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Group pushes to add 16 licenses for Arkansas casinos

by Michael R. Wickline | June 7, 2020 at 7:56 a.m.
FILE — A roulette wheel spins at Cherokee Casino & Hotel in West Siloam Springs, Okla.

A private group is promoting a proposed constitutional amendment that would authorize the Arkansas Racing Commission to issue casino licenses to 16 private companies across the state.

The Racing Commission already has authorized three casino licenses under a constitutional amendment approved by voters in 2018.

The Arkansas Wins In 2020 Inc. committee is promoting the proposed amendment for the Nov. 3 ballot. Its chairman and treasurer is Tom Stone of Hot Springs.

Stone referred questions from the Arkansas Democrat-Gazette over the past week and a half about the proposal to attorney Todd Wooten of the Dover, Dixon and Horne law firm in Little Rock.

"We have no comment at this time," Wooten said Tuesday in an email.

The questions ranged from why this proposal would be good for the state, estimates of about how much state tax revenue it would generate, who is financing the committee's campaign and whether the committee has concerns its signature-gathering campaign could lead to the spread of the coronavirus.

Wooten said Friday, "We will have a news conference in the future at the appropriate time. As of now, we have no comment."

Sponsors of proposed constitutional amendments are required to collect 89,151 signatures of registered voters by July 3 to qualify their measures for the Nov. 3 general election, according to the secretary of state's office. The process of gathering signatures has been complicated by the coronavirus pandemic and the need to limit contact with others.

A federal judge has ruled in a case involving a different ballot proposal that groups behind such proposals are allowed to accept mailed-in petition signatures while a final ruling in a case on the matter is pending.

U.S. District Judge P.K. Holmes issued an order May 25 in Fayetteville in a lawsuit challenging the signature-gathering process. His order was made in a case involving a proposed constitutional amendment that would change the way congressional and legislative districts are redrawn based on information from the U.S. Census.

Holmes ruled that requiring a petition to be signed in the presence of a canvasser and that the canvasser must sign an affidavit in the presence of a notary public that all signatures were personally witnessed by the canvasser violated free-speech rights.

[RELATED: See complete Democrat-Gazette coverage of casinos in Arkansas at arkansasonline.com/casinos]

The Arkansas Wins proposal has surfaced more than a year and a half after the Driving Arkansas Forward ballot committee won voter approval in November 2018 for what is now Amendment 100 to the Arkansas Constitution.

The Arkansas Wins committee filed a statement of organization with the Arkansas Ethics Commission on May 20, according to the commission's website. If the committee raised or spent more than $500 in May, the committee will be required to file a financial report on its contributions and expenses by June 15 under the commission's rules.

Amendment 100 authorizes the Racing Commission to issue licenses for full-fledged casinos to what is now called Oaklawn Racing Casino Resort in Hot Springs and Southland Casino Racing in West Memphis and a casino license apiece in Jefferson and Pope counties, and allow for sports betting at the casinos.

The Driving Arkansas Forward and It's Our Turn committees reported spending about $9.7 million to promote approval of Amendment 100. The spending was largely financed by the Quapaw Nation's Downstream Development Authority in Oklahoma, Cherokee Nation Businesses in Oklahoma and Southland's parent company, New York-based Delaware North.

The Racing Commission granted the Jefferson County casino license to the Downstream Development Authority of the Quapaw Nation in June and then transferred the license to Saracen Development LLC in October.

The commission is considering proposals from Gulfside Casino Partnership of Mississippi and the Cherokee Nation Businesses for the Pope County casino license.

The Arkansas Wins In 2020 proposal, which wouldn't affect the four casinos allowed in Amendment 100, would authorize the Racing Commission to issue licenses in the following counties to be owned by the following companies.

• One license in Benton County, G-First Ark Gaming LLC.

• One license in Boone County, Boone County Gaming LLC.

• One license in Chicot County, Lake Village Gaming Associates LLC.

• Two licenses in Crittenden County, one each for West Memphis 1 Gaming Associates LLC and West Memphis 2 Gaming Associates LLC.

• One license in Garland County, Garland County Gaming Associates LLC.

• One license in Greene County, ASC Transaction Facility LLC.

• One license in Jefferson County, Pine Bluff Gaming Associates LLC.

• One license in Johnson County, Clarksville Gaming Associates LLC.

• One license in in Miller County, Texarkana Gaming Associates LLC.

• One license in Nevada County, Prescott Gaming Associates LLC.

• Two licenses in Pulaski County, one each for Little Rock 1 Gaming Associates LLC and Little Rock 2 Gaming Associates LLC.

• One license in Sebastian County, Fort Smith Gaming Associates LLC.

• One license in St. Francis County, Forrest City Gaming LLC.

• One license in Washington County, Fayetteville Gaming Associates Inc.

According to records in the secretary of state's office, CT Corp. System of Little Rock is the registered agent and Wooten is the incorporator/organizer for the following gambling associates firms: Clarksville, Fayetteville, Fort Smith, Garland County, Lake Village, Little Rock 1, Little Rock 2, Pine Bluff, Prescott, Texarkana, West Memphis 1 and West Memphis 2. Each company filed with the secretary of state's office on May 21.

Dover, Dixon and Horne law firm attorney Randy Bynum of Little Rock is the registered agent and Wooten is the incorporator/organizer for G-First Ark Gaming LLC, while Wooten is the registered agent and incorporator/organizer for Boone County Gaming LLC, according to records in the secretary of state's office. Both companies also filed with the secretary of state's office on May 21.

Registered Agents Inc. of Mountain Home is the registered agent and Riley Park of Mountain Home is the incorporat0r/organizer for ASC Transaction Facility LLC and Forrest City Gaming LLC, the secretary of state's office records show. ASC Transaction Facility filed with the secretary of state's office on April 30 and Forrest System Gaming filed May 20.

Asked if he could shed light on about who would own the casinos or whether that's none of the public's business, Wooten replied Wednesday in an email, "No comment."

Arkansas Wins' proposal would levy a 13% tax on the first $150 million of net casino receipts and and a tax of 20% on receipts exceeding $150 million. Fifty-five percent of the tax receipts would go to state general revenue funds; 15% to the county in which the casino is located and 15% to the city where the casino is, or 30% to the county if the casino is not in a city; and the other 15% to all other counties that don't have a casino licensee to be allocated pro rata among these counties based on the population of each county.

Asked about Arkansas Wins' proposed amendment, John Berrey, chairman of the Saracen Development Authority and the Quapaw Nation, said last week in a written statement, "We are currently reviewing the amendments, but at this point our attention is focused on the construction of the Saracen Casino Resort in Pine Bluff."

Oaklawn Racing Casino Resort spokeswoman Jennifer Hoyt last week declined to comment about the proposal. A spokesman for Southland, Jeff Strang, couldn't be reached for comment by telephone and email last week.

In 2018, the Arkansas Wins In 2018 Inc. committee proposed a constitutional amendment that would authorize the creation of four private casinos in four specific locations in Benton, Boone, Miller and Pulaski counties.

The committee didn't report raising contributions and spending money, according to the Ethics Commission's website. The president for the committee was retired businessman Mark Diggs of Little Rock and its secretary/treasurer was businessman Bob Womack of Branson.

That committee's proposal drew criticism from Driving Arkansas Forward committee counsel Nate Steel in March 2018.

At that point, Steel said, "Just like last time, the sponsors are attempting to award themselves casino licenses by writing their own property interests into our constitution."

At the time, Wooten, who represented Arkansas Wins In 2018, declined to respond to Steel's criticism.

In October 2016, the state Supreme Court ruled that the ballot title was insufficient for the proposed constitutional amendment promoted by the Arkansas Wins In 2016 and the Arkansas Winning Initiative ballot committees. That amendment would have authorized casinos in Boone, Miller and Washington counties.

Under that 2016 proposal, the casinos would have been controlled by three limited liability companies owned by Missouri businessmen Jim Thompson of Blue Eye and Bob Womack of Branson. Cherokee Nation Entertainment would have been involved in the Washington County casino complex.

The Arkansas Wins In 2016 and the Arkansas Winning Initiative committees reported collectively spending $6.1 million promoting the proposal. The Cherokee Nation Businesses financed most of the Arkansas Winning Initiative's committees' $6.1 million in expenses.

Neither Womack nor Thompson could not be reached for comment by telephone last week.

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