Like all areas where casinos have faced Covid-19 issues, Atlantic City has been hit hard financially. As casinos were shut down for quite some time, operators were left with zero revenues. They had to try and stay afloat, holding on to employees if they could. The city and state also suffered due to revenue losses. Not long ago, two pieces of legislation were introduced to help provide relief to the area, but this legislation has since stalled.
What’s the Hold Up?
There are two emergency relief bills currently being considered: S2400/A4032 and S2398/A4031. One will temporarily change taxes associated with casinos as well as fees. The other will allow the treasurer of the state to provide interest-free loans to casinos that have made required payments to the city.
The goal of the legislation was to provide financial relief after each of the nine casinos were shut down indefinitely back in March to try and slow the spread of the coronavirus. Other relief measures involving Covid-19 have moved forward but the casino bills have stalled for a few weeks.
Earlier this week, Assembly Majority Leader Louis Greenwald stated that stabilizing the casino industry in New Jersey is a focus. Trenton is watching Atlantic City as well as other gaming jurisdictions to see how the virus is impacting the confidence of customers to return to casinos for gaming.
Greenwald stated that the situation is fluid as it continues to change. The goal is to learn how to manage the virus and support the industry at the same time, determining the best way to move forward. Lawmakers want to create a strong and reliable base of customers while managing the virus in a safe and efficient way.
S2400/A4032
This bill was submitted in June and moved forward rather quickly. The Assembly has yet to take up the bill though. However, discussions have taken place with Speaker Craig Coughlin regarding the proposal. This bill will reduce gaming revenue taxes for a one year time frame. Hotel fees will be eliminated until the end of this year. Certain licensing fees and are deferred.
With this legislation, casinos would be able to deduct 100% of provisional gaming credits and coupons against gross revenues. A total of $100m in federal grant money provided for Covid-19 would be available for small business assistance by the state Economic Development Authority.
Executives within the casino industry maintain that the two bills will be critical to the survival of the industry moving forward. Over the past two years, the casinos in Atlantic City have seen an increase in total gaming revenues. These totals were pushed by the opening of the Ocean Casino Resort and the Hard Rock Hotel & Casino.
All nine casinos in AC have reopened as of July but are limited to 25% capacity. There is also a ban on smoking and indoor dining along with beverages on the casino floor. These stipulations are a result of the virus being a continual threat and while needed, will cause the casinos to see a decrease in revenues.