Several towns in Rhode Island might soon get in trouble after they overtaxed local casinos. This has prompted Bally's Corporation to sue Tiverton and Lincoln towns claiming that they overtaxed it in the past two years.
Still, the gaming operator's lawsuits are seeking reimbursement for 2021. It has tried several times to reach an agreement with gaming authorities in various Rhode Island towns on a low tax assessment after the Coronavirus pandemic began. Yet, the crisis affected all industries in the country.
Bally's says that the pandemic affected its Ocean State casinos, yet the tax rates didn't reduce. Tiverton and Lincoln have negotiated with the casino about reducing its tax rate. But some gamblers claim that the operator's recent lawsuits will help it pressure the officials to reach a final agreement.
Why Bally's Corporation Has Sued Rhode Island Towns
Most businesses in the country tried to reach their customers during the pandemic. Most states banned casinos from allowing players to enter their premises, and some of them couldn't run online.
Bally's wasn't left out as it had to completely shut down its casinos in Rhode Island. Still, the casinos had few players at once, even when they resumed operations. These restrictions greatly reduced their revenue and lowered their properties' value.
The gaming operator tried to get a lower property assessment to recover the revenue it had lost. This eventually helped it pay low tax rates, and it has been negotiating with Tiverton and Lincoln to reduce property tax assessment.
Will Bally's Gain Anything From the Lawsuits?
Bally's Corporation states that the two Rhode Island towns ought to have evaluated it at lower tax rates in 2021 and 2020. But it is seeking compensation with interest for 2021 taxes. It might win huge reimbursement payments once the legal suits go through.
Tiverton did its evaluation of Bally's casino in December 2020, and it was at almost $60.5 million. This was 6.5 percent less than the previous evaluation. Even so, the operator says that Tiverton didn't consider the pandemic's impact on its operations.
Instead, it claims that the evaluation should have been $41 million. Bally's assessment shows that its taxes ought to have been $266,000 less.
The same applies in Lincoln's evaluation, as Bally's property in the town was found to be worth $108 million. Bally's paid $2.7 million in property tax, and it wants to get a 30 percent decrease in its Lincoln property tax assessment.
More Details About Rhode Island's Casino Industry
Bally's two Rhode Island legal suits are huge as its properties are the only full-service casinos in the region. Governor Dan McKee recently signed a bill that offers Bally's exclusive control of the state's casino industry. It will last for two decades and requires the operator to collaborate with International Game Technology (IGT).
The new bill prolonged another existing agreement that compels IGT to increase its operations in the state and hire at least 1,100 workers from local communities. Also, it will perform technology upgrades worth $155 million. Bally's and IGT will team up in a $100 million expansion project on its Lincoln casino.
The operator dominated Rhode Island casinos before it filed the lawsuits. Still, the state is a major investment in its future growth. Some gaming analysts claim that it is using the lawsuits to compel Tiverton and Lincoln to settle.