Operator News
US – New Jersey Legislature passes new PILOT tax relief plan for casinos
By Phil - 22 December 2021
The New Jersey Legislature has approved a new casino PILOT bill, to provide tax relief to Atlantic City’s casinos and help them recover from the pandemic.
The bill will now go to Governor Phil Murphy’s desk. With the amendments, the variable payment starts at $110m in 2022 and can range between $100 and $120m based on gaming revenue amounts generated at the casino properties (not including internet revenue).
S4007 proposes a new $5m fixed payment to be paid directly to Atlantic City that is divided among the casinos. This additional payment is not included for 2024-2026 under the current PILOT law.
Internet gaming has previously been included in the formula to establish the annual variable payment amount and the allocation of this amount between properties, even though most of the online revenue is received by third-party companies — not land-based casinos. While online gaming has seen significant increases in recent months, these revenue increases have contributed to a great misperception around the financial health of Atlantic City casinos since the pandemic. The monthly reporting of revenue combines online and land-based gaming revenue and attributes the entirety to Atlantic City casino properties, thus creating a number that does not accurately reflect the current state of the industry. Removing it from the equation retains that stability for the city and county and allows the PILOT program to produce more revenue in 2022 and thereafter than it produced in 2021. Internet gaming is already taxed at 15 per cent6 (in addition to the 2.5% tax that goes to the city), and that money goes to the Casino Revenue Fund which supports programs that benefit seniors and persons with disabilities.
The Casino Association of New Jersey (CANJ) said: “The Casino Association of New Jersey (CANJ) is pleased legislators passed the amended PILOT program, which will protect thousands of jobs and provide certainty and stability to the market. We would like to especially thank Senate President Sweeney, Assembly Speaker Coughlin and Assembly Majority Leader Greenwald for their efforts and support of this critical legislation. Under the revised PILOT program, Atlantic City and Atlantic County will receive more tax revenue moving forward year over year from the casino industry, and the funding provided by the PILOT program will help improve Atlantic City’s infrastructure and create a safer community for visitors and residents. We look forward to Governor Murphy quickly signing this important legislation into law and we are committed to working to continue to revitalize our historic seaside destination resort.”
Mayor Small added: “The great city of Atlantic City is in a better financial position than we were five years ago. There’s no question about it. And the great city of Atlantic City will be in a better financial situation five years from now than today, and that is because of the PILOT bill.”
