RUSSELLVILLE -- The City Council's gaming committee on Monday evening selected a small Iowa casino company over two other contenders to recommend for a Pope County casino license.
"We are happy they chose us," said Dan Kehl, owner of Kehl Management of Dubuque, Iowa. "Hopefully, this will help bridge the divide between the city and the county and the community. We put our best foot forward and they decided who would be the best community partner."
The decision came after the committee received three proposals earlier this month -- from Kehl Management; Warner Gaming of Nevada; and Choctaw Nation Division of Commerce of Oklahoma. Cherokee Nation Businesses of Oklahoma, endorsed by the county Quorum Court, only submitted a brief proposal and was not included in the consideration.
Gulfside Casino Partnership of Mississippi, who has sued the state Racing Commission, did not submit an application to the committee.
Only three of the five committee members -- council member Eric Westcott; businessman Bart Langley; and former council member Nathan George -- voted, with all three voicing support for Kehl. Two abstained -- Russellville School District Superintendent Mark Gotcher and Arkansas Tech University Chief of Staff Mary Gunter -- after the Arkansas Democrat-Gazette objected when Gotcher announced the vote would be taken anonymously.
The meeting was momentarily halted while Westcott and Russellville Mayor Richard Harris consulted by telephone with city attorney Trey Smith. Harris then said the vote had to be taken publicly, but members could abstain from voting.
Westcott presented a one-page spreadsheet detailing each applicant's proposal. In an interview after the meeting, Westcott said it was clear that Kehl Management would provide the most financial benefits to Pope County.
Kehl Management, which proposes to open the $216 million Elite Casino Resort, will pay $178.3 million over 30 years in economic benefits to the county and various nonprofits over and above the net casino tax required by law, according to Westcott's spreadsheet.
That compares to the 30-year benefit of $44.3 million proposed by Choctaw Nation, $156.6 million by Warner Gaming and $90.1 million by Cherokee Nation Businesses.
After the meeting, George said it was clear in Kehl's public presentation of its proposal on Oct. 2 and its application package that the company would be the best community partner for Russellville and Pope County.
"There is a lot of money being tossed around by these vendors, but Kehl is the best option from a community standpoint," George said.
The committee will present a report to the City Council on Thursday.
But an endorsement by the city is moot in light of Amendment 100, approved by voters in November 2018 to allow new casinos in Pope and Jefferson counties. The required endorsements must come from the county, regardless of whether a casino is built within city limits. Amendment 100 also allows full-fledged casinos at the racetracks in Hot Springs and West Memphis.
The city's committee was set up in early September after Warner Gaming and Choctaw Nation urged Harris to have the city conduct its own "open and transparent" vetting process as operators vie for the license to be awarded by the state Racing Commission.
On Aug. 13, the Pope County Quorum Court -- amid allegations of secret meetings -- passed a resolution supporting Cherokee Nation Businesses. Ben Cross, county judge of Pope County, had negotiated an economic development agreement that included an upfront $38.8 million payment that would be distributed to nonprofit organizations, the county and some municipalities -- but not Russellville.
The Racing Commission, in June, rejected all five applicants for the Pope County casino license -- Gulfside, Cherokee Nation, Kehl, Warner Gaming and Choctaw Nation -- because none contained endorsements by current local officials.
Gulfside filed suit in Pulaski County Circuit Court against the commission, saying its application met the requirements of Amendment 100 because it contained endorsements made by officials right before they left office in December.
The Racing Commission ruled earlier this year that the endorsements can come only from officials in office at the time the application is submitted. The Legislature also passed Act 371, which became effective in March, that requires the same thing.
But Amendment 100 does not state when those documents have to be dated or submitted.
The Racing Commission opened a second 90-day window to accept applications for Pope County casino licenses. That window closes Nov. 18. The Cherokees have submitted a new proposal with the county's endorsement.
There are three lawsuits in state courts concerning the casino issue, as well as complaints filed with a state prosecutor and the Arkansas Ethics Commission that allege wrongdoing by county officials.
Harris, who campaigned for office on anti-casino sentiments, said he appreciated and was "very proud of the job" the committee did in researching and choosing a potential casino operator.
Harris would not say, however, if he would issue a written letter of endorsement for Kehl.
"It would do no good to issue a letter at this point," Harris said. "The ball is in the county's court."
When asked again if that meant that he would not write an endorsement, Harris repeated only that a letter would be useless.
Amendment 100 was defeated by Pope County voters, who also approved an initiated county ordinance that said an election must be called to allow voters to decide if they want officials to back a casino applicant.
The local opinion began to shift in June when the grass-roots group Pope County Majority was created on Facebook by Kelly Jett and quickly collected nearly 7,000 members.
Jett, who was wearing a blue T-shirt emblazoned with the Cherokee Nation Businesses' "Legends" logo, said after the meeting that she was excited that Kehl Management won the committee's support.
"I think Choctaw and Hard Rock suggested the committee because they were out for vengeance after they didn't get the county endorsement," Jett said. "They caused all this division in the community and then got beat out by a small company with a whole lot less money and only a history of good business practices. The committee chose good work ethics and how the company treats people who worked for them."
Metro on 10/15/2019