BUSINESS & ECONOMY

Asm. Caputo Wants More Specifics in North Jersey Casino Plan

By Brenda Flanagan
Correspondent

They clowned for the camera, but lawmakers remain deeply divided over the proposed constitutional amendment to authorize two new casinos in northern New Jersey, particularly over how much revenue it will actually generate for the state. Sponsor Ralph Caputo introduced a concurrent resolution that urges the Legislature to offer more specifics.

“The way this is going to be accomplished hopefully is by having enabling legislation that will dictate exactly what the tax rate’s going to be. We haven’t done that yet, and in terms of transparency I think it has to be discussed and hopefully we get something accomplished before November,” he said.

Caputo says the tax rates should be significantly higher than the effective 9.25 percent currently paid by Atlantic City casinos, and should be tiered, depending on how much each developer spends on a new casino.

“It should be at least 30 to 40 percent on the Meadowlands project that occurs, and 15 percent or somewhere around that for the Jersey City project,” he said.

If you average the lowest of Caputo’s lowest proposed tax rates, you get 22 percent. Apply that to a projected best-case $1 billion in revenue and it could generate $220 million in tax money — half of that dedicated to Atlantic City, most of the rest for benefiting New Jersey’s elderly and disabled — with 2 percent set aside for New Jersey’s racing industry. But critics see nothing concrete.

“Saying what he’d like to see them to be — as opposed to actually setting a tax rate so that the public knows what they’re voting on — would be very important. How do you put a ballot question to amend our constitution and say, ‘Why don’t you pass this and we’ll figure out what the tax rate’s going to be?'” asked Assemblyman Chris Brown.

Atlantic City’s gaming executives view two northern casinos as direct competition that could force more casinos to close in the beleaguered shore town, and a recent poll showed more than half of those surveyed oppose expanding casinos to North Jersey. With billions at stake, dueling ads present vastly different views.

Caputo’s resolution aims to clarify legislative intent and revive public interest. But it’s still not clear enough for some opponents.

“They’re talking about between $500 million and $1 billion in revenue coming into the state and we’re going to let the Legislature decide how they’re going to direct that money? Let’s have some secure outlined paradigm set in place so that we know — and the voter knows — what the money’s going to be used for. And let’s do something to protect the taxpayer,” said Assemblyman Robert Auth.

Caputo says enabling legislation with specific tax rates could offer voters some reassurance. But he acknowledges legislative debate over the TTF and pension funding has sucked all the oxygen out of the room.