The Joint Budget Committee on Tuesday signed off on two state contracts totaling $150,000 with an Arizona-based consulting firm to help the Arkansas Racing Commission create and implement casino gambling rules and oversee future casino operations.
The identical contracts are for $75,000 each between different parts of the Department of Finance and Administration and Fox & Fox Consulting LLC of Scottsdale, Ariz. The contracts run through June 15, 2020, said Kevin Anderson, assistant of fiscal services for the Bureau of Legislative Research. The state finance department's Management Services and Racing Commission each have a contract with the consultant.
Byron Freeland, an attorney for the Racing Commission, said the commission had no expertise in casino gambling when voters in November approved Amendment 100. The amendment authorizes up to four full-fledged casinos and gave the commission 120 days to adopt related rules.
"This body should know that there are a lot of hoops that you can jump through to get their rules published, and 120 days seemed fairly tight, so the commission needed some help to meet that time deadline," he said.
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"This was a gentleman who was recommended to us by several different sources and we checked him out," Freeland said. "We just need some help, if possible, to come in and review the rules and help us with setting up procedures for when the casinos open."
Sen. Linda Chesterfield, D-Little Rock, asked about the consultant.
"How did we find out about somebody from Scottsdale, Ariz., and then bring them to Arkansas?" Chesterfield asked. She noted that casino gambling exists in Arkansas' surrounding states, including Louisiana, Missouri, Mississippi and Oklahoma.
"I understand there were recommendations made by other people in the industry," Freeland said.
"When the amendment passed, the commission started checking around and decided the Nevada rules were more or less the gold standard. ... That's when they discovered Mr. Fox's name when they were talking to people about the best rules," he said. "I think he has a national reputation and practice. ... His name was suggested from some source to a commissioner."
The commission includes Alex Lieblong of Conway, Mark Lambreth of Batesville, Butch Rice of Beebe, Denny East of Marion, Michael Post of Altus, Bo Hunter of Fort Smith and Steve Landers of Little Rock, according to the agency's website.
The commission also considered several other people, including a certified public accountant, before deciding to contract with Fox, said Ed Armstrong, the state's procurement administrator.
Fox has been co-owner of Fox & Fox Consulting LLC since 2015. He was engagement manager for risk advisory services for Experis, formerly known as Jefferson Wells, in Phoenix from 2010-18, according to his resume.
Fox's resume indicates that he was director of internal audit and controls for Jefferson Wells in Phoenix from 2003-10, vice president of internal audit for MGM Mirage of Las Vegas and manager for Arthur Andersen LLP in Las Vegas.
Freeland said the consultant will be used to help with rules and "once the casinos open, we need some consultant to advise the commission on how many people you need to supervise those casinos and actual supervision of the casinos."
Amendment 100 authorizes the Racing Commission to issue casino licenses to Southland Gaming and Racing in West Memphis and Oaklawn Racing and Gaming in Hot Springs, as well as to an applicant in Jefferson County and an applicant in Pope County. Under state law, Southland and Oaklawn already operate electronic games of skill.
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Metro on 01/23/2019