TRENTON – A package of bills that would address Atlantic City’s fiscal crisis was approved by the Senate on Thursday, sending the governor legislation that would help bring stability and predictability to the city’s finances. Sponsored by Senate President Steve Sweeney and Senator Jim Whelan, the five-bill legislative plan would address Atlantic City’s immediate financial crisis and enable the city and the casino industry to realize future economic growth.
“This plan will help address the immediate fiscal crisis triggered by the multiple casino closings and downturn in the gaming industry,” said Senator Sweeney. “It will help stop the hemorrhaging and bring stability to Atlantic City’s finances and more predictability to the city’s revenues. We need to take immediate action to stabilize the existing workforce, the casinos, property taxpayers and the entire community.”
Bold action is needed to thwart the loss of property tax revenues, the problem of continued tax appeals, and to ensure that the city and its remaining casino industry return to fiscal solvency and ultimately prosperity, both senators said.
One of the severe problems afflicting city finances is a drop in the ratable base.
“The revenue lost to this crisis has been sudden and substantial,” said Senator Whelan. “This plan will bring more certainty to the city and the casino industry and it will help protect local taxpayers from bearing the burden. We have the ability to turn the city around and work to realize a prosperous future.”
The recovery plan relies on revenue already generated within the city and uses it to be spent within the city. The plan to have casinos make payments in lieu of taxes, known as PILOT payments, will provide more certainty to the city and greater predictability to the casino industry.
The PILOT payments by the casinos would be comparable to what they would pay without the plan, but the PILOT would provide more certainty and predictability and avoid the delays caused by tax appeals. The legislation includes a “hold harmless” provision so that no casino will pay more in PILOT payments over the next five years than they paid in 2014.
Senator Sweeney stressed the importance of the provisions protecting the rights and benefits of casino employees. “The casinos must make sure that workers get healthcare and retirement benefits that meet industry standards and allow them to support their families,” he said. “We can’t allow anyone to try to exploit this situation in order to deny employees their right to a living wage and reasonable benefits.”
The bills would:
(S-2572/A-3981) – Stabilize Casino property tax payments by authorizing them to make Payments In Lieu Of Taxes (PILOT) in the amount of $150 million for the first two years. The bill creates the “Casino Property Taxation Stabilization Act” to address the dire situation in Atlantic City with casino closures. It would require the casino gaming properties in Atlantic City to make payments to the city based, in part, on casino gaming revenues.
The bill was approved with a vote of 33 to 5.
(S-2573/A-3982) – Require the holder of a casino license to submit proof to the state that all agreements entered into with representatives of its employees for collective bargaining provide for suitable healthcare and retirement benefits for all full-time employees. A casino that fails to comply would be subject to forfeiture of its license.
The bill was approved with a vote of 25 to 14.
(S-2574/A-3983) – Establish an additional category of state school aid to help Atlantic City, where commercial property accounted for nearly 78 percent of the municipality’s total assessed property valuation in 2008 and declined by nearly 32 percent, from nearly $16 billion to less than $11 billion, between 2008 and 2013.
The bill was approved with a vote of 25 to 13.
(S-2575/A-3984) – Reallocate the casino investment alternative tax to Atlantic City to pay debt service on municipal bonds.
The bill was approved with a vote of 38 to 2.
(S-2576/A-3985) – Repeal the law that requires the Casino Reinvestment Development Authority to enter into an agreement with the Atlantic City Alliance for a five-year partnership. The bill would also repeal the portion of law that authorized the authority to assess a fee on casino licensees if the public-private partnership was terminated or otherwise ended.
The bill was approved with a vote of 40 to 0.
Already approved by the Assembly, the bills now go to the governor.