A Fort Smith-based company has added 30 employees this year and compressed natural gas could be part of the reason.

Billy Turner, fleet supervisor at Tri-State Enterprises, said the company has increased its staff from 100 employees last year to 130 this year thanks in part to sales growth and cost savings associated with the conversion of fleet vehicles now running off of CNG.

"We can show that just with the fuel savings alone, that we are starting up new routes," he said. "And everytime we start a route, that's one person driving and one person in the warehouse. We've been able to get several routes started.”

Turner said that was possible due to conversion of each vehicle the company was purchasing, which now consists of 10 "box trucks" with CNG conversion kits installed and plans for a tractor trailer outfitted with CNG.

With vehicles getting between seven and nine miles per gallon and being driven as much as 100,000 miles in a year, he said the savings add up quickly.

At the time the company started doing conversions of its fleet vehicles last year, he said compressed natural gas was running about $1 per gallon while traditional gasoline and diesel were running higher, as much as $4 per gallon. At those rates, it could cost $50,000 at eight miles per gallon to fuel 100,000 miles of travel on diesel, while CNG would only cost $12,500.
http://www.fueleconomy.gov/feg/savemoney.shtml

From last year to present, costs have fluctuated, with fuel hanging around $2.80 to $3.00 per gallon for diesel. CNG has risen to about $1.70. But even with the gas drop and the CNG increase, the company is still looking at fuel savings of $13,750 per vehicle.

Dean Pendergrass, who handles fleet sales at Breeden Dodge in Fort Smith, said a typical CNG conversion can run as low as $6,500 to as high as $12,000 for the largest tanks, similar to those used at Tri-State, which he said illustrates how companies and even government fleets can have real savings in as little as a single year by converting to CNG.

And the use of CNG is being noted by the Fuel Institute as reducing the demand for diesel fuel in the United States as soon as 2016. A study for the Fuel Institute said diesel fuel demand could drop as much 12.5%.

Mitchell Simpson, deputy director of the Arkansas Economic Development Commission's Energy Office and the Arkansas Clean Cities Coordinator, said rebates were available this year to help individuals and businesses convert vehicles to CNG power to see those savings over the use of traditional fuels. To convert vehicles that traditionally run on gasoline, he said a rebate of $4,500 or 50% of the cost – whichever was lower – had been available earlier this year. The program had $150,000 available, but those funds have all been used for this year, Simpson noted, adding that the state hopes to bring the program back next year.

But even with the conversion rebates available last year and earlier this year, Turner said his company had not taken advantage of the rebates due to requirements by the AEDC energy office.

"The biggest challenge is the rebate," he said. "If they would do it like other states and take the EPA stipulation off of it, then other fleets could save as much money as we are. It ties into more jobs for the state of Arkansas," Turner said.

The EPA stipulation Turner mentioned is in place, Simpson said, to make sure the CNG conversion kits meet quality standards as well as emission standards and said the regulations are in place to protect Arkansans.

"It just means that they've gone through a pretty stringent evaluation process to make sure those kits are safe and appropriate for the conversion vehicle and that the emissions are low," Simpson said.

Turner said even without the rebates, his company could point to the savings it has already seen and continues to see as a reason to continue its CNG efforts.

"We have 30 new jobs this year. As far as natural gas is concerned, I can fully say four of those jobs are because of natural gas savings. The other 26, it had a little bit of a hand in it. … We're putting money back into the company and that's why we're growing like we have."

The pricing battles between retailers nearly two months before Christmas are heating up as Wal-Mart Stores and competitor Target unveiled plans to sway consumers toward their respective stores and websites.

Savings on 20,000 items in Wal-Mart supercenters will be rolled back on Saturday (Nov. 1) as the retail giant seeks a jumpstart on the official holiday season. Price reductions expand across the big box from grocery items to popular toys and electronics, according to Stephen Bratspies, executive vice president, general merchandise for Walmart U.S.

He said the retailer is focused on delivering lower prices throughout the holiday shopping period – which officially starts this weekend – as stores transform from orange and black to red and green within a short 12-hour window. The retailer gave no details regarding Black Friday deals, except to say they had bought deep in categories like licensed products around the Frozen and Ninja Turtles movies, flat screen televisions, tablets and popular toys.

Bratspies said the physical stores will feature more “retailtainment” events like Frozen parties, or trade-in and up promotions for gamers like the early release of Call of Duty. Wal-Mart said retailtainment and store events are left up to store managers, although the corporate office does make broad recommendations which are followed about 80% of the time. Bratspies said one of Wal-Mart’s strengths is its ability to feature local events and merchandise when possible.

Walmart.com is kicking off its holiday seasonal savings program on Nov. 3 and plans to offer weekly online specials to registered shoppers via email. Free shipping only applies to orders over $50, but this year the retailer is providing free same-day pickup in stores  on certain items.

Savings Catcher has been expanded to cover top toy purchases and holiday ham and turkey prices effective Nov. 2. The retailer also is making a new app function available to assist shoppers locating certain items within a supercenter. With “Search My Store,” customers may search for nearly any item carried in a Wal-Mart store and see the item’s availability at that store, its aisle location, ratings and reviews.
 
“Search My Store” is already available on Android devices and expands to iPhones by mid-November.

“We are taking care of our customers today and all season long no matter how they shop – whether in our stores, online or on their mobile devices,” said Fernando Madeira, president and CEO of Walmart.com U.S. “More than 65% of Walmart customers have smartphones and they look to us to provide a flexible shopping experience when, how and where they want.”

TARGET DEFENSE
Target may be the darkhorse of this holiday season if new CEO Brian Cornell has his way. The company has already announced free delivery on online orders regardless of size.

Walmart.com responded with free shipping on only selected gift items as noted on its website. Target also outlined an aggressive price match strategy between Nov. 1 and Dec. 24. 
 
“If a guest purchases a qualifying item at Target between Nov. 1 and Dec. 24 and then finds it for less at Target.com, a local competitor’s printed ad or at select online retailers, Target will match that price,” the company noted in a statement.

Walmart is testing price match against online retailers in six markets. The company gave no details on the test saying only that it’s being discussed. The retailer’s normal price match policy between identical in-store items to other physical store competitors is unchanged.

Target also announced weekly sales, weekend promotions and exclusive deals on Target.com and Cartwheel, Target’s savings app. Cartwheel will offer daily deals for its more than 10 million users, and from Nov. 2 to Dec. 24, Cartwheel will offer 50% off a 
different toy every day. 
http://cartwheel.target.com/

The app will have new features for the holidays, including special deals for top users, personalized recommendations and a select number of popular offers that do not expire, Target noted in its release.

CONVENIENCE TOOLS
Both retailers mentioned new or expanded tools and resources to provide more convenience for shopper this holiday season.

• Wal-Mart
Wish List: Starting Nov. 7, children and parents can build a Toy Wish List for Santa by adding their favorite toys directly from Walmart’s digital Toy Book. Wish lists can be shared on Facebook and in email with friends and family.

Holiday Hub: New this year, Wal-Mart is sharing how-to videos, product demos, seasonal recipes and other tips across multiple platforms where customers seek holiday inspiration, including Pinterest, YouTube and Walmart.com.

• Target
Wish List App: Target’s new app is available Oct. 31, and creates holiday wish lists for parents and kids. Children may add must-have items to their list, while parents can share the list with friends and family. The app also offers an augmented reality feature that works with Target’s Kids’ Gifting catalog. Plus, guests can save 10% on their Wish List on one day of their choosing before Nov. 26. The app can be downloaded on Apple and Android mobile and tablet devices or printed on the registry kiosks in Target stores.

App Enhancement: Target is re-launching its mobile app in time for the holidays with enhancements such as helping guests locate and purchase what they’re looking for using interactive store maps and shopping lists as well as streamlined checkout including, Apple pay in the iPhone app.

Former President and former Arkansas Gov. Bill Clinton made his way through the Fort Smith and Texarkana areas Sunday (Nov. 2) on what is likely his last 2014 campaign through the state before Tuesday's (Nov. 4) general election.

But with recent poll numbers indicating growing leads for the Republican U.S. Senate candidate Tom Cotton and Republican gubernatorial candidate Asa Hutchinson, what brings Clinton through western Arkansas on a final campaign swing?

Dr. Janine Parry, director of the Arkansas Poll and a political science professor at the University of Arkansas in Fayetteville, said there were two reasons – political heritage and mobilizing a Democratic base for a possible surprise upset. Parry's Arkansas Poll gave Hutchinson an 11 point lead over Democrat Mike Ross in the race for governor, while it showed Cotton with 13 point lead over Democratic incumbent U.S. Sen. Mark Pryor.

And it is the large spreads in the two races at the top of the ticket that Parry said could be giving the former president heartburn this close to the election.

"It matters to him," she said. "He's watching the political landscape change both swiftly and dramatically in a very short period of time. So it matters to him and he wants to try to preserve the party that supports the policies he thinks are best.”

By being a presence on the trail in recent months and especially in the closing weeks of the campaign, Parry said Clinton's Fort Smith visit and others around the state are meant to drive Democratic voters to the polls in a mid-term election that traditionally sees lower Democratic voter turnout.

"It still looks like a good ground game, Democrats are arguing. They (say they) can overcome these huge obstacles and win the race and potentially keep the Democratic majority in the Senate. The stakes are high and they don't want to risk (not pulling) out all the stops. That's where we're at.”

She said high profile surrogates, like Clinton, are what Democrats think will bring out their base of voters. What is tough to know, at this point, is how well the efforts are working. In the first week of early voting, both Democrats and Republicans were talking a big game with a 36% increase in early voting from 2010 to 2014, or the last mid-term to this year's mid-term.

Dr. Jay Barth, one of the pollsters behind the Talk Business & Politics and Hendrix College polls that showed Cotton with an 8.5% lead on Pryor and Hutchinson with an 8% lead over Ross, said the early voting is always a big question, but especially this year with the significant increase in early voters.

"I think it's a key question. Obviously, I think Democrats think they are tapping into folks who would not have previously voted. Instead of focusing on someone (that traditionally votes and votes early), they'll focus on others on Tuesday. There's a lot of big question marks and it's somewhat of a high risk strategy (to depend on high Democratic turnout). Most would rather be high in the polls and not depend on turnout models," he said.

The only race where Clinton's campaigning in Fort Smith and Texarkana may have a net benefit is the 4th District race for Congress, where Barth's polling shows Republican Bruce Westerman leading Democrat James Lee Witt by only two points, within the margin of error.

In a statement Friday (Oct. 31), Witt — Clinton's director of the Federal Emergency Management Agency during his eight years as president — said having the former president and 4th District native campaigning in and near the district the weekend before the general election was important to his race.

"I consider him a close friend and confidant," Witt said. "The President understands the importance of our race.  He knows how critical it is for everyone to exercise their right to vote, and his ability to have an impact on voters in undeniable. Right now, so many of these races are about blaming others for our problems instead of working together to get things done. Under the leadership of President Clinton, we balanced the budget and actually left office with a surplus. We didn’t balance the budget with a single party majority. We did it by working across party lines with Democrats and Republicans. I believe President Clinton reminds voters what it is like for politicians to actually work together for the good of the people.“

But during a campaign stop Friday in Mulberry, Westerman said Clinton was drawing a contrast between himself and Witt and it was something he hoped would happen again on Sunday.

"He may turn out a few more Democratic voters, but I was really appreciative of President Clinton the last time he came because he went to Hot Springs and talked to voters about how I opposed Obamacare. So I hope he'll talk about some of the same issues when he's here this time," he said.

Westerman also pointed to internal polling that conflicted with the Talk Business/Hendrix College poll showing his race neck and neck with Witt.

But Barth said it appears Clinton's jaunt through western Arkansas Sunday, with a final stop at Fort Smith's Northside High School Sunday night, was meant to draw attention to the 4th District, where Democrats are hoping to force an upset victory in a state that Parry acknowledged has quickly turned into a sea of red.

"He clearly does get media attention. They'll be big stories in all of those markets that he's visiting," Barth said. "But I think everybody sees that race as pretty close. Even the Westerman folks at this point have to recognize it is closer than they thought it was. It has been reaffirmed by some polling that I've seen. So I agree that geographically the visits this weekend seem to be targeted there, as well as enhanced turnout, especially in the African American communities that could have a benefit for statewide candidates, as well."

Third quarter net income for Fort Smith-based ArcBest was $19.618 million, well ahead of the $13.982 million in the same quarter of 2013, and thanks in large part to an almost 10% gain in ABF Freight revenue.

Per share earnings of 72 cents missed the consensus estimate of 75 cents. Excluding a one-time charge for a pension settlement, the per share earnings were 74 cents.

Total revenue in the quarter was $711.3 million, better than the $623.4 million in the same quarter of 2013, and better than the consensus estimate of $699.25 million.

For the first nine months of the year, ArcBest has recorded net income of $31.633 million, considerably better than the $5.465 million in the same period of 2013. Total revenue for the first nine months of 2014 is $1.947 billion, up 11.6% compared to the 2013 nine-month period.

"We continued to see strong demand for services from the ArcBest companies in the third quarter and are pleased that our commitment to provide customers easier access to our supply chain solutions is being well received," Judy McReynolds, ArcBest president and CEO, said in the earnings report released early Monday (Nov. 3).

Gains at ABF Freight, ArcBest’s largest subsidiary and one of the nation’s largest less-than-truckload carriers, were driven by rate increases, tighter capacity in the sector and more shipments from existing customers. Shipments during the quarter were more than 1.33 million, up 10.7% compared to the same quarter in 2013. Tonnage during the quarter was up 7.2%, and is up 5.9% year-to-date.

The company reported that it continues to struggle with inexperienced dock workers and other employees the company has had to hire to handle the increase in shipments.

“Actions are actively being taken to drive productivity improvements and to reduce total labor hours to match available freight levels. In order to reduce costs and improve the transportation services offered to our customers, returning productivity to historical levels is an important priority for ABF Freight's management team,” the company noted in the statement.

During the earnings conference call, David Ross, an analyst with Stifel Nicolaus, noted that operating income was up $7.5 million in the quarter, short of the estimated $15 million per quarter expected through contract labor savings. McReynolds responded by saying the company is on track to realize up to $65 million in savings from the new labor contract with the International Brotherhood of Teamsters.

“And just in addressing the growth over a short-term basis from existing accounts we’ve had to service that business with more expensive methods. And so we have that issue to work through. We’ve highlighted it. And we continue to see issues on the productivity side, but we are seeing improvement with the employees that have been with us for several months now,” McReynolds said.

She said employees hired between March and July have improved productivity by 35%-40%. She said workforce issues are not unexpected with the company experiencing “the greatest sequential growth that we’ve seen as a company in 15 years.”

Panther, the logistics company ArcBest acquired in June 2012, continues to perform well. Panther revenue during the quarter is $82.784 million, well ahead of the $65.851 million in the same quarter of 2013. Revenue in the division for the first nine months of the year is $236.435 million, better than the $179.533 million in the same period of 2013.

"Panther, in particular, reported one of its strongest quarters ever, contributing over $4 million of operating income and $7 million of EBITDA. Year-to-date through September, Panther's EBITDA was more than $20 million,” McReynolds noted in the report.

SEGMENT NUMBERS
ABF Freight
Operating income
2014 (January-September): $35.389 million
2013 (January-September): $164,000

Panther (premium logistics freight services)
Operating income
2014 (January-September): $11.841 million
2013 (January-September): $3.745 million

Domestic/Global transportation management
Operating income
2014 (January-September): $2.449 million
2013 (January-September): $1.564 million

Emergency/preventative maintenance
Operating income
2014 (January-September): $2.84 million
2013 (January-September): $2.367 million

Household goods moving
Operating income
2014 (January-September): $3.091 million
2013 (January-September): $2.552 million

ABF Freight had 73.5% of total company revenue in the quarter, up from 73% in the second quarter. For the first nine months of the year, ABF recorded 74.1% of ArcBest total revenue.

McReynolds has set as a goal to grow non-asset based revenue so the company is not as dependent on the whims of the national trucking sector. Non-asset based revenue during the third quarter accounted for 26.5% of the total, up from 24% in the second quarter. Revenue from non-asset-based operations was 17.8% of the 2012 total revenue, and just 10.6% in 2011.

Also, the company continues to bolster its financial position. Available cash and short-term investments totaled $203.24 million at the end of the quarter, up 43.8% over the $141.26 million as of Dec. 31, 2013.

Company shares (NASDAQ: ARCB) were set to open Monday at $39. During the past 52 weeks the share price has ranged from a $45.68 high to a $25.25 low.

The City Wire plans to update this story after the company’s conference call with analysts.

With a better than expected third quarter net income of $2.717 million, Van Buren-based USA Truck is on track in 2014 to end five consecutive years of losses.

The third quarter net income of $2.717 million was an improvement over the $602,000 loss in the same quarter of 2013. Also, the 26 cents per share in income was a big jump over the consensus estimate of 10 cents per share.

Total revenue in the quarter was $153.618 million, better than the $141.822 million in the third quarter of 2013 and just above the consensus estimate of $153.4 million.

For the first nine months of 2014, the trucking company posted $1.85 million in net income, a wide swing from the $4.474 million loss during the same period of 2013. Total revenue for the first nine months is $452.405 million, better than the $413.587 million in the same period of 2013.

USA Truck posted a net loss of $9.11 million in 2013. While an improvement compared to the net loss of $17.671 million in 2012, it marked the fifth consecutive year of losses for the trucking company.

"Both our Trucking and asset-light Strategic Capacity Solutions (SCS) businesses realized revenue gains and positive operating income, a direct outcome of our intense focus on operational effectiveness, while also benefiting from today's strong demand environment,” USA Truck President and CEO John Simone said in the earnings report.

Gains in the trucking sector were boosted by an increase in revenue per loaded mile. Total miles driven in the quarter declined 1.64%, but the base revenue per loaded mile increased to $1.819 in the third quarter compared to $1.663 in the same quarter of 2013. Overall, the base trucking revenue per seated tractor in the quarter was $3,170 compared to $2,948 in the same quarter of 2013. This overall gain was made with an average of 71 fewer tractors in the mix during the third quarter.

Simone noted in the earnings report that tractor utilization can improve.

“Our focus on unseated truck count continues to be a top priority and we believe our driver recruitment and retention efforts are making incremental inroads in this important area. We believe these efforts, as well as our strategic and operational initiatives, will continue to drive improvement in our truckload business,” Simone noted.

The star of the quarter for USA Truck was the Strategic Capacity Solutions division – the logistics and brokerage unit. Operating revenue during the quarter was $49.359 million, ore more than 32% of total revenue. That is up from 27.2% during the same quarter of 2013. For the first nine months of 2014, SCS division operating revenue was 31.94% of total USA Truck revenue, up from 25.99% in the same period of 2013.

UPDATED INFO:A direct benefit to the bottom line was $4.775 million less spent on fuel in the quarter. Michael Borrows, chief financial officer with USA Truck, told The City Wire that $3.1 million of that was from a 10.5% improvement in fuel mileage. The remainder – about $1.6 million – was the result of falling diesel fuel prices during the quarter.

The federal Energy Information Administration shows that diesel fuel prices nationwide have fallen from an average of $3.943 per gallon in May 2014 to $3.681 in October, a decline of 6.64%.

Simone said fuel efficiencies have resulted from several technological and mechanical changes, including reducing idle times to five minutes and setting road speeds. He said the company is cycling more than 2,000 trucks through maintenance shops to make the changes. The process should be finished by the end of 2014, and the upfront expense will pay off in bigger efficiency gains in future quarters, Simone said.

Economic conditions are more favorable for the trucking industry than they have been in many years, but Simone said USA Truck needed many fundamental changes to be able to take advantage of the improved conditions.

“Certainly the market has given us a tailwind ... but without the improvements in efficiencies we would not have been able to accomplish what we have,” Simone said, adding later in the interview that a “rate (increase) alone is not enough to overcome the inertia of a poorly run operation.”

The company was able to push rates higher to post a 9.4% increase in rate per loaded mile during the third quarter, which was up from 7.1% in the second quarter.

A potential drag on future gains is the ongoing driver shortage in the national trucking sector. USA Truck, which is trying to end five consecutive years of financial losses, has had to overcome a morale and image problem among drivers. Simone said early in his tenure with USA Truck that a better relationship with drivers was a top priority.

“I am pleased with the progress we’ve made with re-imaging the brand (with drivers) since I arrived,” Simone said during Monday’s interview.

He said morale among drivers driver is improving because the company is “changing the way we interact and value our drivers.” Part of that value is a year-over-year increase of $1.8 million for driver pay and benefits – an increase of 4.6%.

Overall, Simone said USA Truck began fourth quarter strong and he is “optimistic” holiday shipping will remain strong.

The earnings report also included the following information.
• For the year to date, the company reduced debt by a total of $14.5 million, and in the past 12 months, the company reduced debt by $26.5 million. Debt decreased during the third quarter by $10.7 million, sequentially to $114.4 million. 

• Fleet fuel efficiency initiatives produced a 10.5% improvement in miles-per-gallon, or $3.2 million, while offsetting higher driver-related costs.

• For the first nine months of the year, the company spent more than $2.59 million on legal and other related costs. The expense was primarily related to the hostile takeover attempt of USA Truck by Knight Transportation.

USA Truck shares (NASDAQ: USAK) were set to open Monday at $17.50. During the past 52 weeks the share price ranged from a $19.57 high to a $11.95 low.

Home sales in Arkansas’ four largest markets rebounded in September, with year-to-date sales up almost 4% and the value of homes sold up almost 2%. September sales in the four markets were up 7.26% and the sales value was up more than 9%.

August sales in the four markets were down more than 5% and sales were down more than 8%.

Jeff Collins, an economist for The City Wire, said improvements in this year's housing market can be taken as more evidence that the economy is heading in the right direction.

"This is really good news," he said of the September report. "Couple that with other economic news ... and it seems everybody is feeling the economy is righted."

Home sales in Arkansas’ four largest metro areas during the first nine months of 2014 totaled 16,469, up 3.83% compared to the same period in 2013, according to The City Wire’s Arkansas Home Sales Report. The average price per home sold in the four markets was $162,720, down 1.77% compared to the same period in 2013, and the total value of $2.679 billion in the four markets was up 1.99%.

The year-to-date comparisons are up against what was a robust 2013 in terms of Arkansas home sales and sales values. For example, the 2014 year-to-date home sales are up 18.18% over the same period in 2012 and the value of home sales is up 19.39% compared to the same period in 2012.

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

SEPTEMBER NUMBERS
September home sales in the four markets totaled 1,936, up 7.26% compared to September 2013, and up 29.76% compared to September 2012. The average price per home in the four markets during September was $164,449, up 1.89% compared to September 2013, and up 0.49% compared to September 2012. The total value of sales in the four markets during September was $318.373 million, up 9.28% compared to September 2013 and up 30.4% compared to September 2012.

There were 939 homes sold in central Arkansas, up 9.19% compared to September 2013, and up 33.57% compared to September 2012.

September home sales totaled 615 in Northwest Arkansas, down 1.6% compared to September 2013, and up 26.28% compared to September 2012.

Jonesboro area home sales totaled 199, up 26.75% compared to September 2013 and up 25.95% compared to September 2012.

In the Fort Smith area, home sales totaled 183, up 12.27% compared to September 2013, and up 27.08% compared to September 2012.

The total value of the sales during September were up 10.45% in central Arkansas, up 4.17% in Northwest Arkansas, up 21% in the Jonesboro area, and up 17.1% in the Fort Smith region.

THE REGIONAL PICTURE: 2014
Central Arkansas — Home sales
Jan.-September 2014: 7,747
Jan.-September 2013: 7,431
Jan.-September 2012: 6,699

Fort Smith area — Home sales
Jan.-September 2014: 1,504
Jan.-September 2013: 1,325
Jan.-September 2012: 1,228

Jonesboro area — Home sales
Jan.-September 2014: 1,717
Jan.-September 2013: 1,458
Jan.-September 2012: 1,314

Northwest Arkansas — Home sales
Jan.-September 2014: 5,501
Jan.-September 2013: 5,648
Jan.-September 2012: 4,695

The top five counties in terms of Jan.-September 2014 home sales:
Pulaski — 3,583, up compared to 3,425 in 2013
Benton — 3,503, down compared to 3,555 in 2013
Washington — 1,998, down compared to 2,093 in 2013
Craighead — 1,356, up compared to 1,152 in 2013
Saline — 1,268, up compared to 1,188 in 2013

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

FED MOVES
Collins said other real estate-related economic news has to do with an Oct. 29 announcement from the Federal Reserve that it will stop its program of purchasing mortgage-backed securities. In 2008, the Fed began buying treasury bonds and mortgage backed securities as a way to stimulate the economy, but has decided that those measures are no longer necessary. Most recently, the Fed spent $15 billion a month on treasury bonds and mortgage-backed securities.

Mortgage-backed securities are, as the name suggests, backed by mortgages and generate capital for more home loans. In 2008, there was a fear that a large number of mortgage defaults would destroy that market and greatly diminish the amount of credit available for home buyers. The Fed, then, decided to step in and prop up that segment of the economy.

Collins is also encouraged by the Fed's decision to keep short term rates at around 0% in hopes of stimulating the economy further.

Overall, Collins said he is encouraged by what he sees in the housing market and economy as a whole. He expects to see more good economic news in the months to come.

Kantar Retail released its annual price leadership study between mega retail competitors Wal-Mart and Amazon on (Oct. 30), and the results show Walmart.com had lower prices over its supercenter format and Amazon.

Price wars are the primary focus among all retailers — physical and digital formats alike, despite unequal operational costs between brick and mortar and online-only.

Retail experts say consumers don’t think in shopping channels. Instead, they think of the retailer — Amazon, Wal-Mart, Best Buy, and others. Wal-Mart marketing executive Stephen Quinn recently said retailers must connect with consumers on a brand level in multiple formats and price matters more than ever.

While historically the Wal-Mart supercenter has dominated from a price-point perspective, this year’s findings indicate a shift to more alignment between Walmart.com and the supercenter, with aggressive pricing in general merchandise on Walmart.com yielding the most competitive offer overall across the three venues, according to the Kantar study.

“From a brick and mortar standpoint, Wal-Mart has long held a reputation as a price leader,” noted Anne Zybowski, vice president with Kantar Retail and contributor to the study. “While Wal-Mart looks to offer consistently low prices across channels, it is also contending with the dynamic pricing realities online retail entails.” 

The Wal-Mart supercenter’s basket was 5% more expensive than the Walmart.com basket, Kantar reported. While the gap between the supercenter and Walmart.com basket is narrower this year, the advantage for Walmart.com is a reverse from last year’s iteration of the study when the supercenter was 7% cheaper.

Walmart.com execs have said they aggressively match or beat prices with all of its major online competitors and that is something they have pushed over the past year using technical algorithms. They have also added 1 million extra items to the online store which now boasts 7 million items for sale. 

That said, the message from Bentonville for Wal-Mart Supercenters has been that it has the lowest basket prices among its physical competitors daily and weekly. The unveiling of Savings Catcher helped to reinforce that promise on grocery and household consumables, and now includes top toys for the holiday with possibly other selective general merchandise, namely top gift items.

If consumers really don’t look at where they buy a product, it stands to reason that Wal-Mart prices should be the same, despite the higher operational costs of brick and mortar. Wal-Mart has routinely said it doesn’t match its online prices for in-store items, but admitted Thursday (Oct. 30) that there are some discussions and tests about that possibility. It is not clear if that’s for holiday only, or if it could be an everyday service. The test which began last month in five markets, including Northwest Arkansas, also involves price matching with other online retailers within Wal-Mart brick and mortar stores, something Target and Best Buy already do.

Kantar said Amazon’s basket was 12% more expensive than the supercenter’s and 17% more expensive than Walmart.com’s, ranking it the most expensive in three of four sub-basket categories including edible grocery, where the retailer was 37% more expensive than both Walmart channels. 

Zybowski said Amazon has built its mission around the customer, seeking to be competitive on price yet win through its vast assortment and focus on convenience.

“As shoppers increasingly incorporate digital and eCommerce into their purchase decisions, retailers are adopting more nuanced approaches that go beyond low price,” she added.

Kantar reported that third party items in the edible and non-edible baskets drove Amazon’s overall basket cost higher. The study found Wal-Mart supercenter to have the lowest edible grocery cost at $141.38, compared to $141.45 at Walmart.com and $195.29 at Amazon.

Non-edible grocery was also cheaper at the supercenter ($121.49) versus $124.79 at Walmart.com and $155.21 at Amazon. The health and beauty aids category basket was also owned by Wal-Mart supercenter at $110.03 versus $111.61 at Walmart.com and $133.22 at Amazon, according to the study.

It was general merchandise pricing that pushed Walmart.com ahead of the supercenter  by a $32.17 margin. These respective cohorts logged general merchandise basket costs of $200.31 and $232.38, respectively, and both were more expensive than the $196.02 general merchandise basket at Amazon, Kantar noted in the study.

Total basket costs at Walmart.com were $578.06, or $27.22 cheaper than the Wal-Mart supercenter ($605.28) and $100.65 savings over Amazon ($678.74), the study found.

“The results of this year’s study are not entirely unexpected,” Zybowski. said. “Amazon continues to hone its prices in the face of increased cross-channel and online competition, while Wal-Mart evolves its alignment between its store and online positions.

Kantar said the supercenter used in this study is in New England and was the same store used last year. The basket totaled 53 national brands — all of which were available at all three outlets. This study doesn’t include shipping costs or subscription discounts that online retailers offer.

In an Oct. 22 response to questions by the Arkansas Department of Environmental Quality about the stability of a toxic plume of potentially cancer-causing trichloroethylene (TCE), Whirlpool Corporation has again made statements it said justifies previous assertions that the TCE plume is not growing, despite ADEQ statements that have provided the opposite conclusion.

The ADEQ memo dated Sept. 22 stated that the ADEQ believed the plume was potentially growing. ADEQ Engineer Mostafa Mehran wrote to Robert Karwowski, director of environmental, health and safety at Whirlpool, regarding a report by Whirlpool about additional TCE pollution that was found near a Boys and Girls Club located in South Fort Smith not far from the shuttered factory facility.

Whirlpool had previously said the TCE near the Boys and Girls Club was not a threat.

But in Mehran's letter to Whirlpool, the ADEQ engineer said the company failed to indicate that the TCE plume could be growing. He cited several detections of the chemical used as a degreasing agent at the factory through the 1980s, noting that the levels are above detection limits and that TCE was also discovered in groundwater samples taken at the site.

"This could be an indication of plume expansion," Mehran wrote, advising the company to make changes to the August report where it wrote indicating that the TCE at the Boys and Girls Club posed no threat. The report, he said, should indicate that the plume could be growing. Mehran also directed Whirlpool to install additional monitoring wells to keep track of the TCE plume.

"Given the apparent shape of the plume, ADEQ requires an additional monitoring well in the northwest corner of City of Fort Smith property (three properties)," he wrote.

Since that time, Whirlpool and the city of Fort Smith – which owns property where monitoring wells will be installed – have come to an agreement for monitoring wells to be installed.

But in the Oct. 22 letter to ADEQ, Whirlpool's environmental consultant Michael Ellis of ENVIRON Corp. again asserted that there was no risk posed to the public and said the plume was not growing.

"The Mann-Kendall trend analysis utilizes data from all wells associated with the monitoring for the northern plume. … As described in more detail below, our determination that the plume is stable is based on the fact that 82% of these wells exhibit either little or no TCE or a decreasing or stable TCE concentration trend."

Ellis said 14 wells "exhibit a stable trend for TCE concentrations," while seven showed decreasing TCE trends and another seven showed no TCE trend. He said another six wells show TCE "below detection limits." But even with the more than two dozen wells showing stable or decreasing TCE concentrations, Ellis admitted that five "wells exhibit an increasing trend for TCE concentrations."

"TCE concentrations in 11 of the 39 (28%) have been non-detect or less than 1 µg/L since October 2011 and 21 of the 39 wells (54%) have exhibited decreasing or stable trends; therefore, 32 of 39 wells (82%) of the wells exhibit either little or no TCE or a decreasing or stable TCE concentration trend. We believe that this supports our plume stability conclusions," Ellis continued.

Other documents released by ADEQ Monday (Nov. 3) show that the agency had questioned Whirlpool's proposed removal of soil, saying the company's environmental consultants may not be removing enough contaminated soil at the northwest corner of the site, known as "Area 1."

"Please discuss in detail how the removal of limited amount of soil proposed in the work plan will remediate the soil below the RAL," Mehran had wrote to Whirlpool and ENVIRON on Sept. 23.

In response, Ellis said removing more soil than the 300 cubic yards already removed from the site would be pointless and would create "significant additional complications that would negatively affect the progress of onsite and offsite remediation, as well as the redevelopment of the overall site."

Ellis also noted that remediation plan calls for "capping" the site, which would mean a concrete or asphalt layer would be placed on the soil to prevent digging and any soil vapor rising from the contaminated site. The plan calls for the capping in addition to chemical oxidation treatments.

"The selected management method of onsite impacted soils under the RADD (remediation plan) is capping and containment, not removal of soil below the RAL. This method was chosen precisely because soil removal would neither reduce the risk of exposure to onsite workers or area residents not would it materially impact the offsite groundwater contamination."

Ellis also said soil removal above what has already been completed would present "several engineering and operational setbacks."

"Substantial additional soil removal would threaten the structural integrity of the former manufacturing building and stability of the electrical substation," he said. "It would also require de-watering operations. These issues would likely complicate and delay completion of the remediation activities required under the RADD and the ongoing redevelopment of the property."

Contamination of the site former Whirlpool manufacturing facility site in south Fort Smith along Ingersoll Road was discovered in the early part of the century and was disclosed to ADEQ. Contamination, the company said, was caused by the use of a degreasing agent that contained TCE.

The company is the defendant in a class action lawsuit, which it has attempted to settle. The settlement offer, according to Whirlpool Vice President Jeff Noel, would have the company paying 100% of the devaluation amount for properties impacted by the TCE plume, plus 33% of that total and all costs associated with achieving the settlement.

In return, property owners would release Whirlpool of all property claims and allow for reasonable testing and monitoring on property and allow a deed restriction on drilling to be placed on impacted properties. Noel said it would allow property owners to reclaim as much as 75.7% of the original tax appraised value of the properties before Sebastian County Tax Assessor Becky Yandell lowered property values in the TCE plume. According to information Noel said was compiled by Whirlpool, typical TCE settlements only recover 20% of property values.

The settlement is under consideration U.S. District Judge P.K. Holmes III of the U.S. Western District Court of Arkansas in Fort Smith.

Even after two rounds of finance committee meetings meant to slash the budget line item by line item, the Crawford County Quorum Court is still facing a county general budget shortfall of $372,539 for fiscal year 2015.

Requests for expenditures by all county departments totaled $7.226 million at the start of the budget cycle, but County Treasurer Beverly Pyle said the county only has anticipated revenues of $6.817 million.

Speaking Thursday (Oct. 30), Pyle said the county has been hit with decreases in anticipated revenues following the financial crisis of 2008 and has only recently began to rebound. The anticipated revenues are about $220,313 less than the 2014 county general budget of $7.037 million.

Attempts to reach Pyle for an explanation of the reduction in anticipated revenues were unsuccessful Monday (Nov. 3), though individuals with knowledge of the financial situation at the county said tax revenues for the year were simply lower than anticipated for fiscal year 2014, which lead to the downward estimate for the upcoming budget.

Crawford County Tax Collector Kevin Pixley said collections were not down too much, though he said taxes associated with mineral rights had been down the most of any in the county. He said it was due to changes in state law and was beyond the control of the county.

But he said of the funds collected by his office, only about 20% directly benefit the general fund, meaning that if an additional $200,000 were collected, about $40,000 would go to support the general fund.

"The losses are coming from other funds," he added, noting that the majority of monies collected through his office benefit the county's school districts in Alma, Cedarville, Mountainburg, Mulberry-Pleasant View and Van Buren.

He said it is difficult to determine why anticipated revenues would be down more than $200,000 for county general since the taxes that benefit the fund are not too far off last year.

"The collections are about the same as last year. We're probably within $5,000 as far as county general. I'm going to close the tax book this week, which will tell me where the delinquencies are at," Pixley said.

Putting a strain on efforts to trim the budget is a rule adopted by the budget committee that prevents the quorum court from eliminating funding from estimated personnel services, which includes salaries, according to County Judge John Hall.

He said with the county still needing to cut more than $370,000 to meet its budget, the quorum court may need to rescind its own rule and look at the possibility of personnel cuts.

"Now the Quorum Court in their diligence of trying to develop a balanced budget that we can pass in December has really not realized the urgency of the situation, I don't think, that faces us. There's no way that the process that they're going through right now will be able to take that much money out of the budget without getting some revenue somewhere or cutting some positions somewhere. We can't nickel and dime this thing like we have been doing and come up with the type of money it's going to take to get us a balanced budget."

Pixley said the county has already raised taxes on its residents, raising the millage that benefits the general fund from 1.9 mils to 2.9 mils following fiscal year 2011. That total, he said, raised "roughly $650,000 in revenue for county general."

The year the county raised taxes it was facing a budget shortfall of $1 million, which Pixley said "just filled that hole. If we hadn't raised the millage, we'd have a $1 million hole, not a $375,000 hole."

But any talk of raising the millage anymore, Hall said, would be stopped by his office. He said the quorum court and the county's departments must learn to live within its budgets and that means hard decisions will have to be made without a tax increase.

"One thing that's off the table – and you can quote this – there will be no millage increase. I will veto any millage increase if it is brought up. I will oppose it and I will veto it. We are not raising millages. We're not going to do it. I oppose it 100%."

Reached for comment, Quorum Court Finance Committee Chair Mary Jan Blount declined to discuss revenue issues and cuts, saying, "Let's just leave it (my comments) as right now, we're reviewing all the items on the budget. I can't give a clear answer as to where we are able to cut. We're looking at each budget line item by line item to see where there are possibility of cuts. … We're just separately looking at each line item to see where there are opportunities to cut expenses."

Arkansas' congressional delegation will now be all Republicans starting in January 2015 after the party swept state constitutional and federal offices Tuesday night (Nov. 4).

In the 4th District, State Rep. Bruce Westerman, R-Hot Springs, bested Democrat James Lee Witt by a vote of 52% to 44%, while Libertarian Ken Hamilton received 3% of the vote. (See list of statewide election results at the end of this story.)

In a statement, Witt spokesman Beau Bishop said, "The people of the 4th District have spoken. We're proud of the race that we've run. We ran on the issues and the election's over now and it's time for us to come together as a district and do what's best for the people of Arkansas."

He continued, "Our campaign has been about working together and doing things for the betterment of Arkansas and James Lee's not going to run from those principals and ideals at this point. He still believes in everyone deserves an opportunity for a hope and a dream. We can't do that if we're not all working together. That's what James Lee said to Rep.-Elect Westerman when he spoke to him."

Asked whether Witt was done with politics or may run again, Bishop said, "We hadn't gone that far. But I would say he's done, but we haven't talked about it."

Attempts to reach Westerman have been unsuccessful.

In the 2nd District, Republican French Hill is leading with 49% of the vote to former North Little Rock Mayor Patrick Henry Hays' 46%. Libertarian Debbie Standiford has 4%. Shortly after 11 p.m., Hill delivered an acceptance speech, saying that he would focus on cutting the size of government and returning the nation to “economic success for all of our citizens.”

With 17% of precincts counted, Womack won the 3rd District with 82% of the vote against Libertarian Brand Grant, who received 18% of the vote. Womack did not face a Democratic opponent.

With 36% of precincts reporting, Crawford had 64% of the vote to Democratic Heber Springs Mayor Jackie McPherson, who garnered only 32%. Libertarian Brian Willhite received 4% of the vote.

On ballot questions up for statewide vote, preliminary numbers show that Issue No. 1 and 5 passed, while Issue No. 4 failed. The results are based on 38% of the vote reported statewide.

ISSUE NO. 1
On the ballot question that would change administration of state government, voters passed the question by a vote of 60%-40%.

The question mandates review by the legislature of administrative rules in all Arkansas state agencies and approval of any changes to said rules.

The practice for years allowed the agencies to change rules with nothing more than a review of the legislature, but the House and Senate committees overseeing the rule changes have been unable to mandate changes to the rules or reject changes made by the agencies themselves.

ISSUE NO. 4
The other controversial issue on the ballot this year was the question of whether to turn all of Arkansas wet, therefore allowing alcohol sales statewide versus the patchwork wet-dry setup that has been in place across Arkansas since the end of Prohibition nearly 100 years ago.

The initiative to go all wet failed by a vote of 43% for to 57% against. Opponents of the legislation had said it would remove the local community's choice of whether or not to be a wet community.

Should it have passed passage, the 37 counties in Arkansas that are currently dry would have been able to host not just restaurants that want to serve, but also liquor stores and sales of alcohol in grocery stores.

ISSUE NO. 5
While not necessarily controversial, the final ballot question garnering a lot of attention in the races for U.S. Senate and governor was the question on whether or not to raise the state's minimum wage from the current race of $6.25 per hour to $8.50 by 2017.

The ballot question came the same year President Barack Obama has been advocating a race of the minimum wage to $10.10 federally. The rate has been matched by states such as Maryland in recent months.

In Arkansas, the ballot question passed by a vote of 66% for and 34% against.

With passage, the state of Arkansas would be above the current federal minimum wage of $7.50 per hour, though it remains to be seen if the federal rate would rise above the Arkansas rate of $8.50 by 2017.

Other races that have been called include attorney general, where Republican Leslie Ruledge garnered 52% of the vote to Democratic Rep. Nate Steel's 44%; lieutenant governor with U.S. Rep. Tim Griffin earning 57% of the vote to Democrat John Burkhalter's 40% and Libertarian Christopher Olson's 4%; and secretary of state, where incumbent Republican Mark Martin was re-elected with 60% to Democrat Susan Inman's 36% and Libertarian Jacob Holloway's 4%.

STATEWIDE RACES (30 of 30 counties reporting)
1ST CONGRESSIONAL DISTRICT
U.S. Rep. Rick Crawford (R): 63.55%
Mayor Jackie McPherson (D): 32.1%
Brian Willhite (Libertarian): 4.35%

2ND CONGRESSIONAL DISTRICT (7 of 7 counties reporting)
Patrick Hays (D): 43.59%
French Hill (R): 51.87%
Charles Neely (write in): 0.08%
Debbie Standiford (Libertarian): 4.36%

3RD CONGRESSIONAL DISTRICT (8 of 10 counties reporting)
U.S. Rep. Steve Womack (R): 81.47%
Grant Brand (Libertarian): 18.53%

4TH CONGRESSIONAL DISTRICT (30 of 33 counties reporting)
Ken Hamilton (Libertarian): 3.62%
Janis Percefull (write in): 0.08%
Rep. Bruce Westerman (R): 53.85%
James Witt (D): 42.45%

LT. GOVERNOR (71 of 75 counties reporting)
John Burkhalter (D): 38.5%
U.S. Rep. TIm Griffin (R): 57.39%
Christopher Olson (Libertarian): 4.11%

ATTORNEY GENERAL (71 of 75 counties reporting)
Aaron Cash (Libertarian): 5.08%
Leslie Rutledge (R): 52.04%
Rep. Nate Steel (D): 42.88%

SECRETARY OF STATE (71 of 75 counties reporting)
Secretary of State Mark Martin (R): 60.77%
Jacob Holloway (Libertarian): 4.24%
Susan Inman (D): 34.99%

STATE AUDITOR (71 of 75 counties reporting)
Regina Stewart Hampton (D): 37.27%
Rep. Andrea Lea (R): 57.36%
Brian Leach (Libertarian): 5.36%

STATE TREASURER (71 of 75 counties reporting)
Karen Garcia (D): 37.2%
Chris Hayes (Libertarian): 6.32%
Circuit Clerk Dennis Milligan (R): 56.48%

LAND COMMISSIONER (71 of 75 counties reporting)
Commissioner John Thurston (R): 57.3%
Elvis Presley (Libertarian): 6.08%
Mark Robertson (D): 36.62%

BALLOT ISSUES (71 of 75 counties reporting)
Issue No. 1 (Administrative rules change)
FOR: 59.18%
AGAINST: 40.82%

Issue No. 2 (Allowing more time to gather initiative signatures)
FOR: 53.24%
AGAINST: 46.76%

Issue No. 3 (Ethics rules changes; term limits extension)
FOR: 51.95%
AGAINST: 48.05%

Issue No. 4 (Allowing alcohol sales in all Arkansas counties)
FOR: 42.66%
AGAINST: 57.34%

Issue No. 5 (Act to increase Arkansas’ minimum wage)
FOR: 65.74%
AGAINST: 34.26%

While Arkansas Republicans were jubilant – and rightfully so – with Tuesday night’s election results, respondents to a call from The City Wire for post-election comments were more guarded and contemplative in their reactions.

Using social media, The City Wire asked people around the state to send us their comments about the election results. Most news outlets talk to the same handful of “experts” and we’re not wholly convinced they have a better handle on the outcome than many Arkansans. This effort was an experiment to shift the commentary from television talking heads to you.

Respondents were asked to not regurgitate political advertising blather on television ads or respond with talking points from the various political action groups who spent heavily on Arkansas candidates with both parties. Respondents were also asked to keep their responses to 100 words. Some did, some didn't.

“We saw enthusiasm from some of the responses we received and across social media. However, and even among some of the enthusiastic, there appeared a message of, ‘OK, you Republicans can win elections, but can you govern?’ That’s not a surprise considering the independent nature of Arkansans,” said Michael Tilley, editor of The City Wire. “The winning campaigns are certainly celebrating, but voters are like the homeowner who had to fire a general contractor halfway through the process. They are glad to have a new contractor, but they are eager to get the job back on track and will closely watch the new folks.”

This is what they, or maybe you, had to say.

• Cynthia Bailey, Fort Smith
With today's election, we will find that in a year we are still in the same place no matter who has been elected.

• Kay Atchison Brockwell, Jonesboro
The Republicans have won the government. Let's hope they don’t tear it up.

• Michelle Cernak, Crawford County
I can't vote for a mayor where I live nor can I vote for city directors where I do business. Hell, I didn't even get a sticker for voting. For me it's not about the sticker or the bonfire material. I get to remind those elected who they work for. As a mother, wife and business owner, it is my duty as a citizen to be involved in our communities that circle and aid in daily living for all no matter who is in office. I've noticed voting getting more "popular.” Lots of people helping people get informed to help them make a decision that's not just pushing a button and getting a sticker. Don't get your panties in a bunch if your person didn't win, and don't lose your spark leading up to the election. Get involved, speak up and do your part like you got the job.

• Ashleah Courtney, Little Rock
I’m surprised, but not surprised all at the same time. Arkansas is one of the poorest states in the nation, and yet residents continually vote against anything and everything that could make some sort of positive change in that. I’ve talked to people who have gone without insurance for years who are completely against any sort of healthcare reform. Yet they fail to realize that by being uninsured they are driving up healthcare costs for everyone. And that’s just one issue.

• Joel Culberson, Fort Smith
God has decided to bless us with Republicans. What did we do to deserve this?

• Mike Gilbert, Springdale
Some want opportunity and some want security. The challenge is giving the one who desires security his wishes without taking away the opportunity of the others. Some seek success and others seek security/protection. You cannot fault a person for seeking security or protection even if the security and protection is from the unknown. The issues in elections are not about principles anymore, they are all about power. Why would outside groups spend $30 million on attack ads in Arkansas if not for the goal of power? The power of opportunity exists for all who seek it.

• Matt Ketcham, Fort Smith
People get the government they deserve.

• Linda Burris Dare McBride, Fayetteville
With a GOP takeover of the U.S. Senate I worry about what happens if a Supreme Court Justice dies or can't finish their term because of sickness.

• Aric Mitchell, Fort Smith
I feel bittersweet tonight. I believe the country needs a third party desperately, but the Independent vote still isn’t viable, and Democrats have done so much damage to this country in the last 10 years (remember they had Congress for 2 under Bush) that electing a Republican Congress was the only option to roll some of that back. It’s my hope Republicans don’t take this as a win for their party but instead as a referendum on extremist politics, Left or Right, which the President has been entirely guilty of practicing these last six years. We also need to repeal or heavily revise Obamacare. That should be priority one.

• George Clay Mitchell, Van Buren
The taking of the Senate in 2014 may become the biggest political blunder for Republicans in the past 20 years. Now, they have to govern. If they govern from the middle, their vocal base will be angry. If they govern for their base, they're going to upset the rest of the country. End result, Republicans could lose majorities in both the House and Senate in 2016, as well as the presidency. It would be hard for them to recover as a national party.

• Sam Sicard, Fort Smith
In DC we got the divided government with one party controlling Congress I wanted, in Arkansas we lost the divided government I liked.

A former Fort Smith city director is returning to the Board in January and a local mayor is entering his third and final term following the general election Tuesday night (Nov. 4).

In the race for Fort Smith City Director At-Large Position 7, former City Director Don Hutchings claimed victory Tuesday with 59.32% of the vote to Parks and Recreation Commissioner Sherry Toliver's 40.6%. Hutchings will replace retiring City Director Philip Merry, who announced earlier this year that he would not seek a second term to the Board of Directors.

The candidates found common ground in a debate sponsored by the League of Women Voters in October, but there were differences between the two.

Regarding a change in government, the two expressed differences in how the city should move forward, with Hutchings advocating to keep the current city administrator-Board of Directors form of government while Toliver told The City Wire she would be in favor of a change to a Mayor-City Council form.

In conceding defeat, Toliver said she was proud of the campaign both candidates had run.

"Don was so gracious and kind to me in public and private," she said. "I appreciate that."

But even in her own graciousness toward Hutchings, Toliver expressed some disappointment in the results.

"I was really hoping and felt good about it and all the hard work we had done, but I knew I was up against a tough opponent in Don Hutchings. He had the name and face recognition. I am just so grateful to serve the city in this way and get my thoughts out there. I still think I have a place in the city for my thoughts to come to pass."

Hutchings, who is returning to the Board after leaving two years ago to focus on a capital campaign to build a new sanctuary at the church he pastors, was unavailable for comment Tuesday night.

FREEMAN WINS RE-ELECTION
In Van Buren, Mayor Bob Freeman faced off for the second time in four years with Alderman Max Blake in Freeman's bid for a third and final term as mayor and came out on top.

According to the Crawford County Clerk's office, Freeman won re-election with 52.31% of the vote, while Blake saw 47.69%.

Freeman said even with the tight numbers, he plans to enter the municipal complex tomorrow as mayor of all of Van Buren, not just his supporters.

"It was (contentious), but the campaign is the campaign. Now it's time to move on. I've had the privilege of being the mayor and serving the community for the last eight years. I appreciate the opportunity to continue being the mayor for the next four years, moving the community forward with all the citizens. But we've got projects coming up and more to come. I want to thank the community for their support and say it's time to move on and let's go."

Blake said he was proud of the campaign and the ideas he brought to the forefront and looked forward to working with all city leaders, Freeman included, to see those plans become a reality in the city he calls home.

"I was just trying to affect change and I think I've affected change each time I've run. I'm just trying to help the city of Van Buren. Obviously, Mr. Freeman had a stronger base than I did, but that's fine. The citizens have spoken and I'll help Mr. Freeman any way I can to movE the city forward."

ALMA, BARLING RESULTS
In Alma, it was a three way race between Keith Greene, Gary O'Perry and former Rep. Ed Thicksten that will go to a runoff after Greene won the most votes with 46.86%, while Thicksten received 42.76% and O'Perry came in last with 10.39%.

Barling voters also had to decide on whether to approve a new one cent sales tax that would bump the city's sales tax rate to 9.75%, from its rate of 8.75%. The rate would match the city of Fort Smith, but still be below the rates of Van Buren and Alma, which both sit at 10.25%. The tax, which would sunset in 10 years in 2024, was approved by a vote of 71.79% for and 28.21% against.

Barling City Administrator Mike Tanner said the sales tax would pay for street improvements, including "an overlay project, culverts, curbs, sidewalks, that type of thing."

The tax, Tanner said, is projected to raise between $250,000 and $300,000 per year, "depending on the city sales."

He said the figure does not include estimates from any sales associated with a new 70-store shopping center being built at Chaffee Crossing, though he said that could double or triple the collections once completed.

Other contested races of note locally included:
STATE REP. DISTRICT 80
Rep. Charlene Fite (R): 79%
Taylor Watkins (L): 21%

GREENWOOD MAYOR:
Mayor Doug Kinslow: 83.21%
Gary Campbell: 16.79%

SEBASTIAN COUNTY JUSTICE OF THE PEACE DISTRICT 7:
Justice of the Peace Jim Medley (R): 58.85%
Jim Perry (D): 41.15%

VAN BUREN ALDERMAN:
WARD 2, POSITION 2:
Scott Curtis: 44.9%
Darrol Sparkman: 55.1%

WARD 3, POSITION 2:
Adlerman Johnny Ragsdale: 39.92%
Alan Swaim: 60.08%

First-time homebuyers are the catalyst for the rest of the housing market but this important demographic is shrinking nationwide according to a new report from the National Association of Realtors.

First time buyers account for one-third of home purchases today, the lowest level since 1987, according to NAR Chief Economist Lawrence Yun.

“It's not just not as easy as it used to be for young adults to purchase a home,” Yun noted in the release.

He said rising rents and repaying student loan debt makes saving for a down payment more difficult for Millennials who have also experienced limited job prospects amid a slow recovering economy.

When factoring in rising home prices, higher mortgage insurance premiums and tighter credit, Yun said the result is fewer homes being sold to first time buyers. This missing demographic keeps others from being able to sell their homes and move up to a larger property as real estate is one industry with a trickle-up effect.

REGULATORY SQUEEZE
J.P. Sexton, mortgage banker at Centennial Bank in Fayetteville, said there is squeeze on first-time homebuyers and even veteran buyers seeking to refinance. It’s something he attributes to hyper regulation by the federal government. Sexton said there are plenty of downpayment assistance programs and ways to help buyers secure those funds, but the longer laundry list of criteria that must be met is burdensome and in many cases is not relevant to a person’s ability to pay.

The prime example Sexton shared is that of former Fed Chairman Ben Bernanke who recently sought to refinance his own home and was declined because of unstable income, since leaving his job. Sexton said it doesn’t matter that he’s got assets to cover the loan and in one speaking engagement can earn enough for a year’s worth of payments, the tighter rules kicked him out.

Sexton said the regulatory tightening has been increasing since 2008, and while buyers may initially hear they have been approved, when the underwriter gets through scrutinizing the bank statements, income tax returns, appraisals and other ancillary documents a loan offer can be snuffed out.

“I pity the buyer who has a successful garage sale and deposits $500 or $1,000 cash into their bank account and can’t prove where it came from. I have had borrowers hang up on me when I told them their loan was ultimately denied because of things like that,” Sexton said.

He said there is still a growing number of first-time buyers in this local market, but the average age is trending higher as many are waiting longer to buy.

Sexton said the majority of local market mortgage loans now require 5% down and are Fannie Mae backed. He said first-time buyers can pay 3.5% down with an FHA loan, guaranteed by the federal government. Both of these scenarios require private mortgage insurance which raises the monthly payment.

“A few years ago the majority of local mortgages were FHA, but today it’s almost always cheaper to use a conventional loan with 5% down,” Sexton said. “The reality is that some buyers just aren’t financially ready. We work with them too, so they can reach that goal if that’s their desire.”

REALTYTRAC REPORT
Irvine, Calif.,-based RealtyTrac looked at 512 U.S. counties with a combined population of 235 million and found that home affordability is often a hurdle for first time buyers.

To that point, Mel Watts, director for the Federal Housing Finance Agency, has talked recently about a need to “increase access for creditworthy but lower-wealth borrowers.” 

This could be accomplished lower down payments for performing loans sold to Fannie Mae and Freddie Mac, which now require a 20% down payment to escape paying monthly mortgage insurance premiums. The lowest downpayment rate today for Fannie Mae is 5% but requires added mortgage insurance.

“While lower down payments may help pave a quicker path to homeownership for some prospective homebuyers, a bigger obstacle to homeownership is the additional non-mortgage debt many borrowers bring to the table,” said Daren Blomquist, vice president at RealtyTrac. “For borrowers without additional debt, monthly house payments are affordable in more than 90% of U.S. housing markets — whether they make a 20% or 3% down payment. But for borrowers with the additional debt burden of student loans and car payments, monthly house payments are affordable in less than half of U.S. housing markets with a 3% down payment.”

That said, lower down payment requirements do provide a lift over one major hurdle to homeownership. Blomquist notes that it would take an average of 12.5 years to save enough money for a 20% down payment at the current savings rate of 5.6%, reported by the Federal Reserve Bank of St. Louis.

BUYER PROFILE 
The National Association of Realtors reports the median age of first-time buyers is 31, and their median income is $68,300. Their typical purchase is a 1,570-square foot home costing $169,000. The typical repeat buyer, by contrast, was 53, with an income of $95,000. Repeat buyers buy bigger and more expensive homes.

Home sellers are getting older at 54 years on average versus age 46 years in 2009. The typical seller has been in the house for 10 years, which is a new high. One reason noted for the older seller is that many of the Generation X homeowners were forced out of homeownership by foreclosures and short sales during the market bust between 2006 and 2009. The longer time spent in a home is linked to plummeting home values between 2007 and 2011, which holds many homeowners at bay as they try and recover lost equity. 

Yun said better home values this year have allowed some homeowners to sell after waiting years for that opportunity. 

“But if the share of first-time homebuyers continues to shrink, many homeowners who would like to move up to a more expensive house may find it harder to sell their current home,” Yun said.

Overall home ownership rates dipped to 64.4% at the end of the third quarter, lower than 65.3% reported a year ago and trending down this entire year, according to an Oct. 28 U.S. Census report.

Combined building permits for the cities of Fort Smith, Greenwood, and Van Buren were $17.886 million for the month of October, an increase of 22.39% over the same month last year when only $14.614 million in building permits were issued.

Permits were highest in Fort Smith, where a $5.1 million building permit was issued for a 40 bed expansion that will add 25 jobs at Valley Behavioral on the far east side of the city. Another sizable permit was for renovations at Immaculate Conception Church, where a permit valuing more than $1.7 million was issued.

Ana Garcia with IC said the total capital campaign at the church is $3.2 million, with $2.9 million pledged by more than 600 donors.

In all, $15.629 million in building permits were issued in the city of Fort Smith during October.

For the first 10 months of 2014, the three cities issued permits totaling $176.722 million, down compared to $190.102 million during the same period in 2013. The decline represents a 7.04% decline year over year. Even though it was a decline from 2013, the figure is a 44.35% increase from 2012's total of $122.43 million during the same 10-month period. From the same period in 2011, the cumulative total represents a decline of 2.56% from $181.365 million.

Fort Smith had the largest portion of the 10-month total, with $152.263 million in permits issued, a 9.46% decrease from 2013's 10-month total of $168.174 million. Van Buren came in second with $17.125 million, a 12.48% increase from the previous year's 10-month total of $15.224 million. Greenwood this year has issued a total of $7.335 million in permits, a 9.41% increase from the 10-month total in 2013 of $6.704 million.

FORT SMITH
The city of Fort Smith issued 202 permits worth $15.629 million, a 22.3% increase from October 2013's permits of $12.779 million on 161 projects.

Commercial projects totaled $10.523 million on 33 permits, while 115 permits were issued for single family residential totaling $2.723 million.

GREENWOOD
Permits in Greenwood in October were up 375.77% over the same month last year, with $1.536 million in permits issued in October 2014 compared to only $322,860 during the same month last year.

Driving permits in the city were four new residential permits totaling $1.459 million. Other permits issued in the city include a $60,000 accessory building, $13,440 for a residential addition and $4,000 for a residential repair or remodel.

VAN BUREN
Van Buren had the worst month of the three cities, registering a 52.32% decline in October on $721,000 in permits issued. October 2013 saw permits issued totaling $1.512 million.

Driving last October's numbers was new home construction, with 22 permits issued totaling $1.478 million in value.

Permits issued in the city last month included four residential building permits totaling $288,000 and three commercial building permits valued at $433,000.

The total for last month is the second straight year that the city has seen a decline in the month of October, with the city down 24.5% from October 2012's total permitted value of $955,000.

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

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

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

With a sweep of all federal offices, statewide offices including the governor's office and a larger majority in the General Assembly going into the 90th legislative session, Wednesday (Nov. 5) is truly a new and historic day for Republicans. But with Republicans not reaching critical thresholds in the House and Senate, key pieces of legislation will still require the support of at least some Democrats.

Sen. Jake Files, R-Fort Smith, said with the growth to 64 Republicans in the House (out of 100) and 24 seats in the Senate (out of 35) along with each constitutional office was a "clear message" from voters.

"It was obviously a huge day and night for Republicans in Arkansas," he said. "I think the citizens and voters sent a clear message that they were interested in us leading. Now the impetus is on us to govern. There's a difference between campaign and governing. My hope is that we govern as statesmen, not Republican or Democrat."

Already Gov.-Elect Asa Hutchinson, R-Ark., has announced that Sen. Michael Lamoureux, R-Russellville, would serve as his chief-of-staff and the director of transition. The Pro Tem of the State Senate, he served in the House from 2003-2009 and has been in the Senate since that time.

"Not only does Michael bring an ample amount of institutional knowledge of the state’s legislature, having served in both chambers in leadership positions, but he is well respected by his colleagues on both sides of the aisle," Hutchinson said. "My six-point plan to grow our economy and create jobs in our state starts by lowering taxes for Arkansas’ middle class, and I believe Michael has the qualities and experience to help accomplish my goals as Governor.”

Files said Lamoureux's appointment to the governor-elect's staff was a way of ensuring that the governor's proposals from the nearly year long campaign become law.

"We'll start seeing things come together, but there'll be no mad rush to pass legislation in a quick manner. This will mean more coordination between the governor's office and the House and Senate leadership to get things done," he said, adding that it would be hard to determine how quickly Lamoureux could whip votes for the governor-elect's legislative priorities.

Sen. Uvalde Lindsey, D-Fayetteville, noted that while the Republicans will have a majority, it'll still be short of the three-fourths majority needed to pass appropriations and short of the two-thirds majority needed for other parliamentary actions.

Even so, Lindsey said Lamoureux's appointment could be a way to bridge the gap between parties as he is well respected on both sides of the aisle.

"He will do a great job to serve Asa as chief of staff. He did a great job as President Pro Tem in the 89th (Legislative Session). Quite frankly, I'm a little sad to lose him as a colleague in the Senate but he will serve the governor well. He has built and continues to build trust with all members of the Senate and if you trust somebody and value their judgment and word, that's always a valuable asset no matter where you are in life and what you do. Michael takes that attribute and that criteria to the corner office," Lindsey said.

The one hiccup that could arise in General Assembly, according to Democratic Rep. Greg Leding of Fayetteville, is what he asserted at two factions of the Republican Party.

"I think obviously the Republican legislators will find more opportunities to partner with a Republican executive branch, but I don't think the Republican caucus is unified. I think you see three parties in the legislature. I think they're evenly split at the house level — Democratic Party, Republican Party and the far-right party," Leding, the former House Minority Leader, said.

"Obviously, most of the time Republicans might manage to come together, but I don't think they'll always manage to be on the same page."

Rep. Justin Harris, a West Fork Republican whose sprawling district stretches through much of rural Crawford and Washington Counties, disagrees with Leding's analysis and said Hutchinson is likely to see a unified front even on issues like the Private Option that have been contentious between conservative Republicans and the party's more moderate leadership from the last legislative session.

"I think (Leding is) wrong, I really do. I think he's dead wrong," he said, adding that he believed dissatisfaction with the way national politics are run in Washington trickled into the overwhelming wins by Republicans on Tuesday (Nov. 4).

But he said issues like the Private Option – Arkansas’ implementation of the federal Affordable Care Act – would not cause Republicans to lose focus on governing and giving citizens a taste of something different than Washington-style gridlock.

"We need to look at what we're going to do (with the Private Option). But I think you'll see a united Republican front and I don't think you'll see a split party. so I disagree with that."

Files said he believed Democrats would still have a voice in the process, even if it is controlled by his Republican colleagues. He expects Lamoureux to be an effective extension of the governor's office, making sure all sides are heard.

"I like to think that most of the people down there are relational people wanting to build consensus and for me, it's the right thing to do. I've been in the House with 24 (Republican) members. So you're selective as to what is opposed and what is stood up to."

Lindsey echoed those sentiments and added that he expected the governor's office to work with Democrats and Republicans in good faith to accomplish the best for Arkansans.

"I know Michael will build a strong position of friendship and trust. He already has that with the president designate (Jonathan) Dismang. They're good friends. And I know Sen. Lamoureux is good friends with the minority leaders (on both sides) and with all of us. He will do a good job to help build the relationship (between branches of government)."

Officials with the city of Fort Smith and the office of Arkansas Attorney General are expected on Thursday (Nov. 6) to renew talks with federal officials in Dallas about the city’s efforts to respond to alleged violations of the federal Clean Water Act.

It was announced in early October that negotiations had broken down between the city and the Environmental Protection Agency and the United States Department of Justice. Fort Smith Attorney Jerry Canfield said during a special meeting Oct. 2 notifying the Fort Smith Board of impending legal action that he expected a lawsuit to be filed as soon as Oct. 3. The Feds never filed a lawsuit.

Since1993, the city has invested more than $201.2 million improving the city's wet weather system. 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.

Federal officials have said the city is not addressing the problem with the right priorities and/or enough money. The office of Fort Smith City Administrator Ray Gosack would not comment on the meeting, and instead referred comment to the office of Attorney General Dustin McDaniel.

Aaron Sadler, spokesman for AG McDaniel, issued this statement: “I requested that the parties come together one last time to attempt to avoid costly litigation against Fort Smith. I will do everything I can to assist the parties, but ultimately this is a dispute between the city and the EPA. I hope that the city recognizes this is its last chance to come to terms with the federal government and prevent a lawsuit.”

When asked if McDaniel would attend the meeting in Dallas, Sadler said the office would not comment on who or how many from the AGs office would be at the meeting.

Fort Smith City Director Keith Lau said the city did inform the Board that another round of negotiations would take place between the city and EPA. He said it was his understanding that McDaniel’s pushed for the meeting.

“I’ve heard that Dustin (did not sign off on the authorization on the lawsuit) and encouraged the DOJ to resume negotiations,” Lau said. “I think Dustin McDaniel deserves kudos for helping us stave off a lawsuit and getting us back into negotiations.”

Lau was not sure why the public was not notified of the meeting, and said he is not sure of the status of the meeting.

“I really don’t know if negotiations are close or are far apart. ... I haven’t been told if this is a last ditch effort,” Lau said. “But am I positive that it will change the outcome? No.”

When asked about the meeting, Fort Smith City Administrator Ray Gosack said the city has communicated with the Feds through the office of Attorney General McDaniel

Gosack has said the city has made significant progress toward compliance, eliminating four of five overflow problems in the city since 2007 and said in spite of the Justice Department's planned lawsuit, the city would continue with projects aimed at bringing the city into compliance with federal law.

As crude oil prices fall into bear market territory, industry analysts are forecasting that pump prices in Arkansas and the rest of the U.S. may remain relatively low this winter and could drop another 5 to 15 cents per gallon before Thanksgiving Day as gas stations catch up with the steep declines in the wholesale market.

The lower gas prices could also prompt consumers to take the lock off their pocketbooks just in time for the holiday shopping season, Wall Street analysts say. In a recent research note to investors, Morgan Stanley’s senior U.S. economist Ellen Zentner estimated that lower retail gasoline prices added about 0.2 percentage points to annualized growth in real consumer spending.

“That chill in the air reminds us that the holiday shopping season is near and, compared with one year ago, households have more spending potential,” Zentner wrote in the Wall Street investment firm’s November bulletin. “On balance, we find that households have roughly $129 billion in additional real discretionary income going into the fourth quarter — a 4.3% gain compared with the same period last year — that has been driven primarily by gains in aggregate wages and salaries.”

Zentner added, “Moreover, nominal income will be boosted by as much as an additional $40 billion year over should lower gas prices continue.”

And as consumers open their wallets, AAA officials are hoping that more affordable gas prices may also induce more travelers to take a winter vacation or trip to grandma’s this holiday season.

“It is too early to say whether more people will travel for the holidays, but lower gas prices should give consumers more money to spend on dining, shopping and lodging during their trips,” the AAA said in its monthly gas price report.

CHEAPER FUEL IN ARKANSAS
Nationwide, the U.S. average price for regular gasoline fell 10 cents to $2.95 per gallon as of Nov. 5, 2014, 31 cents lower than a year ago, according to the U.S. Energy Information Administration. This week’s price is the first U.S. average price below the $3.00-per-gallon mark since Dec. 20, 2010.

AAA officials said national pump prices usually drop during the autumn season due to decreasing demand and the cost savings associated with producing winter-blend gasoline. However global oil prices have declined more than anticipated, as supply has outpaced demand, contributing to even greater savings at the pump for drivers.

“Barring an unexpected market-moving development this winter, motorists can expect to pay retail prices that are relatively low, and could see the price continue to tick downward even a little further as gasoline stations adjust to falling oil prices in the global market,” the AAA said.

Arkansas has the eighth lowest pump prices in the nation when compared to all 50 states, averaging $2.80 per gallon for regular unleaded, according to AAA’s daily fuel gauge. That price is 15 cents below today’s national average. Pump prices in the state’s metropolitan areas range from a low of $2.74 per gallon at the Texarkana state line to a dime higher in the Fort Smith area. Motorists in the Fayetteville-Springdale-Rogers area and the Little Rock-North Little Rock and Pine Bluff markets are all paying an average of about $2.80 a gallon to fill up their tanks.

Drivers choosing to fill up their tanks with a higher-grade of gasoline should expect to pay an average premium of $3.19 a gallon across the state. Big rig drivers and other diesel fuel users will see pump prices at about $3.48 a gallon, down a penny from only a week ago.

WINTER FUEL PRICES
Meanwhile, not only will Arkansas and U.S. consumers get a reprieve from high prices at the pump this winter, costs for residential heating fuels are also declining in all categories, EIA data shows.

After the unusually cold winter of 2013-14, U.S. households can expect lower heating expenditures this winter compared with last winter, the EIA said in its recent short-term energy and winter fuels outlook. On average, household expenditures for homes heating primarily with natural gas will total $649 this winter, a $31 decline from last winter’s average.

Homes heating primarily with electric heat are expected to spend $938, or $17 less. Homes using heating oil or propane, a staple fuel in Arkansas’ rural areas, have higher expenditures on average ($1,724 and $1,992, respectively) than homes using natural gas and electricity, but still lower ($652 less and $362 less, respectively) compared to last year.

Also, the latest forecast from the National Oceanic and Atmospheric Administration (NOAA) said temperatures are expected to be warmer than last winter. The extreme weather patterns last winter elevated demand for all heating fuels led to a drawdown of U.S. energy supplies, putting upward pressure on heating prices. Because weather patterns present great uncertainty to winter energy forecasts, EIA’s projections include a “10% colder and 10% warmer scenario.”

The EIA’s forecast and pressure on this winter’s natural gas prices is likely to be downward compared to last winter, the Natural Gas Supply Association (NGSA) said in its recent annual winter outlook report.

“When NGSA weighed all the different pressure points, the picture that emerged for the upcoming winter is one of remarkable growth in supply and steady underlying growth in demand that will be moderated by the forecast for a warmer winter than last year’s,” said NSGA Chairman Greg Vesey. “The abundant supply of natural gas is great news for consumers. When all key supply and demand factors are combined, we anticipate downward pressure on prices compared to last winter.”

As of Oct. 20, residential heating oil prices averaged $3.48 per gallon, almost 5 cents per gallon lower than last week, and 38 cents less than last year’s price of $3.86. Wholesale heating oil prices averaged nearly $2.65 per gallon, 2 cents per gallon lower than last week and nearly 46 cents lower when compared to the same time last year.

Residential propane prices decreased by less than one cent last week to $2.37 per gallon, half a cent less than the price at the same time last year. Wholesale propane prices averaged nearly $1.08 per gallon, 4 cents lower than last week’s price and 20 cents per gallon lower than a year earlier.

Still, natural gas prices have rallied from last week’s 52-week low. At the end of Wednesday’s session, natural gas spot prices were up 46 cents from a week ago to $4.20 per million British Thermal units (MMBTU) at Oklahoma’s Henry Hub. That is also nearly 73 cents higher than a year ago.

The EIA is expected to release its monthly short-term energy outlook next week. The updated forecast from the U.S. Energy Department is expected to reflect the dramatic decline in domestic and internal crude oil prices, and its effect on retail and wholesale gasoline prices in the near term and through 2015.

The team helping Gov.-elect Asa Hutchinson become the next governor will include Mike Carroll of Fort Smith and Philip Taldo of Springdale.

Standing in front of a portrait of Republican governor Frank White in the Capitol Rotunda, Hutchinson announced his transition team’s steering committee and said he would not decide what to do about the private option until January.

During his first press conference as the state’s newly elected governor, Hutchinson said his steering committee is composed of:
• Mike Carroll of Fort Smith
• Stacy Hurst of Little Rock
• Alec Farmer of Jonesboro
• Philip Taldo of Springdale
• Mayor Arnell Willis of Helena-West Helena
• Steve Lux of Hot Springs Village

Carroll is a CPA and partner with Fort Smith-based Beall Barclay & Company. He joined the accounting firm in 1981, and is a 1977 graduate of Ouachita Baptist University. Involvement outside the company includes serving on the Board of Trustees for the Ouachita Baptist University Foundation, board of directors of the Fort Smith Regional Chamber of Commerce and former board chairman of St. Edward Mercy Medical Center – now Mercy Fort Smith. He and his wife Pam live in Fort Smith.

Taldo is a Realtor and owns Griffin Company Realtors and One Springdale Inc., a development company. He is a graduate of Springdale High School and has been in the real estate business since 1978. Outside activities include being a member of the Northwest Arkansas Regional Airport Authority, board chairman with Hope Cancer Resources Foundation and advisory board member with Arvest Bank-Springdale.

Hutchinson, the committee, and his other transition leaders will have plenty of work to do. In addition to creating a budget that includes his promised middle class tax cut, Hutchinson must decide which agency heads to keep and which to replace. Among the holes to fill: Richard Weiss, longtime director of the Department of Finance and Administration, who has announced his retirement.

BEEBE MEETING, PRIVATE OPTION
Hutchinson said he had “an excellent meeting” Nov. 6 with Gov. Mike Beebe. Hutchinson’s newly named chief of staff, Michael Lamoureux, was at the meeting as well. Hutchinson said he had reached out to legislative leaders, including Senate Minority Leader Keith Ingram, D-West Memphis, and House Minority Leader Eddie Armstrong, D-North Little Rock.

Tuesday’s election put the state’s Medicaid private option in jeopardy. The program that uses federal dollars to purchase private insurance for lower-income Arkansans barely passed in 2013 and barely survived in 2014. A number of vocal opponents were elected in Tuesday’s Republican landslide.

Hutchinson said he would work with leaders in the Legislature and in state government to look at benefits and costs and to determine if the program should be continued and, if so, what changes should be made. He said he would not commit to a decision “at least through the end of January.”

“You can ask me every day,” he said. “It will be the same position as I took during the campaign because (I’m going) to continue to study that, listen to everybody, make my own decisions on it, and then it will be at least that long to develop my approach to it.”

Hutchinson said his priorities would be career education, computer science courses in high school, and his tax cut plan, which he said was his highest priority. He said he would call at least half a dozen industrial and business recruits on his first day of office. Community leaders have already provided him names of prospects.

Hutchinson said he had received a call from President Obama the night of his election.

“He importantly recognized the key role that governors play in directing really national policy, and he wants to have a good partnership with governors,” he said. “I certainly expressed my support for that, willingness to work with him on key issues that impact our state.”

With Republicans taking control of the U.S. Senate, all seven Arkansas constitutional offices and strengthening their majority in the Arkansas General Assembly, there's no doubt that this week was a good one for the Republican Party. But U.S. Rep. Steve Womack, R-Rogers, said governing will be anything but easy.

To illustrate his point, Womack recited a saying from his father about dreams and reality.

"Son, the realization is never as great as the anticipation," Womack quoted his father as saying, adding a personal anecdote. "In Washington, as in Little Rock, there are things we will always like to do, and they almost always have to be balanced against a political reality of making them happen."

Womack spoke Thursday (Nov. 6) during the annual meeting of the Fort Smith Regional Chamber of Commerce.

Even with the majorities gained by Republicans Tuesday (Nov. 4), Womack said the fatherly wisdom imparted on him reminds him that he and his constituents will have to be patient as Republicans work to affect change nationally and locally.

Womack, who was re-elected Tuesday by a whopping 79.4% against Libertarian Grant Brand, also acknowledged that the week was not just good for Republicans nationally and locally, but for Arkansas Republicans the election was also historic.

"We're just a couple of days removed from a very historic election in our state and nation. In Arkansas, for the first time in 141 years, the GOP has control of every single federal elected position. Not only have I been witness to this phenomenal shift, but I have participated in it," he said. "And at the state level, every constitutional office in our state now resides with the GOP."

Womack said his work in the next Congress would directly impact his constituents back in Arkansas and specifically, in Fort Smith. Among the local issues Womack said he was working on in Congress was ensuring the new missions of the 188th Wing of the Arkansas Air National Guard continue to progress, along with the 123rd Intelligence Squadron which is relocating from Little Rock Air Force Base to the ANG base in Fort Smith.

The missions, according to a presentation Thursday by outgoing Fort Smith Regional Chamber of Commerce Board Chair Melissa Hanesworth, has a $144 million economic impact on the region.

Womack said he was working to make sure the squadrons' operational timelines established by the Pentagon stay on track and said while attending the Army-Navy football game at the U.S. Military Academy in West Point, N.Y., he met with Secretary of the Air Force Deborah Lee James. He and James were able to make plans for her to visit Fort Smith, which he said would happen "soon."

"Secretary James is keenly aware of the transition and has assured me that the future of the 188th is secure and that the timelines will be met," he said.

The timelines established include the establishment of a SCIF, also known as a sensitive compartmented information facility, at the Fort Smith base which he said would allow the squadron to discuss and house classified information tied to its mission. The completion date for the SCIF, he said, is the first quarter of fiscal year 2016.

He also said the remote piloted aircraft (RPA) mission at the base should launch by the third quarter of FY2016, with a space targeting mission set to launch during FY2016's fourth quarter.

Womack's speech also touched on his work on the House Transportation and Infrastructure Committee, specifically discussing local infrastructure needs, the federal Highway Trust Fund and how a solution in Congress could have a direct local impact on industry.

"Long-term solutions to funding America's infrastructure needs continues to be elusive to Congress," he said. "I am hopeful the new Congress can find the right solution, whether it's a user-based solution or some other unique opportunity. Bottom line, we need our roads. We need I-49. We need additional depth on the MKARNS (McClennan-Kerr Arkansas River Navigation System). When you consider the confluence of systems – river, rail, air, and interstates, not to mention the availability of energy resources – the Fort Smith region and its resources is uniquely situated to be the center of the resurgence of American productivity."

A change in insurance rates and possible cost of living raises the major highlights of the proposed Fiscal Year 2015 budget presented to the Sebastian County Quorum Court Thursday night (Nov. 6).

Regarding insurance for county employees, County Judge David Hudson said the county had offered two different insurance plans with $2,500 and $1,000 deductibles respectively. The county, he said, was shelling out more money on the higher deductible plan which has lead the judge's office to recommend combining all employees into a single plan that would have a $2,000 deductible.

For an employee of the county insuring him or herself only, the plan would run $80 per month, while an employee and any dependents (i.e. children, spouse or both) would up the plan to a flat rate of $204 per month.

Compared to the 2014 rates for the two plans, employees on the $1,000 deductible will pay the same amount for coverage at $80 per month, but family plans under the $1,000 deductible were running $254 per month. The new plan will cost $50 per month less.

On the $2,500 deductible plan, individual employees were paying $20 per month while family plans were running about $104 per month, meaning both plans increased by $60 and $100 per month respectively, though the deductible dropped by $500. Hudson did not state how much combining all employees into a single plan.

"A continued emphasis on wellness programs and benefits will be emphasized as a documented health initiative that improves the well being of employees and has helped stabilize health care costs in other organizations both regionally and nationally," the budget document outlining the insurance costs stated.

Hudson said the attempts at cost savings came as a result of flat revenues at the county from the countywide sales tax and property tax collections.

"Total General Fund personnel cost has grown 18% over the past five years while General Fund revenues have increased 17% during the same time period," he wrote. "Slow growth in County property taxes and decreasing or flat increases in County sales tax revenues are significant budget issues for 2015 and later County budgets."

Tied to personnel costs is a proposed 1% cost of living increase for all county employees, which is historically less than previous years.

"In 2009, we had a 3% merit and capital improvement adopted in the budget," he said. "In 2010, 3% cost of living and capital included in the adopted budget. In 2011, 2% cost of living and no cap. It was deferred to February. 2012, 3% cost of living. No cap. It was deferred to February. 2013, 0% cost of living, no cap. It was deferred to February. 2014, 2% cost of living and no cap. Deferred to February."

While Hudson is pushing for raises, up to $505,000 will have to be cut he told Justice of the Peace Linda Murry when questioned about the proposed spending plan.

He told her options would be discussed with the Quorum Court at meetings next week, with the court left to decide where potential cuts should come from.

"What it comes down to is do you want to give people a raise, do you want to allocate 1% or do you want to do special pay and reclassifications and things like that," he said, speaking of a reorganization of the county's pay grade system across all departments.

"You have to make a decision about where you want to spend your money," Hudson added. "We have a close budget."