Mississippi casino expansion efforts were rejected by the state’s Gaming Commission unanimously this week, after the regulators deemed that two proposed sites didn’t qualify as suitable for the projects.

Mississippi casino expansion Biloxi Diamondhead

Two Mississippi casinos, one in Biloxi and another in Diamondhead, were rejected without explanation by the state’s Gaming Commission. The three-member board includes Chairman Al Hopkins (left) and Commissioner Jerry Griffith (right). (Image: Tim Isbell/Sun Herald)

The three-member panel met privately on Thursday for about 90 minutes, deliberating whether to approve two new casinos in Biloxi and Diamondhead. When they emerged, Mississippi Gaming Commission (MGC) Executive Director Allen Godfrey said the two applications had been denied, but no further explanation for the judgment was provided.

Mississippi-based RW Development and Jacobs Entertainment were behind the two bids. An attorney representing both parties noted that RW will appeal the decision, and the legal counsel said he will meet with Jacobs Entertainment to determine if they too will challenge the commission’s verdict.

Water, Water Everywhere

While the state Gaming Commission adjourned without explaining its decision, one likely cause for at least the Diamondhead site rejection was that the proposed destination is too far inland.

Mississippi gambling law mandates that casinos touch water on the Gulf Coast or Mississippi River. That requirement became muddied in 2005, however, following the devastating result of Hurricane Katrina, the costliest natural disaster in US history.

Lawmakers eased the law on water gambling, and allowed some casinos to be built slightly inland as the city underwent a massive recovery. For instance, the Magnolia Bluffs Casino, which opened in 2012, sits back more than a quarter-mile from the Mississippi River.

Now a dozen years since the Category Five storm hit the Gulf, regulators are once again becoming more stringent towards keeping gambling away from the mainland. The proposed Diamondhead site would have placed a casino just south of Interstate 10 next to the city’s Yacht Club. The vacant land is about a mile from Bay St. Louis, which feeds into the Gulf of Mexico.

But the Biloxi site is much closer to water, just steps in fact, located near the intersection of US 90 and Veterans Avenue next to the Gulf, leaving the explanation for its dismissal less obvious.

It’s also possible that good old-fashioned political pressure impacted the commission’s decision. Gulfport Mayor Billy Hewes, whose jurisdiction already includes two casinos, celebrated the rejection, noting that his coastal resort town would have been neighbored by the two proposed properties if they’d been approved.

“The greater impact would be the effect of completely changing the character of our south Mississippi community, as it would effectively open the floodgates to an indiscriminate proliferation of gaming sites to areas never contemplated or desired,” Hewes told the Associated Press.

Upstream Fight

With the Gaming Commission ruling against the developers, their fight has been dealt a serious setback. Though it’s not over, it marks the second time that both sites have been rejected by state gaming officials.

In 2008, RW Development’s Biloxi proposal was also rejected by the Commission. And in 2014, Jacobs suffered a similar defeat. The two gaming entities then held out for a new MGC regime. Though Godfrey has been with the MGC since 2003, the three commissioners who make the final decisions serve staggered four-year terms.

Despite a modified leadership in the state agency, the Mississippi casino expansion efforts, for at least the time being, remain on the back burner.