Monday, December 5, 2022

Bally’s two Rhode Island casinos sue host towns seeking lower property value and tax bills due to pandemic closures | Yogonet International

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Bally’s two casinos in Rhode Island have sued their respective host jurisdictions seeking tax reductions due to pandemic-related closures.

Earlier this month, Bally’s Tiverton Casino & Hotel filed a lawsuit against the town of Tiverton in state Superior Court alleging it is being overtaxed, as reported by Boston Globe. Bally’s Twin River Lincoln Casino Resort filed a similar suit against the town of Lincoln in February.

According to a spokeswoman for Bally’s Corporation cited by the newspaper, the company is currently in an ongoing process to reach tax stabilization agreements with both towns. The casinos expect to reach a deal outside the courts that would “reflect the realities of the COVID-19 restrictions and closures,” Doyle said.

However, the lawsuits are already filed, and they claim the towns failed to properly take into account the hits the casinos took from COVID-19 closures in 2020, leading to assessments that were illegally high into 202, which depreciated the property’s value through ‘economic obsolescence’. The casinos were fully shuttered for weeks in spring of 2020 and again during the winter of 2020. Even when they were allowed to re-open, they were under significant capacity and hours restrictions for months.

The Tiverton property was last assessed at $60,476,900 on Dec. 31, 2020, a depreciation of 6.5% from its previously assessed value, as reported by Yogonet last month. The company Tiverton used to reassess properties, Northeast Revaluation Group LLC, is one of two companies used by municipalities throughout the state to evaluate property values. In May 2021, a series of tax appeals to the company from Tiverton residents revealed a computer glitch incorrectly evaluated nearly 70% of residential properties in town. 

This reassessment brought the casino’s tax bill in 2021 to $863,005. But if the casino’s arguments won out, the assessment should have been closer to $41 million, according to David Robert, Tiverton’s tax assessor. That would have cut its property tax bill in Tiverton in 2021 by $266,726, according to Robert. 

The appeal states a 61% economic obsolescence factor “would be conservative” and should be applied to the casino property. However, it also states the appellant “seeks to work with the Tax Assessor’s Office to determine an appropriate obsolescence factor” and has also proposed a “concept to stabilize real property taxes in which (Bally’s Tiverton) operates for a period of time to allow the Applicant some recovery while not adversely impacting the municipality.”

David Robert, Tiverton’s tax assessor, denied the casino’s original appeal in January 2022, which was then appealed to the Tiverton Tax Board of Review later that month. Since the new assessment showed a depreciation in value from the casino’s last assessment, Robert told the casino an economic obsolescence factor had been applied during the revaluation. 

At the Tax Board of Review hearing for the appeal, a representative for Bally’s Tiverton said the business’ attorney already is working alongside the town to come to an agreement over the property value, but the company wanted to appeal to reserve their rights to take the matter to a higher court. The Board of Review is expected to render a decision within the next two weeks.

In Lincoln, the assessment for the casino was $108 million at the end of 2020. That was unchanged from the end of 2019. But that failed to take into account these same “economic obsolescence” factors that COVID closures brought to Tiverton, the casino said. The casino sought a roughly 30% cut to their property tax assessment there, according to minutes from one town tax board meeting. The casino’s annual property tax bill in Lincoln was most recently $2.7 million.

The casinos are now asking the court to recoup the money they say they’ve been overtaxed, plus penalties and interest. They’re not seeking to recoup money from its 2020 taxes, but for 2021 forward.

In March, Bally’s Corporation named Bobby Lavan new Chief Financial Officer to replace Steve Capp, who would continue to support the company through the end of April. Lavan has been Senior Vice President, Finance & Investor Relations of Bally’s since May 2021. In this role, he led the acquisition, financing and integration of London-based online software developer and gaming business Gamesys, completed in October last year, as well as the internal and external reporting processes.

In June last year, Rhode Island Gov. Dan McKee signed a bill that gave International Game Technology (IGT) and Bally’s Corp. control of most of the state’s gambling operations for the next 20 years. In exchange for the 20-year contract extension, the new law commits IGT to expanding and keeping 1,100 employees in Rhode Island, investing $155 million in technology upgrades, and partnering with Bally’s on a $100-million expansion of Twin River Casino in Lincoln. It also required an upfront payment of $27 million.


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