The deal announced by Jeff Chiesa, a former U.S. senator and New Jersey attorney general, was for less than half the amount the city owed the casino from a series of successful tax appeals the gambling hall filed. "The settlement took both sides working closely together to find common ground," he said.
It covers the years 2009-15, and includes the casino dropping pending appeals for 2013-15 which could have added another US$ 65 million to the total the city owed.
The debt has its roots in the continuing contraction of Atlantic City's casino industry, which has seen five of its 12 casinos shut down since 2014. But even before that, an onslaught of competition from casinos in neighboring Pennsylvania badly hurt Atlantic City's casino market.
Because of the lower levels of business they were suddenly doing, Atlantic City's casinos were able to successfully argue that their property tax assessments were too high. A series of appeals won by many casinos over the years blew large holes in the city budget.
Atlantic City was unable to pay the full $165 million it owed the Borgata, which was allowed by a court to withhold current tax payments. Those payments will now resume as part of the deal.
Source: GMB / McClatchy DC
