The Borgata will get a refund of more than $88 million under a settlement it reached with Atlantic City over how much the city’s top casino should pay in property taxes.
The Borgata’s parent company, Boyd Gaming, announced the settlement Tuesday in a filing with securities regulators. The settlement covers tax years 2011 through 2014.
The Borgata will receive a tax refund of $88.25 million for tax years 2011 through 2013, as well as an estimated tax credit of $17.85 million for the tax year 2014.
The city also agreed to an unspecified lower tax assessment on the casino for 2015.
Settling casino tax appeals has been a top priority of new mayor Don Guardian. Several casinos are challenging their assessments, citing the declining gambling market and saying their properties are now worth less. At almost every turn, tax courts have sided with the casinos, opening a potentially huge hole in Atlantic City’s already shaky finances.
Neither the mayor nor Borgata officials immediately returned calls seeking comment on the settlement.
In return for the refund, the Borgata agreed to drop its appeals of its tax assessments from 2011 through 2015.
The settlement does not affect the casino’s ongoing appeal of tax assessments for 2009 and 2010. In that case, the state tax court ruled in October in favor of the Borgata, saying it is due an additional refund of $48 million, plus interest. The court found the city had over-assessed the casino by 2 ½ times its true value.
The Borgata had been paying $58 million a year in property taxes, a significant part of Atlantic City’s $249 million budget as of 2013.
The city had valued the casino’s total property value at $2.3 billion for each of the two years at issue. But during the trial, the tax valuation expert the judge found most accurate was an appraiser with 35 years’ experience who was presented by the Borgata. She placed the property value at $880 million for 2009 and $870 million for 2010.
Others contesting their true taxable value include the two Trump Casinos, Trump Plaza and the Trump Taj Mahal; the Tropicana Atlantic City; and Caesars Atlantic City.