Store-bought Casinos Electric power Insurance Operate Tax burden Program

Prior to the recent economic downturn, commercial casinos collected at the very least $30 billion in revenues every year from 2005 through 2008.1 In this period, US casino owners built new facilities and expanded how big their existing facilities. Consequently of the economic downturn, new US commercial casino construction has arrived at a screeching halt and casino operators are now focused on existing facility cost reduction.

The Nature of Casino Properties

Commercial casinos often encompass hotel resorts, which provide attractive packages of services due to their corporate and family customers. Casinos are particularly worthy of EPAct because of their large gaming floors, hotel occupancy rooms, meeting halls, and parking garages. All these features typically consumes large square footage and the EPAct benefit includes a potential for 60 cents per square foot for all the three measures described above. Some of the smallest commercial casinos are about 50,000 square feet many American casinos are normally over 100,000 square feet. One of the largest ones, MGM Grand on the Las Vegas strip is almost 2 million square feet. Hotels themselves are the most favored of Section 179 building category. (See “Hotels and Motels Most Favored Energy Policy Act Tax Properties”)

It’s common to consider commercial casinos as positioned in two states Nevada and New Jersey. While it holds true that both of these states have the biggest commercial casino revenues, you will find 12 states with commercial casinos in the United States, the other commercial casino states are: Colorado, Illinois, Indiana, Iowa, Louisiana, Michigan, Mississippi, Missouri, Pennsylvania, and South Dakota. Members of the American Gaming Association have publicized some of the commitments to energy reduction. Reporting casinos include Boyd Gaming Corporation, Harrah’s Entertainment, Inc., and MGM Mirage. They’ve projects including significant energy savings via cogeneration, ERV(energy recovery ventilation), more efficient HVAC units, replacing incandescent lights with energy efficient lightings, windows with energy efficient day lighting systems, solar thermal storage and numerous other energy saving initiatives.

The underlying rule set to qualify for the Section 179D lighting tax deduction makes casinos and particularly casino hotels the most favored property category for the tax incentive. The rule set requires at the very least a 25% watts-per-square foot reduction as set alongside the 2001 ASHRAE (American Society of Heating Refrigeration and Air Conditioning Engineers) building energy code standard. Full tax deduction is achieved with a 40% watts-per-square foot reduction set alongside the ASHRAE 2001 standard. The ASHRAE 2004 hotel/motel building code standard requires 40% wattage reduction, which means that any hotel or motel lighting installation that fits that building code requirement will automatically qualify for the most EPAct tax deduction.

Occupancy Rooms

For most other building categories, the Section 179D tax provisions require compliance with the bi-level switching requirement. The comparison is definitely predicated on wired as opposed to plug-in lighting. Casino hotel occupancy rooms have a major advantage in which they often use plug-in lighting, and since these rooms function as hotel and motel spaces, they are specifically excluded from the tax bi-level switching requirement. Since occupant rooms usually are one of many larger spaces in hotel casinos, casinos are normally able to use energy efficient lighting to generate large EPAct tax deductions for the facility.

Back of the House Spaces

Casinos frequently have large kitchen, storage, and laundry (so called back of the house) spaces which have historically used T-12 fluorescent lighting. This lighting is indeed energy inefficient compared to today’s lighting products that it is going to be illegal to manufacture in the United States after July 1, 2010.4 Once manufacturing of these prior generation lighting products ceases, the cost of replacing these inefficient bulbs will increase. Simply stated, casinos must look into acting now to displace these lighting fixtures to save lots of both energy and lamp replacement costs. The EPAct lighting tax incentive can be utilized to address the opportunities linked to these legally mandated product changes

Ball Rooms, Banquet Rooms and Restaurants

These aspects of casinos have historically used designer type lighting that is energy inefficient and often very costly to keep and replace. Specifically, replacing bulbs and lamps in high ceilings is very costly since expensive mobile hydraulic platform equipment must certanly be rented or purchased to deal with the replacements. New lighting products and, specifically, light emitting diode (LED) products, make use of a fraction of the vitality and have a considerably longer useful life and are now being substituted. The combination of large energy cost reduction, operating cost reductions, utility rebates and EPAct tax deductions can greatly improve the economic payback from these more pricey lighting upgrades.

Parking Garages

Many casinos have large adjoining parking garages that can save substantial energy costs and generate large tax deductions by upgrading to energy efficient fixtures. Togel Hari Ini In Notice 2008-40 issued March 7th, 2008, the IRS announced that parking garages are a property class that is specifically eligible for use the EPAct tax deductions. Also, parking garages are excluded from the tax bi-level switching requirement. Please see the September, 2008 International Parking Institute article specialized in parking garages EPAct lighting deduction tax opportunities.5

Slot Machines and Gaming Floors

One of the biggest energy users on hotel gaming floors is slot machines. Although they were early adapters of fluorescent technology, even these energy efficient bulbs normally have to be changed 3 times annually because of 24/7 operating hours. Because of the high labor maintenance costs, casino owners are now transitioning to LED technology in their slot machines. LED’s, while they have higher at the start costs, have high energy efficiency and much longer life cycle, offering significant savings in labor and maintenance costs.

HVAC

Casinos because of their typical 24 hour occupancy can perform significant energy cost savings from energy efficient HVAC systems. Specifically, Nevada’s hot climate further makes energy efficient HVAC an extremely worthwhile investment. Fortunately. Nevada with the greatest revenues from casinos has America’s second highest convenience of energy efficiency through renewable geothermal energy.6 Certain kinds of very efficient HVAC investments will often qualify for the HVAC EPAct tax incentive including geothermal and thermal storage.

LEED Casinos

We expect to see more casinos obtain LEED status. (See LEED Building Tax Opportunities Article7). In 2008, The Palazzo, Las Vegas Casino became the biggest LEED certified building and one of many first certified LEED casinos in the US.8 Casinos and hotels find that certain kinds of frequent travelers are extremely interested in remaining in facilities which have clearly demonstrated they are focused on the environmental surroundings and sustainable design. To become LEED certified, a casino must have a building energy simulation model produced by a qualified engineer. Modeling can also be needed for the EPAct, HVAC and Building Envelope tax deductions. Qualified tax experts that know how to make the adjustments to convert LEED computer models to EPAct tax deduction models can evaluate LEED models and determine whether large tax deductions are probable. For instance, a 500,000 square foot LEED casino that qualifies for the most EPAct tax deduction will receive an instantaneous tax deduction of $900,000 =(500,000*$1.80). Casino owners who understand the magnitude of these benefits can use the tax savings to help justify the expense linked to achieving LEED status.

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