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Atlantic City Budget Plan Pounds Casinos

4 February 2003

ATLANTIC CITY – As reported by the Press Plus of Atlantic City: ``The lovefest between Gov. James E. McGreevey and Atlantic City casinos is over.

``On Monday, McGreevey proposed casino taxes that figure to cost the industry at least $135 million this year, which would wipe out its net profit and reduce its cash flow by 11 percent.

``McGreevey, trying to bridge a $5 billion state budget gap, said he wants to raise the casino-revenue tax to 10 percent from 8 percent; impose a sales tax on the rooms, meals and other incentives casinos give free to their best gamblers; and impose a 7 percent occupancy tax on hotel rooms statewide.

``…Experts said the timing is bad for the casino industry: It's coming off a year in which revenue grew only 2.4 percent and casino-style gambling likely is coming to nearby states.

``Dennis Gomes, Casino Association of New Jersey president, called the plan "a ridiculous proposition."

``…Gomes said the cost to the industry would be closer to $200 million if all taxes are enacted.

``…The 8 percent casino-revenue tax has never changed since the first casino opened 25 years ago.

``… McGreevey has `no interest in harming the casino industry,' said the governor's spokesman, Micah Rasmussen. `But these were tough decisions that had to be made.'…"

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