Group Proposes Casino Amendment to Fund Highways

Group Proposes Casino Amendment to Fund Highways

A group called Driving Arkansas Forward launched a ballot initiative on Friday, proposing a constitutional amendment to legalize casinos in Arkansas that would generate more money for highways.

The group, chaired by lobbyist Don Tilton, asked the attorney general's office to certify the effort's popular name and ballot title, "The Arkansas Casino Gaming and Highway Funding Amendment of 2018." The amendment would authorize three casinos and allocate 65 percent of the tax revenue they generate to the state highway fund to pay for roads and bridges.

More: Click here to read the proposed amendment.

Under the amendment, the lottery division of the state Department of Finance & Administration would issue up to three casino licenses through a merit-based selection method that would require approval by municipal or county leaders in the communities where the casinos are sited.

The first license would be for a casino in Jefferson County. The next license would go to a gambling site in Crittenden County. The third would be available for Miller, Mississippi, Pope, Union or White counties. The order of the counties are based on economic need and population, organizers said.

"Our highway system must be a priority if Arkansas wants to remain competitive nationally and provide the best economic opportunities to our residents," Nate Steel, counsel for Driving Arkansas Forward, said in a news release. "This amendment focuses on highway funding while creating a fair, transparent and merit-based process for issuing gaming licenses. We can no longer afford to lose potential gaming revenue to surrounding states when we have the opportunity to keep that money here and create jobs in communities that need them."

Scott Bennett, director of the Arkansas Department of Transportation, said Friday that "anything that is going to generate additional revenue for highways is going to be a good thing" for Arkansas roads and drivers. But he pointed out that expected revenue from the plan — $45 million per year — would finance only a portion of the department's highway maintenance needs.

"You know, if it generates $45 million a year, that's roughly 10 percent of our shortfall," he said. "But we have also said all along that if something's going to be done to generate an additional $400 million dollars a year for highway improvements, that it's not all going to come from the same source... there are going to have be several sources that are utilized."

Bennett said he wasn't sure whether the department would officially endorse the plan.

"We'd have to discuss it with the commission and see; we typically haven't done that," he said. "But at this point I don't know if we will or not... you know, anything that's done to try to address the shortfall is going to be a good thing, and the revenue could be put to good use."

Steel told Arkansas Business that members of Driving Arkansas Forward had met with potential supporters in Jefferson County earlier in the day. He said he expects the group to add to its coalition and include city and county leaders and economic developers.

Steel said the proposal differs from previous plans to get casino gambling in Arkansas, some of which sought to write private businesses into the state's Constitution.

This plan would not do that; instead, he said, it would rely on the already established state lottery division to distribute licenses. No county is guaranteed a license.

"It's going to be a merit-based system wherein the lottery division will have to determine that someone meets the qualification in the amendment, which would include a minimum of demonstrating a $100 million investment in a facility, experience operating a casino [and] passing a criminal background check."

Steel said that if there's no qualified applicant in a county, then the county won't get a casino.

"Or, for example, if the city and county together don't want a casino, then they're not going to get one," he said. "It's 100 percent local control."

Steel said supporters aim keep gambling revenues in the state, provide an economic boost to some of Arkansas' neediest counties, and devote much-needed dollars to highways throughout Arkansas.

"This didn't start with highway funding and then back into casinos," he said. "This started with all those issues. Arkansas needs a fair and well-regulated casino licensing system. And we need every county to benefit. So when you look at those two things, I think we've done it the best way we could."

Steel said the next step for the group is to add to its coalition and get the ballot title approved. He said he was confident that the plan the group has offered is a good one, particularly compared with previous casino proposals brought by others.

"This is not one of these monopoly casino amendments, or forcing it into a town that does not want it or anything like that," he said. "This is a clean casino amendment — completely merit based and with local control. So we think that will withstand any legal challenge."