Atlantic City will soon get $32 million in unpaid taxes from the former Revel Casino Hotel.
A bankruptcy court judge on Thursday issued an order permitting the city to move forward with efforts to collect the unpaid taxes from the casino. That came on the same day the judge also rejected the casino's effort to re-open a past tax settlement that Revel now claims was unfair.
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Judge Gloria Burns permitted Atlantic City to pursue the tax debt. The most likely manner for it to be paid is when Toronto-based Brookfield Asset Management completes its $110 million purchase of the casino from bankruptcy court. City Attorney Jason Holt said a portion of the proceeds from the sale would be set aside in an escrow account to settle the tax debt.
If the deal does not close before early December, the city could sell a tax sale certificate, in which an investor in effect buys a lien against the property and pays the taxes due on it. The investor gets paid when the property owner pays off the tax debt; if that doesn't happen, the investor can foreclose in two years.
A Brookfield spokesman declined to comment Friday.
According to a September court filing by the city, property taxes on casinos account for more than 60 percent of Atlantic City's annual tax levy. The $37 million due from Revel this year accounts for about 18 percent of the city's budget.
Atlantic City raised its tax rate by 29 percent this year, primarily because successful tax appeals from casinos reduced its tax revenue.
Revel opened in April 2012 at a cost of $2.4 billion, and never turned a profit. After filing for its second bankruptcy, its owners closed the casino resort on Sept. 2.
Wayne Parry can be reached at http://twitter.com/WayneParryAC