The state has sold more than $68 million in bonds to cover tax-appeal settlements with seven current and former Atlantic City casino properties.
The bonds, which were sold Wednesday, have a 4.1 percent interest rate, which state officials described in a news release as an “attractive” rate.
The bonds cover settlement agreements with Bally’s Atlantic City, Caesars Atlantic City, Golden Nugget Atlantic City, Harrah’s Resort, Tropicana Atlantic City, the former Trump Taj Mahal Casino Resort and the former Trump Plaza Hotel and Casino.
“Atlantic City is now getting excellent access to the bond market, which is amazing for a city that was contemplating bankruptcy before we stepped in to manage its finances,” said former U.S. Sen. Jeffrey S. Chiesa, the state designee leading the financial recovery effort for Atlantic City. “The fact that the city obtained bond insurance and sold the bonds at a low-interest cost means it is well-positioned to responsibly pay down the tax refunds it owes to casinos while preserving critical public services.”
The city is responsible for paying back the bonds, officials said.
In November, Gov. Chris Christie appointed Chiesa to oversee operation of the city as part of the state’s takeover of the resort.
The bonds sold Wednesday under New Jersey’s Municipal Qualified Bond Act program will finance the remaining property-tax appeals filed by casino properties that the city faced and two noncasino tax appeals, totaling about $71.1 million.
These include appeals for 2016 for Bally’s, Caesars, Golden Nugget and Harrah’s; for the years 2015 and 2016 for Tropicana; for the years 2014 to 2016 for the former Taj Mahal; and for the years 2014 to 2017 for the former Trump Plaza.
This is the second multimillion-dollar tax appeal the state has settled since Chiesa has been appointed.
In February, state overseers reached a $72 million tax settlement with Borgata Hotel Casino & Spa. The city owed Borgata $165 million after successful property-tax appeals by the casino. The settlement saved the city $93 million, according to the state.
“The city is in a much better place and is back on the road to stability,” Chiesa said.