Arkansas judge tells racing commission to consider Gulfside casino application
LITTLE ROCK, Ark. – In a decision that further delays, and could undermine, the hopes of Cherokee Nation Businesses to site a casino in Russellville, a Pulaski County circuit judge has sent a rejected license application back to the Arkansas Racing Commission for review.
Circuit Judge Tim Fox ruled on March 24 that restrictions on when local officials could endorse applicants were unconstitutional and that the ARC must consider “on its merits” the application of Gulfside Casino Partnership of Mississippi.
Gulfside attorney Casey Castleberry claimed his client was the “only applicant for Pope County that timely complied with every requirement of Amendment 100.”
Amendment 100, passed in 2018 by Arkansas voters, allowed the establishment of casinos in Pope and Jefferson counties, and expansion of the horse track facilities at Hot Springs and West Memphis to include casino gambling.
CNB and Gulfside were among five applicants rejected during the initial application window because none were endorsed by local officials still in office, per a rule adopted by the ARC and a law passed by the Arkansas Legislature.
However, Gulfside’s application contained endorsements from officials who had since left office: Jim Ed Gibson, former county judge of Pope County, and Randall Horton, erstwhile mayor of Russellville.
There was some ambiguity in Amendment 100 about when endorsements were to be submitted, which the ARC and Legislature attempted to clarify. The ARC passed Rule 2.13.4(b) requiring endorsements only from local officials in office when the application is submitted. Arkansas lawmakers passed Act 371 also requiring endorsements from those in office.
In his ruling, Fox said the requirement “imposes an additional qualification, sometimes referred to as a ‘negative' qualification” not found in Amendment 100.
A demand by Gulfside that its application be sent to the ARC with instructions to license Gulfside was rejected by Fox.
Scott Hardin, speaking for the Arkansas Department of Finance and Administration, said any appeal of the ruling to the Arkansas Supreme Court would be the decision of the ARC and the Attorney General’s Office. Following Fox’s order and making a decision could also spark a lawsuit.
All parties had anticipated a delay, expecting a probable appeal regardless of the decision.
The ARC allowed a second period for applications, but sidelined it after Pulaski County Circuit Judge Wendell Griffen, in a suit filed by the anti-casino lobby Citizens of a Better Pope County, stopped the ARC from issuing a Pope County license until further hearings.
But Griffen added that his order didn’t prevent the ARC from taking applications submitted post deadline for the first application period based on “good cause shown,” per ARC regulations.
CNB did receive – during the second application window – a quorum court resolution of support, and a letter of support from Ben Cross, Pope County judge.
“We have respected the Arkansas State Racing Commission’s process and guidance throughout this period of continued delays, including its decision to wait for action at the circuit court level before considering our requests for acceptance of our application into the May 2019 period for ‘good cause shown,’” CNB CEO Chuck Garrett said on March 25. “Now that the court has ruled, we have renewed our request that our application be accepted so that we can move forward with the process, preferably before the racing commission and Attorney General’s Office decide whether to appeal the ruling.”
In a March 26 letter to the ARC, Castleberry urged the denial of the CNB application.
“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 wrote. “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 included a copy of a Dec. 27, 2018, letter from former CNB CEO Shawn Slaton to Gibson. In that letter Slaton asks for “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 … Gibson, and CNB’s failure to timely obtain local support is not good cause,” Castleberry wrote in the letter to ARC.
In an email sent by Cross on March 25 to the ARC, and shared with the Arkansas Democrat-Gazette, he repeated his endorsement of CNB.
“I do not believe there is any likelihood that you would reasonably grant Gulfside Casino Partnership a license,” Cross said. “In light of the looming economic outlook, please do not hesitate to act and subject our county to any further potential loss of revenue.”
The March meeting of the ARC was cancelled, but did not include any discussion of Fox’s decision on the agenda. As of April 8, no decision on whether to appeal had been announced by the ARC or the Arkansas attorney general.