Judge's ruling rouses all sides in casino debate

Thursday 2nd April 2020

The state Racing Commission has been inundated with letters from each corner of the Pope County casino license debate after a judge ruled last week that both a rule and a law that set restrictions on when local officials could endorse the applicants were unconstitutional, according to documents obtained by the Arkansas Democrat-Gazette.

Last week's ruling from Pulaski County Circuit Judge Tim Fox kicked a rejected application from Mississippi casino operator Gulfside Casino Partnership back to the racing commission to apply the provisions of Amendment 100 and consider the application on its merits.

Gulfside had sued the Racing Commission after its application -- submitted last year with endorsements from two local officials right before they left office -- was rejected along with four other applicants because none contained letters of support from local officials in office at the time of the application.

Constitutional Amendment 100, passed by state voters in November 2019, allows a new casino each in Pope and Jefferson counties and allowed the expansion of gambling at the racetracks in Hot Springs and West Memphis.

[RELATED: See complete Democrat-Gazette coverage of casinos in Arkansas at arkansasonline.com/casinos]

While Amendment 100 does not stipulate when the endorsements have to be dated or submitted, the Racing Commission established Rule 2.13.4(b) -- which requires endorsements from local officials in office at the time the application is submitted. The Legislature also passed Act 371, which became effective in March, that requires the same thing.

Fox ruled last week that the rule and law impose an additional qualification beyond the language of Amendment 100, rendering them unconstitutional.

Gulfside was the only one of the four applicants to include a letter of endorsement during the first application window.

A second application window for the Pope County license was opened after the county Quorum Court passed a resolution in support of Cherokee Nation Businesses for the license and Ben Cross, county judge of Pope County, subsequently issued a letter of support for the Cherokees.

That second window was "abandoned" by the Racing Commission after Pulaski County Circuit Judge Wendell Griffen barred the commission from issuing a Pope County license under Rule 2.13.4(b).

Cherokee Nation Businesses -- which submitted an application without an endorsement during the first window -- has asked the Racing Commission to consider its application -- amended with local support -- under a separate rule that allows reconsideration for "good cause shown."

Gulfside attorney Lucas Rowan said the commission should immediately issue Gulfside the Pope County casino license.

"There is no legal or factual basis for 'good cause,'" Rowan said. "CNB applied in May, was denied in June and waived the right to appeal under the Racing Commission's rules.All parties had the opportunity to obtain a letter of support from November 2018 until the close of the application period on May 30, 2019. Gulfside was the only applicant to meet all requirements of Amendment 100, and like Saracen, should receive a casino gaming license without further delay."

The Racing Commission granted a casino license last summer to the Quapaw Nation to build the proposed $350 million Saracen Casino Resort in Pine Bluff.

Cherokee Nation Businesses countered -- in a March 25 letter to the Racing Commission from Cherokee attorney Scott Richardson -- that Fox's ruling gave the authority to the Racing Commission to deny Gulfside's application.

"CNB has been repeatedly assured that the 'good cause shown' provision was included in the Casino Rules so that the County Judge and/or Quorum Court of Pope County would have time past the May 2019 application period to consider which operator it would provide a letter or resolution of support and for that potential casino operator to be considered for the Pope County casino license," Richardson said in the letter, which this newspaper obtained through an Arkansas Freedom of Information Act request.

Scott Hardin, a spokesman for the state Department of Finance and Administration, said Wednesday that a meeting has not been scheduled by the commission to discuss Fox's ruling. The scheduled meeting for Saturday has been canceled, but the Pope County casino license was not on the agenda.

No decision has been made of whether the state attorney general, who represents the Racing Commission, will appeal Fox's ruling, Hardin added.

In a March 26 letter to the Racing Commission, Gulfside attorney Casey Castleberry said that the Cherokee's request should be denied.

"The ruling does away with CNB's argument that it was impossible to meet the letter-of-support requirement during the May 2019 application period because Gulfside, in fact, submitted an application that met Amendment 100's letter-of-support requirement during the May application period," Castleberry said. "In fact, CNB had from November 14, 2018 to December 31, 2018 to obtain a letter of support from county officials but failed to do so."

Castleberry attached a copy of a Dec. 27, 2018, letter from Shawn Slaton, then chief executive officer of Cherokee Nation Businesses, to Jim Ed Gibson, who was then county judge of Pope County. In that letter Slaton asks Gibson to give them the opportunity to vie for his endorsement "in an open process to help you determine the best partner for Pope County."

"Apparently, CNB waited until December 27, 2018 to attempt to obtain a letter of support from Pope County Judge Jim Ed Gibson, and CNB's failure to timely obtain local support is not good cause," Castleberry said in the March 26 letter to the commission.

The Racing Commission received numerous emails and letters from a wide cross section of the issue, according to documents received under the Freedom of Information Act.

Cross, Pope County's county judge, in a March 25 letter urged the commission to act quickly in awarding a casino license.

"Our selection of CNB/Legends as the appropriate vendor Pope County is our final option at having a local say in the matter," Cross said. "Essentially, the state of Arkansas placed this upon us, please let us have some say in who we are partnered with for decades."

Some emails and letters to the commission were received from those opposed to any casino in Pope County.

"Please, please do not issue license for either casino in Pope County," said Russellville resident Glenda Bull, in a March 26 email. "We love our quite [sic] little communities in our county. If a casino is brought in that will all change. Please I pray do not issue a license."

Nathan Harrison, a Pope County resident, told the commission he was not in favor of any casino in Pope County, but if it is inevitable, the commission should award the license to the "vendor who is willing to work with both the city of Russellville and Pope County."

"Gulfside and CNB have valid applications, so good cause should not play into any decisions here. Neither should a very short history of CNB being present in Pope County," Harrison said. "They have poured many dollars into the community to gain followers, not partners. Hosting semi-fancy events and giving away T shirts doesn't make a partner. Gulfside has not had any local presence aside from the occasional meeting and phone call to the mayor, council members, [Quorum Court] members, and the judge. These organizations are in business for one reason, to take as much profit as possible from people willing to gamble."

Dozens of emails and letters were submitted from individuals and members of the pro-casino group Pope County Majority, asking the Racing Commission to accept the Cherokee application.

"I want to take the time to point out that the plain language of Amendment 100, as originally written, says that a license is to be granted to a vendor that has 'a letter of support from THE county judge or county quorum court.' Today, it was said that your rules are against the plain language and there was some unconstitutionality in denying Gulfside," said Francis Schlude, a Pope County resident. "As I am certified as an English teacher, the word 'the' is a definite article adjective."

Metro on 04/02/2020

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