Successful appeals by casinos of such assessments have cost the city close to $400 million in recent years in refunds and tax revenues, causing major damage to the city budget. The deadline for appeals this year is April 1, meaning that if Sweeney’s plan or something similar isn’t passed in the next few weeks, the city could face another round of battles over how much the casinos expect to pay in property taxes.
Lawmakers, Casinos, and Mayor All Support Plan
The bills have been supported by many legislators in both the State Senate and Assembly, with even some lawmakers who originally blasted the plan as corporate welfare having come on board after adjustments to the proposal were made. Atlantic City’s Republican mayor, Don Guardian, says he’s behind the plan as well.
“Our residents and business owners alike need these bills to be passed,” Guardian said. “I’m confident that everyone involved with the process will see how important they are to Atlantic City’s long-term property-tax stabilization and will pass them.”
The casino industry in New Jersey has also come out in favor of the bills.
“Make no mistake,” wrote the Casino Association of New Jersey, a lobbying group that represents some of Atlantic City’s casinos. “Without this plan, certain casinos that remain in Atlantic City are at risk.”
Recent polling has also shown general support among New Jersey residents for providing aid to Atlantic City, even if they also feel as though the city’s best days are behind them. However, despite such a broad base behind the bill, Sweeney and other top Democratic legislators have no put the bill to vote yet.
Christie Yet to Sign On to Tax Relief
The holdup appears to be due to Governor Christie’s lukewarm reception to the tax relief plan. He says that he wants to see what the emergency management team he has put in charge of Atlantic City’s recovery recommends. He has also had less than glowing words for Sweeney’s plan in the past.
“Unfortunately, though, all these efforts have no yet created a plan for long-term success in Atlantic City in my view,” Christie said in January, referring to several plans including Sweeney’s. “I say this because all of them assume an investment of extensive state resources without a comprehensive and committed plan leading to long-term fiscal stability for Atlantic City.”