A Russellville committee tasked with reviewing proposals for a Pope County casino license is exploring alternatives to protect the applicants' private financial information from public view while still keeping the process open and transparent, Russellville Mayor Richard Harris said Wednesday.
The action comes as one member of the Russellville City Council's Community Gaming Evaluation Committee resigns and after members of the Russellville School District expressed distrust of the committee's suggestion Monday that nondisclosure agreements be signed to keep parts of the submitted applications and process private.
"The committee was developed by the council to be open and transparent. This is also the intent of the committee members, whom may not have much experience serving in a public capacity and may not be sensitive to how their discussion may be perceived," Harris said in an email to the Arkansas Democrat-Gazette. "The NDA [nondisclosure agreement] discussed at the last meeting related to protecting the financial information of the operators and was [in] no way intended to suggest that any information should be withheld from the public."
Harris forwarded to the Democrat-Gazette an email sent Wednesday by businessman Bart Langley -- who initially suggested the use of nondisclosure agreements -- to his fellow committee members proposing alternatives to the privacy contracts.
"It has come to my attention that our efforts to protect the confidential financial information of the prospective casino operators with the use of non disclosure agreements which are a standard industry practice, has been misunderstood by both the press and the public," Langley said in the email. He then suggested two options to "ensure we go the 'extra mile' regarding transparency."
One option is to ask the Russellville City Council to hire an independent certified public accountant to "vet only the financial ability of the operator based on their furnished information that they are capable of executing their plan."
The other option, Langley said, is to attach a separate notice to a request for proposals that is to be issued. The notice would state that "any and all information that the committee will receive will be shared with the entire community," Langley said.
When contacted Wednesday evening, Langley said that no members of the committee had yet responded to his suggestions.
Harris -- who said of the nondisclosure agreements Tuesday that it was "not realistic" to keep all of the information available to the public during the selection process -- said that Langley's email makes it apparent that "the committee is making every effort to be open and transparent."
"I will leave the resolution of this issue up to the committee, as long as the process selected leaves no question in relation to the transparency of the process," Harris said.
John Tull, an expert on the state's open-records law and general counsel for the Arkansas Press Association, said that if the city pays for an independent certified public accountant, then the information submitted to the accountant is subject to the state Freedom of Information Act.
Langley said it was never his or the committee's intent to keep information from the public with nondisclosure agreements, which are "solely for the purpose of protecting the operators' proprietary financial information."
"We're trying to go the extra mile to give transparency while also respecting the privacy of the proposed operators," Langley said. "This committee is neither there to debate for or against a casino. It's not there to decide whether or not the mayor's going to write a letter or not."
The city's gaming committee was established by the City Council earlier this month in response to the Pope County Quorum Court's surprise resolution endorsing Cherokee Nation Businesses, one of five competitors, for the casino license.
Russellville was not named as a beneficiary of a proposed $38.8 million "economic development fee" that would be paid by the Cherokees and shared by the county, various other cities and nonprofit organizations. The Cherokees' casino would be built just north of Russellville and couldn't be annexed into the city without county approval.
Harris initially said, when setting up the committee, that the city was trying to get a part of the revenue stream. Other council members said they wanted to "bring some transparency" to the process that was lacking in the county's decision.
A draft Harris provided Wednesday to the Democrat-Gazette of the request for proposals -- which is expected to be sent out this week -- asks applicants to include details of "providing annual revenue to non-profit entities or foundations" in the city or county.
The city also asks the casino operators to provide an analysis of economic benefits including "any proposed economic development fee," any community development grant or proposed research and economic development support, and a "formula-based revenue sharing plan" with a minimum annual payment to the city and county "in addition to the taxes and fees described in Amendment 100."
The committee -- initially composed of council member Eric Westcott; Pope County Justice of the Peace Bill Sparks; Russellville School District Superintendent Mark Gotcher; Arkansas Tech University Chief of Staff Mary Gunter; Langley; and former City Council member Nathan George -- talked previously about meeting with the casino applicants privately and about other options to keep information, such as financials, from their competitors.
Sparks, who was not at the meeting where the nondisclosure agreements were discussed, resigned from the committee Wednesday.
"With me being a member of the Quorum Court, there could be too many times that it could present problems, and I'd just prefer not have those things come up," Sparks said when asked about the reason for his resignation.
Some members of the Russellville School Board said Gotcher should recuse himself from the committee because a nondisclosure agreement puts the district at risk. No vote was taken on Gotcher's participation.
"I just think that puts our district in a tough situation. My personal opinion is that we should not be a part of that committee, but most definitely not be [in] any nondisclosure agreed upon," board member Chris Cloud said at the board meeting Tuesday. "I just think that move alone puts our district at risk when these proposals come out in the future. Right now it doesn't seem clean to me."
At that meeting, School Board President Morgan Barrett said Gotcher is the best person for the job to bring "factual information" on the school district to the casino process, but that Barrett could not support the use of nondisclosure agreements.
"I think the introduction of a nondisclosure agreement, just by the nature of a nondisclosure agreement, keeps things secret," Barrett said. "I think that kind of taints the open and transparent process."
No member of the City Council casino-vetting committee stepped up to take on the role as chairman. But Gotcher said Wednesday that he agreed to "facilitate" its meetings.
"The role of chairman would require me to get approval of my local School Board," Gotcher said. "But since then, we have not seen the need for a chair, therefore we are all working together very well thus far. I will facilitate our meetings when the need arises."
Harris said Wednesday that the email address set up for "communication purposes" for the committee will not be kept private and will be released if requested under the state Freedom of Information Act.
Furthermore, all of the emails will also be forwarded to Harris' city email account, "Which is also subject to the FOIA. Therefore, there is no private server and no private email," Harris said. "Every attempt is made to ensure that the information provided in this process is open and subject to the FOIA."
The city will also create a Web page to inform the public of the information concerning the process and any announcements.
The latest draft of the request for proposals cautions the casino applicants in bold print to familiarize themselves with the state Freedom of Information Act.
An applicant, according to the request for proposals, can designate "any portion of its response exempt from inspection and copying" under the Freedom of Information Act but has to cite the specific exemption under the law that allows the information to be withheld from the public.
"Identification of the entire proposal as confidential may be deemed non-responsive and may disqualify the Casino Applicant," according to the document.
Applications have to be submitted to the committee no later than noon Oct. 1, but there will be no public opening of the responses, according to the document.
The applicants will publicly present their proposals Oct. 7, and the committee will select the final applicant by Oct. 14. The recommendation will be placed on the City Council's Oct. 17 agenda.
According to Amendment 100 -- approved by voters in November to allow new casinos in Pope and Jefferson counties and the expansion of gambling at the racetracks in Hot Springs and West Memphis -- applications must include endorsement by local officials. If the casino is to be located inside city limits, Amendment 100 requires endorsements from the mayor of the city as well as from the county judge or county Quorum Court.
In June, the state Racing Commission rejected all five applicants for the Pope County casino license because they didn't meet a commission rule that specified that the endorsements had to be from current officials. After the county endorsed Cherokee Nation Businesses, the Racing Commission opened a second, 90-day window to accept applications. That window closes Nov. 18.
A Section on 09/19/2019