Porn impresario Larry Flynt says he’ll back out of his deal to buy the Normandie Casino after being “treated as a second-class citizen” by local politicians.
Last week saw Flynt, the founder of the Hustler adult entertainment business, announced as the buyer of the Normandie Casino in Gardena, California. But this week saw Flynt accuse Gardena city council of moving the goalposts by changing the card room’s municipal tax obligations.
Flynt, who already owns the Hustler Casino in Gardena, has objected to the city’s plans to replace their standard 12% gaming revenue tax with a minimum monthly payment of $800k from the two casinos. To soften the blow, the city offered Flynt a discount on its 12% rate if either property’s monthly revenue exceeds $2m.
On Thursday, Flynt addressed the city council, warning them that he was prepared to walk away from the deal to buy the Normandie, which Flynt has already begun rebranding as Larry Flynt’s Lucky Lady Casino. Flynt warned that “400 people are going to be out of a job” if he made good on his threat.
Flynt called the Normandie “a piece of junk” that will require him to spend an initial $17m in refurbishments and a total of $60m over the next four years on expansion and promotion. Flynt says the planned upgrades will significantly boost the city’s property tax take so there’s no need to dip any further into his pocket.
Unimpressed by Flynt’s arguments, city council voted 3-1 in favor of their tax plan. An angry Flynt told the Daily Breeze that the city’s tax plan made it “totally impossible” for him to perform the necessary upgrades and still turn a profit.
Flynt said the council’s vote was particularly galling based on his belief that his Hustler Casino had “saved the city from bankruptcy” after paying $80.5m in tax over the years. Flynt claimed that no one “has done as much for the city and received so little.”
Flynt warned that unless councilors reversed their decision, he planned to “dedicate all my time to get those people replaced because they’re not good for the city and not good for me.” Flynt said he would devote his considerable financial interests to ensuring the election of candidates “who are friendly to gaming.”
The Normandie’s former owners were forced to sell after state regulators revoked the gaming licenses of several members of the family that controlled the venue. In January, these individuals reached a $2.3m settlement with federal authorities over repeated violations of the Bank Secrecy Act.