Luzerne County sets tax assessment for Mohegan Sun Pocono casino

By Jennifer Learn-Andes - | June 20th, 2016 1:48 pm

PLAINS TWP. — The Mohegan Sun Pocono casino’s new property tax assessment will be $152.5 million, Luzerne County Manager C. David Pedri announced Monday.

The casino had no prior assessment because its past real estate tax payments were flat dollar amounts dictated by a 2007 court-approved assessment appeal agreement that expired the end of 2015. Under the expired agreement, the casino paid $2.9 million to the three taxing bodies last year, with $2.01 million going to Wilkes-Barre Area School District, $653,360 to the county and $261,460 to Plains Township.

Although those payments weren’t based on a formal assessment, a property valued at $113.7 million would have paid $653,360 in county taxes last year.

The new assessment requires the casino to pay $707,680 more in taxes to all three taxing bodies based on their current tax rates, or a total of $3.6 million.

These payments include $2.48 million in school taxes, $876,370 in county taxes and $269,980 paid to the township.

Wilkes-Barre Area is planning a tax increase that would up the casino’s school tax payment another $84,500, to a total $2.57 million.

The county is in the process of mailing a change-of-assessment notice to Mohegan Sun, which is owned by Connecticut-based Downs Racing LP. The casino has the right to challenge the value within 40 days.

Mohegan Sun Pocono representatives could not be reached for comment Monday on the new assessment.

The Wilkes-Barre Area School School District also has the right to file a reverse appeal arguing for a higher value if district officials believe the assessment is too low.

The county hired Media, Pennsylvania-based Coyle, Lynch & Company for $56,000 to complete an appraisal for the new assessed value. County officials wanted an expert’s input because casino valuations are complicated. Several other Pennsylvania counties with casinos have taken a a similar approach.

The Mohegan Sun complex includes four parcels totaling 264 acres with a hotel/convention center and other amenities.

Pedri said he’s satisfied with the new assessment because it is comprehensive and will generate an additional $223,100 in revenue for the county.

The appraisal and assessment were based on the real estate value of the property — not the profitability of the business occupying that real estate — in compliance with state assessment law, he told the council in an email Monday.

County and municipal tax bills were issued earlier this year, but the delay won’t cause these taxing bodies to lose revenue because the casino’s upcoming bill will be retroactive to Jan. 1, Pedri said.

If Downs Racing appeals the new value, Cole, Lynch & Company may be paid additional hourly fees ranging from $100 to $350 to prepare and provide testimony and attend hearings for an assessment challenge in 2017.

Testimony fees would be capped at $25,000 in 2017, the contract says.

Property owners must continue to pay taxes on contested values as their challenges are processed. Retroactive refunds are paid if assessments are reduced.

The new appraisal is hundreds of pages long and available for public review at the front desk of the county assessor’s office, which is on the second floor of the county’s Courthouse Annex at the corner of River and West Jackson streets in Wilkes-Barre, Pedri said.

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By Jennifer Learn-Andes

Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.