Trump Entertainment Resorts, owner of Atlantic City’s Trump Plaza casino, which was shuttered in September 2014, announced that it would keep it closed for the next decade or so in an attempt to avoid higher taxes.
The gambling operator submitted a deed restriction for its property, under which it could not be used as a casino for at least ten years. Yet, the facility could be used for various other purposes.
As mentioned above, Trump Entertainment resorted to this move in an attempt to avoid the higher taxes that might be imposed under a proposed legislation, which might be signed into law anytime soon. The bill calls for Atlantic City’s gambling venues to make certain payments instead of taxes for a period fifteen years. The proposal comes as part of a rescue plan for the struggling gambling hub.
If New Jersey Gov. Chris Christie signs the bill into law, it would apply to all casino properties that operated in 2014 and were not under a deed restriction.
Trump Entertainment said in a Friday filing to a Delaware bankruptcy court that it feared Trump Plaza would be included in the list of venues that would be required to make payments under the PILOT plan, even though the property is currently shuttered and does not generate revenue.
Trump Plaza closed doors on September 16, 2014, thus becoming the last of the four Atlantic City casinos that were shuttered last year.
Trump Entertainment had previously appealed both its 2015 and 2014 property taxes and hopes that this would secure the company with a more satisfactory deal than being included in the PILOT program. If the proposed rescue plan is enacted, Atlantic City’s gambling venues would not be able to appeal their taxes.
The casino operator pointed out in its filing that rival Caesars Entertainment filed for such a deed restriction on its Showboat Casino Hotel before closing the property down in August 2014. Thus, the company avoided having its facility included in the PILOT plan.
Robert Griffin, Chief Executive Officer of Trump Entertainment, said on Sunday that the deed restriction would also apply to any potential buyer of the property. It also could be canceled, in case the buyer pays Trump Entertainment a certain undisclosed release fee.
According to the Friday filing, businessman Carl Icahn, who is to purchase Trump Entertainment, had approved the deed restriction.
The casino operator said that it expects a bankruptcy judge to give the nod to the deed restriction on July 9.
