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Supreme Court ruling results in new application process for Pope County casino license

The Arkansas Judiciary Justice Building in Little Rock.
John Sykes
/
Arkansas Advocate
The Arkansas Judiciary Justice Building in Little Rock.

The Arkansas Supreme Court on Thursday (Oct. 26) affirmed a lower court ruling that said Cherokee Nation Businesses was not a qualified applicant when granted a casino license in Pope County. The decision opens anew the application process.

Pulaski County Circuit Court Judge Tim Fox ruled Jan. 12 that Arkansas officials “unconstitutionally” granted a casino license to Cherokee Nation Businesses. Gulfside Casino Partnership had appealed a November 2021 decision by the Arkansas Racing Commission (ARC) to grant the Pope County license to Cherokee Nation Businesses and its Legends Resort and Casino company.

The Cherokee Nation proposal was approved in a narrow 3-2 Racing Commission vote after the Arkansas Supreme Court ruled ineligible the Gulfside Casino Partnership proposal in late October 2021. The state’s high court ruled that Gulfside did not have an official letter from an elected official during the active part of the application process, while Cherokee Nation did.

Judge Fox noted in his 6-page ruling that the ARC acted outside its authority and did not follow the rules of Amendment 100 – the voter-approved amendment allowing four casino operations in Arkansas – in granting the license to Cherokee Nation.

Thursday’s Supreme Court ruling, written by Associate Justice Cody Hiland, mirrored the ruling from Fox in its assessment.

“The ARC issued the Pope County casino license to both Legends and CNB. Yet at the time of this issuance, CNB had no application pending with the ARC. As stated, five applications were submitted during the May 2019 application period, but all five were rejected for failure to meet the requirements of amendment 100. Since then, the ARC did not reopen another application period during which it considered new applications. As CNB’s only application before the ARC was submitted in May 2019 and was ultimately rejected, it was not a “qualified applicant” as required by amendment 100. So, the ARC acted ultra vires in issuing the license to CNB. We affirm the circuit court’s decision on this point,” Hiland wrote in the ruling.

Trent Minner, regulatory division administrator of the Arkansas Department of Finance and Administration, said his division will work with ARC on a new application process.

“The Department of Finance and Administration’s Regulatory Division is still reviewing the opinion issued by the Arkansas Supreme Court this morning. DFA will be working with the Arkansas Racing Commission to open a new application window in a timely manner. We will work with the commission to ensure all legal requirements of Amendment 100 are fulfilled and that the process is carried out in compliance with Arkansas law,” Minner said.

Any applicants would be required to obtain a letter of support from Russellville Mayor Fred Teague if the planned location is in city limits, and requires a letter of support from Pope County Judge Ben Cross or the Pope County Quorum Court.

Casey Castleberry, attorney for Gulfside Casino Partnership, praised the decision.

“We are ecstatic about the Supreme Court’s affirmation of Judge Fox’s ruling that Legends was not a qualified applicant for the Pope County casino license. Just as the Racing Commission selected our superior application in 2020 in a head-to-head with Legends, we look forward to demonstrating again to county leaders and residents how our proposed world-class resort will benefit them and the entire state,” Castleberry said in a statement.

The Cherokee Nation casino proposal was estimated to cost $225 million and include 50,000 square feet of gaming space accommodating 1,200 slot machines and 32 table games, a sportsbook located within a high-end sports bar, a luxury hotel with 200 rooms with a resort-style pool, spa and fitness center, 15,000 square feet of mixed-use conference and entertainment space accommodating 1,000 people, and an outdoor water park and music venue.

Gulfside had proposed a $254 million that would include 500 hotel rooms, 80,000 square feet of gaming space, dining options and outdoor entertainment space. The casino would add 1,500 jobs in the region and have a $60.5 million annual payroll.

Amendment 100 was approved in 2018 by Arkansas voters. It established The Arkansas Casino Gaming Amendment, which requires the Racing Commission to issue licenses to Oaklawn Jockey Club in Hot Springs, Southland Racing Corporation in West Memphis, and to entities in Pope County and Jefferson County. Casinos in three counties are operational: Oaklawn Racing Casino Resort in Hot Springs, Southland Casino Racing in West Memphis and Saracen Casino Resort in Pine Bluff.