The city of Fort Smith has responded in a court filing to a lawsuit alleging that the city had violated the Arkansas Freedom of Information Act when City Clerk Sherri Gard twice contacted city directors regarding the removal of an item from a meeting agenda.

In the filing by City Attorney Jerry Canfield and attorney Michael Redd, who is representing City Director Keith Lau, the men acknowledged that Gard had polled board members regarding removing two items from meeting agendas after City Director Mike Lorenz called Gard to initiate the process and said it was perfectly acceptable under Arkansas law.

The items in question, placed on the agenda by City Director Philip Merry and seconded by City Director Pam Weber, included a resolution that would have hired an auditor to review legal billings from Canfield's law firm Daily and Woods to the city after allegations were leveled by attorney and blogger Matt Campbell that the city was being charged for services not rendered and overcharged for other services. Another resolution would have established a committee to review whether the city should continue with contracted legal services provided by Daily and Woods or hire in-house legal counsel.

"Defendants admit that the Fort Smith Code contains procedures for the formulating of agendas of meetings of the Fort Smith Board of Directors," Canfield writes in his response. "The Arkansas General Assembly has delegated to municipalities, including municipalities operating under the city administrator form of government, the power to adopt rules to govern the formulation of agendas for meetings of the board of directors of the municipalities."

The lawsuit, filed by attorney Joey McCutchen on behalf of Fort Smith resident Jack Swink, said cities could not impose ordinances that would "give public officials the power to do something that would otherwise be prohibited under state law, including the open-meetings provisions of the AFOIA."

Due to the belief by Swink and McCutchen that the city ordinance allowing directors to remove items from agendas that led to the lawsuit, the lawsuit asks that the ordinance be invalidated. But in the response dated July 18, Canfield said invalidating the city ordinance that allows one director to ask that an item be removed so long as three other directors also notify the city clerk that they want the item removed would impede the city's ability to conduct business.

"Further, the granting of relief to the Plaintiff under the allegations of the Plaintiff's Complaint would render both the public meetings provision of the FOIA (A.C.A. § 25-19-106) and the criminal penalty provision (A.C.A. § 25-19-106) unconstitutionally vague, violating the Fifth and Fourteenth Amendments to the U.S. Constitution and Article 2, § 8 of the Arkansas Constitution."

The response asks that the lawsuit be dismissed against defendants Gard, Lau, Lorenz, City Director George Catsavis, Vice Mayor Kevin Settle and the city of Fort Smith.
The city previously lost a 2002 lawsuit by Fort Smith resident David Harris that was appealed to the Arkansas Supreme Court regarding then-City Administrator Bill Harding's polling of city directors regarding their votes on a property purchase.

One positive quarter does not a turnaround make, but Van Buren-based USA Truck posted second quarter net income of $722,000, better than the $1.398 million loss in the same quarter of 2013 and the first quarter in the black in three years.

Per share earnings of 7 cents also beat the consensus estimate of a 2-cent per share loss. Total revenue for the quarter was $153.298 million, better than the consensus estimate of $152.32 million.

For the first half of 2014 the trucking company has lost $867,000, better than the $3.872 million loss posted during the same period of 2013. USA Truck posted a net loss of $9.11 million in 2013. While an improvement compared to the net loss of $17.671 million in 2012, it marked the fifth consecutive year of losses for the trucking company.

“We posted our first quarter of positive net income in three years,” President and CEO John Simone said in the earnings report. “While continuing the work of implementing our turnaround plan, the progress we are making is evident in virtually every area of our business. ... The Company’s improved second-quarter performance was driven by a 12.1% increase in base revenue, while operating expenses net of fuel surcharge collections increased only 7.4%, yielding a 410-basis point improvement in operating margin – a testament to the multiple revenue growth, operational and cost-efficiency initiatives we have implemented.”

Investors liked the report. The thinly-traded USA Truck shares (NASDAQ: USAK) were up more than 4.5% in early morning trading after closing Wednesday at $18.58. During the past 52 weeks the share price ranged from a $19.57 high to a $5.28 low.

The second quarter numbers would have been even better, but the company had a $2.2 million charge – 13 cents per share – to cover legal costs primarily related to the effort to defend against a hostile takeover attempt by Knight Transportation. Knight and USA Truck agreed to a “standstill” arrangement in early February, which effectively ended the takeover attempt.

Another boost to income and revenue is the continued growth of Strategic Capacity Solutions (SCS), USA Truck’s brokerage and logistics division. Revenue in the division for the quarter was $41.762 million, up over the $30.028 million in the 2013 quarter. Operating income in the division was $5.991 million in the quarter, more than double the $2.163 million in the 2013 quarter.

For the first half of 2014, SCS operating income was $11.069 million, up 233.9% compared to the $3.315 million in the same period of 2013.

“This performance was made possible by crisp execution within this highly efficient service against the backdrop of a market characterized by strengthening demand and tight capacity,” Simone said in the statement. “Our SCS segment accounted for over one-third of our consolidated base revenue during the quarter, substantially strengthening and diversifying our integrated business model.”

Despite the better numbers, the company continues to struggle in a few key areas. The operating ratio for the first half of the year was 104.8%, up from 104.4% in the same period of 2013. The ratio indicates that company lost 4.8 cents for each dollar in revenue. Also, the empty mile factor during the first half of 2014 rose to 12.3% from 11.4% in the same period of 2013. The average number of seated tractors fell from 2,115 in the first half of 2013 to 2,040 in the 2014 period. The number of parked trucks rose from 4.9% in the first half of 2013 to 8% in the first half of 2014.

However, tighter capacity and increased demand across the U.S. freight industry allowed the company to command higher rates. The base revenue per loaded mile was $1.72 in the first half of 2014, better than $1.635 million in the same period of 2013.

“Although fixed costs were pressured during the quarter by elevated employee medical benefit plan costs, we achieved improvements in critical areas such as insurance and claims, fuel and maintenance costs. We also took steps we believe will increase our seated truck count, which remains one of management’s top priorities as the availability of qualified drivers continues to be problematic across the truckload industry,” Simone explained in the report.

A study released by the National Association of Manufacturers (NAM) on Thursday said the Environmental Protection Agency’s (EPA) new ozone standards could cause Arkansas to lose more than 10,000 jobs, pay more than $240 million in environmental compliance costs, and shut down most of the state’s coal-fired electric generation.

“Manufacturing in the United States is making a comeback, and we’re reducing emissions at the same time, but tightening the current ozone standard to near unachievable levels would serve as a self-inflicted wound to the U.S. economy at the worst possible time,” NAM President and CEO Jay Timmons said. “This rule would undermine our work to expand manufacturing in the United States, making it almost impossible to increase operations, create new jobs or keep pace internationally.”

Altogether, according to the study conducted by NERA Economics Consulting, NAM said the EPA’s controversial plan to cut carbon dioxide emissions could reduce the nation’s GDP by $270 billion per year and carry a compliance price tag of $2.2 trillion from 2017 to 2040, increasing energy costs and placing millions of jobs at risk.

At this price, the NAM study estimates that it would be the most expensive regulation the U.S. government has ever issued, Timmons said. “Ozone standards set at this level could break us,” he said.

At the direction of President Obama, the EPA released its Clean Power Plan on June 2, cutting so-called “dirty air” emissions 30% by 2030 from 2005 levels. At the time, critics said it would essentially end Arkansas’ and the nation’s reliance on coal-fired electricity generation.
www.thecitywire.com/node/33325

Under the new guidelines, Arkansas regulators and stakeholders will also have an option to develop and submit a workable plan beyond the earlier announced June 2016 deadline. On June 25, nearly 20 stakeholder groups and state regulators from the Arkansas Department of Environmental Quality and the Arkansas Public Service Commission met to discuss how to implement the new greenhouse gas standards in Arkansas.

DOING THE IMPOSSIBLE
At that meeting, Chuck Barlow, vice president of environmental policy and strategy for New Orleans-based Entergy Corp., called the new EPA rules “another level of hell.”

NAM officials said their 144-page study was “the most rigorous examination” of EPA ozone regulations to date. The nation’s largest manufacturing association called on the Obama Administration to delay implementation of the more stringent ozone standards, or keep today’s carbon emission rules at the current level of 75 parts per billion.

“We are rapidly approaching a point where we are requiring manufacturers to do the impossible. The new EPA (rules) should be entirely off the table,” said NAM Vice President of Energy and Resources Policy Ross Eisenberg. “We hope the EPA takes us up on this offer. They need to take the time to get this right.”

Here are some additional highlights of the study finding that ozone standard from 75 parts per billion (ppb) to 60 ppb could:
• Reduce U.S. GDP by $270 billion per year and $3.4 trillion from 2017 to 2040;

• Result in 2.9 million fewer job equivalents per year on average through 2040;

• Cost the average U.S. household $1,570 per year in the form of lost consumption; and

• Increase natural gas and electricity costs for manufacturers and households across the country.

CONSUMER PRICE HIKES
In Arkansas, NAM officials said that new ozone regulations could cost Arkansas hundreds of millions of dollars to reduce emissions to federally required levels. For example, the new EPA rules would push up residential electricity prices by 15% and natural gas prices by 32%, the report said.

NAM officials said the EPA has identified only 38% of the controls needed to meet the standard. The remaining 62% of reductions would have to be met with unknown controls that the EPA has not yet identified but which would likely have to include early shutdowns of existing facilities, equipment and vehicles.

Eisenberg said NAM has sent the study to EPA officials and asked for a meeting to discuss the details and methodization of the new report. The new NAM report is another high-profile study that critics of the new EPA standards can use to put political pressure on the EPA to delay implementing the new stricter greenhouse gas rules.

The U.S. Chamber of Commerce has issued a 71-page report saying the EPA’s plans to regulate carbon dioxide emissions from power plants will cost America’s economy more than $50 billion a year between now and 2030.

Randy Zook, President and CEO of the Arkansas State Chamber of Commerce/Associated Industries of Arkansas, said he hopes his membership forcefully voices its opposition to the EPA rules.

“Today’s study should serve as a wake-up call to job creators in Arkansas and across the nation,” Zook said. “The report clearly demonstrates the exorbitant costs that come with a more rigid ozone standard, and the severe impact that such a revision would have on our state economic outlook. These costs will make it almost impossible for Arkansas manufacturers and businesses of all stripes to create new jobs, or even keep pace with international competitors.”

ARKANSAS RULE DEVELOPMENT
In Arkansas, The PSC and ADEQ have been tasked by Gov. Mike Beebe to oversee the process of developing new rules to meet the EPA mandate in Arkansas. ADEQ is in the process of preparing the necessary paperwork to seek the assistance of a meeting facilitator for future stakeholder meetings. Also, the public comment period on the EPA docket began June 18 and must be received by federal regulators on or before Oct. 16, 2014.

Meanwhile, EPA Administrator Gina McCarthy has been criss-crossing the nation to get public input on the prosed Clean Power Plan. This week, the EPA held four public hearings in Washington D.C., Atlanta, Denver and Pittsburgh, to give interested parties an opportunity to comment on the proposed rule.

EPA predicts that when the proposed plan is fully implemented in 2030, carbon emissions from these sources will be 30% below 2005 levels. Obama administration officials say the proposal will protect public health, move the United States toward a cleaner environment and fight climate change while supplying Americans with reliable and affordable power.

To date, the EPA has received around 300,000 comments on the proposal, and anticipates hearing oral comments from about 1,600 people.

Retailers from Wal-Mart to local boutiques expect a busy weekend as Arkansas shoppers take advantage of the state-sponsored tax holidays beginning Aug. 2 and running through Aug. 3. 

Shoppers may purchase clothing up to $100 per item, unlimited school and art supplies and up to $50 in clothing accessories and pay no state or local sales tax on those purchases, a savings of nearly 10% in Northwest Arkansas and the Fort Smith metropolitan area.

Electronics purchases are not part of the tax free program but Wal-Mart announced Thursday (July 31) that it will unveil price roll-backs in-store and online for top electronics and other college dorm room essentials. Wal-Mart said its rollbacks and special buys are timed to the start of sales tax holidays in select states and at a time that data shows a spike in customers shopping online for back-to-school items. 

“The combination of families stocking up on school supplies, college students shopping for electronics and select state sales tax holidays makes this one of the busiest times of the year for us,” said Steve Bratspies, executive vice president, general merchandise for Walmart U.S. “We know that customers are searching for ways to save as they prepare for the fall. That’s why we’re making it easier for them to get back to class for less with great deals available on Walmart.com and in our stores.”

Sales tax holidays are a big part of the back-to-school season for many families in Arkansas – for some, it can mean enough savings to purchase extra an shirt or a backpack, Wal-Mart noted.

“We’re prepared for this busy time with the items that matter most this season like supplies and back-to-school clothing,” the retailer said in a statement.

Wal-Mart said the products in biggest demand and the most well-stocked include: 
• 24-count Crayola Crayons;
• Elmer’s School Glue; 
• binders; and
• notebooks and notebook paper. 

The retailer said big trends for 2014 include items featuring characters from Disney’s Frozen and Captain America: The Winter Soldier. 

It’s not the just large retailers who can benefit from tax-free weekends, according to the National Federation of Independent Businesses. Retailers of all sizes should leverage these one-day or weekend shopping events with sales, coupons and more, according to Andy Ellen a spokesman for the organization.

"When the tax holiday is offered, it drives a lot of foot traffic, both for the items that are tax-free that weekend as well as taxable items," Ellen said. 

Sixteen states are offing tax holidays in 2014, according to Diane L. Yetter, president of Chicago tax-consultancy firm YETTER. 

Not everyone is excited about the sales tax holiday as some groups cite a loss of state revenue.

“The primary reason Arkansas began offering the tax-free weekend was because consumers living near border states were believed to be shopping in those states that offered the tax free savings. Now retailers in state don’t lose out to neighboring Oklahoma, Texas and Missouri,” said Kathy Deck, director for the Center for Economic Research at the University of Arkansas.

She said the state-sponsored holiday does promote walk-in traffic for retailers and it helps to coordinate when consumers shop for the covered back-to-school items given they have the means to purchase them during the stated weekend.

Deck said it is not clear how much tax revenue the state looses annually from the one weekend of tax free incentive. But when she factors in that Arkansas consumers are shopping more in-state, Deck said that is money that at one time was flowing elsewhere.

“Two things are likely, consumers might spend a little more than they normally would because they are getting more for their money without paying taxes. There is also the fact that they are shopping during a promotional period which could mean they buy items that had not planned,” Deck said.

Economist Liz Malm of the Tax Foundation, notes that sales tax holidays do not promote economic growth or significantly increase consumer purchases. She sad the evidence shows that they simply shift the timing of purchases. Some retailers raise prices during the holiday, reducing consumer savings.

The Arkansas Department of Finance shows the complete rules for the state-sponsored tax-free purchases on its website.

A new flurry of polling shows Republicans with a solid victory in one Congressional District, advantages in two other districts, and an air-tight race for the remaining district in Central Arkansas. U.S. Rep. Steve Womack, R-Rogers, is safe in the 3rd District, and GOP candidate Bruce Westerman has a lead in the 4th District race against Democrat candidate James Lee Witt.

The latest round of Talk Business & Politics-Hendrix College polling centered on four Congressional District level surveys that provide a first glimpse at this fall’s congressional match-ups.

“Rather than obsess on the specific numbers in these head-to-head races at this juncture of the election cycle, I’d encourage readers to view the big takeaways and some cross tab data analysis to interpret these results,” said Roby Brock, Talk Business & Politics Editor-in-Chief. “With little advertising in these match-ups so far and with the suffocation of messaging from the Senate and Governor races, the Congressional campaigns have taken a back-seat this cycle. I expect campaign spending in the final 90+ days to impact the current state of these races.”

The four polls that construct these Congressional District results were conducted July 22-25 in all four Congressional districts. The surveys used a combination of IVR technology and live caller connections. The margins of error fluctuate for each district, but range from +/-4.5% to +/-4.9%.

The Congressional head-to-head questions were the first question asked in our survey after determining voter participation in the November general election from a list of likely Arkansas voters in each Congressional District. Only voters who answered in the affirmative for participation were allowed to complete the poll.

Congressional District 1
Among 450 respondents, with 20% being cell phone users, the First District survey has a margin of error of +/- 4.6%.

Q: In the race for Congress in your congressional district, the candidates are Republican Congressman Rick Crawford, Democrat Mayor Jackie McPherson, and Libertarian Brian Scott Willhite. If the election for U.S. House were today, which candidate would you support?
47.5% Republican Congressman Rick Crawford
33% Democrat Mayor Jackie McPherson
3% Libertarian Brian Scott Willhite
16.5% Undecided

Takeaways: As an incumbent, Crawford remains poised to capture enough of the undecided votes to win his re-election campaign. But as our polling has suggested over the past two years, there has consistently been a sizable number of voters who remain unfamiliar or undecided with him. The 16.5% undecided suggests Crawford is still not a household name in the district.

Congressional District 2
Among 483 respondents, with 19.5% being cell phone users, the Second District survey has a margin of error of +/- 4.5%.

Q: In the race for Congress in your congressional district, the candidates are Democrat Patrick Henry Hays, Republican French Hill, and Libertarian Debbie Standiford. If the election for U.S. House were today, which candidate would you support?
43% Democrat Patrick Henry Hays
44% Republican French Hill
3% Libertarian Debbie Standiford
10% Undecided

Takeaways: The Second Congressional District, which has elected Democrat Vic Snyder and Republican Tim Griffin in recent years, appears to be a toss-up at this point. Throw any number of variables in this race — age, gender, ethnicity, geography, the margin of error — any way you slice and dice it, this race is competitive.

Congressional District 3
Among 408 respondents, with 17% being cell phone users, the Third District survey has a margin of error of +/- 4.9%.

Q: In the race for Congress in your congressional district, the candidates are Libertarian Grant Brand and Republican Congressman Steve Womack. If the election for U.S. House were today, which candidate would you support?
20% Libertarian Grant Brand
57% Republican Congressman Steve Womack
23% Undecided

Takeaways: The Third District remains solidly Republican and without a Democratic challenger, Cong. Steve Womack is on cruise control to re-election. The larger undecided block may reflect dissatisfaction with no Democratic choice in the race.

Congressional District 4
Among 439 respondents, with 15% being cell phone users, the Fourth District survey has a margin of error of +/- 4.7%.

Q: In the race for Congress in your congressional district, the candidates are Republican Representative Bruce Westerman, Democrat James Lee Witt, and Libertarian Ken Hamilton. If the election for U.S. House were today, which candidate would you support?
48% Republican Representative Bruce Westerman
34% Democrat James Lee Witt
3% Libertarian Ken Hamilton
15% Undecided

Takeaways: There appears to be a Republican advantage in this race, which has really yet to heat up. Westerman won his GOP primary, but it was his opponent who did the major advertising. Neither Westerman nor Witt have spent major money on paid media for the general. With four TV media markets in the Fourth, spending by the candidates or third party groups could cement or alter these results quickly, as we saw in the GOP primary.

ANALYSIS
Dr. Jay Barth, professor of political science at Hendrix College, offered the following analysis of the results.

Second Congressional District
At this stage, the battle for the open seat in central Arkansas’s Second Congressional District appears to be the one to watch moving into the stretch run of campaign 2014. Former North Little Rock mayor Pat Hays has been well-served by his years of visibility in that office in the sole media market in the district and is in a statistical tie with Little Rock banker French Hill, coming off an impressive GOP primary victory in May.

Patterns we have seen in other races emerge in this race. Both are in exceedingly strong shape with their fellow partisans, but Hill leads comfortably (53% to 30%) with independents. A significant gender gap expresses itself as Hill leads 50% to 40% with men and Hays leads 46% to 40% with women. Finally, typical racial patterns emerge with Hill leading among whites and Hays leading strongly among African-Americans (although Hays’s support among African-Americans – at 80% to 7% – is particularly solid for a Democratic candidate this cycle, as will be noted below).

It should be pointed out that our Second District sample is flawed in that it undersamples African-Americans from Pulaski County, bringing down the overall African-American percentage to 9%, and oversamples whites from Pulaski County. Pulaski County voters compose 60% of our sample in contrast to approximately 55% of the 2012 vote. Democrats hope to best their 2012 turnout in the Democratic-swinging county, but 60% of the district vote would be exceptional.

However, when the sample was re-weighted to take geographical and racial patterns into account, the race shifted only marginally, to a 44% to 44% tie indicating the closeness of the race and the importance of turnout in determining the eventual winner.

Cross tabs of the Pulaski and non-Pulaski County votes show Hays with a 47% to 43% lead in both men’s home county, but Hill leading 47% to 38% in the suburban counties surrounding it. At present, Hays is underperforming for a Democrat in Pulaski County and Hill is underperforming for a Republican in the counties outside of the state’s largest county. The question: Do those patterns hold, keeping the race exceedingly close, or does either Hill or Hays make a move in a race that may well be overshadowed by the U.S. Senate and gubernatorial races? Editor’s note: Dr. Barth’s household has contributed financially to both the Hill and Hays campaigns.

Fourth Congressional District
A different pattern emerges in the race for the other open seat. Coming off a victory in the GOP primary, State Representative Bruce Westerman is in strong shape at this point against former FEMA Director James Lee Witt in the Fourth Congressional District.

Democratic nominee Witt has to solve several electoral problems if he is to close the gap with Westerman in the coming months. First, Westerman is destroying the Democratic nominee among independent voters, leading 57% to 23%. Witt will portray himself, like Hays in the Second District, as a nonpartisan problem solver but the fact that Independents are now behaving much like Republican partisans in the Fourth District makes that a tough challenge.

Second, at this stage, Witt appears to face some challenges with African-American voters. One in five of the district’s African-American voters express support for Westerman and, just as problematically, fully one in four African-American voters are undecided in the race suggesting that the Witt campaign must engage in more effective outreach among African-Americans in the coming weeks. As the race proceeds, Witt will likely attempt to attach himself to President Bill Clinton – still exceedingly popular with the state’s African-American voters. Bringing African-Americans fully into the Democratic fold in this race is particularly important in a district with a significant African-American electorate.

At this stage, a big advantage for Westerman. The key question: Can he hold off the advertising barrage coming from a well-funded Witt in a massive district where multiple media markets means that advertising can shift voting patterns quickly?

The Incumbents
First District Congressman Rick Crawford has a solid 47.5% to 33% lead over Heber Springs Mayor Jackie McPherson driven heavily by his 61% to 14% lead with independent voters in our sample. Crawford’s continued low name recognition for a veteran congressman, shown in previous surveys, is holding down his lead and keeping a chunk of voters (16.5%) in the undecided camp. This presents some opening for McPherson if he were able to pull together funding to reach across the large, mostly rural district with its multiple media markets. Like Witt, McPherson will also have to bring African-American voters, historically strong Democratic voters, back into the fold (at this stage, one in five express support for Congressman Crawford) as well as closing the chasm with independent voters.

Finally, one thing is completely clear: Third Congressional District incumbent Steve Womack appears on his way to a strong re-election. Lacking a Democratic opponent, Womack is left to battle Libertarian Grant Brand. Womack shows a solid majority in his race for a third term.

Van Buren's eligibility for the Rural Development loans appeared safe following passage of a new federal Farm Bill earlier this year, but the community was dealt a blow Thursday (July 31) after it learned the city was no longer considered a rural community eligible for the loans.

According to Karen Phillips, housing and development director at the Crawford-Sebastian Community Development Council, the local administrators of the USDA Rural Development Loan program began looking at eligibility requirements after passage of the Farm Bill and noted that Van Buren was no longer eligible in part based upon its proximity to Fort Smith, meaning the community will officially lose eligibility status on Oct. 1.

Vickie Davis, an agent with Sagely & Edwards Realtors in Fort Smith, told The City Wire that eligibility requirements state that a community with no more than 35,000 residents must not be considered part contiguous part of a metropolitan statistical area. If the Arkansas River did not divide the two cities, Van Buren would be a contiguous neighbor of Fort Smith and is included in the MSA.

A meeting held at the USDA's office on Brooken Hill in Fort Smith today, featuring USDA State Director Lawrence McCullough, confirmed the loss of the loans for the community of 23,000.

"I guess everyone was confused about what the purpose (of the meeting) was," Philips said. "It was just to discuss Van Buren's rural eligibility, so that gave us at least a glimmer of hope thinking that they were wanting to hear comments from us, facts and all of the details about Van Buren and why it should be eligible. In the end, the said it was a done deal and Van Buren would no longer be eligible."

The Rural Development Loan, Philips said, allows low income residents to purchase a home with no money down and lower mortgage insurance premiums than traditional residential financing options.

"Their income limits went into the $70,000 range before the guaranteed loan part (would kick in), which meant you could get less mortgage insurance and no down payment requirements. It was a good option to get affordable payments and purchase without a large amount of money saved up first. It was a good option for everyone, not just low income families."

Executive Director Jackie Krutsch of the Van Buren Chamber of Commerce said the real hurt will likely not necessarily be middle class families, but those who would not be able to realize the dream of homeownership without the Rural Development Loan. She cited per capita income figures to show that Crawford County falls below other counties and the state in salary. In 2011, figures she cited from the U.S. Bureau of Economic Analysis listed Crawford County has having a per capita average income of $27,830. Statewide, the figure stood at $34,032 while just across the river Sebastian County's per capita average annual income was $38,513.

"You can see the difference between Sebastian and Crawford Counties is pretty significant," she said.

While the change in status for Van Buren could hurt homebuyers, Krutsch noted the impact it would have on mortgage originators, as well.

"Our home mortgage originators are very concerned about how this could impact their business and individual clients wanting to purchase a home," she said.

Developers are also likely to be impacted, Krutsch said, noting that neighborhoods throughout the community her chamber serves have focused on serving customers depending on Rural Development loans.

"Even if they (purchasers) don't have the down payment, a family of four could get into a house in the price range of $130,000 to $140,000. In Van Buren, there have been a lot of housing developments in the last 15 years in the price range for Rural Development guidelines. In the right price range, essentially. When you limit that funding mechanism, then you've taken those people out of the market."

Davis said the most likely scenario as far as impact is concerned is more buyers will buy homes outside of the Van Buren city limits in order to qualify, likely spurring growth in other communities.

"I think it's just going to shift people from Van Buren to outlying communities elsewhere in Crawford County. It's just going to put a lot of people out of buying a home in Van Buren because a down payment can get expensive. So I think it will be quite a bit of a hit (to the local economy)," Davis said.

For buyers in Van Buren looking to get in before the Oct. 1 change in eligibility, Philips said it was not too late, but potential buyers had to act fast with their mortgage lenders.

"The requirement to have an application to USDA is by Sept. 30. I definitely would not wait that long, though. They need to act as soon as possible to turn in an application and then talk to their local lender specifically about contract deadlines," she said, adding that other programs within USDA, such as the "Guaranteed Loan," may have other requirements that should be verified with a lender.

The port of Van Buren is expanding with the addition of a new 15,000-square-foot bulk storage building to be built by Five Rivers Distribution, according to Five Rivers Distribution President Marty Shell.

Shell, an operator at the port in Van Buren and the operator of the port of Fort Smith, made the announcement during Thursday's (July 31) Fort Smith Port Authority meeting.

"There's no AEDC (Arkansas Economic Development Commission) money, there's no grants, there's nothing out there. It just comes straight out of our pocket. But we see a heavy, heavy need for bulk storage in this area," he said.

The news that Five Rivers was constructing its own bulk storage building came at the same meeting where the port authority was to discuss plans for a new bulk storage building at the Port of Fort Smith. The new building is expected to cost between $700,000 and $900,000, Fort Smith Deputy City Administrator Jeff Dingman said Thursday, adding that the port authority had applied for a $200,000 grant from the Arkansas Waterways Commission in order to defray some costs of a new building.

Competing for the grant from the AWC are the ports at Little Rock, Pine Bluff, Osceola, and West Memphis, with Dingman noting that the AWC was unlikely to give a single port the entire grant but would likely split it between the five ports that had made the applications.

The largest part of the funding for the bulk storage facility is to come from a loan originating with the Arkansas Economic Development Commission, Dingman said, adding that if the port comes up short on the $200,000 grant from the AWC it could instead scrap plans for the new building in favor of using the money on other projects.

"There are still a lot of parts of that that are still as unknown today as the last time we talked about it, really. I think if we end up with whatever we end up and it's not enough to do our building project, then like we talked last time, we can request authorization to use it for some other type of improvement at the facility. But whatever we get, we can use. We just don't know if we can use it for … if it will be enough to make our building project work or not."

Shell said Fort Smith was the only port to request for a new building, with other ports requesting to use the so far unknown amount of grant money for river dredging and maintenance issues.

Even though the port authority is still moving forward with its plans for a bulk storage building, Shell said building an additional storage facility at the Van Buren port was a necessity for customers who need space now and cannot wait until the port authority finds out sometime in November whether it received the $200,000 grant necessary to begin construction.

"We still support, will still continue on, would still like to see the Port of Fort Smith develop a bulk storage warehouse over there, as well. But we have customers just telling us that they need something quickly and we figured we could do it privately faster than we could publicly, so we've decided to build a 15,000 square foot (facility),” Shell said.

Dirt work on the site is almost complete, Shell said, adding that Five Rivers would soon accept construction bids. He would not disclose the cost to construct the facility and added that AEDC and other funding options were not being used since the facility would not add additional jobs to the economy in the near term.

A public meeting will be held on the grant application made by the Fort Smith Port Authority, Dingman said, with Shell adding that Sen. Jake Files, R-Fort Smith, would attend to advocate for Fort Smith to receive its share of the funding. Legislation Files sponsored in the Arkansas General Assembly made the grant money available through the AWC.

The race for Arkansas governor made a stop in Fort Smith Friday (Aug. 1) with Republican Asa Hutchinson and Democrat Mike Ross each addressing a crowd of 325 at the Fort Smith Regional Chamber of Commerce's First Friday event.

Each candidate was given 15 minutes to make their case to Fort Smith business leaders, government officials and the public, followed by a five minute question and answer session. With the toss of a coin, it was determined that Hutchinson would address the crowd first.

The former congressman and Fort Smith native laid out a series of six issues he said were important to not only Fort Smith, but to the state and would be priorities should he be elected the state's next governor in November.

First on the list was working to ensure the the 188th Wing's new unmanned flying mission was a success and he said getting on a new national governor's council created in 2008 could help keep the unit's mission active and stable for many years to come.

"We've got to make it work, we've got to make it expand and I think there's a great opportunity there and I want to be supportive," he said. "In fact, as governor, I will seek a seat on the council of governors that helps guide Department of Defense policy when it comes to the National Guard. There's 10 governors that are appointed to that slot."

Hutchinson said technology education at the secondary level was a priority of his, saying that by introducing coding courses at the high school level students would have marketable skills as they enter high education or the workforce following graduation. He said the total cost of implementing such educational standards would be about $500,000 to train educators to teach the courses and to develop curriculum. He said a change in the state law would be necessary to offer the courses for either math or science credit.

Manufacturing was also a focus of Hutchinson's remarks, with proposals made to remove what he has said repeatedly throughout the campaign are burdensome regulatory processes in Arkansas. Doing so would not only keep manufacturers in Arkansas, but would allow the state to recruit additional industry to the state.

One such industry is the firearms industry, with Hutchinson touting his past work with the National Rifle Association and saying that he was already pitching Arkansas as a possible home for manufacturers who may be looking to relocate as a result of anti-gun legislation in their respective home states.

He said all of the effort in bringing jobs to the state — and being what he called "the jobs governor"— would be remiss without a reduction in taxes, making Arkansas competitive with surrounding states that have lower or no income taxes such as Oklahoma and Texas.

"I presented a tax plan that would lower the individual state income tax rate in this state and it is a job creation issue," he said. "It is a competitive issue."

Hutchinson said as governor, he would push the state to convert more vehicles to compressed natural gas because it would create a "cleaner environment" and "lower cost fuel."

"I don't believe that mandates from the government, but I do believe in leadership and so I pledge that as governor that I will accelerate conversion of state vehicles to CNG options to that we can provide leadership and a better example for people in this state. I think that is a good opportunity for the River Valley, as well, and we will capitalize on that."

When Ross took the stage, the former congressman and state senator talked about his small business background and time in government, noting that when he left Congress in 2012 it was because he was "fed up with Washington," but not necessarily public service.

"The last thing we need in state government is the kind of partisan bickering and disfunction that we see in Washington today. In this state, we're too small for that and there's a lot more that unites us than divides us. So let me be clear — I am a conservative, pro-business, pro-gun Arkansas Democrat but I am not running to be governor of the Democratic Party. And I am not running to be governor of the Republican Party. I am fed up with the extremes of both parties. I am running to be governor of all the people of this great state and I pledge to work with everyone who will work with me to make this state an even better place to live, to work and to raise a family."

Ross took a shot at Hutchinson's plan to be the jobs governor, saying that it requires investment in education.

"Asa said he wants to be the jobs governor, but I want to be the education governor because I think that's how you become the jobs governor. I think that is how you create economic opportunities in this state."

He said often various communities in the state lose out on jobs and business expansions because the towns and cities simply do not have an educated workforce to service businesses.

Ross said Arkansas has been "49th (in education rankings) all my life," noting that West Virginia is currently the only state in the country ranked worse in education. In order to combat that, he pitched his Pre-K program for all Arkansas children whose parents want to place them in the program versus the current placement of children in households at 200% of poverty level. Ross pointed to Oklahoma's program that has about 75% of the state's eligible children enrolled as a sign Pre-K for all students can be accomplished in a conservative state.

Ross also noted that career and workforce education would be a priority as governor, adding that out of 100 9th graders, only an average of 20 graduate college. But making shifts in Pre-K and workforce education will not be about short-term results, he said it would be about a generational shift in Arkansas while the workforce education was more geared at the short-term solution.

"What I'm talking about is a generational thing. The quality of the Pre-K program in Arkansas is exceptional – we're ranked 11th in the country. The issue is access. And what I'm talking about doing here with Pre-K is something we're going to see the results from in 18 years, but it's past time for us to start on it."

Ross also discussed his plan to reduce taxes, saying that a third of Arkansas taxpayers are in the top tax bracket in the state. But he said the plan would be as revenues increase in the state versus an immediate tax break should he win the governor's race later this year, citing the tax cuts implemented by Kansas Gov. Sam Brownback when he took office.

"Just look at Kansas and Gov. (Sam) Brownback. A $350 million deficit this year. This is not Washington. Money does not grow on trees. We must have a balanced budget. We don't print money here. I understand that and for 10 years, I helped balance the state budget as a member of the Arkansas State Senate."

Before wrapping up, Ross got in one last shot at outside interest groups spending upward of $3 million against his candidacy in the state on television.

"They're trying to convince you that I'm something that I'm not. Let me tell you the truth. And you can look it up. Each of the 12 years I served in Congress, I was named one of the most independent members of Congress by National Journal. Each of the 12 years I served, I earned an A plus rating from the National Rifle Association. I received awards from the U.S. Chamber of Commerce and by the National Association of Manufacturers. And I could go on and on. And by the way, in case Asa missed this, the only time Nancy Pelosi had an opponent (in her race for Speaker of the House), I gave the nominating speech for her opponent with her sitting on the front row.”

Four Fort Smith city directors were dismissed from a lawsuit alleging violations of the Arkansas Freedom of Information Act according to a Thursday (July 31) court filing.

City Directors George Catsavis, Keith Lau, Mike Lorenz and Vice Mayor Kevin Settle were all released from the lawsuit that alleges the FOIA violation after Lorenz had called City Clerk Sherri Gard requesting two items be removed from meeting agendas. Gard then contacted all members of the Board to determine if there was adequate support to remove the items. A city ordinance passed in the 1970s allows removal of items from a meeting agenda if four directors notify the city clerk of their desire to have the item removed.

Attorney Joey McCutchen, representing Fort Smith resident Jack Swink, said Saturday (Aug. 2) that the removal of the four city directors was due to the elected officials' lack of understanding of the Arkansas FOIA law prior to the polling having been conducted by Gard.

“(A)fter some formal and informal discovery, while directors should have knowledge of the FOIA, it's pretty clear that the administration clearly had the knowledge and that it's the city administration who's responsible for this. That was one of the big reasons."

McCutchen said he was not excusing the actions of the Board members, specifically noting that City Directors André Good, Philip Merry and Pam Weber — while not originally named as defendants in the lawsuit — also took part in the action leading the lawsuit.

"The fairness argument is out there also," McCutchen said. "Though I think Philip Merry and Pam Weber have tried to be so transparent on this particular issue, I think they were involved in the process, also. Everyone was involved in the process and I think the directors were put in a bad situation. In my opinion, that's why we have a city administrator to advise and make sure we're doing business in public and openly. In my personal opinion, those folks were trying to be transparent. They were trying to bring things to a vote in public with something that was put on the agenda in public. They were trying to vote again in public."

Merry had originally attempted on June 3 to get votes on the hiring of an auditor to review legal billings for the city after allegations of improper billing by the Daily and and Woods Law Firm — whose law practice serves as the contracted legal services provider for the city — were leveled by attorney and blogger Matt Campbell, who has since formed a law practice with McCutchen and attorney William Buckley.

Merry had also attempted to get a vote regarding the formation of a committee to review whether the city should continue paying outside counsel for legal representation or hire in-house attorneys to represent the city. A study session was subsequently held with the Board regarding the allegations, which City Attorney Jerry Canfield has said are without merit.

Merry's resolutions, seconded by Weber, were placed on meeting agendas and twice were removed through the city ordinance at the original requests of Lorenz.

McCutchen added that this lawsuit, which still names Gard and the city of Fort Smith as defendants, is just the latest case in which the city has illegally polled city directors. He cited a case brought in 2002 by Fort Smith resident David Harris which the city ultimately lost on appeal before the Arkansas Supreme Court in 2004, as well as another FOIA lawsuit that was brought by McCutchen that led to a 2012 Arkansas Supreme Court opinion that said while the city was not necessarily in violation of FOIA regarding a series of one-on-one meetings between the city administrator and city directors, a circuit court's attempts to rule part of the Arkansas FOIA unconstitutional was in error.

"I think those are two major reasons (for continuing the lawsuit without the city directors as co-defendants). The city bears ultimate responsibility and the common denominator is the city administrator. I think the city of Fort Smith should be extremely sensitive to this issue of polling in private and it's pretty clear to me that they're not and they continue to go down the same path in a different way."

In a response to McCutchen and Swink's latest lawsuit, City Attorney Jerry Canfield said the city is within its rights to poll city directors and had asked for the dismissal of city directors granted Thursday. City Director Keith Lau, who had hired his own attorney with the Board ultimately voting to pay any fees associated with his legal defense, said he was pleased with the dismissal.

"Honestly, I'm happy and relieved," he said. "What I said before was I thought, and so did my attorney (Michael Redd), I was not liable if found in violation. If Joey (McCutchen) and Jack (Swink) want to decide if that procedure is a violation of the Arkansas FOIA, more power to them. We'll let the courts decide. I'm just happy to be out of it personally."

Farming is still big business in Arkansas despite being overshadowed by headlines from corporate giants Wal-Mart, Tyson Foods and some of the nation’s largest trucking and logistics companies in the country.

Agriculture accounted for $17 billion of valued added to the Arkansas economy in 2011. That’s 17 cents of every $1 linked to the sum of employee compensation, income and indirect business taxes, according to an economic report from the University of Arkansas in 2013.

There are more than 259,200 jobs statewide supported by agriculture, that’s one in six jobs in Arkansas, creating almost $10 billion in labor income comprising 15% of the state’s total. The aggregate of the agriculture sector’s share of the state economy in Arkansas is 2.3 times greater than for the U.S. as whole.

Some Arkansas banks have taken notice of more demand from the state’s agriculture sector. Arvest Bank recently announced is it ranked No. 26 in the American Bankers Association Top 100 Farm Lenders in the U.S. for the first quarter of 2014. Northwest Arkansas-based Arvest Bank held about $503.68 million in total outstanding agriculture loans to end the first quarter of 2014, according to Steve Griffin, executive loan manager for the Fort Smith region of Arvest Bank.

The bank notes that it’s also expanding the agriculture loan products through the Federal Agriculture Mortgage Corporation, commonly known as Farmer Mac. These products provide several  tools that help farmers/ranchers mitigate risks that have plagued the industry for the past few decades. 

Arvest said the low interest loans help farmers free up funds than can be used to counteract business risks such as drought expenses, falling crop prices and other weather-related disasters.

“We’re currently in a situation similar to the farming boom of the 1970’s – which was followed by the farming crisis of the 1980’s. The best way a farmer/rancher can reduce their financial risk is to take advantage of the current low interest rates,” Griffin said.

While the average U.S. farmer or rancher is in good financial shape, many in the industry see potential pitfalls that could cause problems similar to what the industry experienced in the 1980s. Land prices are increasing while grain and cattle prices are becoming volatile. Prices often depend on global factors including the Chinese economy, trade agreements between Japan and Australia, exchange rates, weather, inflation and domestic demand. 

A recent report from Wells Fargo economist notes that the U.S. farm sector made a solid comeback in 2013. Overcoming three consecutive years of slow growth, the industry’s output surged 16.4%, while overall real GDP increased just 1.9%. Arkansas ranked ninth in terms agricultural share of state GDP at 3.8% in 2013, according to the Wells Fargo report.

The report also summarizes 2014 as another good year for the nation’s farm economy, noting that repeating the 2013 performance could be tough given drought in large parts of California and unpredictable weather in the Midwest and South.

Local lenders also mentioned weather as a threat to 2014 profits for some farmers.

“We have a wonderful bunch of farmers in our Brinkley bank that have been with us for many years. We had a terrible rain that dumped up to 10.5 inches about a month ago that has caused major problems with some of the crops,” said Gary Head, president of Signature Bank.

He said some farmers may see lower yields as a result of the recent rain deluge.

“Our loan demand is steady there and we are prepared to work with our farmers through a potentially rough year,” Head said.

Signature Bank has grown its farmland loans to 1.71% of total loans, up from 1.51% a year ago. That totals about $6.5 million, up from $5.8 million in 2013. Other agriculture loans held by Signature Bank total about $6.4 million, up from $5.15 million in 2013, according to bank’s filings with the Federal Deposit Insurance Corp.

While the first five months of 2014 have shown generally sluggish sales tax receipts, June's figures released by the city of Fort Smith on Aug. 1 show a marked improvement. But the city's finance director told city directors in an e-mail that the reason behind the increase is not yet known.

The city's sales taxes (1% for streets and 1% combined for water and sewer projects and fire and parks and recreation) collected $3.691 million in the June report, 12% higher than budgeted.

Overall for the first six months of the year, revenue from the city's sales tax collections are 1.49% above last year's totals for the same period and 0.92% below this year's projected budget.

The total in the June report represents a overall drop in all sales tax receipts of 0.44% below budget. (Because the state of Arkansas has a two-month delay in reporting collections back to the cities, the city of Fort Smith — for budgeting purposes — has historically reflected the collections on a one-month delay. Which is to say, the tax collections remitted to cities in June are from taxes collected in April and transferred by merchants to the state in May.)

Collections so far in the 2014 reporting period of the city's sales taxes were $20.054 million, up from collections of $19.759 million in the same period of 2013. The same period in 2012 saw $20.026 million with $19.273 million in 2011. The city sales tax for fire and parks did not begin collecting revenues until November 2012.

Total collections of the Fort Smith city sales taxes in 2013 was $38.938. Collections in 2012 totaled $39.21 million, just ahead of the $38.684 million collected in 2011. The 2011 collections were 3.9% above the 2010 revenues of $37.23 million.

Fort Smith's share of the countywide 1% sales tax in the June report was $1.428 million, up 13.94% from June 2013 when the city's share of the county sales tax revenues was $1.253 million. The figure was also 13.41% above revenue estimates of $1.259 million.

The countywide tax generated $15.353 million for Fort Smith during 2013, up 0.49% compared to 2012 and down 1.99% compared to budget forecasts. The countywide tax generated $15.279 million in 2012, just ahead of the $15.15 million in 2011, but lower than the peak collection of $16.61 million in 2008.

The countywide tax collection is critical because the revenue is a little more than 40% of the city’s general budget of roughly $42 million. A majority of the general fund budget supports fire, police and other critical city functions. The dip in collections compared to budget estimates has resulted in city officials seeking 4% budget cuts from all departments.

In her email to the Board of Directors, Finance Director Kara Bushkuhl that she believed the spike in sales tax revenues for the month to not necessarily be because more shoppers were hitting the mall or big box stores.

"It appears that this is some kind of adjustment but I have no information over what period it would cover or for what reason.  Other cities are experiencing varied fluctuations like Fort Smith is seeing," she wrote.

Bushkuhl added that her office had reviewed information in an attempt to narrow which sector may have been responsible for the spike, but again said it could not be determined.

"When reviewing the NAICS (North American Industry Classification System) code information for the first 6 months, there does not appear to be any large fluctuations in the four largest categories that comprise 39% of the total city sales tax paid.  The four largest categories are: general merchandise, full service restaurants, building materials, and grocery."

In addition to county and city sales taxes being above target, Bushkuhl said franchise fees were up, as well. But she noted that could change depending on the weather.

"The franchise fees for the 1st two quarters are above last year and above budget expectations.  Electric is up 10% and natural gas is up about 12% over last year.  This may not hold for the 3rd quarter if we continue to see cooler temperatures in August and September as we have in July."

PREVIOUS ANNUAL COLLECTION INFO
Fort Smith 2% sales tax collection (1% for streets; 1% for water/sewer bonds)
2013: $38.937 million
2012: $39.210 million
2011: $38.683 million
2010: $37.229 million
2009: $37.554 million
2008: $41.226 million
2007: $37.858 million
2006: $36.840 million

Fort Smith portion of 1% countywide sales tax
2013: $15.353 million
2012: $15.279 million
2011: $15.15 million
2010: $14.89 million
2009: $15.04 million
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million

GOP gubernatorial candidate Asa Hutchinson laid out a plan to fight Environmental Protection Agency (EPA) rules that are being debated over so-called “dirty coal” power plants.

The EPA has asked states for comments on a proposal made by President Obama called the Clean Power Plan, which mandates a 30% reduction in carbon dioxide emissions from existing power plants by 2030 from 2005 levels, mainly targeting the nation’s fleet of more than 600 coal-fired plants that currently supply the lion’s share of the nation’s electricity needs.

Arkansas energy leaders with the state’s largest electric utilities have said the requirement could force closure of existing power plants and would raise rates for consumers. A manufacturers’ study released last week also indicated that Arkansas could lose 10,000 jobs as a result of the EPA rules. Renewable energy supporters say the EPA rules could benefit Arkansas by providing cleaner air and creating new alternative energy jobs.

Hutchinson said, if elected, he would seek the support of the Attorney General and the State Legislature to oppose the EPA rules. While a comment period is still underway until Oct. 16, 2014, Hutchinson said Arkansas should join a lawsuit that 12 states have started in opposition to the federal government rules.

“I’ve seen this train moving before, you better move early,” he said. “I want to send a signal — nationally and in Arkansas — that this is a position I will take.”

Hutchinson said he expects the current 12-state case challenging the rules’ authority to make its way to the U.S. Supreme Court. He also indicated that he thought the costs to join the existing lawsuit would be minimal and that Arkansas’ addition to the litigation would provide “more strength in numbers,” which he said would make the legal challenge stronger.

While he has visited with GOP Attorney General nominee Leslie Rutledge on the issue, as well as Republican leadership in the Arkansas House and Senate, Hutchinson said he has yet to speak to Attorney General Dustin McDaniel (D) or Democratic AG nominee Nate Steel. He said he planned to visit with them regarding the lawsuit. Rutledge has said many times this year that she would use the Attorney General’s office to push back on “federal overreach.”

McDaniel met on Monday (Aug. 4) with Avi Garbow, General Counsel of the U.S. Environmental Protection Agency, to discuss the EPA rule. McDaniel also outlined issues in a letter to the EPA.

“I’m very appreciative that General Counsel Garbow made time to meet with me today to discuss how the proposed rule may affect Arkansas,” McDaniel said. “The meeting was productive and a step in the right direction.”

Steel, who announced in June that he had “serious concerns” over the EPA’s new emission guidelines, said he would exercise caution before jumping into litigation over the matter. But he didn’t rule joining the 12-state lawsuit out either.

“While I stand ready to take any action necessary on this issue and protect Arkansas ratepayers, I will not be the kind of Attorney General who sues first and asks questions later. I look forward to learning more about Attorney General McDaniel’s meeting with General Counsel Garbow and how we can best protect Arkansas’s consumers,” Steel said.

Today, coal-fired power represents 44.5% of Arkansas’ annual net electric generation. Natural gas-fired generation is second at 23.2% and nuclear energy is next at 19.4%. Renewable energy generates about 6.4% of the state’s power needs and hydroelectric fills 5.4% of the state’s electric capacity. Petroleum-fired fuel, once a staple for heating oil, now generates less than one percent of the state’s power (0.6%).

Nationwide, coal has been the largest source of electricity generation in the United States for more than 60 years. However, its annual share of total net generation declined from nearly 50% in 2007 to 39% in 2013 as some power producers switched to more competitively priced natural gas.

Arkansas’ home sales market shows no signs of slowing down, with the number of homes sold during the first half of the year up more than 5% and the combined value of the homes sold up more than 2%. Home sales in June were up almost 9% in Arkansas four largest markets.

Also, the year-to-date 2014 numbers are up compared against what was a healthy Arkansas real estate market in 2013.

Home sales in Arkansas’ four largest metro areas during the first half of 2014 totaled 10,268, up 5.16% compared to the same period in 2013. According to The City Wire’s Arkansas Home Sales Report. The average price per home sold in the four markets was $162,291, down 2.79% compared to the same period in 2013, and the total value of $1.666 billion in the four markets was up 2.23%.

The City Wire’s Arkansas Home Sales Report captures home sales data in the state’s 14 most populated counties within its four largest metro areas — Central Arkansas, the Fort Smith area, Jonesboro/Northeast Arkansas and Northwest Arkansas. The report, which records closed sales, accounts for between 70% and 75% of total Arkansas home sales.

For the first six months of the year, only the Northwest Arkansas area had a decline (down 2.39%) in the number of homes sold compared to 2013.

JUNE NUMBERS
June home sales totaled 2,087, up 8.75% in the four markets compared to June 2013, and up 15.24% compared to June 2012. The average price per home in the four markets during June was $174,172, down 1.39% compared to June 2013, but up 3.59% compared to June 2012.

There were 959 homes sold in central Arkansas, up 6.67% compared to June 2013, and up 11.9% compared to June 2012.

June home sales totaled 728 in Northwest Arkansas, up 4.9% compared to June 2013, and up 17.42% compared to June 2012.

Jonesboro area home sales totaled 205, up 19.88% compared to June 2013 and up 20.75% compared to June 2012.

In the Fort Smith area, home sales totaled 195, up 25.81% compared to June 2013, and up 10.8% compared to June 2012.

The value of the sales during June were down 1.76% in central Arkansas, up 11% in Northwest Arkansas, up 22.2% in the Jonesboro area, and up 38.29% in the Fort Smith region.

THE REGIONAL PICTURE: 2014
Central Arkansas — Home sales
Jan.-June 2014: 4,856
Jan.-June 2013: 4,599
Jan.-June 2012: 4,240

Fort Smith area — Home sales
Jan.-June 2014: 945
Jan.-June 2013: 790
Jan.-June 2012: 803

Jonesboro area — Home sales
Jan.-June 2014: 1,072
Jan.-June 2013: 897
Jan.-June 2012: 810

Northwest Arkansas — Home sales
Jan.-June 2014: 3,395
Jan.-June 2013: 3,478
Jan.-June 2012: 2,973

The top five counties in terms of Jan.-June 2014 home sales:
Pulaski — 2,261, up compared to 2,144 in 2013
Benton — 2,166, down compared to 2,176 in 2013
Washington — 1,229, down compared to 1,302 in 2013
Craighead — 844, up compared to 709 in 2013
Saline — 794, up compared to 711 in 2013

Link here for a PDF document of the June 2014 data.

MARKET THOUGHTS
Kathy Deck, director of the Center for Business and Economic Research at the University of Arkansas, said the June report is typical for this year.

“It looks very much like what we’ve been seeing,” she said. “Overall, the economy is recovering. We’re seeing employment go up in the state. That, of course, brings with it some housing demand.”

In most markets, there has been an increase in the number of units sold and a decline in prices. Deck said three factors have come together to help boost sales – low interest rates, low unemployment and attractive pricing have all brought buyers to the closing table.

Another factor, she said, is that people do wonder when interest rates might rise and that is causing people to buy while they still have the increased purchasing power through low rates. While lower sales prices are attracting buyers, Deck said those are also a sign of some hesitance on the part of buyers. The economy may be recovering, but consumers are still cautious.

George Faucette, CEO of the Coldwell Banker franchise in Northwest Arkansas, believes the regional economy there can maintain the pace.

"I believe sales will strengthen only slightly, if any, for the second half of this year; but I do believe the pace of the first half is sustainable. Our agents are continuing to be very busy, and the general economy of Northwest Arkansas is doing very well,” Faucette said.

The numbers for the remainder of 2014 may not be rosy for Crawford County in the Fort Smith metro area. Van Buren was recently notified that its residents will not be eligible for Rural Development loan assistance through the U.S. Department of Agriculture after Oct. 1. According to Karen Phillips, housing and development director at the Crawford-Sebastian Community Development Council, the local administrators of the USDA Rural Development Loan program began looking at eligibility requirements after passage of the Farm Bill and noted that Van Buren was no longer eligible in part based upon its proximity to Fort Smith.

Vickie Davis, an agent Sagely & Edwards Realtors in Fort Smith, said the recent positive numbers in Crawford County may be the result of people anticipating the loss of the loan assistance program.

"A lot of people are trying to get things cleared out before that (Rural Development) stuff happens," Davis said.

MarketPlace Grill has closed its Fort Smith location, leaving more than 50 people without a job as the company works to actively expand its presence in central Arkansas.

According to Managing Partner Dave Godwin of Restaurant Management Group, the company has worked on an expansion in the central Arkansas market and said the closure of the Fort Smith location was a business decision as a part of the expansion efforts.

"The Fort Smith market has been good to us, but we had an opportunity in Little Rock," he said. "Everything lined up for us that it was in the best interest of the company for us to make the move. I can't really point to one specific thing necessarily. I'm not sure what to tell you there but that as a company, we're trying to grow and we had the opportunity to open in Little Rock to open the store. Things lined up in such a way that as a business, it was in our best interest to make the move."

Godwin noted that the closure of the Fort Smith location, open since 1995 at 8302 Phoenix Ave., had nothing to do with declining sales or patronage, declining to cite sales figures for the Fort Smith restaurant.

He said total employees at the Fort Smith location was "probably in the neighborhood of 50 or 60." Asked whether severance packages or employment at other MarketPlace locations were offered to Fort Smith employees, he said, "It's really kind of a mixed bag. Kind of all of the above." Godwin did not go into specifics regarding offers made to employees.

MarketPlace's new Little Rock location is 11600 Pleasant Ridge Road, with an opening planned for the early fall, Godwin said. He said the company was looking to add another two locations in addition to the new Little Rock locale.

The company still owns and operates MarketPlace Grills in Conway and Springdale, as well as a MarketPlace express at the Northwest Arkansas Mall in Fayetteville. Godwin said the company was also looking to re-open Burger Life, a concept restaurant that had originally replaced MarketPlace at its former location on Joyce Boulevard in Fayetteville. He said lease negotiations were ongoing on a new location in Fayetteville.

The now-vacant building that had housed MarketPlace's Fort Smith location has been put up for sale by its owner Benefit Bank. In a statement, Benefit Bank President Joe Edwards said the company had decided against pursuing further leasing of the 8,216 square foot building.

"The property will not be leased again but is listed with Mr. Bob Cooper of R.H. Gahn & Cooper Commercial Properties for sale as a development property," he said, adding that the bank "appreciates the relationship with MarketPlace over the years and wishes them the best as they move to the Little Rock market."

Cooper said the property is listed for a purchase price of $1.475 million, which includes the building and 1.4 acres. Traffic counts along Phoenix Avenue in front of the restaurant total 18,000 vehicles per day, while Massard Road sees a 26,000 vehicles per day pass the restaurant.

In discussions about a two mil increase in property taxes to benefit the Fort Smith Public Library, much attention has been paid to the impact a tax increase could have on homeowners. But property tax records indicate that businesses operating in Fort Smith could be on the hook for a large portion of the estimated $2.8 million raised through the tax increase.

Early voting on the library tax begins Tuesday (Aug. 5) and continues weekdays through Monday (Aug. 11) in room G-8 of the Sebastian County Courthouse in Fort Smith.

Voters casting ballots in the special election on Aug. 12 will vote in one of four polling sites:
• Ward 1: Creekmore Park;
• Ward 2: Windsor Drive Library;
• Ward 3: Southside Senior Center; and
• Ward 4: East Side Baptist Church.

BUSINESS IMPACT
Property tax figures and projections based on assessed property values were provided to The City Wire by the Sebastian County Assessor's office. They indicate that the top 22 line items would make up 12% of the increase in taxes if the millage rate supporting the library increases from one mil to two mils.

It should be noted that the line items may not include all parcels or business personal property owned by the companies listed in the report. For example, Baldor Electric Company confirmed that property tax information listed in the report included only one parcel from its 2013 tax bill while excluding other parcels owned by the company.

The top company listed in the report is Fort Smith HMA LLC, with a value of $17.841 million. At the current one mil rate, HMA's property tax benefitting the library would only stand at $17,841. If the millage increase passes Aug. 12, the company's tax obligation for increases to $53,523, a difference of $35,682.

Nearly tied for the same increase is Gerber Products Company, which would see its taxes on an assessed value of $16.79 million increase from $16,790 per year to $50,370, an increase of $33,580.

Third on the list are seven properties owned by Wal-Mart, including the Sam's Club location on Rogers Avenue. The total combined assessed value of the properties stands at $14.213 million with a tax obligation on one mil of $14,213. If the millage for the library passes, the total Wal-Mart would owe in taxes increases to $42,640, a difference of $28,427.

For just the three businesses listed as having the largest tax obligation, the increase combined would equal $97,689. The figure for the three is 3.48% of the $2.8 million library Executive Director Jennifer Goodson has said would be raised annually by tripling the millage rate. Just the 22 line item payments provided by the Assessor’s office would account for 12% – $336,170 – of the total, an indication of how much of the property tax bill is paid by business operations with property and certain fixed assets in Fort Smith. Businesses on the list also include Gerber, O.K. Foods, Golden Living, Sparks Health System, Mercy-Fort Smith, Mars Petcare and ArcBest Corp.

‘A UNIVERSAL THING’
Asked before a town hall event Monday evening (Aug. 4) touting the library's proposed tax increase for reaction to the impact a millage increase could have on businesses, Goodson said she "was not equipped to comment on that." Asked whether the library's board of trustees had considered the impact a tax increase could have on businesses in addition to residences, Goodson said, "We knew that the business community would be impacted."

"We're just talking about the future of the community. That's what our focus is. And so if a business and/or individuals believe that this plan is something that is good for the future of Fort Smith, then they make that decision. We don't make a distinction about business perspective versus individuals, people who have a lot of money or people who have a little money. The library is a universal thing in our community, so we've been targeting a variety of folks not a particular segment in everything we've done."

In presentations to the public, Goodson has said the tax impact on a $100,000 home would amount to about $5 per month, or $60 per year, in total taxes paid to the benefit of the library. Goodson confirmed Monday that the taxes would also go up on personal property, such as cars and boats. Information from the Assessor’s office indicates the average tax bill in Fort Smith will rise $72.86 if the millage increase is approved.

NOT A SHARED VISION
Goodson's remarks regarding the fiscal impact a tax increase would have on the city's biggest taxpayers came before a town hall meeting of about 25 individuals which saw most residents who chose to speak voicing opposition to the millage increase. Resident Jay Wiechert was among those who spoke out against the increase.

"We have one mil. You're wanting three mils. That's greed. Shame on you. Shame on you. How can you go from one mil to three mils and keep a straight face?"

Goodson referred to her presentation of nearly an hour Monday night, interviews and information available online as proof that the library board had a plan for the money should voters approve the tax hike.

"And if that is not your vision for the library and its impact in the community, then I certainly respect that. But it is the vision of the board, staff and a number of our stakeholders,” Goodson explained.

HISTORICAL COSTS
Fort Smith resident Jerry Fleming also spoke and had presented town hall attendees calculations, which showed the library had increased its receipt of tax proceeds by 6,397.22% since 1958. The library's one mil property tax rate was passed in 1957. Fowler's chart — formed using data provided to him by the library and presented to attendees Monday — shows the library collected $36,000 from one mil in property taxes in 1958. The total is estimated to be $1.413 million from the one mil in 2014.

The total increase in operating budget included 6% provided to the library from the city's 1% of the county sales tax proceeds. The distribution to the library began in 1995 with $596,000 and is expected to increase to an estimated total of $926,000 this year.

The total from both taxes are estimated to ring in at $2.339 million this year, or 64 times more revenue generated in 2014 than 1958, according to Fowler.

Goodson responded by noting that inflation had increased from the 1950s to present day, noting the rise in the price of an automobile which she said was priced at $2,700 in the 1950s. She also said the library provides more services than in 1958 and has four branches, versus one when the current millage rate was approved by voters. Goodson's response did not persuade Fowler, who said he was not opposed to all proposals included in the library's plan but said the proposed increase was simply too much.

"If you multiply that (the quoted price of a car in 1958) times 64, a car today would be $172,800. A house, $20,000 times 64 is $1.28 million. Bacon, 39 cents a pound in 1958 times 64, we'd be paying $25 for bacon. The only thing that got a 64 times increase that I can find is the library. Now I really don't think that's material. I've said that all along. I just wish you'd stop that being your major theme and that is your major theme."

Resident Don Dickey said the proposed spending plan Goodson and the trustee board have formed for the first year the tax revenues are available (2016) does not address future ongoing budgets, noting that as a business owner he must present business projects and budgets with projections for five years out before he can get a loan from a bank.

Goodson called the proposed budget "a flexible document, not a rulebook. We've got a good first year, but we need to see what we learn and what we experience between now and 2017."

Fowler compared Goodson's response to that of former House Speaker Nancy Pelosi, who famously said of the Affordable Care Act in 2010 before it was voted on in the House: "(W)e have to pass the bill so that you can find out what is in it, away from the fog of the controversy."

Consumers across Arkansas see favorable spending conditions in the short-term but when asked about future economic conditions the survey respondents expect leaner times for business conditions and personal finances beyond a year from now. 

Arkansas consumers are also more cautious than those surveyed in Oklahoma and Missouri. These results are part of the Consumer Sentiment Index first released in July by Arvest Bank. The second installment of the survey data was released Tuesday (Aug. 5). 

The survey of 1,200 consumer households conducted by the Universities of Arkansas, Missouri and Oklahoma found that a majority in the three-state region expect their personal financial situations to improve or remain the same within the next year. They are less optimistic about future business conditions.

Arkansas respondents ranked the lowest among the three states with regard to buying conditions, but 42% said now is a better time for spending than later. That compared to 46% of respondents in Missouri and 49% of those surveyed in Oklahoma.

About one in three respondents in the total survey said now is a bad time for spending, Arkansas had the highest percentage in this category at 37%.

When asked to assess the buying conditions in the next six months the respondents were somewhat optimistic, though Arkansas ranked slightly less so than the other two states. The Current Conditions Index based on that question found the regional rating at 78.7. Arkansas has a reading of 74.7, below Missouri (77.6) and Oklahoma (82.2).

In the three-state region, 51% of consumers expect their personal financial situation to remain the same over the next 12 months, while 27% expect it to be better over the same period. Only 22% expect their personal financial situation to be worse than it is currently. 

By comparison, 28% of consumers in Arkansas expect their personal financial situation to improve and 52% expect it to be the same. 

In Missouri, only 19% of consumers expect their situation to improve and 53% expect it to remain the same. 

In Oklahoma, 34% of consumers expect their situation to improve and 48% expect it to remain the same.

When looking at expectations of business conditions, only 29% of consumers in the region expect business conditions to be favorable in the next year. That includes 30% of consumers in Missouri, 32% in Oklahoma and 22% in Arkansas. 

This trend continued when looking at expectations over the next five years, with 37% percent of the regions’ consumers expecting positive business conditions. That includes 36% in Missouri, 41% in Oklahoma and 33% in Arkansas. 

This is also reflected in the regions’ expectations of widespread unemployment over the next five years, with 56% expecting widespread unemployment. That includes 57% in Missouri, 53% in Oklahoma and 61% in Arkansas.

Arkansas has seen the nation’s steepest reduction in its percentage of uninsured residents, noted a Gallup report released Tuesday (Aug. 5).

The report, based on telephone interviews with 88,678 respondents nationwide, found that the uninsured rate in Arkansas dropped from 22.5% in 2013 to 12.4% in 2014.

Almost half of Arkansans who were not insured in 2013 are now insured, according to the survey. Respondents in the telephone poll were asked, “Do you have health insurance coverage?”

Arkansas’ insured rate in 2013 ranked it next to last nationally, just ahead of Texas. Now it is 22nd along with New Hampshire. Delaware has the lowest at 3.3%. Texas is still last at 24%.

After Arkansas, the next biggest drop is in Kentucky, whose uninsured rate has fallen 8.5% from 20.4% to 11.9%. The top 10 states all expanded Medicaid coverage as part of the Affordable Care Act, also known as Obamacare. The rest of the top 10, in order, are Delaware, Washington, Colorado, West Virginia, Oregon, California, New Mexico and Connecticut.

Nationally, the uninsured rate has declined from 17.3% in 2013 to 13.4% in the second quarter of 2014. It was 14.8% in 2008.

In a phone interview, Gov. Mike Beebe said, “The overwhelming reason for the change is the Private Option.”

The Private Option is the program passed in 2013 that uses Medicaid dollars under Obamacare to buy private insurance for lower-income Arkansans. As of June 30, 176,691 Arkansans have been insured because of the private option. Of that number, 19,508 were assigned to traditional Medicaid because they were judged to be medically frail.

The program must be funded by a three-fourths vote of the state Legislature every year. Earlier this year, it passed with no votes to spare in the Senate and only after significant legislative wrangling.

Beebe said the drop in the uninsured is another point in the Private Option’s favor as legislators again will consider its survival starting in January. Without those federal dollars, he said, the Legislature would not have been able to enact the tax cuts it has enacted, and hospitals would have have lost more money providing uncompensated care.

“There are lots of reasons, some budgetary, some humanitarian, some political, but there are a lot of reasons why it would be very, very difficult to undo the Private Option,” he said.

Sen. David Sanders, R-Little Rock, one of the Private Option’s legislative architects, said the decrease in uninsured Arkansans is a success, but is only one of the program’s points of emphasis.

“I think the Private Option will rise and fall on the strength of the policy,” he said. Later, he said, “Essentially the question is, you know, does the policy work? So it’s one thing to cover; it’s another thing to do it in the most successful manner and achieve the goals that we set out.”

The values of building permits in Fort Smith, Greenwood and Van Buren were a combined $20.975 million in July, up nearly $6.46 million from July 2013 when the combined cities issued $14.515 million in permits.

The increase in values represents a 44.51% increase compared to July 2013.

Building permit values for the first seven months of the year are up 10.23% over the same period last year, with $117.96 million in permits issued this year versus $107.017 million issued from January to July of last year. When compared to the first seven months of 2012, this year's year to date total is an increase of 55.98% over that year's $75.627 million total.

FORT SMITH
Last month, the city of Fort Smith issued a total of 185 permits with a total value of $19.539 million. Compared to July 2013, the city's permit values increased 41.38% from a total of $13.82 million last year.

When compared with permit values from July 2012 of $6.996 million, Fort Smith's building permits are up 179.23%.

Pushing Fort Smith's total values higher for the month was a $9.764 million building permit issued for the Ben Geren Aquatics Center at 7300 South Zero Street. The project, jointly funded by the city of Fort Smith and Sebastian County, is expected to be complete and open to the public by Memorial Day 2015.

The aquatics center project accounted for 65.69% of the city's $14.862 million in commercial building projects permitted during the month of July.

The city also issued 123 residential building permits valued at $4.216 million, with 12 new construction projects accounting for $3.098 million of the total, or 73.47%.

GREENWOOD
Seven building permits were issued in the city of Greenwood last month with a total value of $876,725. The figure for July represents a 249.29% increase from July 2013's total of $251,000 on five permits.

Of the permits issued, four were residential permits valued at $837,385, or 95.51% of the total permits issued.

VAN BUREN
Van Buren saw 40 permits issued with a total valuation of $559,100, an increase of 25.95% over July 2013's total of $443,920 on 28 permits.

A commercial addition valued at $330,000 at 1300 Scott Street accounted for 59.02% of Van Buren's July building permits.

2013 RECAP
Combined values in the three cities during 2013 were $203.037 million, compared to $157.32 million during 2012. The 2013 value is above the $201.079 million in 2011.

Fort Smith closed 2013 with the largest share of valuations, logging $177.687 million (a one-year increase of about 30.24% from $136.428 million in 2012), while Van Buren was the next largest with $17.067 million (a one-year increase of 38.96% from $12.282 million in 2012). Greenwood posted an additional $8.283 million, the only city to show a decrease from the previous year's total of $8.609 million (a decrease of 3.79%).

The gains in the Fort Smith market were largely from industrial construction projects at Chaffee Crossing, the construction of Mercy's new orthopedic hospital along Phoenix Avenue and various municipal construction projects across the city.

Whirlpool has proposed additionally monitoring and testing of water and soil samples at sites near its now-shuttered manufacturing facility in south Fort Smith following detection of trichloroethylene (TCE) in the area.

According to a supplemental work plan submitted to the Arkansas Department of Environmental Quality on Monday (Aug. 4), the company's environmental consultants told ADEQ that the additional test and samples were necessary near the northeast corner of its closed factory after "three of the five new groundwater monitoring wells installed at the northeast corner in late June" detected the TCE.

The new sites were installed on July 8 and Principal Michael Ellis of ENVIRON, Whirlpool's consultants, told ADEQ that no TCE was detected in soil samples at the time of installation.

"Significantly lower” levels of TCE were measured in groundwater at the northeast corner than at other locations, including the facility's northwest corner and Whirlpool's property boundaries, Ellis said.

"In order to determine if remediation activities are warranted, further investigation is required to verify whether TCE detected in the groundwater has migrated under Jenny Lind Road and if so, whether this groundwater has also migrated under the undeveloped property owned by the Boys & Girls Club that will soon be separated from the club by the upcoming Ingersoll Avenue Road expansion," he wrote.

Ellis proposed soil probes to collect soil and groundwater samples in the areas beyond Whirlpool's property lines.

"Based on the results of this first phase of testing, permanent groundwater monitoring wells would be installed, if appropriate," he added. "If remediation activities are warranted, plans will be prepared for ADEQ review and approval to aggressively and swiftly address this contamination as appropriate based on the data from this investigation. … Based on existing data and the easterly groundwater flow direction in this area, there is currently no indication of impacts to other properties adjacent to the northeast corner of the Whirlpool property - other than those where we are proposing to conduct this additional investigation."

Additionally testing will also be conducted at the Whirlpool site, Ellis said, "out (of) an abundance of caution" in order to determine whether there could be any additional TCE migrating from the company's property.

"Once these plans are finalized, we will submit additional work plans to ADEQ for any necessary approvals before commencing these activities," he wrote.

The additional testing will start this week "following the completion of access agreements with the two property owners (City of Ft. Smith and Boys & Girls Club) where the proposed sampling will take place," Ellis said, with initial probes taking one week to complete.

In a statement, Whirlpool Vice President Jeff Noel said the company was committed to being a "responsible corporate citizen of Fort Smith and to managing this issue in an open and responsible matter."

"Sampling data from the new wells near the northeast corner of the Whirlpool manufacturing facility detected no soil contamination, and there remains no health risk to residents. Because of the interest in the ongoing remediation work from Fort Smith residents and City Directors, we are accelerating the supplemental investigation to define the impact of the TCE detected in the groundwater in some of the new wells in the northeast corner of our property, and we plan to complete the sampling, validation and analysis by early September.

"If additional remediation activities are necessary, plans will be prepared for ADEQ’s review and approval to aggressively and swiftly address this contamination as appropriate based on the data from this investigation. While we are still in the process of gathering the facts, Whirlpool is sharing this information now because of our commitment to transparency."

Retail giant Wal-Mart Stores has plenty of publicity-generating irons in the fire from onshoring manufacturing jobs, hiring veterans and sustainability pushes. But one initiative that often goes underreported is the retailer’s economic empowerment of women program — an effort announced in 2011 by then-CEO Mike Duke.

In 2011, Wal-Mart pledged to source $20 billion from women-owned businesses for its U.S. segment by the end of 2016.

MiKaela Wardlaw Lemmon, senior director for women economic empowerment at Wal-Mart, told The City Wire that the retailer remains focused on leveraging its size and scale to empower women across its global supply chain. Lemmon said over the past two years the retailer has developed a comprehensive women-owned business sourcing strategy and sets annual goals with respect to the $20 billion in purchasing power.

“We met the annual goals in the first two years and our spending since then is $400 million ahead of our goal. We are actively working toward growing our women-owned supplier base,” Lemmon said.

Wal-Mart has roughly 1,000 suppliers who made their way on to the retailer’s shelves through the women-owned business initiative.

Women-owned businesses contribute over $1.3 trillion dollars to the U.S. economy and women are responsible for over 80% of the consumer decisions globally.

MEET MAGGIE
Maggie Cook, founder of Maggie’s Salsa, said working with Wal-Mart through the empowering women’s initiative is a great opportunity for her to grow the small business she founded after immigrating to the U.S.

“Women-owned businesses have so much to offer and research shows that women shoppers often gravitate toward the products from woman-owned businesses,” Cook told The City Wire.

Cook, whose full name is Maria Magdalena De La Cruz Cook-Garcia, was born in a Mexican orphanage. Her parents cared for 200 children through the years, legally adopted 60 children and had eight biological children of their own.

By chance she caught the eye of college basketball scouts when her family visited the U.S. on a fundraising mission for their charity organization. Cook dreamed of playing basketball for the Mexican National Team, but that did not happen. Her luck changed when she joined a pick-up game while her family was visiting in West Virginia. The University of Charleston’s (West Virginia) basketball coach saw her play and offered a scholarship.

Cook graduated with a degree in interior design and in 2004 she started Maggie’s Salsa after winning a local salsa contest by unanimous vote. She got the company off the ground with $800 in seed money from a friend and made her first store sale using 6 tomatoes. In 2007, Whole Foods placed an order that required 60,000 tomatoes and she has never looked back.

Dan Irwin, a category director for product at Walmart U.S., said when he tasted Maggie’s Salsa he knew quality and freshness was important and that it would be a great product for Wal-Mart. 

Cook employs 18 people in her small company and outsources the production and distribution to another salsa manufacturer who follows her ingredient requirements.

“Our sales are growing with Wal-Mart and Sam’s as we are in the mid-Atlantic region there. In addition we are in Whole Foods and Kroger,” Cook said.

WOMAN-OWNED 
In July, Wal-Mart was the first retailer to announce its commitment to the Women's Business Enterprise National Council (WBENC) efforts to bring forth a new logo label identifying goods as produced by women-owned businesses.

“At Wal-Mart we are committed to empowering women and impacting women-owned businesses from around the world — and so are our customers. We recently conducted a survey that found 90% of female customers in the U.S. would go out of their way to purchase products from women, believing they would offer higher quality,” Lemmon said.

Wal-Mart’s role in the process was to collaborate on the logo design and conduct the supporting research. The retailer said consumers will begin seeing the new logo on its shelves in September. 

Cook said she plans to use the new woman-owned business labels that will help more consumers know the Maggie’s Salsa is a woman-owned enterprise.

GIRL POWER
Wal-Mart said the majority of its 245 million customers per week are women, and women control more than $20 trillion of annual consumer spending globally. With nearly 1 billion women estimated to enter the global economy during the coming decade, 

Wal-Mart said it’s taking the lead in sourcing from and providing access to markets for those women because it promotes economic growth and better lives for their families.

In 2012, Wal-Mart estimated 224 million women were starting or running businesses in 67 countries around the world. Many of these women are planning for significant business growth; however, substantial barriers challenge female entrepreneurs who hope to grow their businesses. For example, although 29% of U.S. businesses are women-owned, enterprises owned by men are more than three times as likely to reach $1 million in annual revenue. 

“We work to address barriers and help women-owned businesses and our merchants work more effectively together,” Wal-Mart said.

PROGRAM TOOLS
Lemmon also notes that a key to the program success has been the Women-Owned Business Advisory Council (WOBAC) made up of internal advisors, industry leaders, merchants and suppliers. Through conversations with industry leaders, our merchants and suppliers, the retailer identified challenges facing woman-owned businesses and, along with supplier diversity and supplier administration, they implemented a variety of tools and resources to address them.

Wal-Mart developed scorecards to ensure their merchants and other leaders have more visibility into the woman-owned suppliers they work with and how each area of the business is tracking against its target. 

In 2013, Wal-Mart conducted two types of supplier summits. The first allowed teams to discuss strategic business growth opportunities with women suppliers. The second focused on finding new suppliers. Wal-Mart and Sam’s Club held 10 summits last year to help grow existing or identify new suppliers, Lemmon said.

Wal-Mart launched the Supplier Academy in November 2013, which is a set of online educational modules designed to prepare “merchant-ready” suppliers and buyers to work with them. 

Modules such as “Keys to a Successful Buyer Presentation” and “Working with Small and Diverse Suppliers” are aimed at developing strong working relationships and set both sides up for success, the retailer notes.