Casino operator warns Racing Commission of violation

LITTLE ROCK — A casino operator vying for a license in Pope County warned the state Racing Commission it’s violating rules if it goes ahead with a plan at today’s meeting to evaluate the applications without installing a review panel to do the job.

In a letter obtained Wednesday through the

Freedom of Information Act, Cherokee Nation Businesses attorney Dustin McDaniel told the commission failure to comply with the rules “may doom the Commission to do it all over again.”

The Racing Commission is meeting at 9:30 a.m. today to interview — via video — both the Oklahoma-based Cherokees and Mississippi-based Gulfside Casino Partnership for the Pope County license. According to the agenda, the commission will then evaluate the applications.

Commission spokesman Scott Hardin said Wednesday each commissioner was emailed both applications and they have had time to review the proposals in advance of today’s meeting.

“Score sheets will be individually completed by commissioners tomorrow. Scores will be applied based on the information presented in the applications along with the presentations and responses shared at tomorrow’s meeting,” Hardin said. “At the close of the meeting, score sheets will be compiled to determine the overall score for each applicant.”

The Cherokees cited commission Rule 2.13.9(d) which specifically states: “A review panel comprised of members of the Commission shall evaluate the applications and award points for each merit criterion. The points shall be totaled for each application and the applications ranked from the highest total score to the lowest total score. The Commission shall notify in writing each of the casino

applicants of their respective score and their respective ranking among all casino applicants.”

“I think that all of us are ready to be finished with this process,” McDaniel said in the letter. “I can think of few things more painful than to have to repeat the meeting and actions expected on Thursday for failure to comply strictly with the rules. To that end, I would respectfully ask that the AG’s Office give careful examination of the scoring process in advance of Thursday’s meeting.”

Spokesmen for Cherokee Nation Businesses and Gulfside Casino Partnership declined to comment.

The companies are the last two casino operators to remain standing after all five original applicants were rejected by the Racing Commission last year because none met the commission’s rule in place at the time requiring endorsements from officials in office at the time of application submission.

Gulfside sued the Racing Commission because its application contained endorsements from officials who had left office in December 2018.

Earlier this year, Pulaski County Circuit Judge Tim Fox ruled unconstitutional the commission rule and a

state law had the same requirement, that the endorsements come from local officials serving at the time of the application.

The Cherokees resubmitted their application after the county Quorum Court’s August endorsement of the Cherokees for the casino license.

McDaniel said in the letter the gaming rules make it clear there is no authority to “simply tally the scorecards of the commissioners.”

At the commission’s May 7 meeting, members voted unanimously to set points values on four merit criterion that will be used to score the applications: the applicant’s experience with casino gambling; timeline for opening the casino; proof of financial stability and access to financial resources; and summary of the proposed casino.

Each will be assigned a maximum of 30 points except for the casino timeline, which was weighted at 10 points.

Hardin said the review panel will consist of all commission members.

“Each commissioner will individually apply scores with the overall score for each applicant compiled at the meeting’s close,” he said.

McDaniel said in the letter “only the Review Panel as a body” may award points and cannot exceed the maximum possible points to each criterion for each applicant and

then refer those points to the commission.

“I recognize that it is the same individuals, but the Review Panel is like a committee, and a Committee of the Whole is still a Committee acting on behalf of the Commission,” McDaniel said. “As such, the Review Panel must vote to refer its assignment of points per category for each applicant to the Commission before further action may be taken.”

McDaniel said to comply with the gaming rule, the commission will have to vote to appoint the Review Panel, recess the meeting of the Racing Commission and then convene the first “and hopefully only” meeting of the Review Panel.

“If each member tallied up his score card and then those numbers are added together, the result would be to change the maximum score from 100 to a maximum score of 700. Such an action would change the criterion maximums from 30, 30, 30 and 10 to 210, 210, 210, and 70,” McDaniel said. “That would be in clear violation of the scoring rubric voted upon by the Commission AND it would be an ultra vires delegation of the duty to ‘award points’ from the Review Panel.”

Hardin said the letter from McDaniel was provided to all of the commissioners.

“Any impact is yet to be determined as this is at the

discretion of the commission,” Hardin said.

The Dover City Council on Tuesday voted unanimously to authorize Mayor Roger Lee to complete negotiation of a development agreement between the city and Cherokee Nation Businesses should they be awarded the casino license and choose to locate the resort in Dover.

“I anticipate having the agreement finalized soon,” Lee said. “I am pleased to say if Legends receives a license to operate a resort/casino in Pope County they will be welcomed to do so in Dover.” Legends would be the name of the Cherokees’ casino.

The Dover action comes on the heels of Russellville’s City Council voting down Monday an agreement negotiated by Mayor Richard Harris and the Arkansas Municipal League for Gulfside or the Cherokees to voluntarily annex into the city if the license is awarded to one of them by the state Racing Commission.

The main point of contention was that the agreement had not been signed by either the Cherokees or Gulfside and left broad negotiation powers in Harris’ hands.

The council also voted to allow Harris to renegotiate signed agreements with the two casino operators and return to the council for reconsideration.