Jobs have a direct correlation with population migration across the country each year. But while Northwest Arkansas’ employment growth is better than average, it’s not enough to move the needle to favor a statewide pattern of more incoming than outgoing migration, according to two recent national studies.

United Van Lines completed 1,810 moves into and out of Arkansas in 2013. More than 46% (834 moves) were inbound and nearly 54% (976) were outbound, according to Melissa Sullivan, spokeswoman for United Van Lines.

In 2012, United Van Lines reports similar numbers for the Natural State with 48% (876 moves) inbound and 52% (947 moves) outbound. A similar study by Atlas Van Lines also depicts Arkansas as a balanced state with 472 incoming moves last year, and 478 outbound. The Atlas study dates back to 2004.

While the inbound moves to Arkansas totaled more than 700 per year before the 2008 recession, there were nearly that many outbound moves which was enough to keep Arkansas a balanced state over the 9-year period, according to Atlas study. Localized statistics were not available in these two national studies.

An expert who works exclusively with relocation candidate into and out of Northwest Arkansas reported similar results. Joanie Stell, relocation specialist for the local Coldwell Banker franchise, told The City Wire that relocation activity was strong in 2013 in the metro area. Stell said her firm received some 2,000 inquiries that included both inbound and outbound transfers. Stell said the firm received 259 buyer referrals from inbound transfers, while 309 other properties were sold for outbound transfers last year.

“Activity was strong last year, but many of the transfers tend to take place every two years or so as we still see retail-related businesses moving folks in and out of the region at these two-to three-year intervals,” Stell said.

She said there is always some foreign transfers in the mix. Stell is now working with some inbound transfers from Italy.

The latest U.S. Census numbers reflect that 10,287 people moved into the Northwest Arkansas metropolitan area between April 1, 2010 and July 1, 2012. That breaks down to roughly 13 people moving into the region per day, during this 26-month period. Other recently reported stats for local population growth by the Northwest Arkansas Council include births in addition to migration moves.

One in five inbound NWA residents came from outside the U.S. during this 26-month period, according to census data. The government’s migration numbers will be updated for the metro area in March. At that time the migration cutoff date will be July 1, 2013.

Economists agree the Census migration numbers are best gauge for actual new population growth by region as a fair number of the transfers into Northwest Arkansas come from elsewhere in the state following the jobs.


Jeff Collins, an independent economist who conducts the data collection and analysis for The Compass Report, recently said impressive job creation numbers continue to be the story in Northwest Arkansas.

“The unemployment rate in Northwest Arkansas was the lowest in the state amongst all MSAs in September (5.2 percent). It was more than a full percentage point lower than that for the Little Rock/North Little Rock/Conway MSA (6.4 percent). The highest rate in the state was the Pine Bluff MSA at 9.4 percent. To add perspective, of the 372 MSAs in the country, only 23 posted rates above 10 percent in October and only 57 had rates below 5 percent,” Collins wrote in his analysis.

Non-farm employment employment in Northwest Arkansas is well ahead of 2012 figures, with employment in the metro area at 222,900 in September compared to 211,700 in September 2012.

Continued growth in Northwest Arkansas has the potential to alter the state’s political landscape, according to Collins. He said the Northwest Arkansas economy is quickly approaching two-thirds of the Central Arkansas economy. The implications for relative population are obvious.

NATIONAL MIGRATION
Throughout the Southern region, the Atlas study found the majority of states were balanced in terms of incoming and outgoing residents between 2012 and 2013. Tennessee, North Carolina and Texas were the exceptions with each of the states reporting more incoming moves.

Oregon, Idaho, Montana and North Dakota were each deemed inbound states largely linked to the boom in fracking jobs amid the natural gas sector.

The United Van Line study also found that Oregon was its top moving destination of 2013 with 61% of the moves being inbound. Also, notable migration changes were visible in Michigan as after 16 consecutive years as an outbound state, the number of inbound moves were sufficient for a balanced status, according to the study.

"Business incentives, industrial growth and relatively lower costs of living are attracting jobs and people to the Southeastern and Western states such as South Dakota, Colorado and Texas," said Michael Stoll, economist, professor and chair of the Department of Public Policy at the University of California, Los Angeles.

He said there is also visible migration to the Pacific Northwest by young professionals drawn by tech jobs, green space and public transit.

Conflicting testimony about deficit spending at the University of Arkansas was again heard before a legislative group.

A state audit found deficits in the UA Division of Advancement’s budget of $2.14 million in fiscal 2011 and $4.19 million in fiscal 2012.

In September 2013, Roger Norman, director of the state’s division of Legislative Audit, forwarded an investigative report to Prosecuting Attorney John Threet of Fayetteville. Threet eventually decided to not pursue an investigation based on the audit report.

On Tuesday (Jan. 7), the Joint Performance Review Committee of the Arkansas Legislature heard from former UA employees who were not allowed to testify during a December legislative hearing.

Brad Choate, who ran the University of Arkansas’s fundraising division, suggested there’s a “culture of cover up” by school officials, according to this report at KUAR Public Radio.

“Frankly, this is another example of a pattern of shameful behaviors designed to protect themselves rather than be honest and accountable. Ladies and gentlemen, something is rotten in Fayetteville.”

Choate called himself the fall guy for problems that he said had been building since Fayetteville Chancellor David Gearhart ran the Advancement department.

Gearhart disputed that.

“The simple truth is that Mr. Choate failed to carry out his duties and responsibilities as vice-chancellor by ignoring his duty to manage and supervise budgetary matters,” Gearhart said.

Sen. Jane English, R-North Little Rock, and co-chair of the committee, was not pleased with testimony from either side.

“I have been very confused here to figure out how it is you can have this much money floating around and there are all these people who have not a clue about what the budget is or what the projections are,” English said.

Fallout from the advancement division included the sudden and controversial firing of John Diamond by Chris Wyrick, the UA vice chancellor for university advancement. Diamond was serving as the vice chancellor of university relations. Diamond was fired in August, with Wyrick alleging that UA “senior leadership had lost faith” in him.

Diamond asserted that Wyrick had created a “toxic environment” in the department, and threatened the university’s credibility through a “disregard for the University’s obligations” under Arkansas’ Freedom of Information Act. Diamond has also alleged that UA officials told him to destroy documents related to a budget shortfall in the UA Advancement Division.

The impact of health coverage through Obamacare was touted as a way to cap rising insurance costs and provide benefits to the masses of uninsured. But as 2014 gets under way many Americans are finding that is not exactly the case.

Doug Whiteman, insurance analyst for Bankrate.com, said it is easy to forget that 150 million Americans get their insurance from their employer. In many cases these employer sponsored plans have escalated in price as they assume the risks for the insured and those without coverage.

A recent study by Bankrate.com found that 47% of Americans with employer-based health insurance report more money is being taken out of their paychecks each month for health insurance than a year ago. In addition, 44% said they are experiencing higher out-of-pocket expenses, including deductibles and copayments, compared to one year ago.

SQUEEZING THE MIDDLE

Upper-middle-income Americans with employer-based health insurance (annual household incomes between $50,000 and $74,999) are the most likely to report more money being taken from their paychecks and higher out-of-pocket expenses, Whiteman notes.

He said it is this middle-income group that has been the hardest hit by Obamacare. Out of all income levels, they are the most likely to feel that the law has negatively impacted their health insurance.

John and Jamie Smith of Elkins said their employer-sponsored medical insurance costs doubled last year in anticipation of the new law. The Smiths are in their 30s. Arvin and Carol Johnson, a retired couple in Howard, Colo., said their private supplemental policy premiums increased this year, but they are still happy with the coverage. Robby and Marna Robertson, school administrators in south Texas, said their insurance premiums rose this year and they were told to expect higher costs in 2015.

EXCHANGE SURPRISES

While many feared losing family coverage as a result of the Affordable Care Act, few employers have taken this step – less than one in 10 Americans with employer-based health insurance lost coverage for a spouse or child this year. And only two in 10 Americans with employer-based health insurance now have fewer doctors included in their plans, according to Bankrate.com.

“People covered under these employed-based plans should watch for changes and discuss with their employers how Obamacare may affect their coverage and costs. In some cases, getting insurance through the health exchanges could be more cost–effective, so it is important to research all possibilities,” Whiteman said.

A recent CNBC report highlighted some unintended consequences for small businesses and their employees trying to comply with the Obamacare law.

Wesley Lutz, owner of Extreme Dodge in Jackson, Mich., told CNBC on Dec. 30 that he employs 41 people and though he is under no obligation to provide health insurance he has done it for 35 years, picking up 70% of the costs. This year he opted to give each employee $2,400 which they could spend acquiring their own insurance through the exchange marketplace. If they opted to go without coverage, the $2,400 could be used to cover out-of-pocket costs. He said the $2,400 per employee was slightly more than the company paid last year on coverage for the individuals.

He said a few employee came out winners in this move. They were the lower income workers who qualified for subsidies to offset their premiums through an exchange.
Lutz said of the 26 employees who had coverage under the company plan last year, 21 signed on for coverage through exchanges, but their deductibles will rise from $1,125 this year to $3,000 new year and maximum out-of-pocket costs jump from $2,250 to $6,350.

Four of the Lutz’s younger workers opted to keep the $2,400, pay the penalty and go without insurance for now. Experts say this "opt out" by the younger generation is partially responsible for the higher costs of those seeking insurance through the exchanges. Lutz said some older employees were facing costs they simply could not afford, an intended consequence from Obamacare.

“I will continue to do my part to help my employees who need and want health coverage, but this law is not what anyone thought it would be,” Lutz said during the recent CNCB interview.

The Bankrate.com survey found 52% of females with employers-based coverage faced higher out-of-pocket costs, compared to 35% of males.

Some 48% of Americans now want to repeal Obamacare, while 38% want to keep it. When Bankrate.com last asked the same question in September, 46% wanted to see the law repealed and 46% favored it.

The Fort Smith metro jobless rate fell to 6.9% in November and brought to an end 55 consecutive months in which the regional jobless rate was at or above 7%.

Metro employment of 122,993 was down slightly from the 123,153 in October 2013, but was up from the 122,688 in November 2012. The November jobless rate of 6.9% was down from 7.3% in October and down from 7.3% in November 2012, according to figures released Wednesday (Jan. 8) by the U.S. Bureau of Labor Statistics.

All eight metro areas in or connected to Arkansas had jobless rate declines in November compared to October, and seven areas had jobless rate increases compared to November 2012. The Fort Smith regional jobless rate was better than the 7.3% in November 2012.

During November, the lowest metro jobless rate in the state was 4.8% in Northwest Arkansas and the highest rate was 9.5% in the Pine Bluff area.

FORT SMITH METRO NUMBERS 
The size of the Fort Smith regional workforce during November was 132,163, down from the 132,867 during October, and below the 132,392 during November 2012. The labor force reached a revised high of 140,253 in October 2007.

Unemployed persons in the region totaled an estimated 9,170 during November, down from the 9,714 during October, and below the 9,704 during November 2012.

The Fort Smith area manufacturing sector employed an estimated 18,400 in November, down from 18,500 in October, and below the 18,800 during November 2012. Employment in the sector is down more than 35% from a decade ago when November 2003 manufacturing employment in the metro area stood at 28,500. Also, the annual average monthly employment in manufacturing has fallen from 28,900 in 2005 to 19,200 in 2012 – the first year the average has dropped below 20,000 since surpassing that level.

Jobs in the Trade, Transportation and Utilities sector — the region’s largest job sector —  totaled 25,800 in November, down from the 26,000 in October, and above the 25,000 during November 2012. A revised October employment of 26,000 marked a new employment high in the sector.

Employment in the region’s tourism industry was 9,100 during November, down from 9,300 in October and above the 8,900 in November 2012. The sector reached an employment high of 9,800 in August 2008.

In Education & Health Services, employment was 17,900 during November, down from 18,100 in October and above the 17,300 during November 2012. October employment was s a record for sector employment in the Fort Smith area. Annual average monthly employment in the sector has steadily grown since 2005 when it reached 14,000. In 2012 the average was 17,100.

In the Government sector, employment was 19,800 during November, up from 19,700 in October and unchanged compared to November 2012.

NATIONAL NUMBERS
Unemployment rates were lower in November than a year earlier in 293 of the 372 metropolitan areas, higher in 71 areas, and unchanged in 8 areas, noted the broad BLS report.

The U.S. unemployment rate in November was 7%, down from 7.8% from a year earlier. Arkansas’ jobless rate was 7.5% in November, unchanged compared to October and up from 7.2% in November 2012.

Oklahoma’s jobless rate during November was 5.4%, down from 5.5% in October, and up compared to 5.1% in November 2012. The Missouri jobless rate during November was 6.1%, compared to 6.5% in October and better than the 6.6% in November 2012.

ARKANSAS METRO AREAS
Fayetteville-Springdale-Rogers
November 2013: 4.8%
October 2013: 5.1%
November 2012: 4.7%

Fort Smith
November 2013: 6.9%
October 2013: 7.3%
November 2012: 7.3%

Hot Springs
November 2013: 7.5%
October 2013: 7.8%
November 2012: 6.8%

Jonesboro
November 2013: 6.3%
October 2013: 6.4%
November 2012: 6.2%

Little Rock-North Little Rock-Conway
November 2013: 6.1%
October 2013: 6.5%
November 2012: 5.8%

Memphis-West Memphis
November 2013: 8.8%
October 2013: 9.5%
November 2012: 8.1%

Pine Bluff
November 2013: 9.5%
October 2013: 9.6%
November 2012: 8.4%

Texarkana
November 2013: 6.8%
October 2013: 7.1%
November 2012: 6%

FORT SMITH METRO AREA HISTORY
Past annual average unemployment rates
2012: 7.7%
2011: 8.6%
2010: 8.2%
2009: 7.9%
2008: 4.8%
2007: 5.3%
2006: 4.9%
2005: 4.5%
2004: 5.2%
2003: 5.5%
2002: 5%
2001: 4.2%
2000: 3.7%

The November jobless rate in Northwest Arkansas fell to 4.8% from 5.1% in October, the first time since November 2012 that the rate has been below 5%. The region also saw record employment in the Trade, Transportation and Utilities sector and the Government sector, although the figures are subject to revision.

Metro employment of 229,639 was up 0.9% compared to October 2013, and was up 1.7% compared to the number of employed in November 2012. The November jobless rate of 4.8% was above the 4.7% in November 2012, according to figures released Tuesday (Jan. 7) by the U.S. Bureau of Labor Statistics.

All eight metro areas in or connected to Arkansas had jobless rate declines in November compared to October, and seven areas had jobless rate increases compared to November 2012. The Fort Smith regional jobless rate was better than the 7.3% in November 2012.

During November, the lowest metro jobless rate in the state was in Northwest Arkansas and the highest rate was 9.5% in the Pine Bluff area.

The November report marked the 16th consecutive month that the region’s jobless rate has been at or below 6%.

NWA METRO NUMBERS
The size of the Northwest Arkansas regional workforce during November was estimated at 241,333, up from the 239,913 during October, and ahead of the 236,832 during November 2012. June 2013 was the first month the region’s workforce topped 240,000. The average annual monthly labor size was 231,461 during 2012, 227,938 during 2010 and 225,177 during 2009.

Following are other key figures from the BLS metro report.
• Unemployed persons in the region totaled 11,694 during November, down from the 12,351 during October and more than the 11,069 during November 2012.

• The Northwest Arkansas manufacturing sector employed an estimated 27,100 in November, up from 26,800 in October, and above the 26,900 during November 2012. Sector employment is down more than 21% from more than a decade ago when November 2002 manufacturing employment in the metro area stood at 34,300.

• Jobs in the Trade, Transportation and Utilities sector — the region’s largest job sector —  totaled 52,100 in November, up from 51,300 during October, and up from the 49,500 during November 2012. The November employment level is a new record in Northwest Arkansas for the sector, although it is subject to revision in future reports.

• Employment in the region’s tourism industry was 21,900 during November, down from 22,100 in October and up from 20,800 during November 2012. September employment of 22,300 was a new record for the sector, although the figure could be revised in subsequent reports.

• In Education & Health Services, employment was 26,200 during November, up from 26,000 during October and up from 24,800 during November 2012.

• In the Government sector, employment was 31,500 during November, up from 31,300 in October and up compared to 31,100 during November 2012.

NATIONAL NUMBERS
Unemployment rates were lower in November than a year earlier in 293 of the 372 metropolitan areas, higher in 71 areas, and unchanged in 8 areas, noted the broad BLS report.

The U.S. unemployment rate in November was 7%, down from 7.8% from a year earlier. Arkansas’ jobless rate was 7.5% in November, unchanged compared to October and up from 7.2% in November 2012.

Oklahoma’s jobless rate during November was 5.4%, down from 5.5% in October, and up compared to 5.1% in November 2012. The Missouri jobless rate during November was 6.1%, compared to 6.5% in October and better than the 6.6% in November 2012.

ARKANSAS METRO AREAS
Fayetteville-Springdale-Rogers
November 2013: 4.8%
October 2013: 5.1%
November 2012: 4.7%

Fort Smith
November 2013: 6.9%
October 2013: 7.3%
November 2012: 7.3%

Hot Springs
November 2013: 7.5%
October 2013: 7.8%
November 2012: 6.8%

Jonesboro
November 2013: 6.3%
October 2013: 6.4%
November 2012: 6.2%

Little Rock-North Little Rock-Conway
November 2013: 6.1%
October 2013: 6.5%
November 2012: 5.8%

Memphis-West Memphis
November 2013: 8.8%
October 2013: 9.5%
November 2012: 8.1%

Pine Bluff
November 2013: 9.5%
October 2013: 9.6%
November 2012: 8.4%

Texarkana
November 2013: 6.8%
October 2013: 7.1%
November 2012: 6%

NORTHWEST ARKANSAS METRO AREA HISTORY
Past annual average unemployment rates
2012: 5.6%
2012: 6.2%
2010: 6.5%
2009: 6.1%
2008: 4.1%
2007: 3.8%
2006: 3.6%
2005: 3.3%
2004: 3.8%
2003: 3.7%
2002: 3.3%
2001: 3%
2000: 2.9%

Since new laws went into effect last year to improve Arkansas' laws combatting human trafficking, calls to the human trafficking hotline, hosted by the Polaris Project, have increased significantly.

Minority Leader Greg Leding, D-Fayetteville, said awareness of the once hidden issue coupled with the legislation he sponsored was responsible for the surge which has resulted in as many calls during the first six months of 2013 as all of 2012.

"It will be interesting to watch that data," he said. "It will be interesting to see if that is more data tied to both, but I'm interested to see the full 2013 statistics."

Leding said even though the number of calls to the hotline had spiked, residents should not fear that human trafficking is becoming a bigger problem in the state. Instead, he said awareness was helping bring the issue to the surface. The number, he said, is now posted at travel stops and other locations all over the state.

"Going back to an increase in awareness, I don't believe the problem became that much worse," he said. "it's just during the months of working on this legislation, more people were talking about it. Our progress was in the news a number of times and we talked about the hotline a number of times. I'd like to believe the increase was more to do with people having greater knowledge."

The reported increase in the number of calls to the hotline coincides with January being Human Trafficking Awareness Month.

Since Leding and Rep. David Meeks, R-Conway, began pushing for a toughening of human traffic-related laws in Arkansas, the state has moved from one of the worst rated states by the Polaris Project to one of the top rated in terms of laws combating the issue. Meeks said even though the state was made significant progress since the issue was first brought to the attention of many Arkansans at a conference in June 2012, it was important to keep moving forward.

"We are making strides, but we can't stop until it is completely eliminated from the state of Arkansas," he said.

There are specific laws that still need to be strengthened, according to Meeks.

"I think (a lot of) it had to do with the safe harbor law," he said. "I think there was a half point or so that they recommended within that."

The law, which was sponsored by State Sen. Joyce Elliott, D-Little Rock, may be revisited again in the next regular legislative session, Leding said.

"I know there were some concessions made on Sen. Elliott's safe harbor bill. Polaris would have liked it to be a bit stronger, that's something we might visit again in 2015."

State ratings for 2013 issued by Polaris also state that Arkansas should make movements in the area of vacating prostitution convictions for victims of human trafficking.

Meeks said exploring all the information from Polaris and trying to institute stricter human trafficking laws will continue, no matter the progress made.

"Again, it's something that we'll take a look at for Arkansas and if it is (a law that needs to be addressed), we'll definitely try to get it passed in the next legislative session."

Leding looked to the work being done by the Arkansas Attorney General's human trafficking task force as a resource for the legislature in the coming year.

"We'll watch the progress of the human trafficking task force," he said. "And we'll watch hotline data and go from there."

Residents who suspect human trafficking can call the human trafficking hotline at (888) 373-7888.

It’s official. Barring a surprise rejection from federal regulators, Community Health Systems will by the end of January be the new corporate parent of Sparks Health System in Fort Smith and Summit Medical Center in Van Buren.

A special meeting of Naples, Fla.-based Health Management Associates (HMA) shareholders was held Tuesday (Jan. 7), and HMA and Community Health reported Wednesday that 98.7% of the votes cast approved the merger. The votes cast totaled 81.7% of the outstanding HMA shares.

HMA acquired Sparks in a $138-million deal that closed Nov. 30, 2009. The company leases the Van Buren facility in which Summit Medical operates.

Sparks Health System includes Sparks Regional Medical Center, Sparks Clinic (an employed multi-specialty physician group), Sparks PremierCare physician-hospital organization, Sparks Home Health and the fully hospital-integrated Marvin Altman Fitness Center. Summit Medical Center is a fully accredited, 103-bed acute care hospital.

HMA operates 71 hospitals in 15 states with approximately 11,000 licensed beds.

Community Health Systems is almost double the size of HMA, and its hospital portfolio includes eight facilities in Arkansas. Those include four in Northwest Arkansas – Northwest Medical Center-Bentonville, Northwest Medical Center-Springdale, Siloam Springs Regional Hospital and Willow Creek Women’s Hospital.

DEAL HISTORY
The $7.6 billion deal from Franklin, Tenn.-based Community Health was announced in July 2013 and was approved by an HMA Board that was then ousted in a proxy fight pushed by New York City-based Glenview Management.

On Sept. 25, the newly installed HMA Board announced a review of the offer. Glenview had previously said the $13.78 per share offer was too low. Ultimately, the new HMA Board approved of the deal. The HMA Board now believes the deal is good for HMA shareholders.

Between Aug. 16 and Wednesday, the new Board met 11 times and held 18 committee meetings to review HMA operations and the acquisition offer. According to the statement, the acquisition study by several third-party firms determined “that a large initial investment would be necessary to build out HMA's information and clinical capabilities, among other things, and a successive long road to incremental value would not outweigh the benefits of accepting CHS's offer.”

"After conducting an extensive review in conjunction with our legal and financial advisors, we are confident that this transaction provides maximum value to HMA stockholders and represents the best path forward for the Company," Steve Shulman, Chairman of the Board, said in a statement issued in November 2013.

‘SIGNIFICANT STRATEGIC VALUE’
Wayne Smith, chairman of the Board, president and CEO of Community Health Systems, is optimistic and federal approval will happen soon.

“We are pleased that HMA stockholders have seen the significant strategic value in combining with CHS. We are working now to finalize regulatory approvals, and we expect to complete this transaction quickly so that we can integrate our two companies and deliver on our plans for long-term growth and value creation,” Smith said in a statement.

Officials with the companies said the deal should be complete by the end of January.

Community Health announced Jan. 7 it had received new loans totaling $3.26 billion to help finance the HMA deal and to refinance existing debt.

Shares of Community Health Systems (NYSE: CHS) closed Wednesday at $42.42, down $1.07. During the past 52 weeks, the share price has ranged from a $51.29 high to a $32.53 low.

CONSOLIDATION CONCERNS, ISSUES
A Dec. 11, 2013, report from the New England Journal of Medicine said the Affordable Care Act “has unleashed a merger frenzy” in the U.S. hospital industry. The article, which is presents an unfavorable view of hospital consolidation, said hospitals are hoping to secure market position and gain efficiencies to prepare for full implementation of the new health care law.

“The figures are impressive: 105 deals were reported in 2012 alone, up from 50 to 60 annually in the pre-ACA, pre-recession years of 2005–2007,” noted the Journal report.

The article also claimed that mergers may lead to higher prices without improving quality.

“Since the primary driver of growth in private spending in recent years has been price increases for health care services, a compelling argument can be made for putting the brakes on consolidation. Indeed, unless new public and private initiatives are developed to discourage consolidation and to support enforcement of antitrust law, most of these deals will proceed unchallenged,” noted the report.

An October 2013 report from Moody’s Investor Service indicated that hospital acquisitions will “likely continue at a high rate” as the company’s prepare for healthcare reform. Moody’s suggested a benefit for hospitals is that a larger hospital operator may have more power to negotiate with insurers. The report also suggested that larger hospital systems can “leverage administrative costs” during a period when reimbursement cuts have created margin challenges.

HIGHER PRICES
Dixon Hughes Goodman, a Hudson, Ohio-based consulting company, said in a Winter 2013 report that many hospitals are considering some form of “alignment” with other hospital companies.

“Many hospitals and health systems are pursuing alignment with other hospitals, and this movement to consolidation is likely to continue in the near term. In fact, only 13% of hospitals surveyed in 2012 intend to maintain independence from alignment with other hospitals or systems. For the other 87%, alignment is at least a consideration in their strategic plans,” noted the Dixon Hughes Goodman report.

A June 2012 report from the respected Robert Woods Johnson Foundation provided three key findings from a study of hospital consolidations.

• “Hospital consolidation generally results in higher prices. This is true across geographic markets and different data sources. When hospitals merge in already concentrated markets, the price increase can be dramatic, often exceeding 20 percent.”

• “Hospital competition improves quality of care. This is true under both administered price systems, such as Medicare and the English National Health Service, and market determined pricing such as the private health insurance market. The evidence is more mixed from studies of market determined systems, however.”

• “Physician-hospital consolidation has not led to either improved quality or reduced costs. Studies find that consolidation was primarily for the purpose of enhanced bargaining power with payers, and hence did not lead to true integration. Consolidation without integration does not lead to enhanced performance.”

While Democrats are calling for the impeachment of Lt. Gov. Mark Darr, R-Ark., over his admitted ethics violations stemming from misspending of nearly $44,000 in campaign and state funds and some Republicans are starting to call for his resignation, Republicans in the Fort Smith and Northwest Arkansas areas are not ready to pull the trigger just yet. And one Democrat joined the side of many Republicans who spoke to The City Wire, saying he was unsure what should happen.

Darr said Tuesday (Jan. 7) he would not resign from office. In a lengthy statement, Darr said he was not only staying put but he went to great lengths to challenge what he said were inaccurate representations of his actions in the media about his admitted misspending of nearly $44,000 in campaign and state funds.

House Majority Leader Bruce Westerman, R-Hot Springs, told the Associated Press that impeachment was “inevitable” if Darr does not resign. House Speaker Davy Carter, R-Cabot, has said he plans to soon appoint a committee to investigate impeachment options.

Rep. George McGill, D-Fort Smith, said he was not yet calling for impeachment of the state's second highest constitutional officer, a position in direct opposition to his party leadership in the House and Gov. Mike Beebe, D-Ark.

"Not at this time. Certainly I understand the gravity of what he's done and all, but I'm still trying to make my own personal assessment of what should be done," McGill said, adding that he did not find it unusual at all that he would go against Democratic leadership in the House. "No. Party leadership does what it does. And that's fine. And I understand their movement, as well. My hope is that for the good of the state that we don't have to go through an impeachment process."

McGill, who hopes Darr resigns before impeachment becomes an option, was not joined by any of his Republican colleagues who spoke to The City Wire.

Rep. Charlotte Douglas, R-Alma, said she was neither calling for his resignation or impeachment.

"I am not going to call for his resignation and I'm not going to call for his impeachment. I am still going to wait for the process to play out,” Douglass explained. “I'm waiting for the prosecutor to be involved and if there are charges that are made, that will trigger the series of events that will definitely bring action on my part and others."

Douglas said with no impeachment taken place in Arkansas history, the House is unprepared to bring articles of impeachment against the lieutenant governor, adding that before moving any closer to impeachment, House members should allow Pulaski County Prosecutor Larry Jegley to complete his review of the Ethics Commission findings and those of Legislative Audit, the latter of which found examples of Darr misspending on his state credit card.

"Also at this point, we've discovered the House has no – we have no procedures for impeachment. And we are in the process of putting that procedure in place so that if it does come to that that we have a responsible way to carry through with that process," she said. "So we're trying to plan for the future if that is inevitable. Be patient. Let the process play out. Let the prosecutor do his job. At that point, if he is charged with something, that will bring on some action on my part.”

Jonathan Barnett, a Republican representative from Siloam Springs, said the House does not even have some of the basic definitions in place for what constitutes an impeachable offense, urging caution on the part of his House colleagues and bringing to light the possibility of other possible impeachments down the line should Darr become the first politician impeached under Arkansas' Constitution of 1874.

"When I said define impeachment – there are some people who define that as gross misconduct. I just ... what is gross misconduct? If you're going to impeach someone for gross misconduct, then what is gross misconduct and what is an impeachable offense," he asked. "If the members want to go down this path, then there's a lot of members who've approached, I'm not saying they have committed gross misconduct, but I'm saying they've bordered it before. …I think the leg needs to be very careful because there's others. if they want to go back and check everybody's track record, there's some other people who might be bordering on gross misconduct, as well. I hate to admit it, but what about the attorney general (Dustin McDaniel who withdrew from the 2014 race for governor after admitting to an extramarital affair)? Was that gross misconduct? You've got to be careful. Everyone deserves a fair hearing."

Rep. Terry Rice, R-Waldron, has known the lieutenant governor since Darr was growing up in Mansfield and said he was still waiting for some things to unfold before passing judgment.

"Public confidence is important and I want to see how plans unfold," he said, adding that he was not yet ready to call for Darr's resignation. "Again I'm not ready to call for that. I think he's had time to absorb some of these things and all. Again, I was a little surprised at how he did his press deal individually yesterday. I understand it's important for him to try to get his view of it out. It all comes down to public confidence. I knew Mark when he was a boy. He was from my area. I knew his mom and dad very well. And I feel like he'll do the right thing."

Seneca Foods is one step closer to purchasing the canning division of Allens Inc., as the $148 million stalking horse bid for the Siloam Springs company was approved by bankruptcy judge Ben Barry after taking the matter under advisement earlier this week.

The court approval of the Seneca bid officially sets the stage and the clock for any potential suitors who want to try and purchase Allens’ assets from the bankruptcy court.

As previously announced, Allens entered into an asset purchase agreement under which Seneca Foods Corporation intends to acquire substantially all of the Allens canning operations in a court-supervised process under Section 363 of the U.S. Bankruptcy Code.  

The asset purchase agreement sets the floor for an auction that is designed to achieve the highest or otherwise best offer for these assets. Allens also is seeking bidders for its frozen operations in Montezuma, Ga., and intends to sell the assets through the auction process.
 
On Jan. 7,  the court approved the proposed bidding procedures and bid protections for the sale process. The court also set deadlines for interested parties to submit qualified bids to acquire substantially all of the company’s assets and set dates for an auction and sale hearing related to the sale.
 
EMPLOYMENT CONCERNS
Allens said it continues to operate the business in the ordinary course, focusing on its core canned vegetable markets. Although Allens employees have received notification that their jobs may be terminated as a result of the sale process, the company expects that the majority of personnel will be offered continued employment by the winning bidder.

“The court’s approval of the bidding procedures and bid protections is another important milestone in the process that is intended to maximize the value of Allens,” said Jonathan Hickman, chief restructuring gfficer of Allens. “We are encouraged by the continued interest Allens has received for our canning operations and other assets and we are committed to an outcome that provides the most value for our creditors.”

Bankruptcy documents show that Allens employs 1,173. Of that, 766 are hourly, 162 are salaried and 319 are temporary workers hired through staffing agencies.
 
Under the approved bidding procedures, interested parties must submit qualified bids to acquire the assets of the company no later than 5 p.m. on Jan. 27. In the event qualified bids in addition to the stalking horse bid are received, Allens will hold an auction on Feb. 3. The Court has scheduled a final sale approval hearing for Feb. 10, with the closing anticipated to occur shortly thereafter.

Second lien holders filed an objection to the terms of the stalking horse bid with the court citing excessive break-up fees should Seneca lose out to another bidder. The court ordered a $4.5 million break-up fee unless it is one of the second-lien creditors who wins the successful bid, and in that case the break-up fee would be $3 million, according to the court records.

ALLENS' HISTORY
According to the company website, Allens is a family-owned vegetable processing company that began as Allen Canning Company in 1926 near Siloam Springs. The company expanded production during World War II, and during the 1970s added several new brands to its portfolio, including Popeye Brand Spinach.

Allens officials made several moves in 2012 to shore up business, including a March 2012 announcement that Allens was selling six frozen vegetable brands to the French company, Bonduelle Group.

The company also announced in early 2012 that the company would move operations and 150 jobs from Van Buren into an Allens canning operation in Siloam Springs. The company’s Van Buren warehouse operation was expected to remain open.

Consolidating the canning operations came more than 30 months after Van Buren operations were expanded. In June 2010 the company announced a more than $20 million expansion that included a $13.5 million investment in the company’s Van Buren operation. The $13.5 million investment in Van Buren expanded the company’s capacity to process sweet potatoes.

Replenishment is key to driving improved sales for suppliers of Wal-Mart Stores Inc., and while the retail giant has invested heavily in a new system for replenishment and inventory control, insiders say a broad rollout is still likely more than a year away.

Wal-Mart did not return a request for comment on its global replenishment system (GRS) that is now in test mode with a few larger suppliers who say there are still bugs to be worked out. GRS will eventually replace a system known as Inforem, which was created by IBM and last updated in 2007. Inforem uses an upward forecast modeling system, the complete opposite from the downward forecasting model used in GRS.

Duncan Mac Naughton, chief merchandising officer for Walmart U.S., told investors in April 2012 that the retailer was working on the new global replenishment system which is believed to be a better forecasting engine.

“It will allow us to be more real-time with our supplier on what our expectations and our needs are and we will deliver better real-time inventory to our stores,” Mac Naughton said at the investor conference.

He said minimizing inventory at the store level, improving out-of-stocks with better forecasting is an end-to-end commitment using technology to drive better performance in the store. Mac Naughton said then that on-shelf availability would be a big initiative in 2013.

It remains so in 2014 as Wal-Mart has been beaten up by media reports of empty shelves, while also recording rising inventories throughout 2013 at the same time U.S. comp sales have dipped lower. But that has not pushed the retailer to rush out the new replenishment system

Approaching a half trillion dollars in annual revenue, the retailer is often the largest customer for many suppliers, so when Wal-Mart tweaks or makes a major change to one of its operating systems, suppliers have cause for concern.

“For all of the bad you hear about Wal-Mart most people fail realize that this mass retailer is one of the most efficient retailers they can do business with. Retail Link and the supply chain system inside Retail Link review the need for potential orders on every item in every store, every day,” said Matt Walters, senior development of client development for Atlas Technology. Walters also formerly worked at Wal-Mart.

He said once an organization has that logistics process within retail link dialed in, replenishment orders from Wal-Mart become regular and in most cases consistent (less seasonality and/or promotions). 

Jami Dennis, a private consultant to suppliers, said replenishment is one area where she finds many suppliers have concerns. She said the primary issue is that suppliers don’t often understand their ownership of the process.

“Many do not know who their replenishment manager is and/or have limited communications with them. The don’t know that they should be watching store-specific activity and making recommendations. We advise suppliers to ask for a minimum of a quarterly call and in some cases (if there are issues) weekly strategy calls,” Dennis said.

Walters agreed that suppliers must stay on top of the point-of-sale trends, but he said changing forecasts can be an uphill battle, which is why communication is so important. He said some suppliers fall short because of lack of internal communication.


“Sales may not always want to hear about forecast updates or changes so pushing updates internally can sometimes be the biggest hurdle,” Walters added.

REPLENISHMENT PRIORITY
Besides a supplier getting their foot in the door, understanding the complexities of the replenishment process is one of the biggest hurdles many will face, according to Dennis.

“A sales team may sell an item into Wal-Mart but the replenishment team has to sell it for the remainder of that item’s life span. Suppliers could be missing out on hundreds of thousands to even millions of dollars in missed shipments yearly because of a simple lack of knowledge about the different functions and tools that are available to better promote and manage items,” Dennis said.

As Wal-Mart works to convert suppliers to the global replenishment system, Walters and Dennis said having a forecast at 90% or better accuracy is key a supplier’s success.

Even with the latest technology, Dennis said items are being replenished by people, and there are times when even the best replenishment managers need guidance and support to highlight improvement opportunities and avoid mistakes that can go unnoticed because of an immense work load.

EXPERT’S INSIGHT
The theme for GRS is “just in time inventory.” Wal-Mart’s aspirations after converting a supplier to GRS is that their sales and in-stocks increase, while their inventory decreases. Insiders said the early conversions have been frightful for some suppliers with lost shipments leading to high out-of-stocks at the distribution center and store because the initial cutover process was not managed correctly.

There are very few experts on GRS subject matter as the system is in trial mode and Wal-Mart’s own replenishment managers are also still learning the system. Dennis said working through this transition with the replenishment manager and making sure all the different cut-over steps are uploaded and established correctly on the front end will be the deciding factor of a supplier’s conversion success.

When a supplier is given little notice of the transition, Dennis said the best thing a supplier can do is review their “Item/DC” and “Item/Store” forecast variances and offer their recommendation for a new forecast for each variance.

She recommends that suppliers complete a lead time audit, and make sure an accurate order increment and minimum order quantity is in place for each “Item/DC” combo if the supplier stores product at the distribution center. The lead time audit is a validation of processing and transit time from supplier ship point to each Wal-Mart distribution center.

Dennis said suppliers who want to make an easy transition to GRS should make sure they have an open line of communication with their replenishment manager and a firm grasp of the new tighter forecast variance expectations.

A project that once looked to be delayed until 2018 will likely have life breathed into it again on Friday (Jan. 10) should the Fort Smith Parks and Recreation Commission move forward with a recommendation to restore the city's portion of funding for the RIver Valley Sports Complex at Chaffee Crossing.

The sports project, valued at about $3 million, had been pushed back so the city could tap into the $1.6 million it had promised the sports complex in order to pay for an expanded Ben Geren Aquatics Center. The aquatics center, which will now cost $10.9 million, had to have funds from somewhere within the city's park and recreation department's five year capitol improvement plan in order to build a larger park, with the county and city contributing $1.5 million each to the larger facility on top of $8 million already committed to the project.

At the time of the vote, City Administrator Ray Gosack said the project would be pushed back four years in order to tap into the sports complex funding for the aquatics center.

"It would be used for the aquatics center and then we would have to get re-appropriated for the ball field project later on."

But the city was under a legal obligation to fund the sports complex due to an ordinance passed by the Fort Smith Board of Directors in June 2012, which set aside funding for the project each month from June 2013 until June 2014.

With the action expected by the Parks Commission on Friday (its original Wednesday meeting was postponed due to inclement weather), Deputy City Administrator Jeff Dingman said other projects would be shuffled around to ensure the aquatics center and the sports complex are built according to their original timelines.

Election Commission Chairman Lee Webb, who is spearheading the sports complex project along with Sen. Jake Files, R-Fort Smith, said his understanding of the new capitol improvement schedule commits all the city's funding by the end of the this year.

"What they did is they let us keep the money that's already collected, then the $265,000 they need to collect this year," he said. "We only need another $265,000 in 2014 to get our commitment (from the city) and that's why you see the $1 million in 2014 for the water park is because they're going to choose not to take our money."

Dingman detailed where the money for the aquatics center would come from now that the city has upheld its original obligation to the sports complex.

"I think the tennis court project is going to be pushed pack. That is resurfacing and addressing lighting issues at Creekmore and surfacing at Tilles Park. That was going to be done in 2014, but that's been pushed to 2015," he said. "The Riverfront Drive improvements – that's the 51 acre development for soccer fields. The $750,000 originally for 2014 and then additional dollars later on. That (is now) not scheduled until 2015)."

Those two projects alone account for $1 million of the $1.5 million the city needed for the aquatics center. Other delays to bring the total up to the $1.5 million include sidelining the neighborhood park project in the vicinity of Texas Road, among other projects.

Parks Director Mike Alsup said with the reshuffling, there will be no additional funds available for other projects, explaining that the capitol improvement budget is spent up to the last penny.

"Previously, there was some room to breath. Now the schedule is completely tight. No room to breath," he said. "At next week's (Parks and Recreation Commission meeting), there will be a request for a ball field at Martin Luther King park. Because the plan is so tight now, something will have to be sacrificed to fund that."

Alsup went so far as to say there was not "room for contingency now."

But he said while some projects have been shuffled around, citizens should still be proud of the projects that will be completed in the next year or more.

"(This plan) keeps the funding for the (downtown) splash pad and the River West Trail that we already had in the works that are jointly funded through others helping us out," he said. "It moved a few other things back a year, but it kept funding for other things that were already in motion."

Webb said with funding again in place, the River Valley Sports Complex should open by Spring 2015.

Families across the country and local region may not go for out for dinner, but research shows they will plunk down an average of almost $300 per weekend when they travel with their children’s youth sports teams.

Dev Pathik, CEO of Sports Facilities Advisory in Clearwater Fla., told The City Wire that spending on sports travel has steadily risen during the past few years and is largely fueled by youth sports. He said families collectively spend $192 million per day supporting their children’s sports activities. That ranges from gear, uniform fees, private lessons and travel to games often played each weekend during their appropriate seasons.

“Many think they must invest this in their children from a young age if they are going to have the skills necessary to make a high school team, or perhaps secure a college scholarship,” Pathik said.

SFA research released in December 2013 found that net positive spend from 2012 to 2013 increased 22.6% in team sports at school, 16.7% in team sports outside of school and 15.9% in lessons and sports camps.

CAPTURING THE IMPACT
Youth sports and sports-related travel is creating an approximate economic impact of $7 billion per year, according to Pathik. Cities across the country have taken notice in recent years and competition for hosting tournaments for travel ball has become intense, he added.

“It’s not enough to just build a complex and think the masses will come,” Pathik told The City Wire.

He said municipalities can take advantage of the resilience of sports travel but these efforts need to be properly evaluated and planned. There are certain criteria that make a city attractive or unsuitable to events owners and decision makers.

His firm has worked with cities such as Gatlinburg, Tenn., to study the impact that large sports complexes can have on their communities. SFA also is engaged in the lead development and will provide ongoing management of facilities.

He said the $20 million Rocky Top Sports World in Gatlinburg is set to open this summer and features seven outdoor fields, including a track and stadium suited for championship play. There is also an 86,000 square-foot indoor facility that features six basketball courts and 12 volleyball courts.

Nestled in the Smoky Mountains, Pathik said Gatlinburg already gets its share of visitors and soon there will also be a major sports draw to that community.

Kalene Griffith, CEO of the Bentonville Convention and Visitors Bureau, said all of the major cities in Northwest Arkansas actively work to recruit youth and amateur sporting events to the region because they have long benefited from the economic impact of the extra visitors related to sports travel.

Studies show that 27% of all trips made in the U.S. relate to attending a sporting event of some kind, from professional and college games to youth and amateur sporting events.

“A few years ago, we held an AAU basketball tournament, ‘Real Deal on the Hill,’ and over a four-day period the economic impact was $1.2 million for the local region” as 200 teams took part, playing games in all of the four major cities, Griffith said.

That tournament is now played in Little Rock, she said.

In February, Griffith said the city will host the Bentonville Classic, a NCAA preseason softball tournament for 29 teams from up to 8 states.

“This tournament has grown from 12 teams just three years ago. Each team brings in between 18 and 20 people,” Griffith said. “This is one way the city works to keep the local hotels full in months when convention travel is typically low. It is also a great draw for our local residents who enjoy watching college softball.”

Pathik said research shows girls’ sporting events tend to have a slightly larger payback than similar events from boys sports.

“Girls bring more parents and grandparents to their games and they like to shop more I guess,” he said.

FACILITIES ON TAP
Springdale and Rogers also each recognize the value associated with constructing new sports complexes, not only for local use, but also to spur tourism within their cities throughout the year.

In August 2012, Springdale residents approved a $71 million bond issue that included $17 million for a proposed multi-use park that would be a combination of recreation space like Murphy Park and sports facilities like Tyson Park. Mayor Doug Sprouse said Tyson park was built in the 1980s and the city has just added three softball fields since that time.

“Our city has experienced tremendous growth since the late 80s and we just don’t have nearly enough recreation space for our own residents. Not to mention we are missing out of added sales tax revenue from the hospitality side of this issue because sports teams are going elsewhere to host tournaments,” Spouse said.

Roger Davis, general manager for the Holiday Inn and Convention Center in Springdale, said the city and chamber have increased efforts to recruit more sports teams to host tournaments in Springdale. Davis also serves as a member of the local advertising and promotion commission.

“We have a great deal of interest from soccer associations to hold tournaments in Springdale, but there simply aren’t enough fields. The same is true with softball and baseball. Meanwhile our neighbors in Rogers are building new fields and Bentonville has done a terrific job tapping this market,” Davis said.

He said when the city has hosted large sports events like Pitch for the Cure, hotels are full with players and families from outside the area, who eat, buy gas and stay over for two days or more. Griffith said the entire region helps accommodate Pitch for the Cure because 200 teams participate and bring thousands of dollars to the region over the three-day period.

Sprouse said he has become a believer that parks are part of the quality of life piece that Springdale must promote like it’s neighbors to the north and south if it’s going to continue to grow a certain segment of its population.

“The city has bought 70 acres on the southeast side of town for a large park that will have new baseball fields, soccer fields, a football field, tennis courts and a splash pad. We hope to equip these baseball fields with all-weather infields,” Sprouse said.

He said the fields should be finished by spring 2015. Meanwhile three of the softball fields at Tyson Park will be converted to baseball fields once the softball fields in the new park are completed.

Another 120 acres have been purchased by the city of Springdale for a large sports complex on the west side of town, with completion in the next couple of years.

FACILITY PAYBACK
The city of Rogers earmarked $26.8 million of a 2011 bond issue for new ball fields and an $12.9 million aquatic park that opened last May.

The new softball/baseball park opened this past year with six fields and by 2015 the city will have added five new soccer fields and a football field at Veterans Park on the east side of the Rogers, said Frank Adase, sports marketing manager for the Rogers Convention and Visitors Bureau.

Adase works full-time at recruiting sports tournaments to the city and said the new fields which opened in 2013 made a huge impact in the number of tournaments and visiting teams. The city parks division confirmed they hosted 26 tournaments during 2013, a 225% increase from eight tournaments held in Rogers in 2012. There have been 17 tournaments scheduled so far for 2014, according to Jody Sands, spokeswoman with the parks department.

Adase said the competition for large youth sporting tournaments is fierce and top notch facilities are an absolute necessity.

“Between March 1 and July 1 there are 19 weekends, we have tournaments booked on the new fields for 15 of those and our city recreation league will be using them during the weeknights,” Adase said.

He said as lacrosse is growing in popularity the city now hosts two large tournaments in April for that sport.

TEAM SPORTS GROWTH
A report released in November by SFA found there were 12.224 million teams of youth sports for ages 10 to 14 across the U.S. in 2008. Over the next three years the number of team sports for the same age groups increased by roughly 2%.

In total, there are some 50 million youth participating in team sports across the country.

Participation in team sports for children between the ages of 6 and 12, compared to 2009:
• Gymnastics 52%, up 4%
• Soccer 45%, down 3%
• Baseball 37%, up from 32%

Between the ages of 13 and 17, participation in team sports compared to 2009:
• Track and field 48%, up from 44%
• Football 40%, up from 34%
• Lacrosse 34%, up from 33%
• Court volleyball 31%, up from 29%
• Cheerleading 30%, down from 35%

Tyson Foods sent a letter to its hog suppliers dated Jan. 8. that reflects a new set of animal welfare guidelines involving sow farm operations, including a shift away from sow gestation crates.

The Springdale-based meat giant had stood firm in recent years on the use of gestation crates of female hogs. These narrow metal enclosures hold the female pigs during their pregnancy, until they are moved to a farrowing crate a few days before birth, where they can lie down and nurse the piglets.

But Tyson reversed that stance this week on the heels of an earlier announcement by competitor Smithfield Foods who offered its suppliers cash incentives to abandon the use of gestation crates – a move it made with its own hog-raising operations in 2007.

In the Tyson letter to its hog suppliers, the company outlined five desired improvements in its animal welfare program that it expects suppliers to adopt. As part of FarmCheck, the company's ongoing animal well-being program, Tyson said it is increasing audits of sow farms.

"The third-party audits we began in 2012 are important in our efforts to help ensure responsible on-farm treatment of animals and we believe more audits will further validate good sow farm management practices," the company said in the letter, signed by Shane Miller, senior vice president, pork division, and Dr. Dean Danilson, vice president of the company’s animal well being program.


The new guidelines include:
• Tyson asking its contract farmers to install video monitoring systems by the end of 2014 and urging them to use video monitoring of their operation to increase oversight and biosecurity risks.

• Tyson urging its pork suppliers to improve "quality and quantity of space" standards in the design of any new or redesigned gestation barns beginning in 2014. "Whether it involves gestation stalls, pens or some other type of housing, we believe future sow housing should allow sows of all sizes to stand, turn around, lie down and stretch their legs," Tyson said.

• Tyson recommending that suppliers discontinue use of manual blunt-force trauma to euthanize sick and injured piglets as that practice "may not match the expectations of today's customer's or consumers" although it has been acceptable in the industry.

• Tyson’s support of the use of anesthetics and analgesics as pain mitigation for tail docking and castration of piglets. Tyson said current industry practices could use improvements and it will fund research to further improve practical pain mitigation methods for these routine procedures.

Tyson noted there are varying opinions on the issues addressed in its letter, but the company's stance is an effort to "balance the expectations of consumers with the realities of today’s hog-farming business.”

One animal activist group and Tyson shareholder, the Human Society of the United States, has repeatedly asked Tyson to require its hogs suppliers to abandon the use of gestation crates as more food companies such as McDonald’s have refused to source pork from companies who allow crating.

“While the letter contains several promising points on a variety of issues, like encouraging a shift away from 'euthanizing' sick or injured piglets through blunt force trauma and urging the development of pain relief during castration and tail docking, the stand-out, in our view, is Tyson’s language on the issue of sow gestation crate confinement,” said Anna West, spokeswoman for the Humane Society of the U.S.
 
She said unfortunately, Tyson’s letter does not mandate anything of its suppliers with regard to sow housing, nor does it outline any timeline by which alternative housing systems must be in place. 

“Nonetheless, this is big movement from an important company. Tyson may still have a ways to go when it comes to shoring up a gestation crate-free supply system, but its first steps on this issue – like all steps on the path toward a more humane way of living or conducting business – are most welcome,” West added.

Wal-Mart Stores Inc. outlined a long list of leadership and organizational changes for its growing global retail operations. Notice of these changes were given to corporate employees on Thursday (Jan. 9) via a 10-page internal memo, that was also obtained by The City Wire.

“Our customers’ needs are rapidly changing around the world, and they have very high expectations of us. Over the coming years, the global environment we operate in will continue to change and with great speed. So that means our business must evolve quickly so we continue to outpace and exceed our customers’ expectations,”according to the memo from CEO Mike Duke and incoming CEO Doug McMillon.

As McMillon takes the reins from Duke on Feb. 1, more than a dozen other managers and executives will also shift their positions, while Cathy Smith, chief financial officer for Walmart International will exit the company. As previously reported David Cheesewright will become CEO of Walmart International on Feb. 1.

“Cheesewright will continue to have a home in Toronto, and will also maintain a residence in Bentonville. He will be in Bentonville regularly, and will spend time in our markets across the globe,” said Walmart spokesman Kevin Gardener.

A replacement for Cheesewright has yet to be named.

OTHER INTERNATIONAL MOVES
Tony Rogers, senior vice president of marketing for Walmart U.S. has been named chief marketing officer-Walmart China, reporting to Sean Clarke, chief operating officer-Walmart China. In this role, Rogers will be responsible for the marketing of Wal-Mart’s Hypermarket business in China. Additionally, he will work closely with Andrew Miles, chief operating officer-Sam’s Club China and his marketing team to grow the Sam’s Club brand in China while helping to build an even stronger member base.

Rogers joined Wal-Mart in 2005, and since has helped lead the retailer’s U.S. marketing efforts in print, TV, radio and numerous interactive channels. He has a bachelor’s degree in marketing from the University of Texas. Pending work authorization, Rogers will begin work in China Feb. 10.

John Welling, senior vice president for supply chain management, information systems and global business process for Walmart Japan, will move to Canada, assuming the role of SVP of operations for Walmart Canada. Welling will work with the regional operations teams to ensure consistency for all activities that impact Walmart’s stores and customers in Canada. He joined Wal-Mart in 2006 and has a bachelor’s degree in industrial engineering and business management from Bradley University in Peoria, Ill. Welling will begin work in Canada March 3, pending work authorization.

With Welling’s move to Canada, Geoff Sease, vice president of replenishment, planning and space for Sam’s Club has been named as Welling’s replacement in Japan as SVP for supply chain management. Sease joined Wal-Mart in 2000 and was promoted to VP of Sam’s Club Logistics and Supply Chain in 2007. He has a bachelor’s degree in economics from North Carolina State University and a master's degree in business administration-logistics from the University of Tennessee. He will begin work in Japan Feb. 10.

FINANCE TEAM SHAKEUP

Brett Biggs, will replace Cathy Smith as chief financial officer for Walmart International as she has accepted a leadership postion elsewhere. Meanwhile, treasurer Jeff Davis will takeover as CFO for Walmart U.S., a position being vacated by Biggs. who is now serving as EVP and chief financial officer for Walmart U.S.

Biggs also will assume responsibility for finance, international real estate, and will continue to report to Charles Holley, chief financial officer for Walmart Stores Inc.

Claire Babineaux-Fontenot has been promoted to treasurer, and will retain the chief tax officer responsibilities while she assumes additional responsibilities for investor relations, capital markets and treasury operations.

Lisa Wadlin, VP of international tax was promoted to VP over global tax and she will report to Fontenot.

Steven Zielske, chief audit executive, will be the new the Senior Vice President, Finance Capital Markets, reporting to Claire.

Stuart Campbell will join Wal-Mart on Feb. 3 as chief audit executive. He joins Wal-Mart from KPMG International, where he recently retired as global chief information officer. He also has served as partner-in-charge of information risk management at KPMG and a general auditor for Wells Fargo & Co. Stuart has a bachelor's degree in economics from the University of Southampton, England.

Lori Flees will join Walmart on Jan. 13 as senior vice president of corporate strategy. She leaves Bain & Co, where she was a partner in the consulting firm. Prior to that she held roles at Intel and General Motors.

SAM’S CLUB CHANGES
In 2014, Sam’s Club is being fully integrated with Walmart’s Global eCommerce business unit as Sam’s Club works to deliver personalized shopping experiences that the retailer hopes will spur more growth, according to the memo.

Jamie Iannone is joining Wal-Mart to lead this effort as the new president and CEO of Samsclub.com, effective immediately. The entire Sam’s Club eCommerce team will report to Iannone, who will be based in San Bruno, Calif., reporting to Neil Ashe, president and CEO of Walmart Global eCommerce, as well as Rosalind Brewer, CEO of Sam’s Club.

John Boswell, SVP of marketing and member insights will leave Sam’s Club in May to lead an international mission for his church. With Bowell’s departure, Racquel Harris is being promoted to SVP for member strategy and marketing for Sam’s Club. She joined the company in 2012 and has nearly 20 years of marketing experience with Kraft Foods and IBM.

Sonya Gafsi Oblisk, senior marketing director for Sam's Club, will succeed Harris as VP of marketing. She joined the company in 2008 working with private brands.

Talk Business Arkansas asked seven Arkansas CEOs across a broad spectrum of industries to look into their crystal balls and share what they expect in 2014.

Ed Drilling, President
AT&T Arkansas
I think we’re going to continue to see growth in our area of the business. We started a process last year that we call Project VIP as a result of all the demand that we’re seeing in wireless data traffic from individuals and companies that need more bandwidth.

I think in terms of the economy, we’ve seen a few slow growth years. Businesses and consumers were cutting back, but the business has seemed to be coming back into the marketplace. We’re seeing more technology purchases. I think it’s either they can’t wait any longer and they’re seeing so many needs that they’ve got to fill with more bandwidth and more robust technology products, such as Ethernet and fiber – we’re seeing that all come back in. And we’re certainly seeing an explosion in mobile.

Millie Ward, CEO
Stone Ward
We don’t do political, but it is going to be an advertising-rich year for our industry. There is going to be a lot of money spent in the advertising sector on political advertising, in this state and nationally. I heard a statistic the other day that when Carter ran against Ford in the ’70′s, they spent $65 million. Last year in the governor’s race in Virginia, they spent $65 million. That’s just so compelling to me.

We’re excited about the economy and the recovery because we are seeing, across our client base, people beginning to invest more in growth. A few years ago it was a time for everybody to get very lean, and in our business, a number of our clients at a national level have done that. Now, they’re all looking to grow.

Duane Highley, CEO
Arkansas Electric Cooperatives Corp.
We’re really excited about the future for Arkansas right now because unlike any year in recent history, we’re seeing more inquires, more economic development prospects, more people asking about getting electric service to new areas. It’s just at a higher pace then it has been, so I’ve got to believe that even if some of that comes true, it’s going to be good news for Arkansas. The economy appears to be turning, slowly, but turning.

We’re also entering a brave new world in the way power is bought and sold -where computers talk to each other and make arrangements between generating plants across the entire United States grid, and find the cheapest source of power every five minutes… It will provide us an opportunity to continue to provide power at some of the lowest rates in the country.

Bo Ryall, CEO
Arkansas Hospital Association
As we reach the end of 2013, it has been a very difficult year for hospitals financially. The implementation of Medicare reimbursement reductions, sequestration cuts, and 10% declines in hospital admissions have all contributed to a very difficult year. Couple that with the federal government’s healthcare.gov website issues in enrolling the uninsured for insurance and it does not make for a positive outlook for 2014 in health care.

We are very pleased with the enrollment in the Private Option with more than 60,000 in the program and increasing daily. We remain cautious as far as the enrollment on the federal website, but improvements have been noted.

We are also keeping a watchful eye on how Congress deals with the Sustainable Growth Rate formula, which governs Medicare physician fees. We are fully in favor of a change that would remove the threat of annual physician fee rollbacks, but we are also apprehensive about the “pay for” of such a change, which could rely heavily on steeper Medicare spending reductions for hospital care.

The uncertainty in the impact of a changing health care system leads to widespread concern going forward. An improved 2014 will be dependent on the number of uninsured that will now have some type of insurance.

Darrin Williams, CEO
Southern Bancorp
I am optimistic about 2014, but cautiously so. I see challenges but also opportunities in the year ahead for the rural markets served by Southern Bancorp. As a rural community development bank, we’re seeing firsthand the anemic post-recession recovery that rural communities are experiencing.

As banks continue to abandon rural America, more small towns are left with either limited or no access to capital and traditional banking services. Less access to capital means an even weaker recovery because community banks have been the driving force behind small business growth. That said, I think the situation lends itself to opportunities for innovation in these areas.

At Southern we are looking at a variety of ways to bring new financial products and services to these communities to help jumpstart those economies and put them on a similar track as their urban counterparts. From that perspective, it’s an exciting time to be a rural community development bank. Southern is proud to be one of nearly 900 Community Development Financial Institutions (CDFI) across the country that are stepping into underserved communities and creating more fairness of opportunity across America.

With challenges come opportunity, and I choose to see the coming year as the latter.

Judy R. McReynolds, President & CEO
Arkansas Best Corporation
My outlook for the 2014 economy is that while certain markets like manufacturing and auto may be stronger, I anticipate slow growth in general.

The good news for Arkansas Best is that we have growth opportunities in many industries and verticals we serve, despite my expectations for a slow-growth economy overall. I’m bullish about those areas, especially given the wide variety of transportation and logistics services we now offer customers from all of our operating companies. But I’m also concerned that government regulations and programs like The Affordable Care Act are hurting business and job growth in particular.

Also concerning is the fact that banks aren’t seeing loan growth, which indicates that businesses in turn are not seeing many opportunities to invest. I’m having a difficult time identifying a catalyst for more rapid economic growth any time soon.

Ray Dillon, CEO
Deltic Timber Corporation
We’re looking for 2014 to be as good and, hopefully, better than this year. We continue to see growth expand at a moderate rate. We think we’ll see positive housing starts and that will help our lumber business. And from a real estate standpoint, we think central Arkansas will begin to show more growth than it’s shown as we come out of this recession.

Unemployment is the biggest factor that will impact us. It drives free cash flow for consumers. We hope to have people in their starter homes looking for their next larger home. That will generate new household formations and new home starts. That’s what we’re expecting, and we see that activity impacting our lumber business in a good way.

Tyson Foods Inc. is known as one of the largest meat processors in the U.S. with a growing global presence. It operates more than 70 plants across the country that slaughter chicken, pork and beef while it processes those raw commodities for sale in retail and food service channels. But that reality is slowly changing.

During the last few years Tyson has began to focus less on commodity production and more on value-added sales. More recently, Tyson announced plans to expand its prepared foods division. Tyson operates 23 plants that are dedicated solely to prepared foods that produce items such as tortillas or pizza toppings. This prepared foods segment comprises roughly 10% of Tyson’s annual sales equaling roughly $3.2 billion.

In mid-November CEO Donnie Smith announced the company was separating the prepared foods segment from its poultry division and named Donnie King to head up the prepared foods unit’s major expansion goals. 
King will devote his talents to our growing value added foods business and creating an integrated sales and marketing organization to deepen our relationships with customers, Smith said.

It also looks as if Tyson is returning to its early roots as it continues to buy birds on the open market, in lieu of growing them out. Tyson began this buy versus grow practice two years ago in the face of record grain costs which roiled the entire industry. This is a page right out of Tyson’s history book, as founder John W. Tyson Sr. made a name for himself by selling live chickens which he hauled from Springdale to larger markets in Chicago and St. Louis during the mid-1930s.

It was some 22 years later before Tyson built its first processing plant at the urging of second generation poultry pioneer – the late Don Tyson. While Tyson grew exponentially through acquisition over the next 35 years, more recent corporate expansion efforts have been linked to prepared foods and valued-added meats that carry higher margins than the pennies per pound gleaned in commodity chicken, pork and beef.

Smith told analysts in November that the company would continue this buy-versus-grow practice as it focuses on expanded value-added sales by 6% to 8% annually. During fiscal 2013, Smith said value-added sales increased by nearly 6%. Tyson declined to give the total revenue associated with those value-added sales, but in 2012, Fitch Ratings estimated Tyson’s value-added sales totaled $15 billion – some 45% of the company’s total annual revenue.

CHANNEL EXPANSION

Tyson management is also focused on expanding sales (retail and food service) in nontraditional markets such as dollar stores and drug stores. Tyson recently declined comment to The City Wire about its plans to expand its prepared foods segment, citing its quiet period, as allowed by the Securities and Exchange Commission ahead of its corporate earnings release Jan. 31.

The meat giant already does huge volume with mini-marts and gas stations in deli meats, cold cuts and pizza toppings and a recent interview with Meat & Poultry Tyson executives detailed efforts underway to tap more sales in the convenience store and deli channels.

“Who would’ve thought several years ago, you’d be going to your local drugstore to grab a sandwich,” Eric Le Blanc, vice president of marketing for deli and convenience stores at Tyson Foods told Meat & Poultry.


He said Tyson brings more to the table for these venues than just chicken because of its expertise in foodservice and retail, two very different sectors. Le Blanc added that Tyson is striking a balance between delivering what consumers want and what foods the retailers can handle with a limited production platform is the goal.

“Americans are looking for what they want, when they want it,” he said.

This convenience store channel consists of roughly 150,000 locations in the U.S. To put this in perspective, a report from Neilsen said there are more convenience stores than
than warehouse clubs, supercenters, dollar stores, supermarkets and drug stores combined. Neilsen said there is one convenience store for every 2,000 people in the U.S. As a segment annual sales topped $123 billion in 2012, growing 4.9%, a better market when compared to a $310 billion grocery segment which grew just 1.5% year over year.

One of the fastest growing segments within convenience stores is fresh food, such as pizzas, wraps and sandwiches made onsite. Neilsen reports this type of fresh food has increased 38% in sales among convenience stores in the past year.

MARKETING PUSH
Le Blanc said much of the convenience store opportunities lie in densely populated urban areas. These consumers who shop convenience stores for food options tend to be urban, single males. In rural areas the shoppers tend to be females, including busy working moms often middle-to upper income households.

Tyson said it will adjust its marketing strategy to appeal these different customer demographics as it works to build brand awareness using social media as well as targeted television advertising.

Analysts consider Tyson a marketing machine, despite the fact many of its products do not bear the Tyson brand, such as the taco shells sold at Taco Bell or the pizza toppings and crust used by Pizza Hut. The most recent social media initiative was launched last week in conjunction with the popular New Year’s resolution to eat healthier.

“Just Add This” is a motivational social media campaign on Facebook where consumers can find tips that help them lead a healthier lifestyle while making small changes in their daily routines.

Consumers can join the "Just Add This"  conversation online.

Siloam Springs-based Allens Inc. is in the midst of raising cash in the company’s bankruptcy proceedings by selling assets in order to satisfy debtors. Recent court records show creditors in the case are owed nearly $287.94 million with $108 million of that being unsecured claims.

Allens reported assets of $294.46 million, which does not include real property. There was no estimate of real property values provided in the court records. But on Thursday (Jan. 9), GA Keen Realty Advisors announced they had been retained to market and sell six industrial properties along with vacant land and other miscellaneous properties in Arkansas, Louisiana. Mississippi and Oklahoma as part of Allens Chapter 11 bankruptcy case.

Keen Realty's listings showed the approximate values of the combined properties exceeds $16.16 million. However those values were based on appraisals dated January 2012.


Arkansas properties for sale:
• A 329,667 square-foot warehouse and distribution facility on 17.34 acres located at 4601 Newlon Road in Fort Smith – $4.6 million

• A 209,963 square-foot food processing plant and industrial warehouse on 9.49 acres, located at 1208 Virginia St. and 1211 Mary Allen St. in Van Buren – $4.1 million 



• Eighty acres of vacant land in Van Buren – No value provided.

• A 153,090 square-foot food processing facility and warehouse on 7.64 acres located at 404 Fayetteville Ave. in Alma – $1.9 million

• A single-family residence and agricultural land with 4,788 square feet on 10.76 acres located at 21764 and 21935 Meadow Wood Dr. in Siloam Springs – $650,000.


• Four acres of vacant land located at 116 Main in Lowell – No value provided


Other properties for sale:
• A food processing facility with four buildings totaling 210,929 square feet on 32 acres located at 1581 Hwy 114 in Hessmer, La. – $317.050 assessed value

• A warehouse facility with four buildings totaling 186,276 square feet on 23.7 acres located at 501 Guidry St. in Lafayette, La. – $3.495 million

• A 297,625 square-foot warehouse and distribution facility located at 12 Moorhead-Ittabena Road in Moorhead, Miss. – $1.1 million

• A 15,000 square-foot metal warehouse located at 119-120 W. Cherry St. in Westville, Okla. – No value provided

• Sixteen acres of vacant land in Delaware County, Okla. – No Value provided


“These strategically located properties are available for immediate occupancy,” GA Keen Realty Advisors Co-President Matthew Bordwin said in the statement. “The substantial size of the food processing facilities and warehouses, along with the excess land available in certain locations, create tremendous investment and/or redevelopment opportunities.”


Bordwin said these properties can be sold individually or as a package and offers are now being considered. The letter of intent deadline is Feb. 28.


Drama over UA deficits, reaching the middle class in China and the potential impact of Allens’ bankruptcy on the Siloam Springs economy are part of the Northwest Arkansas Friday Wire for Jan. 10.

NOTES & ANALYSIS
• Corporate job losses
We’ll likely found out sooner rather than later what the loss of a corporate headquarter presence will have on the Siloam Springs economy. A federal bankruptcy judge has approved a $148 million bid by Seneca Foods to buy Siloam Springs-based Allens Inc., which filed for bankruptcy in December.

Allens reported in bankruptcy documents that it had 1,173 employees, with 162 of those being salaried jobs. Many of those salaried jobs are likely based in Siloam Springs, and it’s doubtful that Seneca will need a second corporate presence. Siloam Springs is part of the booming Northwest Arkansas economy, but a loss of 100 or more corporate jobs will not be easily or soon absorbed.

• The drama over UA financial deficits
Odds are that no (more) heads will roll resulting from more than $6.5 million in deficits in the Advancement division of the University of Arkansas. Several high profile UA employees have been fired, but UA Chancellor G. David Gearhart appears to have avoided direct jeopardy.

In September 2013, Roger Norman, director of the state’s division of Legislative Audit, forwarded an investigative report to Prosecuting Attorney John Threet of Fayetteville. Threet eventually decided to not pursue an investigation based on the audit report.

Testimony before several Legislative panels included accusations that Gearhart was culpable in a cover up related to the deficits, but Gearhart has emerged (relatively) clean.

ICYMI
Following are a few stories posted this week on The City Wire that we hope you didn’t miss. But in case you missed it ...

• Wal-Mart’s China plan
China holds huge opportunity for Wal-Mart Stores and the retail behemoth has pledged to stay the course by building on the billions in annual sales it recorded there last year.

• Obamacare and premiums
The impact of health coverage through Obamacare was touted as a way to cap rising insurance costs and provide benefits to the masses of uninsured. But as 2014 gets under way many Americans are finding that is not exactly the case.

• Auto sales and the Internet
The persistent car salesman trying to put a customer behind the wheel of a car they were not looking for is likely a relic of the past thanks to the Internet.

NUMBERS ON THE WIRE
90%: The number of shoppers in China who arrive at Sam’s Club in a car, giving them the ability to stock up and buy more volume. This compares to 10% of Walmart China’s shoppers at a supercenter.

$192 million per day: The amount of money U.S. families spend supporting their children’s sports activities. That ranges from gear, uniform fees, private lessons and travel to games often played each weekend during their appropriate seasons.

55 pounds: Per person beef consumption in the U.S. in 2012. Beef consumption has fallen more than 20 pounds per person since the mid-1970s.

11,694: Number of unemployed persons in the Northwest Arkansas metro area during November, down from the 12,351 in October but more than then 11,069 in November 2012.

OUTSIDE THE WIRE
• National attention for Mulberry, Ark.
Ray Chung's family has been in the food business for more than 30 years and a few years ago, they decided to produce edamame on American soil, instead of importing it from China. After months of research, the Chungs opened their first edamame factory in Mulberry, Arkansas, which is a huge surprise to most people.

• The cost of the so-called Polar Vortex
Hunkering down at home rather than going to work, canceling thousands of flights and repairing burst pipes from the Midwest to the Southeast has its price. By one estimate, about $5 billion.

• Want to Save Money? Stop Thinking About the Big Picture
Many of us made a New Year’s resolution to save more money. Just like the resolutions to go to the gym more and eat better, though, our financial resolve will probably fall by the wayside before the snow melts. A new study says that’s because you’re probably going about it all wrong.

WORD ON THE WIRE
“Frankly, this is another example of a pattern of shameful behaviors designed to protect themselves rather than be honest and accountable. Ladies and gentlemen, something is rotten in Fayetteville.”
– Brad Choate, a former UA employee in charge of the fundraising division, during recent Legislative Audit hearings into budget shortfalls at the UA Division of Advancement

“This could be the last hurrah for these low, low rates and a good time for consumers to pay down credit card balances and eliminate those home equity loans and other variable interest debt they have acquired in recent years.”
– Greg McBride, chief economist for Bankrate.com, in noting that recent tapering intentions from the Federal Reserve should push mortgage rates higher in 2014

"I am not downplaying what has occurred, but there is no scandal, no conspiracy and no malicious intentional disregard of the law. If there were, it would apparently involve multiple offices and agencies. It was an oversight that should have been noticed and corrected long before now and by multiple people including myself."
– Lt. Gov. Mark Darr, R-Ark., speaking for the first time since being slapped with an $11,000 fine by the Ethics Commission for misspending campaign and state funds.

"Going back to an increase in awareness, I don't believe the problem became that much worse. It's just during the months of working on this legislation, more people were talking about it. Our progress was in the news a number of times and we talked about the hotline a number of times. I'd like to believe the increase was more to do with people having greater knowledge."
– House Minority Leader Greg Leding, D-Fayetteville, speaking about the increase in calls to the human trafficking hotline in 2013, the same year the General Assembly passed laws tightening laws that address the problem.

The positives and negatives of a regional jobs report, Edamame production in Mulberry and a Lt. Governor that rejects many calls to resign are part of the Jan. 10 Friday Wire for the Fort Smith region.

NOTES & ANALYSIS
• Jobs numbers: The good and the bad
The Fort Smith metro jobless rate fell to 6.9% in November, bringing to an end 55 consecutive months in which the regional jobless rate was at or above 7%.

That’s a welcome direction for the rate, but the region has a LONG way to go to return to workforce and employment levels of less than 10 years ago. The size of the Fort Smith regional workforce during November was 132,163, down from the 132,867 during October, and below the 132,392 during November 2012. The labor force reached a revised high of 140,253 in October 2007.

More troubling is that the region employed 122,993 in November, almost 10,000 fewer jobs than the 132,392 employed in June 2008.

• The drama over UA financial deficits
Odds are that no (more) heads will roll resulting from more than $6.5 million in deficits in the Advancement division of the University of Arkansas. Several high profile UA employees have been fired, but UA Chancellor G. David Gearhart appears to have avoided direct jeopardy.

In September 2013, Roger Norman, director of the state’s division of Legislative Audit, forwarded an investigative report to Prosecuting Attorney John Threet of Fayetteville. Threet eventually decided to not pursue an investigation based on the audit report.

Testimony before several Legislative panels included accusations that Gearhart was culpable in a cover up related to the deficits, but Gearhart has emerged (relatively) clean.

ICYMI
Following are a few stories posted this week on The City Wire that we hope you didn’t miss. But in case you missed it ...

• Fort Smith, Sebastian County approve water park changes
The Fort Smith Board of Directors and the Sebastian County Quorum Court approved resolutions Monday evening (Jan. 6) that would add a wave pool to the Ben Geren Aquatics Center while moving a dive well to near the bottom of the governments' priority list for water park amenities, essentially killing a part of the project that had been the focus of much contention just 11 months ago.

• Uncertain future for Mitsubishi plant
The city of Fort Smith and the Fort Smith Regional Chamber of Commerce bet almost $1.8 million in 2010 that Mitsubishi would open and operate a wind-turbine assembly plant at Chaffee Crossing.

• Obamacare and premiums
The impact of health coverage through Obamacare was touted as a way to cap rising insurance costs and provide benefits to the masses of uninsured. But as 2014 gets under way many Americans are finding that is not exactly the case.

• Auto sales and the Internet
The persistent car salesman trying to put a customer behind the wheel of a car they were not looking for is likely a relic of the past thanks to the Internet.

NUMBERS ON THE WIRE
9,170: Number of unemployed persons in the Fort Smith metro area during November, down from the 9,714 in October and below the 9,704 in November 2012.

$192 million per day: The amount of money U.S. families spend supporting their children’s sports activities. That ranges from gear, uniform fees, private lessons and travel to games often played each weekend during their appropriate seasons.

55 pounds: Per person beef consumption in the U.S. in 2012. Beef consumption has fallen more than 20 pounds per person since the mid-1970s.

OUTSIDE THE WIRE
• National attention for Mulberry, Ark.
Ray Chung's family has been in the food business for more than 30 years and a few years ago, they decided to produce edamame on American soil, instead of importing it from China. After months of research, the Chungs opened their first edamame factory in Mulberry, Arkansas, which is a huge surprise to most people.

• The cost of the so-called Polar Vortex
Hunkering down at home rather than going to work, canceling thousands of flights and repairing burst pipes from the Midwest to the Southeast has its price. By one estimate, about $5 billion.

• Want to Save Money? Stop Thinking About the Big Picture
Many of us made a New Year’s resolution to save more money. Just like the resolutions to go to the gym more and eat better, though, our financial resolve will probably fall by the wayside before the snow melts. A new study says that’s because you’re probably going about it all wrong.

WORD ON THE WIRE
“I think that it’s important to realize that Mitsubishi is having to make bond payments and pay property taxes on a facility that is producing no income. So Mitsubishi has the greatest motivation to make something happen.”
– Fort Smith City Administrator Ray Gosack when asked his thoughts about the chances Mitsubishi will do something with its mothballed manufacturing plant in Fort Smith

“This could be the last hurrah for these low, low rates and a good time for consumers to pay down credit card balances and eliminate those home equity loans and other variable interest debt they have acquired in recent years.”
– Greg McBride, chief economist for Bankrate.com, in noting that recent tapering intentions from the Federal Reserve should push mortgage rates higher in 2014

"I am not downplaying what has occurred, but there is no scandal, no conspiracy and no malicious intentional disregard of the law. If there were, it would apparently involve multiple offices and agencies. It was an oversight that should have been noticed and corrected long before now and by multiple people including myself."
– Lt. Gov. Mark Darr, R-Ark., speaking for the first time since being slapped with an $11,000 fine by the Ethics Commission for misspending campaign and state funds

"Going back to an increase in awareness, I don't believe the problem became that much worse. It's just during the months of working on this legislation, more people were talking about it. Our progress was in the news a number of times and we talked about the hotline a number of times. I'd like to believe the increase was more to do with people having greater knowledge."
– House Minority Leader Greg Leding, D-Fayetteville, speaking about the increase in calls to the human trafficking hotline in 2013, the same year the General Assembly passed laws tightening laws that address the problem

It was just 2011 when the city of Van Buren was refusing to pay a contested 2009 water charge of $253,000 to the city of Fort Smith. Since that time, it is now the city of Fort Smith that owes Van Buren more than $440,000 for water the city was overcharged in 2012.

According to Fort Smith Communications Manager Tracy Winchell, the cities of Fort Smith and Van Buren have a previously established agreement for rate adjustments, or a true up, that is evaluated at the end of each year.

Jeff Dingman, Fort Smith's deputy city administrator, said the amount of adjustment for 2012 would result in Fort Smith giving Van Buren an adjustment of $441,603. The amount, he said, would be spread out in credits to Van Buren of $36,800 during each of the next 12 months.

"Their (adjustment) for the year was about 11.5% of what their billing was," he said, adding that the city was charged about $3.048 million last year for water from Fort Smith's water supply.

Previous years have yielded much smaller adjustments once Fort Smith's utility department compares how much Van Buren was charged for water versus its usage. Information provided by Utilities Director Steve Park show an adjustment of $197,768 in Van Buren's favor in 2011 and another one of $30,884 in 2010.

The dispute in 2009 where Fort Smith said Van Buren owed $253,000 was eventually dismissed due to Fort Smith's failure to comply with contractual obligations with regard to the bill, resulting in no adjustment to Van Buren's 2009 bill.

Prior to the 2010 adjustment in Van Buren's favor, the city owed Fort Smith additional funds for using more water than it had been originally billed for as a wholesale customer — $124,721 in 2008, $129,227 in 2007 and $327,226 in 2006.

Winchell said the numbers show a basic truth about the water contract between both governments.

"At the end of the year, one almost always owes the other money," she said.

Dingman said the contract with Van Buren, it's only true up customer, and other wholesale water customers could be up for discussions in the coming year or more.

"As we're working more toward the consent decree that will (demand more) of the city, we will need to go through all of our rate structures and sewer (rates). It will include revisiting how wholesale agreements with Van Buren and all other wholesale customers work."

Fort Smith has been under a consent agreement with the U.S. Department of Justice since the 1970s due to problems associated with wastewater runoff. A collection of projects to bring the city of Fort Smith into compliance with DOJ demands will see a final price tag once all is said and done, Dingman said in December 2013.

He said the consent decree, which is in the process of being negotiated with the DOJ, should be announced during the first quarter of 2014.

But as for the overage the city of Fort Smith will have to credit Van Buren during the next year, Dingman said $441,603 was not an overage.

"There's no discrepancy," he said. "It's just the way it works."