Sen. Harry Reid (D) may not see as well as he used to, but he’s still got plenty of ‘juice’ on Capitol Hill. He delivered an early Christmas present 
for campaign donor (and Caesars Entertainment co-owner) David Bonderman, in the form of a provision that would preserve a loophole whereby REIT spinoffs would not be subject to capital-gains taxes. The proposed rules change also “would prevent companies from setting up their own affiliated REITs, to hold their property and no one else’s,” which would run a cart and horses through REITs planned by Caesars and MGM Resorts International, another staunch Reid supporter. The so-called “Caesars-TXU carve out” will cost the U.S. government roughly $1 billion in anticipated tax revenues.
Rep. Kevin Brady (R), author of the legislation that Reid gutted, took the defeat in stride, saying immediately after the vote, “We just weren’t interested, I think on both sides of the aisle, in disrupting transactions, mid-transaction.” Senate Majority Leader Mitch McConnell (R) also took a philosophical view, saying “This is the kind of thing that can happen when you have an omnibus.” It’s also the kind of thing that happens when you have “Pinky” Reid in your corner. The gaming industry’s going to miss him.
* Two competing bills to expand casino gambling into northern New Jersey are filleted expertly and at length. It’s unclear at this point which is 
more “george” for Atlantic City but the horseracing industry is sure to back the Assembly’s version, which makes a small provision for the horsey set, while the state Senate leaves them to fend for themselves. The Senate plan would also allow Boardwalk operators to double-dip in the north-Jersey market. Others who covet the two proposed new casinos are willing to pay a premium for the privilege: Hard Rock International has unilaterally agreed to a 55% tax rate in return for a Meadowlands casino. If that’s not ardor, I don’t know what is.
* In the meantime, Atlantic City Mayor Don Guardian (R) must rummage under the sofa cushions for $62.5 million due to Borgata today, for 
excessive property-tax assessments. Guardian says the city doesn’t have the money, period, and Borgata owners are reportedly willing to work out some kind of settlement with Hizzoner. Even if they do, that still doesn’t get Guardian out of the woods. Atlantic City owes Borgata a further $85.5 million in tax refunds. At least a temporary restraining order prevents Boyd Gaming and MGM from immediately dunning Guardian for the full amount, which covers 2011-14.
* Continuing to reduce his leadership role at Crown Resorts, mogul James Packer has stepped down from its board of directors. According to Reuters, “he planned to devote his energy to development projects in Sydney, Melbourne and Las Vegas.” Although Packer has demurred about the possibility of taking the company private, some have seen his gradual draw-down of his executive involvement as a precursor to trying to take at least parts of the company off the public markets.
