The Fort Smith Board of Directors passed an ordinance at its Tuesday (Aug. 5) meeting that would restrict the location of temporary signs in rights of ways, a decision the Fort Smith Board of Realtors said could impact its business.

The ordinance limits the placement of temporary signs, such as yard sale or for sale signs to 10 feet back from the street if no sidewalk is present or on the opposite side of the sidewalk from the street if a paved sidewalk is present. The Board had previously expressed concerns about signs advertising credit repair and rent to own properties cluttering public right of ways.

A July 22 study session of the Board of Directors directed City Attorney Jerry Canfield and Development Services Director Wally Bailey to research whether the Board could pass an ordinance that would limit the sign restrictions to just certain corridors without restricting neighborhoods. Bailey said an ordinance could be drafted to that standard if the Board directed.

The Board did not direct city staff to change the ordinance, but instead continued discussion on the current ordinance. Bailey told the Board that the ordinance up for a vote Tuesday would allow for weekend posting of signs in right of ways for special events, such as open houses and yard sales as long as the individual posting the sign had permission from the landowner.

Robin Mulac, president of the Fort Smith Board of Realtors, said the organization had concerns about the ordinance before its passage Tuesday. In her remarks, she told the Board of Directors it could negatively impact Realtors and clients.

"We are big proponents of single family home ownership and one of the most basic rights of home ownership is the right to sell. And we're a little apprehensive about anything that might limit that, telling us where we can put signs in people's yards. That's a little bit of a concern that's on our minds."

She said with the setback of 10 feet from the road, some homeowners may decide to move the sign legally placed by the realtor and may then be in violation of the ordinance. She said landscapers and others doing work on properties may also remove the signs and may return the sign to an improper location according to the new ordinance.

Mulac said the Board of Realtors was also concerned about how limiting sign placement could negatively impact not only new home sales, but also the various businesses associated with home purchases who could be negatively impacted by even a small drop in home sales.

City Director Pam Weber, who is a Realtor, said the she thought the ordinance was about beautification of the city and would not negatively impact the ability of realtors to sell homes in the area.

"We need to do something to get rid of the visual clutter in our town and make our town look better," she said.

Weber added that "the better we look, the better we'll do economically." The ordinance passed Monday, she said, was an effort to further beautification efforts and improve the local economy, as well.

The measure was approved by a 6-1 vote, with Director Kevin Settle opposed.

In other business, the Board passed a rezoning of 11701 Custer Boulevard, 7201 Fort Chaffee Boulevard and 12201 Roberts Boulevard in Chaffee Crossing from not zoned to a planned zoning district. The area includes the new River Valley Sports Complex, which is now under construction as the U.S. Army Reserve has commenced dirt work at the site.

Another rezoning was approved at 8801 Wells Lake Road, from not zoned to light commercial. The location will house a second Red Rooster Bistro location at Chaffee Crossing.

The Board also passed state-mandated updates to construction codes and passed approved a resolution to authorize Mayor Sandy Sanders to execute an additional 10-year franchise agreement with Newroads Telecom for a non-exclusive wholesale fiber optics network.

Arkansas Senate Republicans on Tuesday elected by acclamation Sen. JIm Hendren, R-Gravette, as Senate majority leader and Sen. Jimmy Hickey, R-Texarkana, as majority whip.

The 22-member caucus met last week to determine the process, gave members a week to select nominees, and when the nominations closed Monday night, elected the two senators electronically.

Hendren said Tuesday he and Hickey will start preparing for the upcoming session immediately. Unlike two years ago, Senate Republicans will enter the session confident of a majority. Sen. Jonathan Dismang, R-Beebe, has already been elected the incoming president pro tempore. Top issues will include tort and regulatory reform, economic competitiveness, the state lottery, and expanding broadband access for public schools.

“I have found that it is almost impossible to do a thorough job of developing complicated legislation in the midst of a session. It has to be done in advance,” Hendren said.

Hendren will lead a caucus deeply divided over the so-called Private Option, the state program that uses Medicaid dollars through the Affordable Care Act to buy private insurance for lower-income Arkansans. Hendren has been an opponent of the program, Hickey a supporter.

The Gallup organization released a poll Tuesday that found that Arkansas has seen the largest reduction in uninsured residents in the country. The rate dropped from 22.5% in 2013 to 12.4% in 2014. As of June 30, 176,691 Arkansans have been insured through the Private Option. Of that number, 19,508 were assigned to traditional Medicaid because they were judged to be medically frail.

Hendren said the news did not change his opinion that the program is financially unsustainable. However, he said opponents must consider the large number of Arkansans who now have health insurance because of it.

“We have this program, and I’m one who believes you’ve got to be fair with people,” he said. “So anything that’s done, we have to take into account the fact that we’ve got a lot of people in Arkansas who are playing by the rules and who are working hard, and to just yank that away from them without any consideration is not something that I think is the right thing to do. So we’re going to have to look at how we can find some middle ground, or find some sort of process that gets us to a program that’s more sustainable.”

Senate Republicans will try to craft a compromise or at least just take a vote and get past it, Hendren said. He said his goal will be to “not let that define us as a caucus.”

“We’re not going to let those differences and those different groups that we come from prevent us from being effective as a caucus,” he said. “We’re just not going to let that happen.”

A sales tax increase rejected by Missouri voters has pushed that state’s highway officials back to square one in terms of finding money to complete the portion of Interstate 49 that would connect to the Bella Vista Bypass at the Arkansas-Missouri border.

The about five-mile stretch is the remaining portion between Kansas City and the I-49-I-40 interchange near Alma without secure funding.

Missouri voters rejected an increase in the state’s sale tax to pay for highways, roads and bridges. The proposed amendment was defeated 59% to 41%, according to the Missouri Secretary of State’s office. The constitutional amendment would have been a three-quarters of one percent increase to the state’s 4.225% sales tax and would have included banned tolling on state highways and prevented an increase in the state’s tax on gasoline and other motor fuels.

Had the Missouri tax passed, the state projected $4.8 billion in revenue over 10 years that would have covered 800 road projects which were identified by state transportation officials. Missouri followed the lead of Arkansas who passed a half-cent sales tax last year to pay for its part of the bypass with a $150 million price tag.

Arkansas completed its portion of the 19-mile Bella Vista Bypass and stopped just south of the state line, waiting for Missouri to come up $50.4 million needed to complete five miles of the highway to connect Bentonville to Pineville, Mo.

Arkansas officials remain hopeful that Missouri will find the money to complete its portion of the road, but until then the full benefit of Arkansas’ $150 million investment cannot be realized.

Randy Ort, a spokesman for the Arkansas Highway & Transportation Department, said the section will be built, but now the question is, “When?”

“It certainly throws uncertainty into the timing of it. Had the initiative passed, we would have anxiously awaited an announcement from Missouri on the timing. Now that the initiative has failed, we anxiously await an announcement from Missouri on the timing,” Ort said.

Becky Baltz, district engineer for the southwest region of the Missouri Department of Transportation, said the five-mile segment is in limbo until other revenue can be found.

“Without the additional funding we’re not going to be able to complete that project,” Baltz told The City Wire.

Baltz said the section could be built within two years if funding were available.

The Northwest Arkansas Council, one of the leading advocates for completion of I-49 through the Arkansas-Missouri border, issued this statement about Missouri voter rejection of the highway funding plan: “We appreciate that Missouri lawmakers put the sales tax issue to a vote this week. Our organization has communicated with Missouri about the Bella Vista Bypass many times, even as recently as this summer, and we know Arkansas and Missouri are committed to finishing the bypass.

“The bypass has a huge long-term economic importance in both of our states and that’s why we definitely need to work together to get the bypass off our states’ to-do lists.”

Two decades long Alma residents have filed to be the city's next mayor following news that long-time Mayor John Ballentine would not seek re-election. The candidates, retired businessman Keith Greene and former Rep. Ed Thicksten, have both filed to appear on the November ballot.

Both men have said jobs and the completion of Interstate 49 through Alma would be their focus if elected mayor of the city of 5,400.

"For many years, Crawford and Sebastian Counties were considered part of Northwest Arkansas when it was convenient, " Greene said in a statement. "When (I-49) was completed that ended any dispute. It placed Alma in a most unique situation. It ascertained that growth would come. Few cities of Alma's size enjoy that benefit. As the next Mayor, my challenge will be to harness that growth and prepare the city to handle the demands as needed."

Thicksten, who served in the Arkansas House of Representatives from 1975 to 1999, also spoke of the interstate's importance to the community and said his past experience with funding the construction would put him in position to advocate for completion of the next stretch of the interstate from Alma to Barling, where a section of what will eventually be I-49 is scheduled to open in the fall.

"When I was in the legislature, I was one of the chief sponsors of the (legislation that guaranteed) the state paid its share of what was then I-540 and what is now I-49. I have a long history with the highway. In fact, I was involved in the legislation in the House to name it after (former U.S. Rep.) John Paul Hammerschmidt," he said. "I am in charge of the Build the Bridge Coalition. And I am very involved in the work to get the remaining 12, 13 miles of what we have in Alma to bring it on south to connect to the section to be dedicated later this fall in Barling."

Greene and Thicksten agree that completion of the road will bring job growth to the city and both have said the Alma Public Schools were a factor in individuals deciding to settle in the community, with Thicksten going so far as to call it the "best school system in Arkansas."

Thicksten said the city must have more than a good school system to continue growing and that is where a combination of public and private partnerships, along with state and federal grants, could allow the city to possibly develop an industrial or technology park to fuel further growth and attract more families.

"We need to do more as a city. We can have great education, but if we don't have jobs and businesses to come to, we haven't done our job," Thicksten said. "Alma is one of the few cities our size that doesn't have an industrial park. We also don't have a business or technology park. Those are obvious things we can do in a relatively short amount of time."

He said using a combination of grants, state and federal funding and private investment would allow the city to develop a technology park for a small investment. And he said developing a technology or other business-type section of the city could spur additional private investment.

"If they see the opportunity to make some money, they'll be on board," he said of businesses who could make the decision to locate in Alma.

Greene's mayoral announcement said he would continue the work of Ballentine, who he said has set Alma on a "positive course."

"As mayor, I will work to continue the positive course set by the current administration to keep Alma a great place to live. As Mayor of Alma, my focus each day will be to promote the growth and prosperity of our city with the assets we now have and the possibilities to come and make Alma a marketable city."

He continued: "I cannot claim to have held any former political office, but I can claim to have over 40 years of seeking opportunities and solving problems successfully."

Thicksten said if elected, he would create a committee of 21 diverse residents to make suggestions to the mayor and city council on policies to improve the future of the community in a transparent way. He added that he looked forward to the next 88 days of campaigning.

"I'm excited about it. Instead of it being work, I consider it a great pleasure to campaign. I enjoy listening to (the voters) and meeting them."

Municipal elections will appear on the Nov. 4 general election ballot in Crawford County.

Digital coupons are becoming somewhat of a necessary evil for retailers, according to Carol Spieckerman, CEO of NewMarketBuilders. But not all retailers are on the same page .

Dollar General, one of the weakest in digital prowess among value retailers, recently announced a partnership with Coupons.com that will make digital coupons available in its 11,300 stores.

“The DG Digital Coupon program provides our customers with an easy-to-use and convenient platform to use digital coupons toward our everyday low prices, helping them get the products they need at prices they want,” said Todd Vasos, Dollar General’s chief operating officer.

He said the service is aimed at shoppers who are using digital and online technology to save money which is part of Dollar General’s everyday commitment. To use the DG Digital Coupon Program, customers sign up online or in stores using a numeric identification number, which is typically their telephone number. After signing up, customers select the most relevant coupons to be added to their profile and the discounts are applied at checkout to customers’ eligible purchases, including leading national brands and Dollar General’s store brand products.

“As more retailers offer the option, shoppers have come to expect them. I like what Dollar General is doing with its DG digital coupons. The program is truly shopper centric because it allows customers to choose which coupons they want to use online then have the savings automatically applied at checkout. Beyond the convenience factor, it is a paperless transaction which gives Dollar General sustainability points,” Spieckerman said.

While Wal-Mart is miles ahead of Dollar General with numerous digital innovations including e-receipts, their digital coupon policy is somewhat old school.

“Walmart’s insistence on paper-based coupons is inconsistent with its sustainability push but it does encourage shoppers to opt for its Savings Catcher program instead,” Spieckerman explained. “Savings Catcher is great for Wal-Mart because it keeps shoppers spending in the Walmart ecosystem as they redeem gift cards. It may sound convenient for shoppers to load coupons onto their smart phones but not every shopper will be comfortable handing their phone over to a store associate. Paperless and automatic is the way to go.”

Wal-Mart has made manufacturers coupons available on its website for several years, according Ravi Jariwala, spokesman for Wamart.com. He said the site allows consumers to surf for the coupons they want, click the box to clip, and the savings are tallied onsite. The consumer must print out the coupons, which can then be redeemed at their local stores.

Jariwala said during 2013 Scan & Go tests there was a digital coupon function that automatically deducted the coupon from the purchase. Scan & Go is no longer being tested, but Jariwala said Savings Catcher and e-receipts came out of the learnings from the Scan & Go tests. 

He said when a shopper signs up for e-receipts they automatically get the benefits of Savings Catcher, which was rolled out nationally this week and expanded to include produce and select general merchandise.

GROWING MOBILE
Just how pervasive is mobile shopping? Shop.com reports 156 million Americans own smartphones. Goldman Sachs projects that U.S. retail sales directly on smartphones will more than double from $70 billion this year to $173 billion by 2018. Similarly, tablet sales will more than triple from $130 billion this year to $453 billion in 2018.

Among U.S. smartphone users, approximately half have consulted their phones to find store information such as location and hours. Half as many again tap their smartphone when they’re browsing or looking for a product or service. And while 37% of 18-to-34-year-olds have purchased a product on their smartphone, so have 29% of smartphone users 35-54 and 14% of those over 55, according to Shop.org.

This summer, 54% of back-to-school shoppers cited coupons as the leading factor that influenced them to shop at a particular store. 

About half of U.S. Internet users will have redeemed a digital coupon by the end of this year. Roughly half (48%) of those are mobile coupon users, up from 39% last year, and more growth is ahead, according to Prosper Insights and Analytics.

WHAT’S NEXT?
Retailers are strategically using digital coupons to achieve a variety of goals beyond the immediate sale. For example, Ace Hardware recently concluded a test in Northern California that encouraged in-store shoppers to text them for a coupon. 

Ace reported that the test increased average basket size in the store and grew the company’s opt-in text-messaging list. Prosper Insights notes that coupons can be a key element in campaigns to re-engage customers, avoid abandonment on the checkout page and rescue abandoned online carts.

“The budgeting aspect of Wal-Mart’s Scan & Go was one of the most popular traits singled out by our mobile users. When they scanned an item into their phone and e-cart it kept a tally of their total purchase. Consumers liked that aspect,” Jariwala said.

Gibu Thomas, senior vice president of mobile at Walmart.com, said during the June shareholders week that e-receipts hold much promise as a platform upon which applications may be built. In the future, he predicts through e-receipts, shopping lists will be generated based on previous shopping trips and then emailed or texted to the consumer as they enter the store. Those lists could also attach manufacturer coupons for more savings potential.

Discount grocer ALDI – a small box, no frills, private label grocery format – was recognized as the nation’s low-price grocery leader for the fourth year by consumer research firm Market Force.

The Market Force survey for 2014 asked shoppers to rank the top grocery offering low prices. The participants ranked ALDI ahead of Costco, Wal-Mart and Trader Joe’s. They also named ALDI one of the top three favored grocery store chains in America.

"It's no surprise that ALDI continues to be recognized as the low-price grocery leader," said Jason Hart, ALDI president. "However, these latest survey findings prove that a growing number of consumers are choosing to shop at ALDI for more than just low prices."

ALDI also maintained a top five ranking in the categories of good private label brands, accurate pricing and sustainable policies. ALDI also ranked in the top five for courteous staff, fast checkout. But the small box grocer didn’t make the top for five for the one-stop shopping category, which went to Wal-Mart, Costco, H-E-B, ShopRite and Meijer.

Hart said ALDI continues to increase its branded product also adding more better-for-you options like gluten-free and organic choices. ALDI announced in December plans to grow its U.S. footprint by 650 stores over the next five years.

While price matters, consumers also expect well-stocked stores that can anticipate their needs in an inviting atmosphere. Publix takes the top spot in this category, followed by Trader Joe’s. Wal-Mart and ALDI did not make the top five ranking in this survey. (See detailed ranking info at the end of this story.)

When it comes to product quality, Costco took the top spot in beef, trumping Publix and H-E-B. Publix took top grade in produce quality, with H-E-B coming in a close second. Wal-Mart nor ALDI ranked in the top five for the two quality categories, despite a major marketing push by Wal-Mart on beef and fresh produce.

“Competition is fierce and growing in the grocery sector with regional players going national and national players moving toward neighborhood market concepts. It’s only getting more difficult to attract and keep customers, and being adequate is no longer good enough,” said Janet Eden-Harris, chief marketing officer for Market Force. “We’ve found that delighted customers are three times more likely to recommend a grocery store than those who had just an OK experience. This tells us that chains that truly wow their customers on their first visit can establish brand advocates who go on to recommend the grocer to friends and family.”

Wal-Mart’s sustainability score was not among the top five according to the survey. Trader Joe’s, Publix, ALDI, Costco and H-E-B were the top choices by the survey respondents.
When all the category scores were tallied by Market Force, Trader Joe’s took the No. 1 spot as the favorite grocery store chain with a score of 85%. Wal-Mart ranked No. 11 with a score 32%, despite being the most shopped grocer in the nation.

Arkansas now has eight public compressed natural gas fueling stations with the opening Thursday (Aug. 7) of Fort Smith's second compressed natural gas fueling station at 4315 Savannah Road. The Fort Smith stations are owned by Arkansas Oklahoma Gas Corp.

Two public CNG stations are under construction in Springdale, and one is planned for West Memphis. The first CNG station in Fort Smith opened in April 2011 and was the first public facility in Arkansas.

The new Fort Smith fueling station houses one pump that can be used by two vehicles at one time, with a second pump scheduled for installation before year's end, according to Fred Kirkwood, senior vice president of customer development at Arkansas Oklahoma Gas (AOG).

"(This station) has three times the capacity of our existing station (just off Rogers Avenue)," he said, adding that plumbing and electric are already in place for the additional pump.

‘PURE SAVINGS’
AOG President Mike Callan said the opening of the new fueling station is an investment – roughly $1 million – in what the company believes is the future of American fuel.

"We really believe at AOG that this is the wave of the future. As you can see from the sign, we're selling compressed natural gas for $1.63 per gasoline gallon equivalent," he said.

Compressed natural gas is a cleaner burning fuel than gasoline or diesel and is inexpensive enough, that AOG has invested in conversion of many vehicles in its fleet to run on the fuel, he said.

"What we do is we amortize, we look at our fuel savings," he said. "We're going to save around $1.50 to $2 per gallon on our fuel, so the more gallon equivalent of CNG that we burn, we're calculating that savings into covering the cost of the vehicle conversion and then everything after that is just pure savings on our operating cost each month."

When AOG was originally doing their own conversions, he said conversion kits would cost about $8,500 per vehicle. Now the company is able to purchase vehicles directly from Ford, General Motors and Ram with CNG already pre-installed at the factory.

Barry Rowton, owner of Falcon CNG — a Fort Smith-based CNG conversion business — has said the factory conversions typically run between $9,000 and $10,000, but added his company could convert a half-ton pickup truck with a 16.5 gallon CNG tank for about $6,800 "when it's fully said and done and out the door."

Using the factory installs, Callan said AOG is able to recoup the nearly $10,000 investments in a short amount of time.

"It is different for each vehicle. It is very dependent on how many miles that vehicle drives. Most of our vehicles, we're looking at at an amortization of less than three years. We're able to pay for the conversion and then everything after that is pure operations cost savings," he said, adding that a typical vehicle stays in AOG's fleet for a minimum of 175,000 miles.

GOVERNMENT FLEET CONVERSION
One of the largest purchasers of fleet vehicles on an annual basis are local governments. The Springdale Water and Sewer Commission announced July 16 it would buy two CNG trucks. With the purchase of two compressed natural gas vehicles, Springdale Water Utilities will become the first public entity in Northwest Arkansas to use CNG. The two vehicles are a pilot program to determine whether cost savings can be accomplished by converting more of the utility's more than 70 vehicle to reliance on the alternative fuel.

In the most recent budget year, the Fort Smith Board of Directors set a priority to incorporate more CNG conversions into the city's fleet to realize the cost savings touted by Rowton, Callan and others at the Thursday grand opening of the CNG station.

But according to Deputy City Administrator Jeff Dingman, the costs outweighed any fuel savings and do not justify the expenditure for vehicles with CNG conversion kits, though he said many of the city's bids this year for new vehicles have also included price quotes for conversions.

"I think it would be, just because there's a Board directive to try to be more proactive, if the margin gets close enough then I think we'd go for it. But I don't know what close enough means, really, whether it's $500 or $2,000. I think if it got in that ballpark, we'd certainly try to make it happen. But when we're talking about vehicles, I mean, a lot of times when you pencil out the fuel costs with the conversion on a vehicle… how long do you keep a vehicle for its intended purpose? Is 10 years too much? Will it take 10 years for it to break even? Does it come within $1,000 or $2,000 of breaking even? Are you even going to keep that vehicle for 10 years or do they rotate out every seven years?"

Dingman said the city has yet to purchase a new CNG vehicle this year beyond some transit vehicles and other vehicles that were converted using grant monies to test whether it would be a benefit for the city. Vice Mayor Kevin Settle said even though no vehicles were purchased with CNG this year, it would not change the desire of the Board to see additional CNG vehicles added to the city fleet.

"The costs will come down and the technology will get better," he said. "We'll see those prohibitive costs come down. This is not a one year action, it is a long-term action through the years. Other cities are doing this in transit. That is one of the major areas. And I think the Board has said it is a long-term goal, not just a one or two year goal."

‘STAGGERING’ SAVINGS
Dean Pendergrass, commercial fleet sales manager at Breeden Dodge Chrysler Jeep Ram in Fort Smith — who has been involved in some of the city's bids for new vehicles this year, including CNG conversions — said many businesses see the fuel costs reduce by about 60% per year once CNG vehicles are introduced into fleets. So he said while the up front costs may be higher to the city, it makes sense to go ahead and purchase a conversion in the long run.

"For this year, they are trying to go green, but at the end of the day costs is kind of prohibitive. But the fuel savings (are) there. But it's the initial cost that really kind of scares people, but they do eventually recoup that out, especially on a municipal level because they do drive a lot of miles. So they would recoup it, but it's just getting your administration to recognize that initial cost upfront is there, but you're going to recoup it later in the life of the vehicle."

Rowton of Falcon CNG said more and more companies are seeing the benefits.

"We have some companies here in town that drive very high miles and get very low miles to the gallon, they're saving thousands per month per truck. It's staggering the kind of money (saved)."

And it is because of those savings that AOG has decided to invest in the second fueling station and Rowton is expanding his business, as well, which just opened earlier this year.

"It's been going great. Fixing to have to bring on some more staff to keep up with it. I'm just not able to keep up."

Arvest Bank, which turned over $551,764 to the Benton County Court in the interpleader case of H. Dennis Smiley, has reportedly settled with 18 of the 20 banks holding claims against the money. While the cost of that settlement may never be known, the claims and legal costs exceed $3 million, according to court filings.

Smiley was forced to retire as president of Arvest Bank-Benton County in March when possible loan fraud was discovered. Smiley reportedly borrowed an estimated $4.5 million from more than a dozen Arkansas banks dating back to 2009, according to Uniform Commercial Code filings with Arkansas Security of State.

Arvest, Smiley’s former employer, filed the interpleader case in April asking the court to decide how the proceeds would be split from Smiley’s retirement fund after his termination. The funds were pledged as collateral among at least 20 banks staking claims far exceeding the retirement funds.

Last week 18 of the banks involved in the interpleading signed over their interests to Arvest Bank, who then asked the court to dismiss their claims as of July 30. Following is the list of banks settling their claims against Arvest.
Bank of Oklahoma
The Bank of Fayetteville
Bank of the Ozarks
Benefit Bank
Chambers Bank
Centennial Bank
Delta Trust & Bank
First Bank, Hampton
First Federal Bank, now Bear State Financial
First National Bank of Fort Smith
Integrity First Bank
First Security Bank
First State Bank of Lonoke
First National Bank of NWA
First State Bank of Russellville
First Western Bank of Booneville
Legacy National Bank
Summit Bank in Arkadelphia

Signature Bank and First State Bank of DeQueen did not settle with Arvest and will have their day in court on Sept. 18. Benton County Circuit Judge John Scott has ordered a pretrial and status conference. Scott filed that notice with the court Thursday, (Aug. 7). He said on Sept. 18, he will schedule future hearings and or a trial in this matter. He told The City Wire he wanted to conduct status hearings in all of the Smiley cases on Sept. 18. At that hearing Scott said he will decide all pending motions and set all other matters for trial if needed.

Jason Kincy, spokesman for Arvest, said the bank did ask the court to dismiss the claims of the 18 banks mentioned in the filing. He said the bank has no comment on the settlement or any of the actions that led to the dismissal, or any of the pending litigation. Kincy also re-affirmed that no other Arvest employee has been implicated in the Smiley situation, despite their names being mentioned in several of the court filings. 

“We don’t expect there to be any other personnel changes related to this case, all of those associates named in the filings remain employed by Arvest,” Kincy said.

A number of the banks settling their claims told the court that Arvest knew or should have known about the multiple usage of collateral pledged by Smiley, a bank officer. There have been no public records of the settlements made, and there likely won’t be, according to the court.

Cases that remain open for hearing on Sept. 18 include:
• Arvest interpleder versus H.Dennis Smiley, Signature Bank and First State Bank of DeQueen;
• Delta Trust Bank versus HDH Holdings, a business entity of Smiley;
• First Security Bank foreclosure on Smiley’s home at 56 Champions Boulevard in Rogers Pinnacle Country Club;
• Simmons First National versus Henry Dennis Smiley, Design for the Home;
• First Federal Bank versus HDH Holdings, H. Dennis Smiley Jr.; and
• First State Bank versus Henry D. Smiley Jr.

The city of Fort Smith has invested $201.2 million since 1993 on wet weather sewer improvements and another $150 million or more could be poured into improvements before the city atones for violations of the federal Clean Water Act – bringing the grand total for compliance with the law to $351.2 million.

Deputy City Administrator Jeff Dingman said the city has been under an administrative order from the U.S. Department of Justicen (DOJ) since the early 1990s directing the city to make improvements to comply with the Clean Water Act. He said the city may be placed under a DOJ consent decree that would require even more system work.

"The city has been under the administrative order (since) 1989, I think. But it's really been the last eight years or so that we've had these current ongoing negotiations on this consent decree action," he said.

DIRECTIVES V. CONTRACT
Steve Parke, director of utilities at the city, explained the differences between an administrative order and a consent decree as being a directive versus a contract.

"The consent decree is a pending action. And essentially what a consent decree does is it takes things in more of a contract format. (For example), the parties agree in the future that on schedules and stipulated penalty payments if you don't meet schedules, those types of things. It's an enforcement matter," Parke said. "So an administrative order is kind of a directive. You will go out and and do these things and do your best to get them done. A consent decree will come about if the agency either felt you weren't making appropriate progress or adequate progress. I guess if they thought your improvements were not sized properly. Those types of things."

Parke has said publicly as recently as December 2013 that city wastewater runoff date back to the 1970s. In the same article on The City Wire, Dingman explained that some of the problems leading to the administrative order included drainage into the Arkansas River.

"In the past, there have been areas of town where untreated water has gone into the streams and the river in violation of the Clean Water Act. That's the whole deal. We've (had) untreated water going to streams and rivers in violation and we have to prevent those."

Dingman recently told The City Wire that drainage into the river is no longer the primary problem.

"The current system, the deficiencies are based on age of pipe and that sort of thing. And we still can't guarantee that we're not going to have overflows. We still have recurring (problems) like a particular manhole in an area, (we) still know of several of them that will overflow if we receive a certain storm event, a certain amount of rainfall within a certain amount of time. So, those are becoming more and more infrequent as we address capacity issues in the lines."

But he said until all overflows stop, the city is still looking at violations of the Clean Water Act.

"The Clean Water Act says, 'Thou shall not overflow,' and you know, if we know of areas in town that have recurring overflows — infrequent or not, then we are not in compliance. So we're not going to be in compliance until we can address those," Dingman said.

CONSTRUCTION AND CONTRACTORS
Projects completed or under construction using the $201.2 million spent since 1993 include equalization tanks on Grand Avenue, as well as improvements to the Massard Wastewater Treatment Plant, the construction of two overflow storage tanks at Jenny Lind Road and Zero Street, construction of the Mill Creek Pump Station, as well as equalization tanks under construction on Navy Road near the Port of Fort Smith and the Arkansas River.

A variety of companies have been awarded construction contracts associated with $95.004 million in improvements just since 2008 to July of this year, Parke said, with Neosho, Mo.-based Branco Enterprises taking in the most at $46.434 million. Fort Smith-based Forsgren was awarded contracts totaling $16.076 million during the same period and Topeka, Kan.-based BRB Contractors was awarded contracts totaling $12.93 million. Contracts awarded to the three companies total $75.439 million, or 79.41% of contracts awarded during the last five and a half years.

Dingman said further capital and infrastructure improvements will be needed once a consent decree is filed by the Justice Department, details of which he said are still confidential at the direction of the DOJ, he said. While he said the DOJ will not allow disclosure of working documents — Dingman said Justice Department officials collect all notes and paperwork from any negotiation participants at the end of each in-person meeting — the consent decree will have specific benchmarks the city must meet in its efforts to comply with the decree.

According to Dingman, the city will comply with the decree in two areas: capital improvements and ongoing operations and maintenance.

THE LIMITED PIE
The capital improvements are why the cost for complying with the consent decree could meet the $201.2 million total already spent to this point. As for how long the city will have to comply with the order, he said it is under negotiation and it is ultimately at the discretion of the Justice Department.

"I mean, as far as getting the capital projects done, it's all going to depend on what the final decree says we're required to do. I mean, if we are able to put more capital investment in and less (operations and maintenance)… the pie is only so big, right? The more of that pie we can use initially for investing in capital needs, the more quickly we can get in compliance with our system," Dingman said.

"But the other piece of the pie has to be.. the pie is all how much we can afford, right? So if we're using a big chunk of it to address the capital needs and the infrastructure, then we have less of the pie to use towards ongoing maintenance. But as soon as we can get as much of it as possible, as much the collection system as possible in compliance, then that pie that's available for operations and maintenance gets bigger, you know? So I don't know, it's all a balancing act at this point."

Since the pie is only so big, the city will have to increase sewer rates to cover costs associated with complying with the consent decree, Dingman said. But it depends on how much time the DOJ gives the city to comply with the consent decree how much rates could go up and how quickly. It also would impact how much debt the city could possibly incur in the short term to comply with the order.

"And the right answer will depend on the timeframe. The timing of it is the variable that's going to impact the rest of it. And so can we afford the debt we need to incur to correct all the problems? Well, the answer if we have 20 years to do it is yes. If we have five years to do it it, no. So that's the variable that's going to possibly drive the whole thing,” Dingman explained.

He also said the DOJ is considering the city’s “arguments on affordability” for water and sewer bills in “a particular area.” He also pointed to specific maintenance issues as being a big factor in how much the city can afford.

"If we're required to inspect 50% of the system every two years, so we cover 100% of it every two year cycle, that's going to be unaffordable to our city. We can't get anywhere close to that. We're going to have to have a smaller percentage over a larger amount of time. Those are all points that are still being negotiated."

POSSIBILITY OF FINES
Dingman said the city has not had to pay fines for violation of the Clean Water Act, but he said those would be spelled out in the consent decree, as well, possibly adding additional cost if the city cannot comply during the prescribed timeframe.

City Administrator Ray Gosack has not shied away from the rate increases, noting in a July memo to the Board of Directors that sewer rates "will likely be necessary in order to begin implementation of the consent decree requirements for wet weather sanitary sewer system improvements."

Neither Dingman or Gosack have publicly said what the rate increases could be, only that the increases would be phased in versus a quick rise. Asked whether it would be more cost effective for the city to pay fines in the short term in order to buy more time to comply with the consent decree, Dingman said it was a scenario that has so far not been discussed among city staff.

"No, just because we're negotiating in good faith to try to get a consent decree that's acceptable. I guess at some point, you may have to look at that, but presumably we'll get to a consent decree that … I mean, that's the whole point of these negotiations is to try to get as many of these points agreed upon before the consent decree is lodged by the Department of Justice."

With negations ongoing between the city and the Justice Department, it is unclear when a consent decree could be handed down and the timeframe for getting out from under it. But Dingman and Parke confirmed a conference call was scheduled to take place Wednesday (Aug. 6) regarding the consent decree with an in-person meeting scheduled for later this month in Fort Smith. Gosack said July 22 that the city expected to begin spending on any compliance measures associated with the consent decree as early as next year.

A recent Pew Research study said Republicans nationwide have a clear electoral engagement advantage going into the November mid-term elections, but enthusiasm among likely Republican voters is lower than in years past. But two Arkansas political science professors said local politicos and operatives should not put too much stock in the survey.

The survey showed nearly even totals for self-identified Republicans and Democrats, but noted that Republicans are more enthusiastic about supporting their party's candidate in the fall by a margin of 45% to 37% Democrats.

Even with the advantage for Republicans in the poll, compared to 2010's difference of 55% to 42%, Republican enthusiasm nationwide is lower. Part of that has to do with the balance in power in Congress, with the number of Republicans wanting to defeat their incumbent member of Congress at 44% in 2010, versus only 38% in 2014, after four years of a Republican-controlled House.

The only numbers to not change in the poll for Republicans is the unfavorable view of President Barack Obama, with 51% of Republicans describing their vote in the midterms as a vote against Obama versus 52% in 2010.

Dr. Hal Bass, a political science professor at Ouachita Baptist University in Arkadelphia, said while the dislike of Obama may be drive voter turnout in certain areas of the nation, he said the survey from Pew should not be taken as representative of Arkansas.

"Enthusiasm is about a sense of perceived threat," he said. "In a sense, this is sort of counter intuitive. The distrust and disrespect of Obama in Arkansas is in a sense taken for granted. It doesn't drive folks to the polls because everyone feels that way."

He said the enthusiasm gap highlighted in the Pew study was more about a lack of focus within the Republican Party.

"I also think the enthusiasm gap suffers for Republicans for an absence of a real agenda aside from disliking President Obama. It's easy to say what they're against, but it's hard to see what they're for. It's easy to be enthusiastic about a good agenda versus just blocking what somebody else is trying to do."

Dr. Jay Barth, a political science professor at Hendrix College in Conway, said much the same.

"I think because Arkansas has been a state where the president has been unpopular for a long time, this is not a new dynamic," he said. "The president's unpopularity could be aiding some of the numbers nationally, but I don't know that it is strong here (in moving voters). It's been the norm the last two cycles. We'd need to see some Arkansas data on enthusiasm and I imagine some of the campaigns or the parties have done polling on the issue."

According to Barth, the bigger issue in Arkansas is going to be the unhappiness with Congress.

"I think that there's just so much negativity towards Congress as an institution that it's having an impact on individual members of Congress. But I don't know, we only have two members of the House running for re-election of the four," he said, mentioning U.S. Reps. Steve Womack, R-Rogers, and Rick Crawford, R-Jonesboro.

Bass said that even before the Pew study was released, Republicans had the advantage in many races across the state.

"I do think the broad partisan tide favors the Republicans," Bass said. "Arkansas is a conservative state. That benefits the Republicans. And opposition to Obama on top of that helps."

But the two elections still up in the air are the races for U.S. Senate where incumbent Democrat Mark Pryor is facing off against U.S. Rep. Tom Cotton, R-Dardanelle, and the governors race between Republican Asa Hutchinson and Democrat Mike Ross. Recent polls have Cotton and Pryor within the margin of error, while Hutchinson is up by about five points.

The issue is voter turnout and Barth said it is essential for Democrats to be organized if they are to overcome the Republican momentum built during the last two election cycles.

"That could be an impact here," he said. "The Democrats are anticipating and working to build large turnout. They feel like they need a large turnout to succeed. If that can't happen or folks are just so angered at their own party (and the President) and don't vote, that could be disadvantageous to Democrats here."

With the election in its final three months, Barth said the debates would also play a large part in voter turnout and turnout of the two marquee races in the state.

"I think there's tremendous things that could happen race by race and the debates are crucial. The gubernatorial and senate races are close. … I don't think anyone would say this is a done deal. In big races, debates are important. … If one is right on target and another falters, that could change the dynamics as we saw nationally in 2012 with the Presidential race."

The other factors to drive voter turnout could be ballot issues on the statewide legalization of alcohol sales and increasing the minimum wage, but Bass said the races will largely depend on the candidates themselves versus any statewide or national issues on the ballot.

"The races essentially are going to turn on the candidate appeal of the Democrats versus the partisan ideological appeal of the Republicans. If one candidate looms large, it works well for the Democrats. If ideology looms, it works well for the Republicans. That's why you have elections to see which one prevails."

For the second time in a week, Northwest Arkansas’ manufacturing sector was handed a slap in the face as jobs are being moved elsewhere amid corporate consolidations. APEX Tool, formerly Danaher Tool, employs roughly 250 workers whose jobs will be moving to South Carolina in 2015.

"APEX Tool Group has made the difficult decision to close our manufacturing facilities in Dallas, Texas and Springdale, Ark., by the end of 2015, and to consolidate production of our Made in the USA brands to an existing facility we own in Sumter, S.C.,” the APEX Tool Group noted in a statement. “We plan to add 150 to 200 jobs in Sumter to handle this additional capacity, and our associates in Dallas and Springdale whose jobs are impacted will have the first opportunity to apply for these positions. All three of these facilities are operating substantially below capacity so we need to consolidate these manufacturing operations in order to be competitive and serve our customers efficiently.”
 
APEX confirmed the local layoffs will begin in 2015 and the local plant employment is 250. 

“We were informed today of the corporate decision. ... We have known for some time that plant consolidation was part of the company’s long range plans. We were the beneficiary of this strategy in 2009 when we were able to assist our local plant in securing consolidated tool lines from New York at the time APEX Tool Group was formed by Danaher Tool Group and another tool firm,” said Perry Webb, Springdale Chamber of Commerce president.

Webb said the plant has been part of Springdale’s economy for more than 45 years and it was hard to hear the official word. 

“While this is a setback, it is our understanding that there will be no immediate layoffs. That gives us time to mitigate the impact of this announcement through continued job creation in Springdale,” he added.

APEX closed a plant in Gastonia, N.C., in June of 2013 after production of Craftsman tools was shifted to the Texas plant and to China. A year later the Texas plant is set to close as well. The consolidations have come under the ownership of Bain Capital, who purchased Danaher and Cooper Tools early last year.

“I am disappointed to hear of the corporate decision to move Springdale’s plant to another state and am saddened for the employees and their families who are impacted. APEX Tool Group, and Danaher Tool before it, have been excellent corporate citizens for many years. Layoffs are never good news but we are confident our strong local economy will continue to create quality jobs that can address the demand created by this announcement,” said Springdale Mayor Doug Sprouse.

The APEX Tool news comes on the heels of the Superior Industries decision announced July 30 to shutter its plant in Rogers, which will result in the loss of 500 local jobs.

There were 26,300 manufacturing jobs in Northwest Arkansas as of June, the Superior and APEX Tool closures will mean a 2.85% decrease in the overall sector, according to Kathy Deck, director for the Center for Economic Research at the University of Arkansas. While the news is not surprising, Deck said swallowing the losses is not easy, even for a growing economy like Northwest Arkansas.

Fort Smith area business leaders, politicians and other local stakeholders got a first hand glimpse of the United States' largest diesel tugboat as the U.S. Army Corps of Engineers brought together the diverse group of nearly 100 individuals for a nearly three hour tour along the Arkansas River.

The river cruise on the Motor Vessel Mississippi started at Lock and Dam 13 in Barling and made its way along the river boundary between Fort Smith and Van Buren to discuss the future of the Arkansas River and its impact on the regional economy.

Col. Courtney Paul, Little Rock District Engineer with the Corps, said the MV Mississippi — a Memphis-based tugboat that spends the vast majority of its time engaged in construction work along the Mississippi River — brought the communities along the Arkansas River a rare occasion.

"This is a unique opportunity for us. It's the second time ever that the Motor Vessel Mississippi has come up the McClellan-Kerr Arkansas River Navigation System," he said, adding that the Mississippi River Commission would hold public hearings next week on the vessel as it travels from Catoosa, Okla., and works its way back down the Arkansas River.

Public hearings will focus on navigation, the environment and the relationships between recreation and industry along the busy waterway. Paul said among the individuals scheduled on the manifest Monday as the towboat makes its way back through Fort Smith is Gov. Mary Fallin, R-Okla.

He said before the meetings begin, each of the commanders from different regions along the river — such his office in Little Rock and the Tulsa office that manages the river from the Oklahoma border at Fort Smith to Catoosa — are inviting the public to participate and engage with the Corps so the topics of importance to communities all along the river can be made known to the commission.

"We can kind of educate or explain what's going on (along) the river to folks," he added.

According to Paul, policy will be front and center during the meetings with the commission, with testimony during the meetings placed in the Congressional record. And while communities including Fort Smith may push for policies such as the 12 foot channel or a new harbor, he said part of the trip along the river is about an educational experience for the public and local leaders in business and government to understand the Corps' priorities in order to keep industry flowing through river towns like Fort Smith and Van Buren.

He said while local priorities like the 12-foot channel are important, the public needs to understand the threats to the system and how it could impact not only river commerce, but train and truck transport at ports all along the river and how one threat could derail plans like the 12 foot channel. Arkansas business groups are advocating for the river channel to be dredged and maintained to a 12-foot channel along the Arkansas River, deeper than the 9-foot standard in place.

"One of the greatest threats is the situation at the mouth of the system, which is what you call the three rivers area which is the confluence of the Mississippi, the White and the Arkansas Rivers. Why it's a threat to the reliability is that right now, the way it's set up you flow into the McClellan-Kerr Arkansas River Navigation System into the White River, you're in the first pool. You go into the Arkansas post canal, you're in the second pool. And then you follow the Arkansas River up to here and then on to Catoosa. The White River wants to do what … rivers want to do, and that is to meander and join up with the Arkansas. It's done that in the past, we've kind of patched that with a soil-cement levy, but every year we run the risk of a breach of the soil-cement levy."

If a breach occurs, he said it could shut down the river for as many as three or four months, cost local economies in the short term and possibly costing ports, towns and companies along the navigation system in the long term if companies find other ways to transport goods by bypassing the Arkansas River.

He said the risk of a breach means the Corps will make funding a permanent fix a priority with the hope for other projects down the road.

The tour comes just less than two weeks before U.S. Sens. John Boozman, R-Ark., and Jim Inhofe, R-Okla., are scheduled to be in Fort Smith to discuss transportation issues in a question and answer session to take place with the area's Regional Intermodal Transportation Authority (RITA).

The meeting with Boozman and Inhofe on Aug. 19 was organized by consultant Matt Sagely, who RITA has hired to organize meetings between the agency and influential members of Congress focusing on infrastructure issues of importance to the Fort Smith region, including a proposed inland harbor.

The MV Mississippi is scheduled to travel Catoosa before eventually looping back toward Fort Smith Monday evening, where Fallin is scheduled to be in attendance at the Mississippi River Commission meeting on the vessel.

The two leading Arkansas candidates in the U.S. Senate race were in Fort Smith on Friday (Aug. 8) with one talking about a jobs plan and the other pledging to help cattle farmers fend off federal rules that “interfere” with farm operations. The two candidates also expressed concern about President Barack Obama’s decision to attack ISIS forces in Iraq.

Obama said the airstrikes were needed to protect American diplomats and civilians and more than 15,000 non-Muslim Iraqis under siege without food and water by the hardline ISIS militants.

In an interview after his remarks to the 55th Annual convention of the Arkansas Cattlemen’s Association in Fort Smith, U.S. Rep. Tom Cotton, R-Dardanelle, said he understands that American citizens require protection, but said the action represents a larger problem.

“We have to protect our American diplomats and other personnel there, and anytime we can aid tens of thousands of religious minorities who are being persecuted by Al Qaeda with food and water, we should. But overall it just shows the lack of a strategy the President has had in Iraq for the last three years, and really, since he became President, and the lack of an overall Middle East strategy that’s designed to protect America’s interests and defend our allies,” said Cotton, who by several polls holds a narrow lead over incumbent U.S. Sen. Mark Pryor, D-Ark.

Pryor, who spoke Friday afternoon at Gerber’s baby food production plant in Fort Smith, told reporters that he worries about the action leading to more military involvement in Iraq.

"I really commend all of our men and women in uniform who are trying to deliver the humanitarian aid to the religious minority who are under siege right now. But I must say I share the concerns I think many Arkansans have about this becoming a deeper military commitment. So I know this is by nature, right now, humanitarian. And again, I think that is justified. And I think most people will support that because it is limited. So like the rest of us, I'm watching to see how this develops,” Pryor said.

IMMIGRATION DEBATE
Both candidates also addressed the contentious immigration issue and the ongoing crisis along the U.S. border with Mexico. Pryor pointed fingers at the U.S. House for the crisis.

"The Senate passed an immigration bill a year and a half ago, or a year ago I guess. I think perhaps had we had the House pass the immigration bills, perhaps we wouldn't be having the same trouble we're having on the border right now. Because there's so much in that legislation on border security. It was really about securing the borders first and then working on the rest of it secondly,” Pryor explained.

However, Pryor said he does not support unilateral action by President Obama to influence immigration policies through the use of executive orders.

"I do not agree with the President when he says he's going to start doing a lot of things in the immigration world by executive order. I don't think that's the way to go. I think Congress should be involved in the solution here. If we do immigration reform, hopefully the House will pickup the bill that we passed last year. I'm not saying they should pass it verbatim. Let the process work, they'll amend it, make their changes whatever and we'll get together and try to work it out."

Cotton said the U.S. House pushed legislation that would have fixed the problem, but the Senate failed to act. Cotton said he “played an instrumental role in toughening that (a recent House bill) up” to provide border security, ensure that the U.S. “expedite the return of illegal immigrants to their home country and not the settlement of them in our country,” and support border governors who have to call up the National Guard. Cotton also said the House bill would prevent Obama from “issuing future executive amnesties.”

“Mark Pryor voted for the President’s amnesty and then skipped town (Washington D.C.) for five weeks while we still have a crisis,” Cotton said.

PRYOR JOBS PLAN
Pryor’s visit to the Gerber plant – owned by Switzerland-based Nestlé – was to tout his jobs bill he said would promote onshoring manufacturing jobs in the United States and eliminate tax loopholes for employers who take jobs out of country. The plan would also extending tax credits through increased expensing and bonus depreciation.

Pryor said his proposed legislation could result in up to 10 separate bills he hopes to co-sponsor with multiple Republican and Democratic colleagues in the Senate.

Pryor wants to get the legislation passed this year, though as a "realist" he admitted that with only about three weeks of legislative work remaining before the November general election and only five or so weeks before the start of the new Congress in January, it would be a tall order to get multiple bills through the House and Senate.

"And we have a lot of catching up to do in that lame duck (session). So I'm going to do as much as I can to do the best I can and try to make it as bipartisan as we can. I think we'll get a ton of bipartisan support on it, but I can't… I would say probably most of this would happen next year realistically."

Even if the legislation does not make it to a vote, Pryor said he would make the legislation focusing on job creation a central theme in his tight campaign with Cotton as Pryor attempts to win a third term.

"I would like jobs and the economy to be the centerpiece of my campaign. Absolutely. I think I have a good record there. I think that the business community understands that I work with them all over the state of Arkansas to help create jobs here and I just know how important the economy is. So I guess short answer…yes."

COTTON’S FARM SUPPORT
Cotton, who has drawn criticism from farm interests in Arkansas for his vote against the federal farm bill, received a friendly introduction during the Arkansas Cattlemen’s Association luncheon.

Cotton, whose family owns a cattle farm in Yell County, was the only member of Arkansas’ U.S. House delegation to post a ‘No’ vote in January when the farm bill was approved. The politically powerful Arkansas Farm Bureau had urged all members of the delegation to vote for the bill.

Mark Graves, a farmer from Howard County who introduced Cotton, said he was proud of Cotton’s vote against “the unfarm bill” that was more about bureaucracy and benefits than farming.

In his brief comments to the almost 200 gathered at the association luncheon, Cotton said he could continue to speak up for Arkansas farmers in a Washington D.C. environment that knows little about farming.

“They (legislators and regulators) think that food comes from a grocery store,” Cotton said.

His primary objective as a Congressman and if elected to the U.S. Senate, is to push back against “extreme” environmental regulations and certain aspects of the federal Clean Water Act that “interfere” with farm operations.

Graves told The City Wire that he believed “a greater percentage” of cattle farmers support Cotton than Pryor. Graves acknowledged that Cotton’s vote upset some on the farm community, but said those not happy were primarily row crop farmers “that get the big federal subsidies.”

Wal-Mart took part during the past week in a three-day U.S.-African Business Forum in Washington, D.C. where business and government leaders discussed investment and economic opportunities.

Wal-Mart CEO Doug McMillon helped open the forum on a panel moderated by President Bill Clinton on Tuesday (Aug. 5). McMillon along with the CEOs of 
Dangote Group, General Electric, The Dow Chemical Company and Shanduka Group. Each identified ways to strengthen their business ties and generate economic growth with African connections.

Over the past decade, six of the 10 fastest growing economies are in Africa, which has already prompted some of country’s largest firms like Wal-Mart, Procter & Gamble and General Electric to invest in sub-Saharan regions. Africa’s GDP is expected to rise 6% annually over the next decade and real income has increased more than 30% over the last 10 years, according to economists.

The conference was expected to spur investments from U.S. companies to the tune of $14 billion in deals that would benefit Africa but also enhance U.S. profits of the giving companies.

"I want Africans buying more American products. I want Americans buying more African products," said President Barack Obama, who addressed the forum on Thursday (Aug. 7).

MCMILLON NOTES
Wal-Mart owns a majority stake in Massmart, a large retailer based in South Africa it purchased for $2.4 billion in 2011 and the retailer continues to invest in Sub-Saharan Africa.

“We’re investing for the long term, empowering African producers through hands-on training and using our global supply chain to connect them with our businesses around the world,” McMillon said. “Everywhere we operate we see that our customers have so much in common. Our customers in Africa want to spend less on everyday needs so they can provide more for their families.”

He also referenced the success of Seven Sisters Wines, a South African wine producer that supplies a range of wines to 500 U.S. stores. Seven Sisters CEO Vivian Kleynhans took part in Massmart's Developing Wine Brands Program, which helps local suppliers grow their business in South Africa and beyond.

WALMART INVESTMENT
On Thursday (Aug. 7) Wal-Mart and its foundation announced a $3 million investment in three farmer training programs in Rwanda, Zambia and Kenya.

As part of Wal-Mart's commitment to train one million small farmers in emerging economies, the Walmart Foundation is working in partnership with the U.S. Agency for International Development (USAID) to fund training in agricultural best practices for 135,000 farmers, including more than 80,000 women, according to Maggie Sans, vice president of international corporate affairs at Wal-Mart.
 
Walmart Foundation funding in Rwanda is supporting expansion and providing training to 50,000 farmers on agricultural techniques, emphasizing the production of corn, beans and dairy farming.  

Sans said an additional 45,000 farmers will be trained in business skills and leadership in agriculture in Zambi  as part of Agribusiness Systems International’s Women's Improved Marketing and Asset Control (WIMAC) project.
 
In Kenya, Walmart Foundation funding will support the expansion of the One Acre Fund program to improve agricultural practices and market access for 40,000 farmers, which will see them receive high-quality inputs such as seed and fertilizer, as well as post-harvest support. This process is expected to result in a higher crop yield that could double incomes in one planting season, she said.
 
Sans said women in emerging markets typically invest more than 90% of their income back into their families and communities. She ended by reiterating that Walmart is committed to empowering supply chains in Africa, particularly women farmers.

U.S. PLAN 
President Obama outlined a series of steps the U.S. is taking to boost economic ties with Africa.

• As part of the "Doing Business in Africa" campaign, the President announced an additional $7 billion in new financing to promote American exports in Africa.

• U.S. will continue to partner with Africa to build the necessary infrastructure for a flourishing economy. Aiming to bring electricity to more than 60 million homes and business, with a total commitment of more than $26 billion to Power Africa.

• The President called on Congress to renew and enhance the African Growth and Opportunity Act (AGOA). 

• The United States is going to continue to help more Africans trade with each other — because, as the President noted, "the markets with the greatest potential are often the countries right next door."

Arvest had plenty of reasons to settle claims with 18 of 20 banks who were owed money by former Arvest group president Dennis Smiley. The Fayetteville-based Arvest Bank reached private settlements with all but two of the banks staking claim to Smiley’s retirement funds.

Banking consultant Phillip Knight said it was “wise for Arvest to settle and to stop the long, arduous legal battle that had begun between many banks across the state.” He said from a publications relations standpoint, a sealed settlement that allowed Arvest to contain the publicity and offer the banks even pennies on the dollar makes more sense than letting each of the individual claims languish in the court system with legal meters running.

Arvest chose not to comment on the settlement or any of the conversations that led to that action or the pending cases to be heard on Sept. 18 in Benton County Circuit Court by Judge John Scott.

Tim Tarvin, banking expert with University of Arkansas Law School, said Arvest’s decision to settle makes sense on a number of levels.

“Arvest’s decision to button up the matter with a settlement made sense given the high profile nature of the employee involved. This is positive for rebuilding public image and could help to restore relationships with sister banks,” Tarvin said.

BANK CLAIMS
It will likely never be known what the 18 settling banks got in the deal, or if Arvest paid more than the $551,764 from Smiley’s retirement account. Banking insiders agree the total outstanding debts were relatively small for an institution as large as Arvest.

The claims filed with Benton County Court totaled more than $2.2 million:
Delta Trust Bank $245,100 
First Bank Hampton $179,000
First Federal Bank $70,000
Bank of Fayetteville $520,800
First Western Bank $210,900
First Bank Lonoke, $159,000
Integrity Bank Mountain Home $160,900
Simmons First National $85,000
First National Bank Russellville, $145,900
First National Bank Fort Smith, $393,380
Summit Bank, undisclosed amount 
Legacy National Bank, undisclosed amount
Chambers Bank, undisclosed amount
First Security Bank, undisclosed amount.
Benefit Bank, undisclosed amount
Bank of the Ozarks, undisclosed amount
Bank of Oklahoma, undisclosed amount
Centennial Bank, undisclosed amount

Gary Head, President of Signature Bank, told The City Wire he was not approached for settlement by Arvest. Though Signature Bank was listed among those with claims to Smiley’s retirement account, Head said the bank did not file a claim with Benton County Court for payment.

“Our lawyers have been working directly with Dennis and his counsel. We prefer not to kick a man when he’s down, but we will continue to pursue payment for the money we are owed and will have counsel at the hearing next month,” Head said.

First State Bank of DeQueen was the other institution not settling with Arvest. Bank officials reportedly said they too were not approached.

LIABILITY AGAINST FRAUD
Bank officers such as Smiley typically are required to carry professional liability coverage that protects them and their employer against financial loss. 

Garland Binns, attorney with Dover Dixon & Horne in Little Rock, said banks typically have blanket liability coverage on their officers and employees in fiduciary positions. He said the policy can provide against financial loss in the case of fraud. It is not known if Arvest had blanket liability coverage on Smiley, or if the bank has filed any claims with liability carriers regarding the fraud alleged by Smiley.

Smiley allegedly signed other bank officer names on official Arvest documents that allowed him to borrow money from 20 banks using his bank retirement account as collateral. The retirement account had a value of roughly $500,000, but Smiley pledged that same collateral several times without the knowledge of Arvest or the lending banks.

Arvest told The City Wire that none of the officers whose names were signed in connection with pledging Smiley’s retirement account had knowledge of the loan and did not sign the papers. 

“No other Arvest employees have been implicated in this matter,” said Jason Kincy, spokesman for Arvest Bank.

Smiley’s father, Henry Smiley Sr., also told the court that his signature was forged on loan documents to which he had no knowledge. Smiley Sr. claimed that he too, had been a victim of fraud in this matter.

The Federal Bureau of Investigation continues to probe the fraud allegations but no criminal charges have been filed. The statue of limitations on white collar fraud is seven years. 

Tarvin said any criminal charges must come from the federal prosecuting attorney. He said the prosecution generally takes its time to fully investigate each case so that no stone is left unturned before a plea is entered.

Head said several years ago, he had a bank employee that committed a crime and it took three years before she had her day in federal court.

The latest survey of more than 150 Arkansas company leaders indicates an improved outlook for the rest of 2014 on the sales and hiring front, as well as expectations that economic conditions will improve in the last half of the year.

Talk Business & Politics — in conjunction with the Arkansas State Chamber of Commerce and consulting group CEG Partners – released its second “Business Leaders Confidence Survey,” which captures opinions on the future direction of Arkansas economic conditions. The Greater Little Rock Chamber of Commerce also aided in this latest survey.

“There is a lot of good news from this survey and nationally, but it’s kind of like pedaling a bike in the Ozarks. As soon as you make it over one hill, there seems to be another one in front of you,” said Mike Stafford, managing partner with Little Rock-based CEG Partners, which conducted and analyzed the mid-year report.

CEG Partners received results from 154 state business leaders representing top executives in all major industry categories, such as manufacturing, health care, finance, energy, construction and utilities.

Some key takeaways:
• 69% of respondents expect sales and revenues to increase slightly or significantly during the next 6 months – an 8% improvement from January 2014.

• 49% expect hiring to increase slightly or significantly – a 23% improvement from the number we saw in our last survey 6 months ago.

• 47% said economic conditions are better today than 6 months ago – an 88% improvement from our last survey.

• 51% said they expect conditions to improve in the next 6 months – a 46% improvement from six months ago.

“There’s no question that the economy, at long last, in this now five-year old recovery seems to be getting some legs, so this is good news,” said Randy Zook, CEO of the Arkansas State Chamber of Commerce and Associated Industries of Arkansas.

There was one negative highlight in the report related to capital spending. Despite the optimism for employment, revenue increases and the overall economy, business leaders are still cautious regarding capital expenditures. About 51% of business leaders surveyed expect capital spending to increase in the second half of 2014, a 2% decline from 6 months ago.

Stafford said capital expenditures remain a long-term investment, and presently, there is still lingering uncertainty for the long-run even though short-term conditions look positive.

Zook added there is still a lot of “slack capacity” in industry statewide and nationally, which could explain the hesitation in this category.

The results of the Business Leaders Confidence Survey are a contrast to Arkansas consumer opinion on business conditions. The recently released Arvest Consumer Sentiment Survey found only 22% of Arkansas consumers expect business conditions to be more favorable one year from now, mainly because of concerns regarding unemployment.

A $4.9 million grant from the Federal Aviation Administration to the Fort Smith Regional Airport is the largest single grant received by the airport and will pay for completion of a major taxiway realignment by the fall of 2015.

The grant was announced Monday (Aug. 11) by the offices of U.S. Sens. Mark Pryor, D-Ark., and John Boozman, R-Ark., and U.S. Rep. Steve Womack, R-Rogers. 

On May 27 the Fort Smith Regional Airport Commission approved awarding a construction bid to Forsgren for construction of phase three of the Taxiway A West project. The approval was for a contract of $4.636 million with a deductive alternate of $3.741 million.

With the $4.9 million grant, the full design for the taxiway work will move ahead, Parker said. Because of higher labor costs, materials cost and other inflation factors, original estimates set in 2010 were below the real costs in 2014. However, Parker said the FAA agreed to provide more than the original estimate, thus negating the lower alternate bid.

“This is really a big deal for Fort Smith. In fact, this is the largest single grant that the airport has received. ... We’ve had larger projects, but in terms of the amount of money, this is the largest single FAA grant,” Parker explained.

He estimated that work on the third and final phase of the taxiway realignment should be completed by the fall of 2015.

"These funds will allow Fort Smith to make smart, essential improvements to its airport," Womack said in a statement. "Developing our transportation infrastructure is key to the continued growth of the city's and our state's economies."

Commercial traffic at the regional field is on a positive track after posting a decline in 2013. The airport, served by flights from Atlanta and Dallas-Fort Worth, posted June enplanements of 8,393, up 6.56% compared to June 2013. Enplanements for the first six months of 2014 total 44,730, up 6.39% compared to the same period in 2013.
For all of 2013, enplanements at the airport totaled 84,520, down 2.46% compared to the same period in 2012. The decline ended three consecutive years of enplanement gains at the airport.

FIRE SERVICE
Parker also said airport staff may recommend contracting with Green Bay, Wisc.-based Pro-Tec Fire Services to provide rescue and fire-fighting services at the airport.

On its website, Pro-Tec says it “pioneered the contract Aircraft Rescue Fire Fighting services market in the United States in 1975.” Its service map shows 16 airports where it provides some level of rescue and fire support.

Such support was previously provided by the 188th Fighter Wing. The National Guard unit recently transitioned from a manned flying mission to an unmanned flying mission, eliminating the necessity of its own fire protection.

Parker has previously estimated that providing the fire service could cost the airport $750,000, which would be one-third of the airport’s revenue.

The effort to secure fire services has been hampered by the lack of timely response from National Guard Bureau officials on whether the airport can use the equipment and vehicles previously used by the 188th.

Arkansas should be able to connect all of its schools to high-speed fiber optics broadband networks within a few years using $15 million it already spends annually on outdated copper networks along with federal funds, Gov. Mike Beebe and a group that works to connect schools announced Monday.

EducationSuperHighway, a national nonprofit that works to expand internet access in schools, has been partnering with the Department of Education to study the issue and will work with Arkansas to expand access as part of a pilot project that also includes Virginia.

CEO Evan Marwell said the state can become the first to meet the national ConnectED goal, announced by President Obama last summer, of connecting 99% of American students to at least 100 megabits per second with a target of one gigabit per second within five years. Just by reallocating its resources, Arkansas could be the first in the nation to meet the ConnectED goals because of its current financial commitment – “a commitment that is not replicated very often around this country,” Marwell said – along with the investment private providers have already made.

“There’s no reason that by 2018, Arkansas shouldn’t be able to have every public school with the broadband that they need,” Marwell said in an interview after the press conference.

Schools connect to the internet using the state’s Arkansas Public Schools Computer Network (APSCN) along with private providers that they hire. Marwell said the APSCN contract represents more than 50% of the state’s collective investment in connectivity but is delivering only 5% of the broadband that connects schools today.

Because it relies on copper networks, it pays nearly $300 per megabit per month. The state pays more than 22 times more per megabit than the $13 per megabit that school districts who buy their broadband directly pay. If a typical residential cable modem bill cost that much, a family would be paying $3,000 to $6,000 per month.

“So because of this cost inefficiency, if Arkansas schools had to rely only on the connectivity provided by the state network, 60% of them would have less internet access than each of you have in your home,” Marwell said.

Asked why no one before now had revealed how much the state was spending on copper wire, Beebe said, “That’s a really good question. I wish I was technologically smart enough to (have) told you six years ago or eight years ago I had that figured out. And presumably we’ve got technological people around here that could have raised that question, but for whatever reason, it wasn’t raised. The fact that it wasn’t raised five years ago or six years ago, however, doesn’t mean it doesn’t need to be raised today.”

Given the changes occurring in broadband access, Beebe has ordered an in-depth audit of the Department of Information Services, which helps provide the technical expertise in managing APSCN. Beebe said the DIS model, which involves raising its own revenues, may need to be changed or streamlined.

Arkansas is doing better than the national average in terms of connectivity, but almost half of school districts do not have connectivity required for 21st century learning, Marwell said.

Joe Freddoso, who managed the broadband backbone in North Carolina before joining EducationSuperHighway, said Arkansas can move ahead of other states because it already has made the political decisions to spend the money.

“You are investing enough money today in K-12 connectivity to reach your goal, to have high-bandwidth, high-value connectivity to every school,” he said. “You’re spending a portion of the money you spend today inefficiently.”

Freddoso said North Carolina faced a similar situation before it began its initiative. Today, 98% of its schools are fed by fiber optics lines.

The issue of broadband connectivity has become an important one in Arkansas after it came to light that many schools did not have enough broadband connectivity to take advantage of digital learning opportunities or to conduct online tests as part of the Common Core State Standards.

Beebe and the state’s private broadband providers have been at odds over whether to connect schools using private networks or the state’s ARE-ON network that connects universities, medical providers and others. Beebe appointed a group of business leaders known as FASTERArkansas that has been pushing for the state to expand the ARE-ON network to public schools. Private providers do not want to compete with a government-managed broadband entity. They say they have already laid the foundation for a high-speed network, but schools have not connected to it.

Beebe said today he still wants schools to have the option of connecting to ARE-ON. Freddoso said he has met with private broadband providers who seemed open to working with the state on expanding broadband.

“The ones that I met with last week pledged that they would be on board if the business model worked, and I think that’s the process that we’re in now,” Freddoso said.

It’s not enough that Northwest Arkansas be considered a bedrock of retail expertise, some say it now must become a technology hub in its own right as retail and every industry sectors move in sync with digital demand.

“The fly wheel is rolling here and we can become a major technology hub. ... We are not going to become Silicon Valley or Austin, Texas, but we do have some unfair competitive advantages in Northwest Arkansas,” said Jeff Amerine, director of Arkansas Technology Ventures.

Amerine was the morning keynote speaker at the NWA Technology Summit on Monday (Aug. 11) held at John Q. Hammons Convention Center in Rogers. The Bentonville-Bella Vista Chamber of Commerce event packed in 400 tech professionals for a half-day of conversation and collaboration about growing the regional tech sector

MORE THAN JUST REDNECKS
“I wouldn’t normally think of Arkansas as a tech haven but we’re in the midst of creating a Northwest Arkansas venture ecosystem with some amazing things happening in the tech and startup scene,” Amerine said.

He admits that to much of the outside world sees Arkansas and Northwest Arkansas as a place where “gap-toothed, gun-toting rednecks drive huge pickup trucks.” He adds that Sam Walton and J.B. Hunt faced similar perceptions about the region when they sowed their entrepreneurial seeds years ago. 

“That perception is a constant we have to overcome and show the world what we have to offer,” Amerine said. “Growing this tech sector with a supportive venture ecosystem matter because that’s where future economic growth will come from.”

He said the Kauffman Foundation, a think tank for entrepreneurial interests, indicates that 85% of all net new job growth comes from startup businesses.

“If you look at the areas that have this bubbling activity, this churn of disruptive activity, we see talent migrating to areas where there is good quality of life and where innovation occurs. That feeling of innovation and the support that comes from a local ecosystem is very, very important,” Amerine said.

He explained that the formula is not magical, it begins with STEM education – focusing on science, technologies, engineering and math. 

“The creatives and technologists have to be nurtured, it has to start early on. That’s the call to action,” Amerine said. “Tech talent is crucial to keeping the movement going and that’s one of the key problems we face. But that’s not unique to us. That’s every flyover state in the country as talent tends to concentrate on the coasts. We have got to grow our own.”

He added that entrepreneurial outreach and networking opportunities are also key as are more angel investors networks that can provide needed capital at all stages for local startups.

“We need a large scale locally based venture fund that is focused on tech,” Amerine said. “We’re making progress, but there is more work to do.

RETAIL-TECH CONNECTIONS
Angelo Welihindha, head of mass market retail sales at Google, said during Monday’s panel discussion that retail is not just retail anymore because technology is a natural follow-up given the collision between physical and digital commerce.

He said Northwest Arkansas can be an important tech center because of the retail expertise centered here. Welhindha spent more than two years with Nestle after graduating from the University of Arkansas. He worked six years at Wal-Mart before moving to Google earlier this year. 

Stan Zylowski, president of Movista, said Northwest Arkansas is a logical place for tech energy given that there are so many Fortune 500 and Fortune 1000 companies with top retail professionals based here. He said as retailers and suppliers move toward seamless digital and physical interaction they all require top technology talent.

Carol Spieckerman, CEO of NewMarketBuilders said, the lines are blurring like never before between suppliers and retailers who are finding ways to share content. She said technology is the link that will allow seamless transitions between physical and digital shopping and customer experiences. Spieckerman said Wal-Mart has been a leader in the retail space integrating technology and thinking more like a start-up. 

“Macy’s is playing a quick game of catch-up and Target is woefully behind, but perhaps that will change under the new leadership of Brian Cornell and some other outside tech hires,” she added.

STARTUP MINDSET
As a new guy at Google, Welihindha said he sees firsthand how important it is for large companies to think like startups and to foster a climate of networking among its staff, which is something Google does every day.

Welihindha said corporate giants need to foster and support the creative disruptions from technology talent knowing there will be some failures along the way. When Welhindla was a University of Arkansas student in 2004, his entrepreneurial team developed a concept for e-receipts. They were able to pitch the concept to Wal-Mart.

“They told us that e-wallet was the answer and they dismissed our idea. They shooed us out the door pretty quickly and we never heard from them again. We were so disappointed and we thought that if the world’s largest retailer didn’t see the value, we should give up. We had been in revenue sharing talks with IBM but we gave that up and took corporate jobs,” Welihindha said. “Last year when Neil Ashe, CEO of Walmart e-commerce, stood up and said Wal-Mart would be offering e-receipts, I was so angry but at that point I was already headed to California (Google). Keep your minds open and you will understand how emerging technologies can make your company better.” 

Michael Stich, chief innovation officer at Rockfish Interactive, said since 2006 the company has grown to more than 250 people across 10 locations and trying to keep that startup mentality and agility has been a challenge. He said one of the core missions at Rockfish is to foster an environment that welcomes entrepreneurs to try new ventures, with the support of Rockfish. He said the company demands a lot from its people, but also supports their dreams for entrepreneurial ventures.

WAL-MART TECH
Karenann Terrell, chief information officer for Wal-Mart Stores, said she was proud to be an engineer in a family of teachers, but her parents never really understand what her job is. Terrell said Wal-Mart is a retailer and that will never change, but it’s also tech invested and that’s the future for giving customers what they demand.

She said Northwest Arkansas has got to do a better job fostering STEM education.

“We have the opportunity here to make the University of Arkansas great. Wal-Mart and other companies have to be able to co-exist with entrepreneurial ventures and companies have to elevate the role of technology within their corporations investing in talent,” Terrell said.

She said the UA, like many colleges, must put more emphasis on computer science graduates. Just one in 17 technologists nationwide graduated with a degree in computer science. In a room of roughly 400 technology professionals there were less than five computer science graduates from the UA. There were 50 or so who claimed to be graduates of the UA business school. 

“As we see the business school’s entrepreneurial program feed the talent pool, there is much more to be done in computer science education,” Terrell said. “If we don’t, we will miss an opportunity.”

Capital is the essential grease that keeps the entrepreneurial wheels turning and despite lots of cash on the table, area startups say investments are more difficult to secure than they once thought.

“I feel like the teenage guy waiting to kiss a girl, I know it will happen but the waiting is so hard to deal with in the meantime,” said Mark Brandon, serial entrepreneur and founder of Qbox Inc.

Brandon said his Fayetteville-based tech firm is still trying to raise $1.5 million to fund its next phase of growth. 

“We have a growing client base and are bringing in tens of thousands in monthly revenue but we have tapped out about every Arkansas capital source and I have spent a lot time on the coasts trying to draw financial support. I am hearing from investment groups that have requests from 4,000 ventures and they are going to fund 12. Mostly likely that will be those located near them, not miles away in Arkansas,” Brandon said.

Michael Paladino, one of the founders of Overwatch, said his venture is also beating the pavement for investment capital and it’s proved harder than they once believed.

Jeff Amerine, a keynote speaker at the NWA Technology Summit, said Northwest Arkansas is in dire need of its own venture fund that focuses on technology startups. He said there has been a lot work in establishing the local angel investment group that now has 300 members. This group looks at five deals each month, but that is not nearly enough for the deal flow created in this region alone.

Amerine said there is a need for all stages of capital to support ongoing technology ventures. He said the region and state has made major steps in the right direction over the last five years when there was just one angel fund in the entire state. He said accelerator programs like the ARK Challenge, provide some teams some seed money to start but when they need more money to ramp up it can be difficult. Brandon and Paladino, who were each ARK Challenge winners, agreed with Amerine’s assessment.

Abigail Kiefer, founder of Red Clay, moved to Bentonville to start her business a few years ago. In 2012 Red Clay raised $170,000 through local angel investors. Since then they have raised $1 million successfully using crowd sourcing.

“Over three years we have been able raise $1.5 million and it’s never easy. The best capital for a startup is revenue. Area companies who reach out and do business with local startups are the best,” Kiefer said.

Amerine said there have been a few success stories in the past five years that keep the hope alive for other startups, something that is essential for creating a technology hub in this region. There are 10 new angel investor funds in the state, when five years ago there was just one.

Acumen Brands closed the largest deal in the state with an $83 million investment from a capital venture fund that could have gone anywhere and invested in any company, Amerine said.

He said last year, Updata’s $10.5 million purchase of Collective Bias was a huge score.

Ryan Frazier and his team at DataRank got into the Y Combinator in Silicon Valley with a top 5 finish, according to Amerine. Within 24 hours DataRank raised $1.4 million in capital, enough to buy them a few more years and expanded growth opportunities.