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Senate Committee Approves Bills that Could Help Save Atlantic City

The New Jersey legislature is in the process of taking aggressive measures to help save struggling Atlantic City and possibly prevent a fifth casino from closing this year. On Monday, a state senate panel acted on a group of bills that have the potential to give Atlantic City casinos a needed financial boost and possibly save the Trump Taj Mahal from closure.

Atlantic City has seen four casinos close in 2014 and the Taj is scheduled to close on December 20. At present, approximately 9,000 jobs have been lost in connection with casino closures. The closure of the Taj would add at least 3,000 more to that total.

Tax Stabilization Act Would Guarantee Tax Revenue to the City

Perhaps the most important of the five bills is S2572, the Casino Property Taxation Stabilization Act. This bill would allow casinos to make flat payments of $150 million over the next two years instead of paying property taxes. After the initial two-year period, taxes would then be based on gaming revenue in the city. Tax payments could be as low as $75 or as high as $165 million. This system would be in place for at least 13 years.

For those thinking this looks similar to Carl Icahn’s plan for the Trump Taj, you would be correct. Icahn had asked for a similar tax break for the Taj from city administrators but was subsequently denied. This bill would not just benefit the Taj, but all casinos in Atlantic City.

Bills Would Look After Full-Time Employees

One of the reasons that Icahn encountered resistance in his quest for state aid was his desire to terminate union employee health care and pensions at the Taj. While he has backed off from that position, the legislature is making sure a similar fiasco doesn’t happen in the future.

Under S2583, licensed casinos would be required to give full-time employees a “baseline health care and retirement package.” This bill would seem to cover all full-time employees, and not just union employees.

Unite-HERE has yet to act on Icahn’s request for the union to drop their appeal of a bankruptcy judge’s ruling that the Taj could eliminate health care and pension payments to union employees. Icahn later decided that he would reinstate health care and provide partial pension payments to employees provided they drop their appeal.

Legislation Could Save the Taj

The odds of the Taj seem to be improving by the day and the passage of these bills may be enough to guarantee the casino’s continued operation. Major Don Guardian told the Senate committee that, “I do believe this legislation is going to save the Taj from closing.” Considering that S2572 would give Icahn at least part of what he needed to keep the casino open, Guardian believes Icahn will proceed with his plan to invest $100 million into the property.

Senate President Stephen Sweeney supports the bills and is focused on stabilizing the Atlantic City economy. Right now, between 8,000 and 9,000 people are without jobs thanks to the casino closures and up to another 5,000 are facing similar prospects. The most important thing right now, according to Sweeney, is to right the sinking ship that is Atlantic City.

 

 

 

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James Guill

James Guill began his poker career in 2006, spending two years traveling the US tournament circuit. Since 2008, he has covered the game extensively for some of the biggest names in the industry. When not writing about the latest poker news, he can be found hunting for antique treasures in Central Virginia.

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