U.S. Rep. Tom Cotton, R-Dardanelle and the Congressman for Arkansas’ 4th District, says his tough stance calling for farming and immigration reforms is his way of responding to constituent concerns. He also gave few clues to his prospects of challenging U.S. Sen. Mark Pryor, D-Ark., for the U.S. Senate in 2014.

Appearing on KARK’s Capitol View on Sunday morning, Cotton said splitting the farm bill from its long connection with food stamp funding is the first step in reforming the Supplemental Nutrition Assistance Program (SNAP) despite many state agricultural interests arguing to keep them united.

“Farmers I talked to are tired of being held hostage to the food stamp program, which is deeply in need of reform because there are so many abuses. There’s so much waste in that program,” Cotton said.

He cited anecdotal instances of abuse, such as people standing in grocery store lines buying steak with food stamps while talking on a new iPhone and driving a new SUV.

When pressed that 42,000 households in his Congressional district – roughly 16% – are on food stamps and those household median incomes are around $13,600 annually, Cotton acknowledged there are many who play by the rules.

“That’s where we want to target the aid, but we all know there is some waste and some abuse in that program,” Cotton said.

Cotton had written in an Arkansas Democrat-Gazette op-ed in June that the original farm bill did “too little for Arkansas farmers,” but he agreed that the amount of money coming to Arkansas farmers in the coupled farm bill (with food stamps) and the split farm bill (which passed the House last week), equates to roughly the same amount of money for Arkansas farmers.

“You’re right. You’re roughly speaking about the same amount of money going to Arkansas farmers who benefit from these programs, but you have to compare the cost of the overall bills,” he said.

Cotton thinks the House can make deeper cuts to the SNAP funding than the $20 billion over 10 years proposed in the failed bill a few weeks earlier.

IMMIGRATION
Cotton has called for the U.S. House to reject the Senate’s version of immigration reform. He is pushing for an approach that would divide portions of immigration reform into a package of bills for consideration.

In a Wall Street Journal op-ed this week, Cotton wrote, “If the full House approves such bills, they should be sent directly to the Senate for consideration. They should not be handed to a conference committee so that they can be reconciled with the Senate bill.”
Cotton was asked if this was a “brazen” position for a House freshman to take and if this was what “the founding fathers had in mind” when they constructed bicameral government.

“The House will reject not just the Senate bill, but the Senate approach because I believe the American people reject it. The Senate approach is legalization first and enforcement later – maybe,” Cotton said. “It’s not saying ‘my way or the highway,’ it’s saying these approaches are irreconcilable.”

Cotton said only 12 of the nearly 1,800 contacts he’s received in his office support the Senate immigration bill. He does not see the House bringing a vote on the issue before the August Congressional recess.

He’s worried that without detailed House positions, aspects of the Senate bill could take precedence.

“If we go to conference, I worry that any law that passes could be used as a Trojan horse to force the Senate approach through the House in violation of what the American people want,” Cotton said.

As for his preferences on enforcement before legalization, Cotton says border security must come first. He cited his war experience, which he said always included a physical border for security. He also said that visa overstays and employment verification reform were necessary steps that needed to be addressed.

POSSIBLE SENATE RUN

Asked bluntly if he plans to run for the U.S. Senate in 2014 against incumbent Democrat Sen. Mark Pryor, Cotton responded, ”Right now, I’m focused on the work that the people of Arkansas sent me to Washington to do.”

He added, “There’s no time frame [for considering a run], but we’ve got three weeks left until our August recess. That’s a traditional break in the legislative session.  I’m focused very much on the work that the people elected me to do.”

A Democratic group has been airing a TV ad against Cotton that claims he’s is interested in his own personal advancement over serving Arkansas in Congress. Republicans have refuted aspects of the ad.

“I was an Army Ranger. I fought in Iraq and Afghanistan. I’ve faced some real bullets, so some metaphorical bullets in politics don’t really bother me that much,” Cotton said. “Frankly, I don’t think Barack Obama and his liberal buddies worry about where I say things – whether it’s on your TV show, whether it’s on the House floor or whether it’s in a diner in Magnolia – they worry about what I say. Making the case against Obamacare, making the case against this immigration bill. And the more they criticize me for it, the more I’m going to say it.”

When asked again point blank if he would run for the U.S. Senate in 2014 – yes, no or maybe – Cotton responded.

“I’m eager to do the work in the U.S. House that the people elected me to do.”

Link here for a video of the Cotton interview.

J.B. Hunt Transport Services posted solid financial results for its second quarter ending June 30, though it slightly missed the guidance set by Wall Street analysts.

The Lowell-based transport company earned $87.69 million, up 6.3% from the same period a year ago. Net income equaled 73 cents per share, up from the 67 cents earned last year.

Wall Street expected J.B.Hunt to post net earnings of 74 cents a share on sales of $1.4 billion. The company also fell short on the revenue mark with $1.382 billion in sales reported in the quarter. The estimate was $1.4 billion.

Investors weren’t concerned with the miss as shares of J.B. Hunt traded higher on Monday (July 15). Shares traded at $76.37, up 64 cents in the afternoon session in heavy volume. The increase also was up against concerns of slowing GDP and disappointing retail sales which were also reported on Monday.

Part of the reason Hunt missed expectations is because the cost of doing business has increased as it continues to ramp up hiring in its Dedicated Contract Services division. The company said it’s preparing to convert two private fleet contracts which resulted in $2.5 million in additional spending. Those expenses are front-end loaded but will be mitigated in the coming quarters.

The firm also took a $2.4 million write-off from technology which it has abandoned as well as a $1.5 million loss relating to two train derailments. Higher driver costs and recruitment wages also rose in the quarter.

Total operating income in the quarter was $147.4 million, up from $137.2 million a year ago.

INTERMODAL
The intermodal – truck via rail – division of J.B. Hunt continues to be the catalyst for strong earnings again this quarter. Hunt’s intermodal segment posted revenue of $854.74 million in the second quarter, up 12% from a year ago. This segment was responsible for 75% of the company's total sales in the quarter.

Operating income totaled $110.67 million, rising 19%, year-over-year. Overall volumes and revenue each increased 12% over the same period in 2012 in an environment of moderating fuel prices and less seasonally volatile freight demand, the company noted.

The firm grew its Eastern network 14% and transcontinental growth was 11% over the second quarter 2012.

Hunt reports steady demand and lower insurance costs which helped to buoy revenue higher.

The period ended with 61,911 units of trailing capacity and 3,952 power units available to the dray fleet, according to Hunt.

DEDICATED CONTRACT SERVICES
Hunt’s DCS division posted $302.62 million in revenue for the quarter, up 13% from a year ago. DSC sales totaled 22% of the company's total revenue in the quarter.

Operating income was $29.7 million, down 11% because of the previously mentioned expansion costs.

The company said new accounts provided a net additional 863 revenue-producing trucks by the end of the quarter compared to prior year. The additional trucks are needed as the firm ramps up for two large private fleet conversions which will be completed by September. The total cost of these conversions is estimated to be in excess of $3.5 million.

INTEGRATED CAPACITY SOLUTIONS
Hunt’s non-asset based brokerage division posted segment revenue of $131.82 million in the quarter, up 20% from a year ago. This segment comprised 10% of the company total revenue in the quarter.

The ICS segment benefited from a 29% increases in load volume, related to a boost in less-than-truckload business. Contractual business was approximately 60% of total load volume in the current period and comparable to second quarter 2012.

Operating income  of $4.16 million increased 113% over the same period 2012 primarily due to increased revenue and improvement in gross profit margin. Gross profit margin increased to 11.8% in the current quarter versus 10.6% last year.

The segment also had added personnel costs with the opening of two new branch locations in the quarter.

ICS’s carrier base increased 10% and the employee count increased 8% over the second quarter 2012.

TRUCK LOSSES
Hunt’s truckload division posted revenue of $101 million in the quarter, down 20% from a year ago as the firm moves more freight to intermodal.

Second quarter operating income tumbled 67% to $2.95 million as the segment reduced its fleet size by 16% also ran 10% shorter routes which also hindered revenue.
Hunt reports rates from consistent shippers decreased 0.6% from a year ago.

At the end of the quarter the segment has 2,018 tractors, down from 2,396 a year ago. The trucking segment revenue was just 7% of the company's total sales in the quarter.

At least one record has fallen today (July 15) as candidates filed second quarter fundraising reports from federal offices all the way down to races for state house and state senate.

In the race for Arkansas governor, former U.S. Rep. Mike Ross, D-Prescott, announced he had raised $1.97 million in the first quarter of fundraising since entering the governor's race on April 17. The Ross campaign said the amount sets a new record in Arkansas. The campaign also reported having $1.7 million cash on hand.

Ross said in a press release that the record numbers, boosted by more than 5,000 supporters, shows that his message of economic development and improving education is making an impact across the state.

“We have a lot of work to do before Election Day, but I think it’s clear we’ve got a strong start and a lot of momentum on our side. I’m running for governor, because I love this state and I want to use my experience of bringing people together to focus on education and job creation," he said.

The record fundraising quarter surpassed the previous record, set by current Democratic Gov. Mike Beebe, of $1.09 million, the release said.

Of the money donated for the primary and general elections, nearly 90% of donations came from within the state of Arkansas, according to the campaign. Additionally, the press release noted that no loans had been made to the campaign.

That is in stark contrast to former Lt. Gov. Bill Halter, who is challenging Ross for the governor's mansion. According to campaign finance filings from the first quarter, Halter raised $1 million for his gubernatorial run, but that included a $640,000 loan he made to his campaign. Halter's fundraising figures from the second quarter show him only raising $92,900.19, with $837,046.77 cash on hand.

On the Republican side, businessman Curtis Coleman reported raising $101,715 in his first foray into politics. The fundraising figure includes a $25,000 loan Coleman made to his campaign. Coleman has previously said he plans to rely on individual donors for campaign funds, but has left himself open to spending a portion of his personal fortune on the governor's race.

"If the need arises for me to invest personal funds in the campaign, then I'll make the decision at that point with consultation with my family."

Coleman reported $16,747 cash on hand. Reports for former U.S. Rep. Asa Hutchinson, Coleman's primary opponent, have not yet been made public.

In the race for lieutenant governor, Democrat John Burkhalter reported no contributions to his campaign, though he did report loaning himself $30,000, of which only $5,648.49 remains. Burkhalter's company, Burkhalter Technologies of North Little Rock, has also contributed $1,057.10 to cover refreshments and airfare. Little Rock School Board President Diane Curry, who is challenging Burkhalter in the Democratic primary, did not yet have fundraising figures available.

In the race for U.S. Senate, incumbent Mark Pryor, D-Ark., announced he had raised $1.2 million from April to June, with $3.92 million cash on hand in his campaign for a third term.

“We had a very strong quarter and surpassed our fundraising goals,” Jeff Weaver, Pryor's campaign manager, said in a statement. “Sen. Pryor is grateful and humbled by the continued support as he fights for responsible solutions that protect Arkansas’ hard-working families and strengthen our nation.”

Even though Pryor has no announced opponent at this time, the person all eyes have been focused on is U.S. Rep. Tom Cotton, R-Dardanelle, who reported donations of $611,341 in his campaign for re-election to the Fourth District U.S. House seat, along with $1.04 million cash on hand.

Should Cotton challenge Pryor, he will be at an initial disadvantage from a campaign funding standpoint, though outside money could pour into Arkansas. The Senate seat has drawn attention from national groups, with several commercials paid for by outside organizations running on Arkansas airwaves that attack Pryor and Cotton.

Other reported fundraising figures include:
• U.S. Rep. Rick Crawford, R-Jonesboro (First Congressional District)
$99,185 Raised
$168,932 Cash on hand

• U.S. Rep. Tim Griffin R-Little Rock (Second Congressional District)
$275,000 Raised
$447,334 Cash on hand

• U.S. Rep. Steve Womack, R-Rogers (Third Congressional District)
$123,426 Raised
$578,970 Cash on hand

• Republican David Sterling (Attorney General)
$34,176.80 Raised (including $4,005.80 loan)
$70,757.24 Cash on hand

• Republican Ken Yang (Auditor)
$11,731.12 Raised (including $2,967.12 loan)
$26,055.31 Cash on hand

• Republican Dennis Milligan (Treasurer)
$14,612.41 Raised (including $13,912.41 loan)
$17,240.52 Cash on hand

• Sen. Cecile Bledsoe, R-Rogers (Senate District 3)
$12,026.54 Raised
$12,026.54 Cash on hand

• Republican Jana Della Rosa (Representative District 90)
$3,000 Raised
$2,089.94 Cash on hand

Employees needing to file compensation claims may have a longer commute to do so starting next summer.

According to a letter to Fort Smith Mayor Sandy Sanders, the Arkansas Workers' Compensation Commission is considering closing either its Fort Smith or Springdale offices as a result of a $135 million unfunded liability.

"This decision, unfortunately, was made necessary by the fact that the AWCCs' Death and Permanent Disability Trust Fund is faced with an approximate $135 million unfunded liability," wrote AWCC Chairman Watson Bell. "Although they Governor has kept management and labor apprised of this status for some time now, they have failed to agree on any of the proposed resolutions put forth, leaving no option to address this issue other than these closings."

Watson said the General Assembly's failure to address the $135 million liability contributed to the closings, as well.

"Because the issue of the shortfall was not addressed in the 2013 General Session of the Arkansas Legislature, we have been forced to adopt a strategic financial plan that includes closing one of the offices in Northwest Arkansas as a first step. Additional steps could include a reduction in force."

The Fort Smith office employees six people while the Springdale office employees three, according to AWCC Assistant CEO James Daniel. He said plans to do not call for layoffs at this time.

"We would not lay anyone off. I am not clear on (where they would work should one of the offices close). I would presume they would work out of whichever office is kept open," he said. "I would have to research that."

Daniel said of the 6,672 claims filed with the commission during fiscal year ending June 30, Sebastian County had 322 claims filed versus 419 filed in Washington County.

The determination on which office to close will not only be made based on the number of claims in the offices' respective counties, he said, adding that a lot of filings come in from other counties and the majority of filings are done by mail or computer.

The reason for the shortfall was due to the increase in claims and the amount paid in weekly benefits while the tax percentage on workers' compensation insurance plans has remained at 3% for the last 40 years, Daniel said.

He also pointed to a study he wrote in 2011, titled “The Case for a Premium Tax Increase” that explained how insurance companies have not had their maximum liabilities increased since 1987.

"The maximum weekly benefit had been increased to $154 in 1987, and at that time Act 1015 of 1987 tied the maximum weekly benefit to the state average weekly wage. Subsequently, although the maximum liability of the employer stayed at $75,000, the maximum weekly benefit increased each year as the state eaverage weekly increased each year. By 2007, the maximum weekly benefit had increased to $504. That meant that the employer or carrier, still at the $75,000 maximum liability, would only pay the disabled worker for less than 3 years before the Trust Fund took over."

Daniel said the only funding the commission receives is the 3% from the premium tax.

"We don't get sales tax revenue. Everything we get is when a worker's compensation policy is issued. Three percent of that policy is forwarded by the insurance company to us. We have to make a decision as to how much will go to run agency and how much to the trust fund. There were years where we didn't put any in the trust fund and years in the past when we didn't charge the entire 3% because we didn't need it."

He said now about 1.5% of the tax revenue goes to running the commission, while the rest of the money, 98.5% of the funds taken in, go to the trust fund.

"We've done about all we can do," he said, adding that the commission has reduced its employee number from 140 individuals to 105.

"We did that all by attrition, not laying off. We just didn't re-hire when people quit or retired."

Fort Smith City Administrator Ray Gosack said his office would work with the commission to highlight the city's need a continued presence by the commission.

"Having an office 45 miles away makes it much more difficult for citizens who need service to attend hearings or get service," he said, adding that once the decision is made, it would be final.

"I don't have an idea on when they'll make a decision and to my knowledge there is no appeals process. The commission will make the final decision."

Fort Smith residents and city leaders joined together Monday night (July 15) to discuss issues facing Ward 3 and the city as a whole.

Ward 3 Director Mike Lorenz started the meeting by telling residents about many positive developments happening in the southern section of the city.

"This is a real exciting time for Ward 3 and I just want to kind of point out one thing and not take up all the time, but there is a lot of excitement going right now and if you'll notice, there's a whole lot of jobs coming to Ward 3 between Answer Fort Smith that just remodeled the old CV's building on 271 bringing about 70 to 100 jobs when they're done, the HMA service center moving into Phoenix Village that's currently under construction will ultimately have nearly 600 employees there, Sykes just next door at Phoenix Village is expanding. We'll be adding another couple of hundred jobs there."

Lorenz said the key take away for residents and leaders at tonight's meeting was job creation and the impact it would have not only on Ward 3, but on the entire city.

Mayor Sandy Sanders said that since December 2012, nearly 1,200 new jobs had been announced, with many of them coming to the city's southern ward.

"That's great for the community," he said.

The number of employed in the Fort Smith region has grown from 121,200 in December 2012 to an estimated 123,501 in May 2013 – up almost 1.9%. However, the number of employed in the region is down 7.12% from the peak of 132,980 during June 2007, according to figures from the U.S. Bureau of Labor Statistics.

Another project that has the potential to transform the southern section of the city is the Ben Geren Aquatic Center, which Parks and Recreation Director Mike Alsup said could make a big impact on economic development in what used to be a largely uninhabited section of town.

"Of course that's a combined county and city project that we're working on together. It was decided that together we could build something that's really nice for our community that everyone would enjoy. So we're excited about that one, too. I believe that one has got the potential to change the look of Zero Street. I'm not an economist or anything like that but I believe you will see a change in the look of Zero Street along that area in front of Ben Geren Park with this and the other improvements that the county is doing."

The other improvements include the addition of softball fields at an expense to the city, as well as the new storm shelter the county installed in recent years.

While the county is taking the lead on hiring a construction manager and operating the park, the city will be focused on other projects, according to Utilities Department Director Steve Parke.

According to Parke, the city has spent $22 million to improve drainage on the south side of the city and will continue to do so.

"Since 2011, we've spent a little over $22 million worth of improvements in the lower portion of Ward 3, that area south of Cavanaugh from 71 down along Cavanaugh following Mill Creek. In coming years from 2013 to 2015, we currently have identified another $21 million worth of work that we're going to do in getting the flows on down to Mill Creek."

Another project that Parke spoke to residents about was just north and east of Zero Street - the new pump station and equalization facility.

The site, he said, was actually a remediation success story, with the city undertaking nearly $3.2 million worth of remediation in cooperation with the Arkansas Department of Environmental Quality in order to restore the site to a workable use within the city. The location of the new pump station is a little over five blocks from the location of another site that is under review for remediation plans, the area just north of the former Whirlpool plant where trichloroethylene (TCE) has contaminated the groundwater.

Asked after the meeting whether construction would be impacted by the TCE plume that exists south of the construction, City Administrator Ray Gosack said the plume had not migrated north far enough to impact the construction or workers who may be working on the site. But another project taking place just south of the Whirlpool facility to improve drainage is a project that Gosack said was under review, with testing taking place to make sure that no risks were posed to workers or residents.

"There's going to be testing required in those areas to see if there is TCE present and if there is, then they'll put safety measures in place to protect the workers,” Gosack explained.

Parke said the safety measures were likely to include transporting any contaminated soil or liquids from the site, though he said with work only taking place about five foot below the original ground surface, he does not see contamination being an issue with any projects in the area.

Of the questions asked by residents, most dealt with minor neighborhood issues or questions regarding reporting of overgrown grass or neighborhood cleanup.

Resident Linda Mitchell said she was just concerned about bringing the Fort Smith economy back to pre-recession levels, something she hopes the current set of directors is able to do, though she did not hold out much hope.

"I just feel like we're falling further and further behind. We've been here for 45 years in September and Fort Smith was booming a lot bigger when we came here then than it is now. I just feel like we're losing everything to Northwest Arkansas and I'd like to see that change."

Getting product into a Sam’s Club is no easy feat for most small volume suppliers, but those who do make a connection say it has launched other successes.

Blake Pointer, CEO of Rogers-based My Brothers Salsa, and Ron Embree, president of Fort Smith-based River Bend Industries, said Sam’s Club connections gave them new possibilities.

A typical Sam’s Club has less than 10,000 stock keeping units or SKUs. This compares to 100,000 or more SKUs inside a big box retailer like Wal-Mart Stores Inc.  

Finding the right product mix is key to the success of club economics as members do pay for the privilege of shopping, according to Salah Khalaf, Sam’s Club senior manager for supplier diversity.

Khalaf conducts numerous workshops around the country each year trying to attract and educate smaller and women-owned businesses into the fold of Sam’s Club. He works with Showcase Events and Shopper Events, third-party service providers who carry out product tastings and other in-club events on behalf of potential suppliers.

Khalaf said this is just one way smaller suppliers can test their product inside a Sam’s Club.

SHOWCASE EVENTS
Using Showcase Events, formerly known as “Road Shows.” was the perfect way Blake Pointer and partner Helen Lampkin got their My Brothers Salsa product into Sam’s Club and later on the shelf at more than 100 Walmart Stores and Neighborhood Markets across Arkansas and Oklahoma.

Pointer said a few years ago Lampkin – also his mother-in-law – was making salsa in her Bentonville kitchen and giving it away to friends and family. In 2003, she launched the company My Brothers Salsa and began distributing the product to small local retailers like Richard’s Meat Market and specialty grocers like Whole Foods in Little Rock and Tulsa.

But three years ago the company ramped up production after it partnered with Shopper Events with taste demos in the Sam’s Clubs in Fayetteville and Bentonville.

“We did very well with the product, conducting about 10 or 12 weekend ‘Road Shows’ that first year,” Pointer said. “It’s important that the demo weekends are done in areas where consumers can buy the product elsewhere after you are gone. For that reason we stuck to areas where we had product for sale in Whole Foods and later Fresh Markets to get the maximum benefit from the Road Show.”

He explained the Shopper Events or Road Show was a partnership done on a consignment basis, where they set up in a Sam’s Club on a Thursday evening and offered the product all weekend and then split the sales.

Pointer said Shopper Events provided their firm with real sales data that caught the eye of a Sam’s Club buyer and led to inline club space for one of their products.

“We worked with our product manufacturers, one in Rogers and one in Alma, to make a larger jar that fit the Sam’s Club packaging criteria,” he said.

SAM’S & MORE
The connections Pointer made doing business with Sam’s Club proved to be invaluable for getting broader distribution.

He said between the sales at Sam’s Club and the Shopper Events’ data he was able to get a meeting with a Wal-Mart buyer and got 84 stores to start, or all the Wal-Mart and Neighborhood Markets in Arkansas.

“It was important for us to start fairly small. We outsource our manufacturing and had them to consider and the one thing we never want to do is compromise the quality of our product. We are true foodies,” Pointer said.

Khalaf said My Brothers Salsa is a good example of a local company that started small, learned their business inside and out and then connected with Sam’s Club through Shopper Events for the added exposure they needed to become a supplier. He said the worse mistake a potential supplier can make is take on too many stores or clubs and then fail to meet the requirements.

Pointer said during their last meeting with Wal-Mart they got all the stores in Missouri and Oklahoma added to their business. He said Wal-Mart saying, “no” is not a cause for worry. It’s when they say “yes” that the worry level rises.

Since My Brothers Salsa has performed well at Sam’s Club and Wal-Mart, Pointer said the firm was recently contacted by Costco for a meeting. They also just signed a deal to expand the product into Fresh Markets on a national scale. He credits much of the company’s emerging success to the partners they made during the early Showcase Events that first year he joined the company.

Khalaf stressed the importance for potential suppliers to do their homework before they ask for a meeting with Sam’s Club or Wal-Mart.

Pointer said his background in marketing at Saatchi and Saatchi X and his work on the Proctor & Gamble account gave him a solid background for his role at My Brothers Salsa.

“We did our homework long before we sought out a meeting with a buyer and it paid off,” he said.

SAM’S TRIAL
River Bend Industries turned to producing a retail product when it became clear that Whirlpool would close its Fort Smith manufacturing operation. River Bend is a plastics molding company.

President Ron Embree learned of a cooler variant from Northwest Arkansas entrepreneurs Tim Mika and Stephen Bowman. It’s a unique and simple design that places a cooler on the top of an adjustable tripod leg configuration that raises the cooler above the floor/ground for more convenient use. The tripod legs fold into the sides of the cooler.

The “Kosmo Cooler” was born, and by 2011 a few pallets of the coolers were being sold at a few Sam’s Club locations.

Embree did not have the usual struggle to get a Sam’s Club buyer to see the product and begin the process to get it in a store. One of the people affiliated with the Kosmo had a connection within Sam’s Club.

“Fortunately, one of the guys working with us on this, he knew someone already selling to Sam’s. ... He knew the people to contact and to go see.  He already had that relationship with them,” Embree said.

It took about six weeks to get the product tested, and about two months before it was sold in a Sam’s Club store. The cooler sold for about a year. Sam’s Club did not renew sales.

“Sam’s is about sales dollars per square foot and I think there were other products that they could sell better per square foot,” Embree explained. “This (Kosmo) unit has to be displayed and set up so people can tell the difference between it and the competition. In six of the 10 stores I went to, it was not set up.”

However, Embree is grateful for the experience with Sam’s. He learned, for example, that the coolers sold best in Sam’s Club stores near the border with Mexico. With that knowledge, he is trying to get the cooler sold in Wal-Mart’s Mexico division.

VALUED BLUEPRINT
Embree said the experience at Sam’s Club gave him a blueprint of how to work with Wal-Mart and other large retailers.

“The first thing you have to have a contact and a way to get in front of the right people. Everybody’s got the next best thing, the next best deal, and so those guys (buyers for retailers) are swamped,” Embree said.

Selling to large retailers also requires a vendor to be flexible and understand the retailer’s process. One of Embree’s initial lessons in working with Sam’s Club is the speed at which retail moves.

“It’s not difficult for someone who comes from the retail world, but for me it was difficult to grasp that (quick turnaround),” Embree said, adding that he missed a deadline on a few early Sam’s Club orders.

And when dealing with Wal-Mart or any of the retailer’s divisions, knowledge of Retail Link is a must, according to Embree. Retail Link is Wal-Mart’s proprietary computer network that connects Wal-Mart suppliers to sales and other data about the product or products they provide to the retailer.

“You have to know the computer system, and their system is Retail Link. You want to take advantage of that. There is a lot of information there, but you have to know how use it,” Embree said.

RIVER BEND PRODUCTS
In early 2011, Embree employed about 120 at his Fort Smith operation when Whirlpool was still a large part of his business. Today, he employs about 85 in Fort Smith. River Bend also has plastics molding plans in Iowa, and the company has about 365 employees.

Embree has developed variants – three-spicket cooler, camo cooler, etc. – of the Kosmo, and is selling them at Sutherland’s, CV’s and Marvin’s IGA. River Bend recently hired a marketing company that specializes in the hunting-shooting-fishing retail segment.

“They are trying to stir up an interest, so that my online sales pick up and the other big box guys will want to sell them,” Embree said.

River Bend is also producing 12-gallon and 18-gallon “survival storage containers.” The containers, which have to be cut open once they are locked down, are included in the 2014 Grainger Supply catalog.

The Porcine Epidemic Diarrhea Virus, also known as PED, that has infected swine farms in Arkansas and 13 other states is not expected to have a major impact on hog supplies or pork prices in the coming months, according to several swine experts who spoke with The City Wire this week.

Tyson Foods, one the nation’s largest pork processors, purchases hogs from about 2,700 independent suppliers. The Springdale-based meat giant processes roughly 403,000 head of swine each week in its nine pork facilities located throughout the central and Midwest part of the U.S.

“So far, we’ve received very few reports of our hog suppliers’ animals being affected by this disease,” said Gary Mickelson, Tyson spokesman.

Dr. Mike Tokach, extension swine specialist with Kansas State University, said PED was formerly believed to be contained in Europe and China, until the disease was first detected on U.S. soil around April 19. Since early May hundreds of piglets have died across 15 states, but the extent of the spread is difficult to determine because outbreaks are not required to be reported to federal officials.

The American Association of Swine Veterinarians said PED has been found in the following states: Arkansas, Iowa, Illinois, Indiana, Kansas, Michigan, Minnesota, Missouri, North Carolina, New York, Ohio, Oklahoma, Pennsylvania and South Dakota.

Tokach said the virus is serious for hog farmers because baby pigs can rarely fend it off as it often wipes out the intestines with a fairly high mortality rate. He said it’s hard to determine just how many piglets have died. Tokach said PED is complicated by the fact it breeds in heat and bright sunlight, unlike other related swine viruses.

“There has been some tracking from the different diagnostic labs. The American Association of Swine has a tracking how many cases ... of the known farms that have experienced the disease. The number is 69 or 70 farms to date, but the number is going up," Tokach said.

Dr. Jeremy Powell, veterinarian with the University of Arkansas Department of Animal Science, doesn’t see any major concerns in the Natural State.

"I don't think we have that many pork producers left in the state. That's something that's been leaving the state for several years now," he said.

Powell and other experts stressed that PED poses no risk to humans who consume pork, or raise swine.

CONSUMER PRICES
Despite some reports of higher pork prices on the horizon, the experts who spoke with The City Wire don’t see much of a threat given the timing of outbreak.

Piglets born in the spring and early summer would be going to market in the late fall to early winter months, which is also typically the weakest cycle for pork prices throughout the year.

Steve Kay, publisher of Cattle Buyers Weekly, said in recent months there have been too many hogs slaughtered relative to demand, which kept packer margins in the red, and pork prices quite low.

“Packer margins for fresh pork did turn back into black in later June, but I suspect packers have been making money most of this year on their valued-added products.” Kay said.

Tokach agreed, saying any supply chain issues probably have not impacted enough pigs to drive up pork prices in the coming months. That said, hog futures have rallied the past week or so on speculation of tighter supplies after reduced slaughter numbers were reported out of Iowa, the nation’s top pork producing state.

Carcass weights also dropped slightly at the same time grocers increased orders in hopes of more summer grilling by consumers.

Wholesale pork cutout prices were $1.03 per pound last week, up 15% from a year ago. Even with that increase, pork is $2 cheaper per pound than the all beef wholesale price of $3.14 as reported by the U.S. Department of Agriculture.

Expansion of a health and rehab center in Alma and the Sykes call center operation in Fort Smith could add up to 220 jobs in the Fort Smith region – an economically struggling area that has seen several positive job announcements in recent months.

An official with Tampa, Fla.-based Sykes confirmed Tuesday (July 16) that the global “customer contact management solutions” provider will expand its Fort Smith operation located in what was once a portion of Phoenix Village Mall.

"Thanks for your inquiry. SYKES is excited to be expanding our site in Ft. Smith, Arkansas. We are adding about 15,000 sq. ft. to our current facility to support the support needs of a new client. We are currently hiring qualified individuals to join our growing team in Ft. Smith!,” noted an e-mail from Dan Hernandez, executive vice president, global strategies, for Sykes.

Sykes’ expansion in Fort Smith had been rumored, but on Monday night (July 15), Fort Smith City Director Mike Lorenz said during a public meeting that Sykes would be “adding another couple of hundred jobs there.”

Sykes, which employs more than 46,000 at more than 75 locations in 23 countries, opened the Fort Smith operation in early 2011. Sykes was initially recruited to Fort Smith by FSM Redevelopment Partners, the company that purchased the more than 35-acre former Phoenix Village mall property in January 2009.

PHOENIX JOB GROWTH
Lance Beaty, a partner in FSM Redevelopment, told The City Wire that temporary space has been provided for immediate needs, with complete build out of the new space set for the middle of September. The build out costs are estimated at around $600,000, which does not include furniture, fixtures and equipment costs to be paid by Sykes. The total project could be a more than $1 million investment.

Sykes reported 2012 revenue of $1.127 billion, and cash flow from ongoing operations of $86.5 million. Sykes employment in Fort Smith is estimated at 450, with the expansion potentially adding between 150-200 jobs.

“In 2009, buying this old mall seemed like a big risk, but I’d say it’s paid off. It’s been a long time since more than a thousand people came to Phoenix Village to come to work,” Beaty said. “Our little corner of Fort Smith will soon have an annual payroll in excess of $30 million.”

Naples, Fla.-based Health Management Associates announced plans on April 4 to operate a regional service center in Fort Smith that will employ more than 500 with average annual salaries potentially exceeding $40,000. The almost 90,000-square-foot facility also will be housed in what was once a portion of Phoenix Village Mall. HMA estimates the annual payroll will be $21.5 million, with the center at full employment within 12 months. The company is also investing $4 million in furniture, fixtures and equipment for the new center. The facility is scheduled to be ready for operations in early September.

Other businesses located on the Phoenix property includes the Cooper Clinic Pro Med urgent care office, a regional office for AFLAC, Sebastian County Solid Waste office and several retail stores.

Beaty also credited Fort Smith city staff for “being very cooperative to expedite the permitting” for the Sykes project.

ALMA EXPANSION
Alma Healthcare and Rehabilitation, owned by Rogers, Ark.-based Cornerstone Healthcare, is investing $2.4 million in a three-phase expansion that could add up to 20 jobs in the Crawford County community. Cornerstone Healthcare is owned by Allen Kilgore.

A formal groundbreaking is planned for 10 a.m., Thursday (July 18) at the facility located at 401 Heather Lane in Alma.

The expansion will add 10,800 square feet to the existing building, and will include parking lot renovation. A majority of the new jobs will be certified nurse assistants, according to Administrator Debbie Fort. The pay for CNA begins at about $11 an hour, she said. Fort said most of the jobs could be filled within six months.

In a statement prepared by the Alma Area Chamber of Commerce, Fort said the operation is not just a nursing home.

“We discharge an average of 10 to 15 residents a month out of a short­term rehabilitation plan,” Fort said in the statement.

Many patients are recovering from a fracture or stroke and do not require assisted living or long term care. Fort said the work of the facility was to “enhance life and get everyone up to an optimum level of functioning.”

Fort said the new rehab center will allow area residents access to medical services without long trips to other regional facilities.

Lisa­Marie Norris, executive director of the Alma chamber, said the 20 jobs are important to the Alma economy.

“Expanding existing businesses is the heart and soul of economic development. Twenty new jobs in Alma, and especially such high­quality jobs from a top­shelf employer, is fantastic economic development news for the entire region,” Norris said.

The project architect is Guest Reddick Architects from Fort Smith. The structural engineer is Myers­Beatty Engineers from Van Buren. The mechanical engineers are HSA Engineering Consulting Services from Fort Smith, and the contractor is CR Crawford Construction from Fayetteville.

THE JOBS PICTURE
With the possibility of 220 new jobs from the Sykes and Alma Healthcare expansion, new job announcements in the region during the past six months total almost 1,000.
• Phoenix Metals (Chaffee Crossing): up to 40 new jobs, announced March 21

• Health Management Associates (Phoenix Village-Fort Smith): 500 jobs, announced April 4

• Tankersley Food Service, (Van Buren Industrial Park): 20-40 new jobs, announced June 11

• Gerber Foods (Fort Smith plant): $150 million expansion estimated to add up to 90 jobs (The Fort Smith Board of Directors approved on June 4 a bond issuance for the expansion.)

• Answer Fort Smith (Fort Smith): up to 90 jobs, announced June 14

• Sykes (Phoenix Village-Fort Smith): 150-200 jobs (estimated), announced July 16

• Alma Healthcare and Rehabilitation (Alma), up to 20 jobs, announced July 16

Those jobs and more will be needed to return the Fort Smith region to pre-recessionary employment levels. The average annual employment during 2007 in the region was 131,185, according to the U.S. Bureau of Labor Statistics. Following are the annual average employment levels for the five years following 2007.
2008: 130,484
2009: 123,811
2010: 124,532
2011: 122,167
2012: 122,790

As of May 2013, employment in the Fort Smith region was estimated at 123,501.

Fort Smith City Administrator Ray Gosack walked out of tonight's (July 16) Board of Directors meeting with a reason to smile after the Board voted to give Gosack a 2.5% pay raise effective Aug. 1 following his performance review at tonight's meeting.

Following the nearly hour and a half executive session, Mayor Sandy Sanders announced the Board's intention, saying that Gosack had performed well since being hired as city administrator more than two years ago.

"The Board was very pleased with Mr. Gosack's continuing excellent performance and following discussion, the Board has considered the fact that Mr. Gosack since he has been hired has not had a pay increase and has discussed a pay increase for him at this time."

Gosack's salary is $149,500 per year with a car allowance of $5,400 each year, as well. Other benefits, such as health insurance, are the same as other city employees, he said. His raise will amount to an additional $3,737.50 per year.

The pay raise was something both parties wanted, according to Gosack.

"An increase wasn't unexpected. I wasn't really sure how much to expect. I'm very pleased with it. I think it recognizes the accomplishments that the staff has made over the last two and a half years to implement the Board's goals. ... It was mutual. Yes."

The staff Gosack mentions includes all city employees, many of whom Gosack said have been receiving pay increases in varying amounts, typically in the 3% range. Employees who have not received pay raises include those who are ineligible based on performance situations or are on probation, he said.

Following the vote, Director George Catsavis, the only Board member to vote against the raise, said he did so not because Gosack wasn't deserving, but because of the city's financial situation.

"Well, with the revenues being down the last few months and I don't feel like it's appropriate right now to be giving raises to …I just think we need to wait and see how our revenues are going to come out the next few months before we give raises. I mean, you don't spend money you don't have."

That said, Catsavis said he was not against all pay raises, just this particular raise.

"I know that there may be some raises that need to be addressed, but I think that we should have waited until budget talks until we made any decisions on raises for the administrator."

Catsavis did not go as far as Sanders in praising Gosack's performance, saying, "His performance was about the same as it was last time, so it's been steady. So, you know, nothing major. It's been on a steady keel."

Performance reviews haven't always been a smooth endeavor for Gosack and the Board. His last review, in July 2012, was his fourth in less than a year and involved allegations of conflict between various Board members and city department heads.

"While Sanders and the board, were unwilling to discuss the specifics of the personnel matters, sources wishing to remain anonymous have stated the matter involved 'threats to Director Catsavis' and 'derogatory comments about Director (Pam) Weber,' allegedly attributed to Baridi Nkokheli, Fort Smith sanitation director,"The City Wire previously reported.

No such animosity presented itself following the meeting tonight, which also saw the Board approve Nkokheli's request for an update to city regulations regarding automated trash collection in residential areas. He had asked the Board to give him discretion in determining which properties should be allowed to use dumpsters instead of trash bins. The ordinance also classifies a residential customer as a customer in a structure containing four or less residential units.

Weber's previous complaints about the ordinance, that it did not provide an appeals process to Nkokheli's decision regarding curbside collection versus a dumpster, was addressed by Gosack, who informed Directors that Ordinance 83-12, which was approved by voters in November 2012 and mandated citywide curbside sanitation service, actually included language that would require a supermajority vote of 5 of the 7 city directors to allow for another collection method "where it is impractical for the side-loader solid waste collection vehicles to operate due to terrain or other conditions."

Nkokheli apologized for any confusion his request for a new ordinance had caused, telling The City Wire that "it was my fault" for not being aware of the language in Ordinance 83-12.

Tonight's vote was 6-1 for the ordinance's second reading, meaning the ordinance will not have to come back for third and final reading due to the Board's supermajority vote.

If former Democratic Congressman Mike Ross is elected Arkansas governor in 2014, he’ll be the third consecutive Arkansas governor named Mike.

Based on admittedly superficial estimates by The City Wire, the odds of Arkansas having three consecutive governors named Mike ranges from 1 out of about 15,600 to 1 in 196 million.

A Ross victory in 2014 – and he is considered a frontrunner – would result in Arkansas governors 44, 45, and 46 being, respectively, Mike Huckabee, Mike Beebe and Mike Ross – also respectively, a preacher, proctor and pharmacy owner.

If Ross loses the race, it may be considered an upset not unlike Frank White’s defeat of Bill Clinton in 1980. Maybe more so, because White partially benefited from the Reagan landslide over Carter.

With respect to consecutive names of duly elected governors, there was the 26th and 27th Govs. Thomas Chipman McRae and Tom Jefferson Terral, respectively. Until Mike Ross decided to re-enter the political world, that’s as close as it has come to a three-peat.

Arkansas has had 45 elected governors and 10 acting governors who took office following the resignation or death of the governor.

James is a first name that came close to being thrice consecutive. Arkansas’ 14th, 16th and 18th governors were, respectively, James Berry, James Eagle and James Clarke.

James is a common name for Arkansas governors. James Sevier Conway was the state’s first governor, and James Miller was the first territorial governor. Miller was appointed territorial governor by President James Monroe.

Possibly the most unusual name was that of Gov. Xenophon Overton Pindall. He wasn’t elected governor. He became governor in a series of successions that followed the resignation of Gov. John Sebastian Little, Arkansas’ 21st duly elected CEO. Little, from south Sebastian County, had a nervous breakdown less than a month after being sworn in on Jan. 8, 1907.

What are the odds of having Mike for a third consecutive time on inaugural invitations?

Linus Yu, associate professor and assistant department head of mathematics at the University of Arkansas at Fort Smith, provided three different calculations. (Yu made it clear his calculations were rough estimates, and provided knowing that The City Wire story was merely a thought exercise. An exhaustive – and possibly expensive – study would be required for a more definitive look at the odds. The estimates also exclude the factor of Ross succeeding in the primary and general elections.)

Using the U.S. Social Security website that lists top baby names by year, along with the percent of total births by name, Yu estimated that based on 2012 births (0.796% of births were boys named Michael), the odds of three consecutive governors named Mike is 1 out of 2 million.

But an Arkansan must be at least 30 years old to be elected. Using 1984 birth figures (3.61% of births in 1984 were boys named Michael), the odds narrow to around 1 out of 15,600.

Also, the Census Bureau has said there are at least 5,163 different first names in common use. Using that number, Yu estimated the odds are 1 in 196 million, but he was not comfortable with that approach.

“Usually the name Mike is way more common than Linus,” Yu said with a laugh, adding that commonality is different than frequency.

Also, the birth figures from the Social Security website reflect nationwide percentages, and are likely different for each state. Also, the figures do not reflect the transition over time; which is to say, the birth-death ratio of people named Mike could be different than those with other names.

There are some other numbers that may impact the odds of not having to change the first name on the door to the Arkansas governor’s office. In the recent quarter, Ross raised a record $1.97 million in campaign funds, and reported having $1.696 million in cash on hand. His presumptive GOP opponent, Asa Hutchinson, raised $378,795 during the quarter, and has just a little more than $725,000 in the bank.

During a July 10 interview with The City Wire, Ross was asked if the state was ready for three consecutive governors named Mike.

"To tell you the truth, I haven't really thought about it. I haven't given it any thought. Huh,” he said, and then laughed.

State education leaders are concerned that a supermajority of Arkansas public schools don’t have the broadband capability to meet forthcoming Common Core testing standards and other digital academic opportunities necessary for the future. Business representatives say the situation is not nearly as dire as projected.

Last Wednesday (July 10), Gov. Mike Beebe (D) convened a group of leaders representing Internet service providers (ISPs), political and educational representatives, and members of the state’s business elite to discuss the subject, which could carry a price tag for upgrades as high as three-quarters of a billion dollars.

“When it became apparent that things weren’t moving fast enough to suit me in the private sector with the proliferation of broadband capabilities, particularly in rural areas, I called everybody together. One of the good things about being Governor is when you send out invitations, they all come,” Beebe said in an exclusive Talk Business interview.

While there is debate about how deficient Arkansas schools may be in positioning themselves for digital learning, there is consensus that the state must improve its efforts.

The 2012 “Digital Learning Now” report from the Foundation for Education Excellence in Education gave Arkansas an “F” for digital learning opportunities. A TechNet Broadband Index listed Arkansas 50th among all states for broadband access in 2012.

According to the Arkansas Department of Information Services (DIS), only a handful of the state’s public schools may have a nationally recommended broadband capability of 100 Mbps per 1,000 students and staff. The average Arkansas school district with 1,800 students has 40 Mbps of bandwidth and needs at least 140 Mbps more, the department concluded.

Business leaders with leading ISPs contend the situation is not nearly as negative as the DIS report projected, and there are myriad solutions to bring the state’s education system up to speed, literally.

Without bandwidth expansion to schools, however, state officials suggest Arkansas students cannot access Common Core testing requirements scheduled to begin in 2014. Common Core is a voluntary set of educational standards for K-12 students to advance their proficiencies in English language arts and mathematics. The standards are designed to ensure that students graduating from high school are better prepared to enter two-year and four-year colleges.

Additionally, more and more course offerings and education materials are requiring Internet access with substantial bandwidth.  For example, the 2013 legislature passed a bill requiring every public school district and public charter school in Arkansas to create a pilot program of at least one digital learning course for students to take.

As other states and countries utilize broadband for distance learning, Arkansas risks falling further behind without action.

TWO WORKING GROUPS
From the Governor’s meeting on July 10, two working groups emerged.

“I charged them with the idea of let’s work together and get this figured out,” Beebe said.

FASTER – which stands for Fast Access for Students, Teachers and Economic Results – will be chaired by Acxiom executive Jerry Jones. It has a heavy business influence in its composition.

The group also includes:
Jeff Gardner, Windstream CEO
Dr. Richard Abernathy, Arkansas Association of Educational Administrators
Kendall Gibbons, Arvest Bank VP for Information Technology
Dr. Don Bobbitt, University of Arkansas System President
U.S. Senator John Boozman (R )
U.S. Senator Mark Pryor (D)
Ed Drilling, Arkansas AT&T President
Morril Harriman, Gov. Beebe’s Chief of Staff
Susan Harriman, Arkansas Department of Education Director of Policy
Walter Hussman, Arkansas Democrat-Gazette Publisher
Dan Rahn, UAMS Chancellor
Jim Walton, Arvest Bank Chairman and CEO
Dr. Charles Welch, Arkansas State University System President
Dr. Sherece West-Scantlebury, Winthrop Rockefeller Foundation CEO
Randy Veach, Arkansas Farm Bureau President
Grant Tennille, Arkansas Economic Development Commission Director
Kathy Smith, Walton Family Foundation
Archie Schaffer, Tyson Foods
Dr. David Rainey, Dumas Public Schools Superintendent

The group was tasked by the Governor with bringing back potential solutions to accelerate broadband activation where it exists and finding alternatives in areas that lack infrastructure. A subset of the FASTER group includes ISP representatives – cable, Internet and phone company executives – who are expected to improve on the accuracy of the DIS broadband capability map.

Cost estimates on how significant of an investment might be needed from the public and private sector vary widely. It could cost as little as $17 million or as much as $765 million, according to state education officials. Business leaders are not willing to make any estimates until they review the broadband inventory data. How the bill might be footed will be a point of debate.

Some variables on the costs involve activating bandwidth in areas where fiber has been laid, but is not in use or is not being used to its full capacity. A Federal Communications Commission program called E-rate 2.0 subsidizes school and library phone and Internet service by as much as 90% of costs.

Lawmakers recently passed legislation to add an earmarked fee to phone bills that could generate $22 million annually for broadband to rural areas of the state, although it has restrictions that could be perceived as discouraging competition between ISPs.

Also, all of the state’s higher education facilities and UAMS are connected to a high-speed fiber network known as ARE-ON (Arkansas Research and Education Optical Network). However, a state law passed in 2011 restricts options for K-12 schools from tapping into this system. The bill prohibits a government entity from providing “directly or indirectly” broadband service. Beebe says he’s aware of the law and sees it as a bargaining chip to encourage the private sector to come to the public school’s aid for K-12 broadband needs.

“There are current restrictions, statutorily – which I understand and I know where it came from,” Beebe said. “So I’m giving the private sector the opportunity to step up and do right and help us solve these problems and invest and that’s the first option. There’s always the option that those restrictions could be removed, you know.”

The second working group tasked with addressing the problem is known as the Quality Digital Learning Study committee. It is working on an educational component to solving the problem. The group, chaired by Dr. Ed Franklin, executive director of the Arkansas Association of Two-year Colleges,  includes:
Dr. Richard Abernathy, Arkansas Association of Educational Administrators
Dr. John Ahlen, former Arkansas Science & Technology Authority director
Claire Bailey, Department of Information Services director
Dr. Jay Barth, State Board of Education
Elizabeth Bowles, Aristotle Internet President & Chairman
Katie Burns, CenturyLink
Cody Decker, Arkansas Department of Education IT Director
Representative Dan Douglas (R-Bentonville)
Adrienne Gardner, Arkansas Science & Technology Authority VP
Susan Harriman, Arkansas Department of Education Director of Policy
Senator Johnny Key (R-Mountain Home)
Dr. Tom Kimbrell, Arkansas Education Commissioner
Representative James McLean (D-Batesville)
Len Pitcock, Cox Communications

This group is charged with identifying the short-term and long-term infrastructure, broadband and digital learning needs of Arkansas public schools as well as devising methods to establish and maintain sufficient broadband capacity for the digital learning environment of the future.

Both groups are pushing to complete their work before the end of this year in anticipation of the 2014 legislative fiscal session. Lawmakers could carve out budget funding for a solution to ramp up the state’s efforts and it is possible that enabling legislation may have to be considered to address the problem.

NEXT: Business, Education Leaders Speak Up
NEXT: Legislative Leaders Address Concerns

Home sales in the area were down for the month of June, pulled down by a more than 50% decline in sales in Crawford County.

The county sandwiched between the region's two largest metro areas saw only 35 home sales during the previous month, totaling $3.096 million in value, a 51.21% decline from the same month last year. At that time, there were 49 homes sold with a value of $6.346 million.

Realtor Jason Kilbreath of Ron Calhoun & Associates said many factors are playing into the decline in home sales north of the Arkansas river.

"There's several factors. One can be the I-540 road work," he said, adding that the construction is causing many people to evaluate commute times when searching for a home.

Other factors Kilbreath mentioned include high gas prices and the possibility of the rural development loan going away. The loans are part of the farm bill, which has become a contentious issue as Congress has been debating renewal of the bill.

"I think the loss of the rural development loan is definitely going to continue to hurt sales. That's what a lot of people, especially first time buyers, that's what they use."

The beneficiary of Crawford County's woes appears to be Sebastian County, according to Kilbreath, who points to the sales for the same period, which only declined 1.9%, holding at $17.138 million with 118 homes sold. In June 2012, the county saw 127 homes sold at a value of $17.470 million.

For the first half of the year, Sebastian County had an increase of 7.78% in home sales, with 564 homes sold with a value of $76.824 million from January to June. The same period last year saw 532 homes sold with a value of $71.277 million.

In Crawford County, only 219 homes were sold during the first half of this year at a value of $23.127 million, a 26.76% drop from the same period last year, when 271 homes were sold at a value of $31.578 million.

With more people looking to buy closer to their workplaces and with more jobs coming to Fort Smith, Sebastian County is ripe for growth, Kilbreath explained.

"I absolutely see Fort Smith outpacing Crawford County with the uptick in jobs and the Barling I-49 interchange, with the 700 jobs that will come in there. That will spur a lot of activity in Sebastian County."

He also sees a housing rush beginning as interest rates on 30-year mortgages have started to increase during the last month. He said as more people try to lock in lower interest rates, the result will be a surge in home sales, especially of mid-sized homes, even into late next year.

"I think for this area for the time, medium-priced homes are the ones that are going to sell pretty quickly. Sebastian County is definitely going to keep the momentum even with the (I-540) construction completed. I think the (potential) loss of the rural development is definitely going to hurt sales (in Crawford County). With the jobs in this area and the price of gasoline, I think you're going to see that Fort Smith is where home sales are going to continue to rise."

Home Sales Data
(January-June)
• Crawford County
Unit Sales
2013: 219
2012: 271

Total Sales Volume
2013: $23.127 million
2012: $31.578 million

Median Sales Price
2013: $104,500
2012: $109,950

• Sebastian County
Unit Sales
2013: 564
2012: 532

Total Sales Volume
2013: $76.823 million
2012: $71.277 million

Median Sales Price
2013: $114,900
2012: $113,000

Environmental consultants hired by Whirlpool submitted a final remedy work plan to the Arkansas Department of Environmental Quality yesterday (July 16) to address pollution of trichloroethylene (TCE) in the area north of its former Fort Smith factory.

In the plan, Whirlpool still pushes for "institutional controls" in order to address the risk posed from the cancer-causing chemical that was used as a degreasing agent by the company during the 1980s.

"These institutional controls will be used as an enforceable mechanism to control potential current exposure to on-site soil and groundwater and potential hypothetical future exposure to off-site groundwater. These institutional controls will be maintained until concentrations of COC meet the remedy objectives for a period of at least four consecutive quarters," the plan read.

An institutional control previously proposed by the company was a ban on the drilling of groundwater wells in the area of the TCE plume north of Ingersoll Avenue. The Fort Smith Board of Directors voted down the proposed ban, though Whirlpool still pushes for what is assumed to be some sort of a ban in this latest report.

"Whirlpool will record restrictive covenants on the site that will require future owners of the property to adhere to the recorded restrictions. In order to meet obligations associated with the off-site restrictions, Whirlpool will pursue off-site institutional controls after the acceptance of the final remedy by ADEQ in cooperation with residents and the City of Fort Smith."

In a memo to Fort Smith City Administrator Ray Gosack dated June 18, Whirlpool's Corporate Vice President of Communications and Public Affairs Jeff Noel said such a ban was still under consideration, even though it was voted down by the Board on March 27.

"Whirlpool Corporation remains committed to a longstanding plan to work with the property owners that were part of the original proposed well drilling ban area. Whirlpool is open to and considering various options to amicably resolve property owners' concerns and claims. Options under consideration include the implementation of a well drilling ban as well as enhanced residential assurances. It is important to note that any potential resolution must be assessed and carried out according to the appropriate legal process, and with full participation of the parties and their legal representatives."

Noel claimed that Whirlpool disagrees "with any claims that property values have been adversely impacted based upon consultation with a national real estate firm." The claim comes after Sebastian County Assessor Becky Yandell's office re-assessed properties in the area affected by the plume, resulting in a cumulative property value decline of 41.2% in the area.

As part of the final remedy work plan, Whirlpool has also specified a "public involvement plan" that will have the company seek public comment on proposed corrective measures to be implemented. The plan consists of the following:
• Establishing a local repository for project documents;
• Compiling a copy of the Administrative Record for public access to the repository;
• Providing public notice of the availability of the record and a request for comments on the record and the proposed corrective measures within 30 days; and
• Conducting a public meeting for all residents and city leaders to review and comment on the final corrective measure.

The document also detailed plans to use chemical oxidation to remedy the problem, which The City Wire reported on in a July 2 report.

"The science is sound and the approach is a proven remedy. There are many sites in the U.S. and Canada that use focused / targeted chemical oxidation to enhance the overall performance of natural attenuation by reducing significant mass in target areas. We are confident this approach is the best solution given the existing understanding of the site and current land uses," said a letter from ENVIRON Corp., the consultants hired by Whirlpool.

"The amount of pressure used during injection will be determined during field activities, as too much pressure could result in short circuiting (daylighting) of the oxidant. However, the addition of pressure at multiple pressure variations / cycles should assist in moving the oxidant further out into the formation, which in turn should increase the effective radius of influence at each injection well. The specific pressures and duration of injections will be field determined based on measured observations."

Whirlpool's plan submitted on July 16 said the plan will be implemented in two different phases. The company will also rely on a process known as Monitored Natural Attenuation (MNA), which the company said includes "a variety of naturally occurring physical, chemical, and biological processes that, under favorable conditions, substantially reduce the mass, toxicity, mobility, volume or COC concentrations in soil and/or groundwater. natural attenuation can be very effective in reducing the mass of COCs including the off-site plume."

Soil vapor monitoring will also be included in the plan, in addition to the monitoring of groundwater.

A schedule included with the document says a public meeting on the plan should take place on Aug. 25.

Greg Carman’s work to keep 45 trucks profitably engaged in a regional trucking company includes remaining positive, staying focused on priorities and not allowing technology to harm good personal relationships with employees and customers.

Carman’s parents, John and Diana, founded Fort Smith-based Carman Inc. in the early 1980s and grew a company that now employs about 65 people and operates with 45 trucks. Greg runs the sales side of the business, and his younger brother, Eric, manages the maintenance side of the business.

“When we were growing up, Eric was always the fixer. I was good on the sales side, and Eric was good on the maintenance side,” Greg explained, adding that he and Eric are proud to keep a business going that their parents worked hard to create. “We are really able to cover each other. He’s got my back and I’ve got his.”

But Greg admitted that in recent years it’s been tough to remain the “positive influence” a small business needs. Greg, who is active on the Board of Directors of the Arkansas Trucking Association, said the state and federal politics impacting trucking and the years of a tough freight environment caused him to have a cynical outlook. There was a point during which he noticed his negative aura was not good for the company.

“An organization can get bogged down, really bogged down with that (negativity). ... I had to step back and recognize that good things are happening and that you can’t lose sight of the positive things that are happening,” Greg said. “If the head of an organization carries that (negative attitude), then the danger is that it perpetuates.”

The other danger to a small company is when the boss is spread thin with non-business activities. In addition to the ATA Board, Greg is an active board member of Girls Inc. of Fort Smith, serves on the leadership team and Woodlands United Methodist Church, and is an active parent with his daughters who are part of a volleyball program that travels to tournaments in several states.

“I truly have to fight against being spread to thin. I truly have to keep tabs on the priorities. ... I consistently have to do that with myself, because I can get off track so easily,” Greg said.

One of those priorities, Greg said, is in monitoring employees and those important internal relationships within all small companies. Greg said part of that effort involves “hiring and keeping good people who know what they are doing” and let them do it.

“When you find those rare people who work hard and do the right thing, that’s a big help to any business. ... Yes, it allows me to concentrate on that (big picture) and what I need to be doing with that.”

Carman and Eric know the business from the office and the road. Prior to directly managing the business, the brothers worked as drivers. Greg drove for about 2.5 years.

“I thought I would just come in and get a desk and be an executive,” Greg said with a laugh. “But he (Dad) put me in a truck. At the time, I thought my dad was so horribly unfair.”

Greg said it didn’t take him long to realize the driving experience was the best thing his father did for him and his brother.

“We know what it’s like out there. ... We’ve seen just about every problem you can see,” Greg said.

Greg and Eric have worked to modernize operations, but are careful to use technology that allows them to “keep the values of the company” created by their parents. Greg said he’s seen many companies rush to adopt new technology, only to see it backfire when it diminished personal interaction between employees and customers.

“Our niche is with those personal relationships. Our customers know they can call me in the middle of the night. ... Try that with some large outfit,” Greg explained. “The large corporations don’t care about anything other than the price. Where true service is still a concern for them (customer), that’s the niche that I’ve carved out.”

That niche is working well, according to Greg, who said the first of the year began with “lackluster” business, but began to improve near the end of the first quarter.

“When we came out of February, all hell broke loose – in a good way,” Greg explained. “Right now, I’m out of trailers. I’m searching and begging to unload one of our trailers today so that I can load it.”

Another positive is that orders historically slowed in July as many Carman Inc. customers would scale back for plant maintenance or inventory shifts.

“That didn’t happen this year. It’s still going strong out there,” he said.

Fresh meat sold at U.S. grocery stores will soon have a label detailing where an animal was born, raised and slaughtered, with the labels costing an estimated $192 million a year, according to meat industry groups.

The more detailed Country-Of-Origin-Labels also mean that livestock will have to be tracked and segregated within country, and no commingling of animals that commonly moved in and out of neighboring Mexico and Canada.

The expanded COOL rules have drawn a heated reaction from the meat industry, prompting them to sue the U.S. Department of Agriculture, who finalized the rules in May.

Last week, eight organizations representing the U.S. and Canadian meat and livestock industries filed suit in federal court attempting to block the implementation of the mandatory (COOL) rules. Plaintiffs include the American Association of Meat Processors, American Meat Institute, Canadian Cattlemen’s Association, Canadian Pork Council, National Cattlemen’s Beef Association, National Pork Producers Council, North American Meat Association and the Southwest Meat Association.

The complaint said the rules compel speech in the form of costly and detailed labels and the regulation exceeds the scope of the mandate offering little or no benefit to the industry or consumers.

Steve Kay, publisher of Cattle Buyers Weekly, said the rules essentially work to undue a concerted 20-year effort to build a cohesive North American meat industry. He said young livestock commonly move across the national borders and is fed out in the United States. Those animals cannot be commingled under the new rules, which means retailers will likely limit their purchases to U.S. born, raised and slaughtered.

A Consumer Reports survey completed this spring found 78% of respondents said they prefer to buy items manufactured in the United States, most cited retaining manufacturing jobs and keeping American manufacturing strong in the global economy their reasons for buying American.

The American Meat Institute and other plaintiffs note in the compliant that all livestock and meat processed at federally inspected establishments in the U.S. and sold in interstate commerce are subject to the same health and safety requirements prescribed by the federal inspection statutes.


“Those products are also graded for quality according to a system administered by AMS (Agricultural Marketing Service) without variation based on where an animal was born or raised. In short, beef is beef, whether the steer or heifer was born in Montana, Manitoba, or Mazatlán. The same goes for hogs, chickens and other livestock,” the complaint notes.

Mark Dopp, AMI senior vice president of regulatory affairs, said in a recent webcast, “Shoes, may say ‘Made in the USA.’ They do not say ‘Leather from cattle born in Canada, harvested in the USA, tanned in South Korea and processed in the USA’, yet that is the sort of labeling that we are now being forced to apply.”

Retail organizations said the cost of segregating, tracking and labeling meat according to these complex new rules will force them to reject meat sourced from Canada or Mexico and stock only meat with the designation “Born, Raised, and Slaughtered in the United States.”

The complaint notes new labels will need to be larger, and many grocers will have to acquire new weighing and labeling machines to handle the complex sorting of packages for each possible label.

“Segregating and tracking animals according to the countries where production steps occurred and detailing that information on a label may be a bureaucrat’s paperwork fantasy, but the labels that result will serve only to confuse consumers, raise the prices they pay and put some producers and meat and poultry companies out of business in the process. Everyone loses under this rule,” Dopp said.

Processed food such as bacon, or marinated chicken or pork loin are exempt from the COOL requirement, so not all of the meat in the grocer case will bear the larger label.

Dopp said the rule is egregious and will create winners and losers in the meat industry based on geographic location near national borders and those who have the ability to further process and bypass the rule. The plaintiffs have asked the court for an injunction that would repeal implementation, which was supposed to begin July 1.

Kay said retailers are technically out of compliance with the law but are likely hesitant to invest in new labeling equipment until after the court has ruled.

Retailers began their “back-to-school” push earlier this year, but the National Retail Federation expects consumers will shell out $54 less per family this year compared to 2012.


A survey conducted by Prosper Insights & Analytics indicates families with school-age children will spend an average $634.78 on apparel, shoes, supplies and electronics, down from $688.62 last year. 
Total spending on back-to-school is expected to reach $26.7 billion, that does not include back-to-college.


“The good news is that consumers are spending, but they are doing so with cost and practicality in mind. Having splurged on their growing children’s needs last year, parents will ask their kids to reuse what they can for the upcoming school season.” said NRF President and CEO Matthew Shay.


 “As they continue to grapple with the impact of increased payroll taxes, Americans will look to cut corners where they can, but will buy what their kids need. It’s important to note, however, that spending levels are still well above where they were a few years ago,” he said.


Apparel retailers will get the lion’s share of the budget, as 95% of consumers with school-age children will spend an average of $230 on fall clothes and denim.
 Another $114 will be spent on shoes and $90 toward school supplies. Roughly half of the families surveyed plan to purchase electronics, new tablets or smart phones, which are slightly cheaper than a year ago.


Shay said 80% of the respondents said they are scaling back because of economic conditions. One in three said they would turn to the internet to do comparative shopping in hopes of saving some money.


With much of the country returning to school in just four to six weeks, that is only two or three pay cycles for many families.


Roughly half of the respondents said they would shop within one month to three weeks ahead of the first day of school in their areas.


“We continue to see a shift in shopping patterns during big spending events, where consumers typically head out early to take advantage of fresh inventory options and initial markdowns, then see a lull only to rev back up again when final sales appear,” said Prosper Consumer Insights Director Pam Goodfellow.

“They are hoping to spread out their budgets but still reap the benefits of getting the products their children want at the best values.”

Hospitality tax collections in Fort Smith and Van Buren are down for the first five months of 2013, but employment in the regional tourism sector was up during May.

Collections in Van Buren during the first five months of 2013 total $174,969, a slight decline of 0.77% from the $176,327 in the first quarter of 2012.

May collections were $36,898, down 1.2% from the $37,344 in May 2012. The city collects a 1% tax on lodging and a 1% prepared food tax.

Maryl Koeth, executive director of the Van Buren Advertising & Promotion Commission, said mixed results from hotels and restaurants suggest a trend among travelers.

“Lodging receipts are up slightly from this time last year, however, restaurants are down about one percent. This confirms what I am hearing from other tourism areas. Despite a sluggish economy people are still taking vacations. They are compensating for less disposable income by taking shorter vacations, a little closer to home and spending less on shopping and dining out,” Koeth explained.

During 2012, Van Buren hospitality tax collections totaled $425,554, up 5.2% compared to the 2011 collections. Hospitality tax collections in Van Buren during 2011 totaled $429,561, up 2.34% compared to 2010. The 2011 collections ended a two-year skid in Van Buren.

FORT SMITH
Collections in Fort Smith for the first five months of 2013 totals $302,038, down 2.8% compared to the same period in 2012. The gap is improving, however. The first quarter collections were down more than 6% compared to the 2012 quarter.

May collections were $61,457, down 7.9% compared to May 2012. The city collects a 3% tax on lodging. Part of the decline is attributable to a hotel being late with remittance because of a franchise change, said Claude Legris, executive director of the Fort Smith Convention & Visitors Bureau.

Legris said May revenue at the Fort Smith Convention Center was up almost 20% compared to May 2012. However, hotel occupancy in Fort Smith was down 2.7%.

“Early indications for June show another decline in collections because some of the Christian Congregation of Jehovah Witnesses (CCJW) events occurred in June last year and some other convention business last year that did not reoccur in 2013,” Legris explained in an e-mail note. “However the month of July is looking solid since all of the CCJW events have taken place in July and the timing of the AR Sheriff's Association was very good (in between the two CCJW sessions) and the addition of a District AME Church event just after the second CCJW session.”

During 2012, Fort Smith hospitality tax collections totaled $746,182, up 5.37% compared to the 2011 period.

TOURISM EMPLOYMENT, ARKANSAS COLLECTIONS

Employment in the Fort Smith regional tourism industry was 9,300 during May, up from 9,100 in April and more than the 9,200 in May 2012. The sector reached an employment high of 9,800 in August 2008.

Average monthly employment in the Fort Smith metro tourism sector ended a two year decline in 2012. During 2007, 2008 and 2009, the average monthly employment was 9,300. That fell to 8,700 during 2010, 8,500 during 2011, but rose to 9,000 during 2012. The sector reached an employment high of 9,800 in November 2008.

Arkansas’ tourism sector (leisure & hospitality) employed 101,200 during May, down from the 102,300 during April and less than the 102,600 during May 2012. At a revised 103,700, January 2013 marked a new employment high in the sector.

Arkansas’ 2% tourism tax receipts totaled $3.716 million for the first four reporting months of 2013, up 1.4% compared to the $3.663 million during the same period of 2012.

Arkansas’ 2% tourism tax receipts totaled $12.405 million during 2012, up 3.16% compared to the $12.025 million during 2011. The gains marked the third consecutive year of improving tourism tax revenue.

A local farmers market expects new business and continued growth following action taken by the Van Buren City Council this week.

On Monday (July 15), the city council approved an ordinance that would allow vendors selling hand-crafted items to take part in the city's local farmers market. According to Barbara Little, a member of the Van Buren Growers Association, the change was requested in order to grow the farmer's market.

"We couldn't accept crafters and we wanted our market to grow and there was favorable feedback."

Market Master Mitch Carolan said crafts had made a big difference at other farmer's markets across the state, so it was something he and the vendors wanted to try.

"I think it will (help). We'll just have to take a wait and see attitude. All of your other farmers markets, you know what a difference the crafts make. (It doesn't just benefit the craft vendor), it also benefits me (as a grower). Even though I don't sell crafts, you may see some produce you want. Or vice versa."

He said growth at the Van Buren Farmers Market, which started six years ago in downtown Van Buren and now finds itself in the parking lot of the Van Buren Public Library on Wednesdays and Saturdays from 7 a.m. to 1 p.m., has been slowed in recent years due to competition from other markets in the area, such as the Fayetteville Farmer's Market and the much closer Fort Smith Farmer's Market, which allows for the sale of hand-crafted goods.

"We've lost a couple of vendors who have left and gone to Fort Smith because of the crafts. When produce is weak, (crafts) still draw people. It's a win-win situation. We're hoping it does the same for us."

Produce has been especially weak this year, Little said, as unusually cool weather and a first-ever May snow blasted much of Crawford County.

"Our growing season started slow and (crafts) were still not included at that point. The tomatoes and stuff were not as ripe as usual. And vendors were wanting to sell crafts and because it wasn't written in (the city ordinance), we started to lose vendors."

Carolan said some producers did not survive the cold blast, which included several late freezes.

"We had the (cold) front at the first of May. I know people that lost their entire gardens. Generally by the first of May, you're picking cucumbers and stuff, but this year it was so wet and so cool, you couldn't get it planted and coming up without the frost killing it."

Wednesday (July 17) was the first day crafts could be sold and Little said there was quite a variety of goods.

"Today we had hand-made bows and arrows, we had hair bows and jewelry, some art, different things. And braided rugs," she said. "It has to be in accordance with the Arkansas state rules that govern any agriculture products for sale in a farmers market, like people making james and all of that. There's specific guidelines."

Previous attempts to grow the market from only eight vendors to today's count of about 25 vendors have included the incorporation of not only produce, but other foods.

"We have buffalo meat, cattle that are strictly grass-fed beef with no antibiotics," Carolan said.

New types of produce are showing up, as well, from farmers and gardeners who were not adversely affected by this year's unusually cold Spring, according to Carolan.

"Were getting some new stuff. I'm seeing more heirloom vegetables at our market. You're seeing that more and more. They don't want the genetically modified stuff. Another practice I'm seeing is we have very few farmers who use pesticides. Most of our people don't use any pesticides at all."

The result, he said, is better-tasting produce that keeps local shoppers coming back time and time again.

"I buy very little from the store because I know someone at the farmers market will have it. These chain stores, they ship it in and a tomato doesn't taste like a tomato. If I bite into a tomato, I want it to bite me back. I want my green beans to have some flavor to it. We had blueberries a few weeks ago. It tastes nothing like what you get in the store," he said. "There's no comparing truly fresh produce to what you buy in the store. There's truly no comparison. It's like comparing a cactus to a rose. You can't compare the two."

Problems with software in the Sebastian County Treasurer's Office do not appear any closer to being solved now that the company Treasurer Judith Miller had contacted about providing her financial software has pulled out of the project.

In a letter to Miller, Financial Intelligence President Robert Baird said the company was "very excited at the chance to add Sebastian County to our growing list of Satisfied customers."

Miller had sought to do business with Financial Intelligence, which focuses on financial software for county governments, after she said more than $500,000 was spent on a financial software system from a company known as New World, which was supposed to provide a single, seamless system that could be used by both the county comptroller's office, which is under the umbrella of the county judge's office, and the treasurer's office.

As previously reported by The City Wire, after 16 months of meetings and consultation with the company, Miller said she had not received a working system from New World.

"Now 16 months later, I have nothing in the treasurer's office whatsoever," she said. "And I decided that I'm done. To me they're in breach of contract."

After some initial wrangling, which Miller said included Hudson refusing to sign a contract with Financial Intelligence, she was eventually able to get the company retained to build a workable financial software system for her office, which she said would only cost the county $700 per month.

But in a letter dated June 1, Baird said he was pulling his company away from the project that Miller had fought hard to get Financial Intelligence to complete.

"Since you reached out to FI on April 17th, FI has participated in numerous discussions with the county's current financial software provider, New World Systems and the Sebastian County Information Technology Department; regarding the interface between our two systems," Baird wrote. "We appreciate the cooperation of the County's IT Department during our investigation of feasibility. We wish them the best of luck moving forward. After much soul searching, I regret to inform you that Financial Intelligence chooses not to provide service to Sebastian County at this time. This was a difficult decision but one that I believe is in the best long-term interest of the taxpayers give the current environment. There are a myriad of factors that we considered in the unique circumstances facing Sebastian County. We viewed the way things showed today as simply too much risk at this time."

Baird did not elaborate on his stated reasons for exiting the project, only to say that if "the current environment changes we would welcome the opportunity to revisit."

Miller said the reason the company pulled out was due to hostility it received from the county's IT department.

"My point, they told the IT department was hostile and they didn't want to come in. And that's just what they told me."

Hudson said Miller had "her opinion and I've got mine."

"I've spoke to the president of the company and I think there's been some misunderstandings, but I don't think that he was comfortable coming in when there was already a company here and it makes things more complex, so I don't think he was comfortable with that."

Hudson went on to say that he had already selected New World as the financial software system and he would like to see that system work.

"But they couldn't deliver a treasurer's package at all," Miller interjected.

Hudson disputed the point in a memo, explaining that there were two different options moving forward with New World.

"There are two options available to move the project forward at this time at little or no additional cost, 1) the interface to the existing Access database system in the Treasurer's office to the new .NET version of New World's financial software or 2) the development of a Treasurer's office system as a part of the .NET New World software system."

Miller said even though she wanted to work with Financial Intelligence, she now has to look to other options.

"I wanted to go with Financial Intelligence because they could do everything I needed, (including) a treasurer's package. They're all over the state (with their) treasurer's package and that's where I wanted to go, but since I can't, I'm going to make my Access program work."

Attempts to reach Baird by phone were unsuccessful.

A bill that would close tax loopholes in online shopping by giving states a mechanism to compel online retailers to charge sales taxes got a big boost today as conservative economist Dr. Art Laffer released a study that backed the Marketplace Fairness Act, a House bill sponsored by U.S. Rep. Steve Womack, R-Rogers.

According to Laffer's study, the MFA could generate "$563.2 billion in state GDP (gross domestic product) growth and 1.5 million new jobs nationwide - with $6.5 billion in GDP growth and 22,600 new jobs in Arkansas alone - by 2022," according to a press release from Womack's office.

The study, titled "Pro-Growth Tax Reform and E-Fairness," attempts to show the favorable impacts that could be made by having states collect revenue from online shopping at various retailers.

"The arguments in favor of this legislation are overwhelming. It is not only fair to level the playing field for our local small businesses, but Dr. Laffer's study proves the concept is a crucial step towards greater growth and job creation through lower tax rates across the board. We hope the House will follow the Senate's lead and pass e-fairness legislation that corrects the current inequity and allows forward-thinking governors the opportunity to lower tax rates and jumpstart economic growth in their states," wrote Colin Hanna, president of the group Let Freedom Ring, in the study's forward.

According to the study, "sales taxes and other broad-based tax regimes with fewer loopholes and lower rates are the least damaging taxes to state economies and state employment."

The estimates listed in the study show that 1-year gross state product (GSP) growth in Arkansas could be 4.13%, with an additional $6.5 billion in GDP, resulting in 1.32% employment growth in the state by 2022.

Recent unemployment numbers showed the state's jobless rate at 7.3% in May, up from 7.2% in April and unchanged from the same period last year. The jobless rate has been at or above 7% for 52 consecutive months in Arkansas.

Not only have jobless rates remained high in Arkansas and across the nation, but the level of growth has stalled, as well, according to Laffer's study.

"The simple arithmetic tells it all. Due to the drop in the country's economic growth rate, we are currently close to 15% poorer than we would have been had the pre-2000 growth rate persisted. And, less national income compounds the federal and state governments' fiscal problems. Slow growth leads to reduced tax revenues and more poverty, which, in turn, leads to greater need for government support programs. And deficits can't go on forever," he wrote. "Tax reforms that broaden the tax base and use the estimated increase in revenues (on a  static basis) to lower marginal tax rates can help revitalize the U.S. economy and increase overall national wealth."

The study also points to purchasing trends, which it says hurts small brick-and-mortar businesses.

"Current purchasing trends (e.g. the growing market share of Internet sales versus brick and mortar retail sales) will for sure continue if Internet sales remain effectively tax exempt. …Linearly projecting out the current growth path of e-commerce, by 2022, 8.6% of all retail trade sales will be conducted via e-commerce, which is almost 60% larger than total sales a decade prior."

Womack said the study supports the premiss of his legislation - that passing the Marketplace Fairness act would be good for business and good for states struggling to balance their budgets.

"Our small retail businesses can grow, create jobs and prosper if Congress passes the Marketplace Fairness Act and closes this unfair and confusing tax loophole - one that amounts to a subsidy for out-of-state businesses. Dr. Laffer's study clearly shows this. And it's not just small businesses that stand to benefit," he said. "Leaders like Gov. Scott Walker of Wisconsin and Gov. John Kasich of Ohio have already implemented plans to cut their state income taxes once they are enabled to collect this due - not new - sales tax, allowing taxpayers to also see significant growth from tax cuts MFA makes possible."

But not everyone is in favor of MFA. An open letter signed by conservative activists, such as Americans for Tax Reform President Grover Norquist, says, "Rather than pass this misguided legislation, Congress should pursue alternatives that encourage tax competition and preserve the American standard of geographical limits to tax authority."

Womack has appeared undeterred in his efforts, saying that there is "no question in my mind that when Congress passes MFA, more tax cuts will be first thing on our state's agenda, as well as others across the country.

"I'm thrilled by Dr. Laffer's study and encouraged by the tremendous economic benefits it highlights. So, let's level the playing field for our brick and mortar retail businesses once and for all."