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PILOT lawsuit argument set for July 13, but state seeks early appellate court action

Author Name, ProPublica

2022-06

ATLANTIC CITY — The state is continuing to use delaying tactics in a lawsuit over a new casino payment-in-lieu-of-taxes law, Atlantic County officials said Tuesday, after the trial judge ruled the law violates a 2018 state settlement agreement with the county.

At a management conference Monday, Atlantic County Assignment Judge Michael J. Blee set oral arguments concerning potential damages in the case for July 13, according to County Counsel Jim Ferguson.

But at that conference, John Lloyd, the lawyer for the state, told Blee he has been instructed by state officials to file a motion for interlocutory appeal — essentially asking the state appellate court to get involved before the trial court case is finished, Ferguson said.

It’s an attempt to further delay any settlement to the county, Atlantic County Executive Dennis Levinson said Tuesday.

“The state has figured out a way to squander more taxpayer money over this case,” Levinson said.

“Normally a person doesn’t have a right of appeal until a final judgment in a case,” Ferguson said. “All we have so far is a judgment of the trial court on liability. Damages have not yet been determined. That’s the next step.”

Judge rules in county's favor in request for PILOT law reconsideration A Superior Court judge on Monday upheld a previous judge’s ruling that changes to a payments…

A state spokesperson declined to comment Tuesday.

County officials sued the state in December after a bill that amended the PILOT program to define casino gaming revenue as only coming from brick-and-mortar gambling became law. The new law cut the county’s share of revenue by as much as $26 million over the next five years, according to county estimates.

The county had sued the state over the original PILOT legislation, and in 2018 the two parties settled that case. It awarded the county about 13% per year of the total PILOT paid by casinos, based on all casino revenues — brick and mortar, internet and sports betting.

Since 2017, casinos have made PILOT payments instead of paying property taxes as a way of stabilizing finances for Atlantic City. The casinos had successfully sued the city to lower their property tax assessments, sending city finances spiraling into possible bankruptcy in 2016.

Lloyd had asked Blee to hold off on setting a schedule for determining damages in the case, Ferguson said, while Atlantic County’s attorney, Ron Riccio, argued the request was made for delaying purposes.

Riccio asked for a briefing and argument schedule, and Blee provided one, Ferguson said.

Atlantic City casino PILOT hearing set for April 25 ATLANTIC CITY — In about a month, lawyers for the state will try to convince Atlantic County…

The county must file its opening submission regarding sanctions and/or damages by May 23, Ferguson said, and the state has until June 13 to file its written opposition.

The county then has until June 20 to file its response to the state, and oral arguments are set for 9:30 a.m. July 13.

The longer the state drags out the case, the more it will cost taxpayers, said county spokesperson Linda Gilmore.

“We are not asking for anything more than what the state — and this governor — agreed to,” Gilmore said.

When the new pilot legislation was introduced in 2021, the premise was that the COVID-19 pandemic had such a devastating impact on the casinos that they needed tax relief to survive, Gilmore said.

Then-state Senate President Steve Sweeney said four casinos would close without it when the legislation was considered by the Senate Budget and Appropriations Committee in December, but never provided information on which casinos faced closure or proof of his assertions.

But the industry’s latest reports show brick-and-mortar casino revenues are now better than pre-pandemic revenues, Gilmore said.

REPORTER: Michelle Brunetti Post 609-841-2895 [email protected]

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