Panel to rethink 2 Pope County casino aspirants

Thursday 16th April 2020

The state Racing Commission, at a special meeting Wednesday morning, accepted Cherokee Nation Businesses' application for the Pope County casino license on a "good cause" basis.

The commission also voted to let a ruling stand without appeal by Pulaski County Circuit Judge Tim Fox that kicked Gulfside Casino Partnership's initially rejected gambling application back to the commission to judge on its merits.

The votes on both issues were unanimous and made with very little discussion.

The commission now will turn the applications over to a contracted evaluator to recommend which operator should be awarded the Pope County casino license, commission Chairman Alex Lieblong said during the meeting, which was held using video and telephone technology.

"And then I think we would all like to see a dog-and-pony show ourselves," Lieblong said.

Jim Fox, a gambling consultant from Scottsdale, Ariz., was contracted by the Racing Commission to review the applications and make a recommendation to the commission, said Scott Hardin, spokesman for the state Department of Finance and Administration. The commission is within the department.

The recommendation from Fox likely will be made before the end of June, according to Hardin.

"The licensing decision is ultimately made by the commission," Hardin said.

Gulfside's application -- along with those from Cherokee Nation Businesses of Oklahoma, Kehl Management of Iowa, Warner Gaming of Nevada and Choctaw Nation Division of Commerce of Oklahoma -- was rejected during the first application window which closed in May 2019.

None contained endorsements from local officials who were in office at the time.

Gulfside sued the Racing Commission over the rejection of its license because its application contained endorsements from local officials before they left office in December 2018.

Constitutional Amendment 100 -- which was passed by voters in November 2018 to allow a new casino each in Pope and Jefferson counties and allowed the expansion of gambling at the racetracks in Hot Springs and West Memphis -- requires endorsements, but does not stipulate when the endorsement must be made.

On March 25, Tim Fox ruled unconstitutional a commission rule requiring that the endorsements be from officials in office at the time of the application.

Butch Reeves, deputy attorney general, told the commission that an appeal of Fox's ruling would gum up the license award process for about 18 months. By then, the consultant contract would have expired, incurring more expense, he added.

The contract with Fox & Fox Consulting LLC expires June 30, 2020. In January 2019, the Legislature's Joint Budget Committee signed off on two identical $75,000 contracts with Jim Fox, one for the state finance department's management services and another for the Racing Commission.

Gulfside attorney Lucas Rowan said the casino operator was pleased "the issue of our eligibility is now settled."

"We remain firm in the belief that we are the best choice for Pope County and for Arkansas, with 500 more permanent jobs and $10 million more in annual gaming tax revenue, all kept in state," Rowan said. "We look forward to continuing to make the strong case for why we should receive the casino license."

Chuck Garrett, chief executive officer of Cherokee Nation Businesses, said the decision against the appeal of Fox's ruling was "completely within" the commission's "discretion and understandable given the expressed desire to avoid further delay."

"We absolutely welcome the opportunity to have our company, its history and our application for Legends Resort and Casino Arkansas objectively scored and judged," Garrett said.

Last fall, the Cherokees received endorsements from county officials and resubmitted the application.

In January, that second window was "abandoned" by the Racing Commission after Pulaski County Circuit Judge Wendell Griffen, in a separate case filed by Citizens for a Better Pope County, issued and extended a temporary restraining order barring the commission from issuing a license for a casino in Pope County.

Griffen, however, said his ruling did not prohibit the commission from taking applications after an application period is closed, if the application can show "good cause."

A commission rule states: "Applications for a casino license will be accepted by the Commission for a period of thirty (30) days, beginning on the date established by the Commission and published as a legal notice by the Commission. No Applications will be accepted after the thirty (30) day period, except for good cause shown."

Lieblong said Wednesday, before the vote was taken, that receiving an endorsement from local officials fit the definition of "good cause."

Garrett of Cherokee Nation Businesses said he was "extremely pleased" with the commission's unanimous vote.

"We are confident the choice will be clear, as it has been in Pope County. Last night, the Atkins City Council joined Pope County Judge Ben Cross, the Quorum Court and four other Pope County cities when it voted for its Mayor to write a letter of support for CNB. We look forward to earning the Commission's support on our merits and fulfilling our commitments to Pope County and the State of Arkansas," he said in a statement.

Hardin said that the commission is not opening a new application window.

"The rules state a license will be issued within 30 days of the application process concluding," Hardin said. "The application process would be complete following Mr. Fox's recommendation and the Commission's interviews with both applicants."

Metro on 04/16/2020

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