ATLANTIC CITY, N.J. (AP) — Trump Entertainment Resorts has paid more than $12 million in property taxes to avoid being charged hefty interest rates on the debt.
Atlantic City had planned to hold a tax sale next week regarding the casino company’s unpaid taxes on the Trump Taj Mahal and the shuttered Trump Plaza. Investors could have bought a lien that had to be paid off with interest of up to 18 percent.
But Chris Filiciello, a spokesman for Mayor Don Guardian, said Monday the company has paid its taxes for the year. That eliminates the need for a sale and gives the city some budgetary breathing room in a year when it is still struggling to reduce expenses and stem a revenue decline brought about by the contraction of its casino industry.
The city is hoping state legislators approve an aid package vetoed last month by Gov. Chris Christie, a Republican presidential candidate, who wanted more spending cuts and austerity measures on the part of the city.
Trump Entertainment had declined to make tax payments since March as it disputed the true value of the real estate, including Trump Plaza, which closed on Sept. 16, 2014, and used that money for other purposes during its Chapter 11 bankruptcy. But in a filing with the bankruptcy court last month, the company displayed a change of heart when confronted with the possibility of having its unpaid debt sold at a tax sale.
“In an effort to prevent the continued accrual of fees and interest at a rate of up to 18 percent on the accrued but unpaid amount owed to Atlantic City for 2015 real estate taxes, the debtors have determined, in their business judgment, that payment of their 2015 real estate taxes prior to the sale by the City of Atlantic City of any tax certificates … would be in the best interests of the debtors’ estates,” the company wrote.
The company also asked for court approval for additional temporary bankruptcy funding from billionaire investor Carl Icahn, who is acquiring Trump Entertainment from bankruptcy. On Thursday, the court approved an additional $12.6 million in funding from Icahn to take care of the property tax payments.
Trump Entertainment Resorts still bears the name of businessman and Republican presidential candidate Donald Trump, even though he no longer owns or controls it.