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Casino plan for Arkansas proposed to benefit roads

by Michael R. Wickline | January 6, 2018 at 4:30 a.m.

A private group on Friday proposed a constitutional amendment that would authorize the state to issue licenses for up to three casinos in Arkansas, with most of the taxes on gambling profits going to roads.

The Driving Arkansas Forward ballot question committee estimated that the proposed amendment could raise about $45 million more a year for the state Department of Transportation.

Attorney Alex Gray, who represents Driving Arkansas Forward and is of the Steel, Wright, Gray & Hutchinson law firm, filed the proposal with Republican Attorney General Leslie Rutledge's office Friday and asked her to certify the proposed amendment's popular name and ballot title.

Gray's law partners are former state Reps. Nate Steel, D-Nashville, and Marshall Wright, D-Forrest City, and current state Sen. Jeremy Hutchinson, R-Little Rock. Hutchinson is a nephew of Gov. Asa Hutchinson.

Under state law, the attorney general is required to certify a popular name and ballot title for a proposed amendment before the sponsor can begin circulating petitions to qualify the proposal for the November general election ballot. A sponsor of a proposed amendment is required to turn in 84,859 valid signatures of registered voters by July 6, according to the secretary of state's office.

Lobbyist Don Tilton, whose clients include the Quapaw tribe, is the chairman of the Driving Arkansas Forward committee. He said he is temporarily serving as the chairman, and his replacement will be determined after the committee's membership is fleshed out. He also said the committee will be financed through "a broad-based funding effort."

Under the proposal, the casinos would be approved by a proposed Lottery Division in the Department of Finance and Administration. The division would be limited to issuing casino licenses to applicants in Crawford, Crittenden, Jefferson, Miller, Mississippi, Pope, Union or White counties. No more than one license would be issued in a county.

The amendment would authorize the division to issue the first license to an applicant to place a casino in Jefferson County; a subsequent license for a casino in Crittenden County; and a third license in a remaining county, Drive Arkansas Forward said in a news release.

Under the proposal, the lottery division would issue casino licenses through "a merit-based selection method," with approval from municipal or county leaders, Drive Arkansas Forward said. At least $100 million must be invested in each casino under the proposal.

If the proposed amendment qualifies for the ballot and voters approve it, Quapaw Tribe Chairman John Berrey said the tribe would apply for a casino license in Jefferson County at an undetermined location. He said he envisions investing roughly $300 million in a destination hotel and casino that would employ more than 1,000 Arkansans and be similar to the tribe's hotel and casino in northeast Oklahoma near Quapaw.

The Quapaw tribe wants to improve the economy of Jefferson County that's in "dire straits," and Pine Bluff Mayor Shirley Washington and Hank Wilkins, county judge of Jefferson County, support the proposed project, Berrey said. The casino would be a commercial casino regulated and taxed by the state, and not regulated under the federal Indian Gaming Regulatory Act, he said.

Washington and Wilkins could not be reached for comment by telephone at their offices on Friday afternoon.

The proposed amendment would make each casino's annual net gaming receipts subject to a 12 percent tax.

Under the proposal, 65 percent of the tax revenue would to go to the state Department of Transportation fund, from which the department uses 70 percent of the funds, and cities and counties each split a 15 percent share; 10 percent to the county in which the casino is located; 22.5 percent to the city or town in which the casino is located; and 2.5 percent to the Lottery Division. If the casino is not in a city or town, then that 22.5 percent would go the county in which it is located.

Gambling opponent Jerry Cox, president of the Family Council, said Friday in a written statement that "if Arkansas becomes dependent on gambling revenue to maintain our highways, the state will have to encourage more and more of this type of predatory gambling from now on.

"This won't be free money. If this measure passes, Arkansans will be driving on roads paved with money that some poor person lost at the casino. It will be better for our economy if that money stays in their pockets and it is used to buy food or pay bills," Cox said.

While state law doesn't allow for stand-alone casinos, it permits electronic games of skill at two racetracks, Oaklawn Gaming and Racing in Hot Springs and Southland Park Gaming and Racing in West Memphis.

The state operates a state lottery. Amendment 87 to the Arkansas Constitution -- enacted by voters in 2008 -- authorized the Legislature to create a lottery to raise net proceeds for college scholarships. The lottery has been selling tickets since Sept. 28, 2009, and helped fund more than 30,000 Arkansas Academic Challenge Scholarships during each of the past seven fiscal years.

Oaklawn spokesman Wayne Smith said in a written statement that "we do not know any of the details and can't comment at this time.

"We are one week out from the start of our 2018 race meet and that is where 100 percent of our focus is right now," he said.

A Southland spokesman could not be reached for comment by telephone on Friday.

In October 2016, the Arkansas Supreme Court rejected a proposed constitutional amendment that would have authorized three casinos in southwestern and Northwest Arkansas. In a 6-1 ruling, the high court agreed with opponents that the ballot title was insufficient.

Metro on 01/06/2018

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