Bill Advances To Give Atlantic City 1.25% Of Sports Gaming Dollars

TRENTON — Atlantic City Mayor Marty Small Sr. has long talked about the city’s need to keep more taxes generated by its casino industry, and a bill advanced in a Senate committee Thursday morning to start that process.

Bill S854 would send 1.25% of sports gaming dollars generated by resort casinos to the city for property tax relief, rather than to the Casino Reinvestment Development Authority to market and promote the city.

“When the bill (legalizing sports gaming) first passed in 2018, the only municipality or township left out of benefiting from sports gaming was Atlantic City,” said Small, who was in Trenton to speak in favor of the bill. “Make that make sense.”

After the vote, Small said he was excited about the city taking more control of its finances.

“CRDA has done a great job with a partnership (with us) and has done a lot of things for us,” Small said. “But I don’t like the attitude of putting a limit on what Atlantic City gets.”

He said CRDA funding should continue, and as a state agency, it can get its funding from other areas.

The decision to give CRDA the municipal share of sports gaming taxes was made early in the state’s takeover of the city, which in 2016 was facing possible bankruptcy. The city had a track record of overspending, and then had to pay tens of millions of dollars back to individual casinos after their successful property tax appeals.

Other municipalities that host racetracks offering sports betting, for example, have benefited from the 1.25% tax, Small said.

The city’s financial picture has improved drastically since then, Small stressed, and its taxpayers should now benefit more from taxes generated in the city.

The sponsor of S854, Sen. Troy Singleton, D-Burlington, estimated about $2.5 million would be newly available to the city under his bill. It generated about $2 million in 2020, Singleton said, basing it on state Division of Gaming Enforcement reports.

But sports gaming revenues have increased at a fast clip each year since legalization, and he did not have 2021 numbers.

Committee member Sen. Vince Polistina, R-Atlantic, did not support the bill, saying the CRDA needs the funds to market the city and prepare for new competition from New York City casinos expected to open in the next few years.

The city receives ample tax relief under a revised casino payment-in-lieu-of-taxes bill approved by the Legislature in December, Polistina said.

Polistina also opposed the PILOT amendment bill, over which Atlantic County has sued, and said any changes to money flowing to the CRDA need to come after a “global discussion” of Atlantic City’s present situation and its future.

The annual amount taken from CRDA will be more like $10 million, Polistina estimated, based on 2021 sports betting revenues.

“We have to make sure we are all talking about the same numbers,” Polistina said.

The Office of Legislative Services has certified the bill (S854) for a fiscal note, meaning it has determined the bill requires a report done on the fiscal impact. But it is not yet posted with the bill, which still must pass the full Senate and Assembly.

S854 was supported by the three Democrats on the Senate State Government, Wagering, Tourism & Historic Preservation Committee but opposed by Polistina and Sen. James W. Holzapfel, R-Ocean.

Small has long complained that his city gets nothing from a variety of state-imposed taxes on aspects of the casino and tourism industry, including parking, luxury and hotel room occupancy. Sports betting is yet another area where the state taxes but the city receives nothing, the mayor said.

“Everyone in this room, and there are about 25 of us, can drive to Atlantic City,” Small said. “Once we park our car, that’s parking tax. We go to the bar and buy a drink, that’s luxury tax. We go into our room, that’s the room tax. We go to a late-night show, that’s luxury tax again. Then we make a sports bet; that’s sports betting tax.

“Guess what the residents of Atlantic City get from our stay?” he asked. “Zero. When are we going to get our slice of the pie?”

New Jersey led the nation in terms of the size of its sports betting market since shortly after the first legal bets were made in 2018. It only recently lost its top spot nationally in January once New York state allowed mobile sports betting and zoomed past New Jersey.

Singleton said state lawmakers continually talk about returning money to the people.

“This is literally giving money back to taxpayers,” he said. “If we’re serious about affordability, here’s an opportunity.”

Original Article