A4031

An Act requiring the State Treasurer to make short term loans to casino gaming properties for the purpose of making required payments in lieu of property taxes to Atlantic City during the COVID-19 public health emergency and state of emergency, and supplementing P.L.2016, c.5 (C.52:27BBBB-18 et seq.).

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. As used in this section, “casino gaming property” means one or more parcels of real property located in Atlantic City, and any adjacent property utilized in connection with such property, upon which there is located a facility licensed to be used for casino gaming in 2014 or thereafter, whether or not in actual operation, which has more than 500 guest hotel rooms, is not subject to recorded covenants prohibiting casino gaming, and is required to make payments in lieu of property taxes to Atlantic City pursuant to the provisions of P.L.2016, c.5 (C.52:27BBBB-18 et seq.).

b. Due to the public health emergency and the state of emergency declared by Governor Murphy in Executive Order 103 on March 9, 2020 in response to the worldwide COVID-19 pandemic, and the required shutdown of the casino gaming properties in Atlantic City on March 16, 2020, the State Treasurer shall make funds available from the “Property Tax Relief Fund” as a short term loan to the owner or licensee of any casino gaming property that may request such a loan, pursuant to the provisions of this section.

These available loan funds shall be used by a casino gaming property owner or licensee solely for the purpose of meeting that person’s obligation to make either, or both, of the payments in lieu of property taxes due and owing to Atlantic City on May 1, 2020 and August 1, 2020 for the casino gaming property pursuant to subsection c. of section 3 of P.L.2016, c.5 (C.52:27BBBB-20).

c. A loan made to a casino gaming property owner or licensee pursuant to this section shall not accrue interest or penalty if repaid by the casino gaming property owner or licensee not later than the first day of the 36th month following the date that the loan proceeds were provided to the casino gaming property owner or licensee. If the loan has not been repaid in full by a casino gaming property owner or licensee by that date, the State Treasurer shall immediately impose a penalty equal to 10 percent of the original loan amount, and shall notify the casino gaming property owner or licensee that the outstanding balance of the loan together with the amount of the penalty shall be due and payable to the State within 60 days. If, by the close of business on the 60th day, the loan and penalty have not been paid in full to the State by the casino gaming property owner or licensee, the State Treasurer shall notify the Casino Control Commission and the Division of Gaming Enforcement. Notwithstanding any provision of the “Casino Control Act,” P.L.1977, c.110 (C.5:12-1 et seq.) or any other law, rule or regulation to the contrary, upon receiving notification from the State Treasurer of the owner or licensee’s failure to pay the loan and penalty as specified under this subsection, the commission shall deem the owner or licensee disqualified to hold a casino license, and the division shall suspend the owner or licensee’s operation certificate for the casino gaming property and, shall order the casino gaming property to be shut down until the outstanding amount of the loan and the penalty are paid in full to the State Treasurer. If a casino gaming property remains shut down due to the suspension of the property’s operation certificate under this subsection for a period in excess of 120 days, the commission may order the casino gaming property to be placed in a period of conservatorship as provided under the “Casino Control Act,” P.L.1977, c.110 (C.5:12-1 et seq.).

d. Notwithstanding any provision of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the State Treasurer shall adopt immediately upon filing with the Office of Administrative Law such rules and regulations as the State Treasurer determines to be necessary and appropriate to implement and administer the short term loan program created by subsection b. of this section, which rules and regulations shall be effective for a period not to exceed 360 days following the date of filing and may thereafter be amended, adopted, or readopted by the director in accordance with the requirements of P.L.1968, c.410 (C.52:14B-1 et seq.).

2. This act shall take effect immediately.

STATEMENT

Due to the public health emergency and the state of emergency declared by Governor Murphy in Executive Order 103 on March 9, 2020 in response to the worldwide COVID-19 pandemic, and the required shutdown of casino gaming properties in Atlantic City on March 16, 2020, the owners or licensees of the casino gaming properties that are required to make payments in lieu of property taxes to Atlantic City pursuant to the provisions of P.L.2016, c.5 (C.52:27BBBB-18 et seq.) are concerned that they may not have sufficient funds on hand to make the quarterly payments in lieu of property taxes to Atlantic City that are due and owing to the city on May 1, 2020 and August 1, 2020. This bill would require the State Treasurer to make funds available from the “Property Tax Relief Fund” to the owners or licensees of those casino gaming properties as short term loans to be used solely for the purpose of paying those payments in lieu of property taxes due and owing to Atlantic City on May 1, 2020 and August 1, 2020.

A loan made to a casino gaming property owner or licensee under the bill would not accrue interest or penalty if repaid by the casino gaming property owner or licensee not later than the first day of the 36th month following the date that the loan proceeds were provided to the casino gaming property. If the loan has not been repaid in full by a casino gaming property owner or licensee by that date, the bill would require the State Treasurer to immediately impose a penalty equal to 10 percent of the original loan amount, and notify the casino gaming property owner or licensee that the outstanding balance of the loan together with the amount of the penalty would be due and payable to the State within 60 days. If, by the close of business on the 60th day, the loan and penalty have not been paid in full to the State by the casino gaming property owner or licensee, the State Treasurer would be required to notify the Casino Control Commission and the Division of Gaming Enforcement of the owner or licensee’s nonpayment. This bill requires the commission to deem the owner or licensee disqualified to hold a casino license and the division to suspend the owner or licensee’s operation certificate for the casino gaming property and to order the casino gaming property to be shut down until the outstanding amount of the loan and the penalty are paid in full to the State Treasurer.

The bill further permits the commission to place the casino gaming property under an appointed conservator if it remains shut down due to the suspension of the property’s operation certificate for a period in excess of 120 days. Under the “Casino Control Act,” P.L.1977, c.100 (C.5:12-1 et seq.), a conservator is empowered by the commission to, among other duties, continue the business of the former or suspended casino licensee.