Secretary of State Joins Harrison County to Defend Against Casino Tax Lawsuit

The Secretary of State's Office has filed a motion to intervene on the side of Harrison County in a lawsuit filed by the Imperial Palace that claims its casino barge site cannot be taxed.  

The lawsuit, filed on March 21, 2001, in Harrison County Chancery Court, argues that "there is no legal authority for the assessment, levying and collection of ad valorem taxes on a separate tax parcel in addition to the upland tax parcel, for the area of littoral rights of an upland owner (see below)."

As part of its challenge to Harrison County's authority to levy taxes on the casino barge site, Imperial Palace argues that its "littoral rights include the right to build wharves, piers, bulkheads, and beach houses andto dock casino bargesand other vessels" (emphasis added). Under this theory of the case, no tidelands lease from the State would be required.  That argument, Secretary of State Eric Clark says, threatens the entire public trust tidelands program.

"We are intervening at the request of the Harrison County officials to protect Mississippi's control of the public trust tidelands," Clark said.  "If the Imperial Palace notion of littoral rights prevails, the Coast stands to lose responsible oversight of the casino industry and about $5 million annually in lease payments."

Tidelands include submerged lands and land covered by the daily rise and fall of tide. Tidelands are publicly owned and held in a trust administered by the Secretary of State. The Secretary of State's Office collects about $5 million a year from tidelands lease holders, including casinos, and the money is returned to the three Coast counties for tidelands projects administered by the Department of Marine Resources. Uplands are lands bordering the tidelands that may be privately owned. Littoral rights refer to the upland owner's right of access to the water bordering his or her property.

Treasure Bay Casino has filed a similar suit in Harrison County that challenges the county's right to tax its casino barge site. The two suits are expected to be consolidated into one, which means that the Secretary of State's Office will oppose the claims of both casinos.

In its suit, Imperial Palace seeks to pay no future taxes on its casino barge site, a refund -- with interest -- of taxes paid in 1999 and 2000 under protest, and attorney fees.

In 1997, Clark's office sued Imperial Palace for refusing to sign a tidelands lease with the State of Mississippi before opening its casino.  Imperial Palace officials signed a lease on November 18, 1997, and pay $500,000 annually in rent.

"The Imperial Palace was wrong then, and they're wrong now," Clark said. "This isn't just about the way the county determines property taxes. It's also about whether a casino can dock a barge on state property and pay our citizens nothing in rent."

The Imperial Palace suit names Harrison County Tax Assessor Tal Flury, Harrison County Tax Assessor David Larosa, and the Harrison County Board of Supervisors as defendants. A hearing in Harrison County Chancery Court is scheduled for September 4.

PRESS CONTACTS

Attorneys representing Imperial Palace:

• Sam Begley (601-969-5545)
• Gerald Blessey (228-594-7070)
• Britt Singletary (228-432-8900)

CAUSE NO. C2402-01-251.

* "Wherefore, IPM [Imperial Palace of Mississippi, Inc.] prays that the Court will enter a judgment against the defendants granting the plaintiff the following relief: