ATLANTIC CITY, New Jersey — The Borgata casino will receive about $63 million after a state appeals panel concluded Monday that Atlantic City had overcharged it on property taxes.
The ruling affirms a $48 million tax refund, and about $15 million in interest for the tax years 2009 and 2010. It is separate from an $88 million tax settlement the casino reached with the city last year for other tax years.
For nearly a decade, Atlantic City has faced a wave of tax appeals as its casinos successfully argue they are not worth what they once were, when the gambling market was doing better. Four of the city's 12 casinos shut down last year and casino revenue has fallen from $5.2 billion in 2006 to $2.74 billion last year.
A bill that would let Atlantic City's casinos make payments in lieu of taxes for 15 years — and not be able to appeal their taxes — has been passed by the state Legislature and awaits a decision by Gov. Chris Christie.
In the meantime, the city continually finds itself with a losing hand. The appeals court ruling Monday 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.
While expressing relief in the ruling, Borgata President Tom Ballance wishes it was never necessary to begin with.
"We're not really pleased at all," he said. "We would rather the city charge us the correct amount of property taxes in the first place."
Atlantic City Mayor Don Guardian said the appeals are killing the city's finances. He is considering what the city's next step should be, while calling 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."
State Assemblyman Vince Mazzeo, an Atlantic City-area Democrat, also said the ruling highlights the need for swift action on the payment-in-lieu-of taxes bill. He said an emergency manager appointed by Christie in January has yet to find any meaningful ways to help the city.
"In absence of any proposal from the emergency manager, I again ask the governor to sign our tax stabilization bill package so we can make sure that Atlantic City and our region have not just a great summer season, but a future that brings Atlantic City back to the resort destination we know it can be," Mazzeo said.
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 Ballance said Monday the city has yet to pay any of that money.
Wayne Parry can be reached at http://twitter.com/WayneParryAC
The story has been corrected to show the last name of Borgata's president is Ballance, not Balance.