On October 20, 2016, many believed that the Mississippi Gaming Commission was set to approve the receipt of public comment on a proposed change to the Commission regulations that would dramatically increase the number of legal locations for gaming sites on the Mississippi Gulf Coast.  But abruptly, Commissioners deferred action on the proposed regulation.

The proposed change to Rule 1.4 would have opened up sites all along the Mississippi coast that for ten years have been deemed off limits to casino development.

The key proposed change to Rule 1.4 would have eliminated language that requires an applicant for site approval to own or control (e.g., lease) all of a proposed casino site from the location of the anticipated gaming floor to the mean high water line.  In other words, under the change if a gaming floor is on property of an applicant that is within 800 feet of the mean high water line, the site would be legal, regardless of whether the applicant owned or controlled the property to the water’s edge.

This issue became important and Commission set precedent in 2008 when RW Gaming sought approval for a site in Biloxi, Mississippi, that was north of the publicly owned sand beach but was within 800 feet of what RW Gaming believed to the mean high water line.  RW Gaming controlled the property to the seawall and submitted evidence to support its conclusion that the mean high water met the shore at the seawall.  The Commissioners disagreed, rejecting the site as not meeting the regulatory requirements and concluding that the mean high water line was where the sand beach met the water and not at the seawall.

The practical effect of the currently existing regulation and the RW Gaming decision is that no site is legal if located north of the public sand beach, as no private developer can acquire the rights of ownership or control of the sand beach all the way to the mean high water line at such location.

While the RW Gaming precedent remains unchallenged, different Commissioners sit in those chairs today.  Comments reportedly attributed to one or more Commissioners indicated that the Commissioners sought to amend Rule 1.4 merely to conform the rule to the statutory language of H.B. 45 adopted in 2005 following Hurricane Katrina that permitted casinos to be built on shore.  The argument went that the express language of H.B. 45 does not require ownership or control of a gaming site all the way to the mean high water line, and the Commissioners intended to merely “clean up” the language to conform the rule to the statute.

However, the legislative history of H.B. 45 was replete with comments of members of the Mississippi House of Representatives to the effect that the statute implements legislative intent that a gaming site must have the same ownership or control all the way to the mean high water line.  The statute itself includes language concerning the “contiguous nature of the parcel” that would have to be ignored or explained away if the proposed changes to Rule 1.4 are implemented.  Many rule change opponents said that the current policy on gaming sites has worked just fine for almost a decade.

The proposed changes to Rule 1.4 drew the ire of existing gulf coast operators and some senior state government officials and legislators.  The Commission has stated that it has no intention to revisit the issue.  However, many legislators have stated their intent to address the issue permanently in the 2017 legislative session.