“There is no evidence to suggest that casinos could not meet their PILOT obligations.” With those words Judge Michael Blee tossed New Jersey‘s current Payment In Lieu Of Taxes (PILOT) special-status tax program for casinos, which has lost round after round in the courts. The PILOT quasi-subsidy assesses each Atlantic City casino a share of its gross gaming revenue rather than levy property taxes. This has been the rule since 2016 but last year, in an overreach sped through the Lege by Gov. Phil Murphy (D), online gambling revenues are excluded from the PILOT assessment. This was done at the behest of alarmist casino owners, who said they needed the financial relief to get past the effects of the Covid-19 pandemic. Judge Bee found these grounds, in a word, dubious. They resulted in a $55 million shortfall that disproportionately affected Atlantic City proper.
In one corner is Murphy. In the other is conservative activist group Liberty and Prosperity 1776. It opposes the PILOT program as preferential tax treatment. And it’s got a point. Blee thought so too. “This Court finds that the Amendment was enacted to aid the casino industry and not for a public purpose,” he wrote. Already this year (through June), supposedly impoverished casino owners have banked $339 million in operating profits, 17% more than already-robust 2021.
Blee’s ruling doesn’t revoke PILOT entirely, merely returns it to its original configuration (i.e., no more exclusion of i-gaming dollars). Lead plaintiff Seth Grossman expects Blee’s decision to be litigated but enjoyed the moment: “The bottom line is when you have tough economic times, every business is affected,” he said. “So to say you’re going to give one industry a break by making everybody else pay more, that’s not helping the economy. It’s just helping one ‘ailing’ industry.”
Blee’s verdict comes on the heels of a discrete ruling that the original PILOT program “had violated the terms of a 2018 consent agreement that guaranteed the county a certain percentage of the industry’s overall PILOT payment.” Murphy is on the hook for a multi-million-dollar damage award in that lawsuit. He’s playing for time but the hourglass is running.
In other Boardwalk news, the Golden Nugget is repairing its parking garage. In order to do it right, portions of the garage will be closed to the public, although it’s not like the Golden Nugget (above) is swamped with business these days—well, except for the recent Wine Festival, happy to report. Not so good, we’re told, the Nugget closes its check-in desk at 11 p.m. You reportedly have to roust the night manager to get into your room or have your questions answered. Lean times at the Nugget, perhaps?
Our East Coast correspondent managed to get comped to a ‘mini-suite’ at Borgata‘s Water Club, “a slightly larger room, but is a corner with windows in two directions, for Saturday and& Sunday nights; that was the ‘good.’ When we valet parked late Sunday, three of the four lanes were parked very close together. When I asked, I was told there was a fire in the garage a few weeks ago (never reported in the A.C. press or TV) and half the garage was closed off; that was the ‘bad.’ When [his wife] won some $ near the Borgata high-limit room I was told they only cash the tickets for high-level players. There’s no sign posted outside saying ‘peasants do not enter’; that was the ‘ugly.’ I’ve never experienced such a rude response in a casino before!” MGM Resorts International, this doesn’t sound like the sort of experience that will quickly be forgotten.
Against the scenic backdrop of the Bellagio fountains, Black Book laureate Tasia MacDonald Musa was arrested August 29, after the 86’d individual was spotted breaking the law by patronizing Paris-Las Vegas. He fled on foot and was apprehended on the other side of the Las Vegas Strip. “Pursuant to NRS 463.155, Musa was booked for unlawful entry by a person who has been placed on the List of Excluded Persons, which is categorized as a gross misdemeanor,” reports the Nevada Gaming Control Board. Musa has a rap sheet longer than your arm, having been arrested 19 times in casinos and convicted of seven gaming-related crimes (grand larceny is his felony of preference). He was banned from Nevada casinos in 2015 for “moral turpitude.” If he thinks the NGCB isn’t watching, he’s just learned a valuable lesson. Gold stars to the security personnel who spotted him on the Parisian premises.
It’s been over 20 years but the Reno-Sparks area has a new casino in the form of Legends Bay. In addition to CEO Gary Goett, some other heavy hitters turned out for the opening last night, including Gov. Steve Sisolak (D) and sports book operator Derek Stevens, seen above at the craps table. Our thanks to Goett for eschewing the baneful ‘soft opening’ and launching when everything was ready. Sparks could use a spark plug for its gambling revenue (July’s numbers weren’t anything to write home about it) and Legends Bay looks like will be the thing.
Arizona sports books scraped together $15 million in revenue in June, on handle of $318.5 million. $9 million went right back out in the form of promotional credits, with Rush Street Gaming, BetMGM and FanDuel the most lavish, while struggling WynnBet, Churchill Downs and DraftKings kept the purse strings tightest. FanDuel led revenue with $7.5 million. Then came BetMGM ($5 million), Caesars Sportsbook ($1 million), Barstool Sports, just under $1 million, and 14 other operators fighting for the leftovers.
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