Hard Rock Atlantic City to Receive $4.8M Property Tax Settlement From City and Atlantic County
Posted on: January 23, 2019, 06:00h.
Last updated on: January 23, 2019, 07:08h.
Owners of the Hard Rock Hotel & Casino in Atlantic City will receive $4.8 million over the next four years after reaching a property tax appeal settlement with the state.
Since Hard Rock – the former Trump Taj Mahal – closed In October of 2016 just five months after then-New Jersey Governor Chris Christie (R) signed the Atlantic City PILOT (Payment in Lieu of Taxes) bill, the state is now conceding that the new property owners shouldn’t have been required to participate in 2017. Hard Rock purchased the shuttered Taj in March of that year from Carl Icahn for $50 million.
In 2016, casinos began appealing their property valuations and subsequent taxes amid a deteriorating Atlantic City economy. The PILOT program guaranteed the state and local government that the casinos would collectively pay $120 million annually for 10 years as the appeals played out.
New Jersey officials overseeing the PILOT said in August of 2017 that all casino tax appeals had been settled through $80 million in city bonds.
“Because of the timing of Hard Rock’s purchase of the property and the work that needed to be done to get the casino into the PILOT, the 2017 appeal was not able to be included in the $80 million bond ordinance the city approved in August 2017 to fund other property-tax appeals,” New Jersey Department of Community Affairs spokeswoman Lisa Ryan told the Press of Atlantic City.
Of the $1.2 million annually due to Hard Rock, Atlantic County will be responsible for eight percent ($96,000), and the city responsible for the lion’s share.
Christie said in 2017 that the state’s oversight of the appeals saved tens of millions of dollars. As example, a court ruled that the Borgata – the top revenue earner in Atlantic City – paid $165 million more in property taxes than it should have between 2009 and 2015. MGM Resorts settled for just $72 million.
Garden State Politics
Longtime Atlantic County Executive Dennis Levinson (R) wasted no time in responding to the settlement.
We were told this was totally, completely settled,” Levinson declared this week. “They can do whatever they want right now, as long as the cost is not passed along to county taxpayers.”
Icahn had initially filed the tax appeal, but it appears the beneficiary will be Hard Rock.
Atlantic County sued the state over the percentage of the PILOT money it was to receive. Christie had told Levinson the county would receive 13.5 percent of the $120 million, but that was reduced to 10.4 percent after the governor argued the county failed in its duties to help stabilize the gaming beachfront town.
Prior to completing his two terms and leaving office in January of 2018, Christie announced in November 2017 that Matthew Levinson – Dennis’ son – was being replaced as chairman of the state Casino Control Commission.
Hard Rock Quiet
The Press of Atlantic City says officials at the casino resort declined to comment on the property tax appeal. After acquiring the property in 2017, Hard Rock International Chairman Jim Allen said the company was committed to revitalizing Atlantic City.
“Our commitment to Atlantic City has never been stronger and we look forward to being a catalyst for further growth and development of the area,” Allen explained at the time.
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