Arkansas casinos coming, but where and when unclear

BY ASSOCIATED PRESS
11/14/2018 08:00 AM
Main Cherokee Phoenix
Cherokee Nation Businesses CEO Shawn Slaton speaks to the Tribal Council’s Executive & Finance Committee in January about groups in Arkansas wanting to pass ballot initiatives for casinos in that state. According to Arkansas Ethics Commission records, CNB has given more than $2.2 million to a group wanting four casinos in Arkansas. COURTESY
LITTLE ROCK, Ark. (AP) – Arkansas voters approved an amendment to the state’s constitution allowing licenses for four casinos: two existing gambling facilities and two others that will be built.

About 54 percent of voters approved of the amendment on Nov. 6. Retired Little Rock resident Robert Bradley said he voted for casinos to keep gambling money in Arkansas.

“People take the money out of their hometown,” Bradley said. “It’s better for the city, for the people. There’s more jobs.”

Now questions remain about where and when gambling will happen, and about how much revenue the casinos will generate.

Where will the casinos be?

The amendment provides for four casino licenses. Two of those licenses will be given to already existing electronic gaming facilities at racetracks: Southland Park Gaming and Racing, a greyhound track in West Memphis (Crittenden County), and Oaklawn Racing and Gaming, a thoroughbred racetrack in Hot Springs (Garland County). The other two licenses will be awarded to casinos after an application process and will be constructed in Jefferson and Pope counties.

Garland County is in central Arkansas, and Crittenden County is in northeastern Arkansas. Jefferson County is in south central Arkansas, and Pope County is in north central Arkansas.

Notably, the amendment passed in all but 11 counties, and of those that did not support the amendment, Pope County residents had the strongest opposition. About 60 percent of voters in Pope County opposed it. In Jefferson County, by comparison, nearly 65 percent were in favor.

State Sen. Breanne Davis said that Pope County residents were concerned that they were being written into the constitution without having a say. The county voted 68 percent in favor of a local ordinance which mandates a local election before the county judge can write a letter of support for a casino, an amendment-mandated part of a casino group’s application.

Quapaw Tribe Chairman John Berrey said the tribe intends to apply for a license to build a casino in Pine Bluff. It’s not clear who else intends to apply, but along with the Cherokee Nation, the two Oklahoma tribes donated more than $5.8 million to the campaign in favor of the amendment.

According to Arkansas Ethics Commission records, Cherokee Nation Businesses donated more than $2.2 million to the Driving Arkansas Forward group that pushed the casino initiative.

According to records filed on Oct. 30, CNB made an Oct. 19 donation in the amount of $664,535. According to past AEC filings, CNB donated $513,400 on Sept. 11, $525,300 on July 30 and $525,300 on June 25. In all, CNB gave $2,228,535 to Driving Arkansas Forward.

In a Cherokee Phoenix story earlier this year, CNB CEO Shawn Slaton said CNB contributed the money to help “protect Cherokee jobs.”

“A significant portion of our market originates in northwest Arkansas, and if an operator other than Cherokee Nation were to gain a foothold, that would threaten jobs at Cherokee Casinos West Siloam Springs and Roland. It could also decrease, for the first time ever, revenue that ultimately funds health care, housing, education and other tribal services. CNB will always go to whatever lengths necessary to protect Cherokee jobs and not only preserve, but continue to increase the dividend paid to the Cherokee Nation, which funds critical services for Cherokee Nation citizens,” Slaton said.

CNB officials said the donations were to help with expenditures such as campaigning and advertising to get the proposal placed on the ballot.

When will the casinos open?

Before casinos can be officially opened, licenses must be awarded. The deadline for awarding licenses to Oaklawn and Southland is June 30, 2019 – but if everything runs smoothly, licenses could be issued earlier.

According to a spokesman, table games at Southland should be running “as soon as is feasible,” while a spokeswoman for Oaklawn said they do not have date yet.

If the Quapaw Tribe is awarded a license for a Pine Bluff casino, a spokesman for the tribe said they hope to have a casino running by early 2020.

How much money will this generate?

The state Department of Finance and Administration estimates that by giving Oaklawn and Southland full casino licenses, the state will lose around $36 million in general revenue over two years. That’s because right now the facilities are taxed as electronic games of skill, which is a higher tax rate than casino gaming.

But the state is using projections based on the money the casinos made solely as electronic gaming facilities.

Supporters say the casinos will generate far more income with additional gambling games and sports wagering. A previous study commissioned by a group advocating for the casinos found the casinos could generate $39 million in annual state and local revenue.

And the state does believe the casinos eventually will be profitable.

“As the casinos operate, we do anticipate it’ll get closer to the numbers that the electronic gaming is generating and will ultimately result in additional revenue for the state,” Hardin said.

It’s not clear right now how the state intends to make up the projected deficit.

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