Former Secretary of State Condoleezza Rice told an audience of several thousand Wednesday night that Russia's takeover of the Crimean peninsula was a "violation of international law" as Crimea is a part of a sovereign state, Ukraine.

Rice was in Fayetteville to speak in the University of Arkansas' student-funded Distinguished Lecture Series. She was chosen by a student committee. Essentially no seats were unoccupied in the lecture configuration at Barnhill Arena, which a UA spokesman said could be up to 6,000 people. It was an impressive number, considering the Razorbacks were playing basketball at the same hour at nearby Bud Walton Arena, beating Ole Miss 110-80.

Rice quickly summarized the region's history with western Ukraine formerly part of Poland, eastern Ukraine and Crimea being Russian, either speaking or in ethnicity, yet the divisions were not terribly important when all of it was in the Soviet Union. Crimea was given to Ukraine in 1954, she said, and earlier this week Russian President Vladimir Putin took Crimea back.

Putin took advantage of chaos in Kiev when Ukraine's President Viktor Yanukovych was ousted, using it as a pretense to send Russian military into Crimea.

"Putin has never been reconciled to the loss of territory that the Soviet Union suffered when it dissolved," Rice said.

‘A RUTHLESS MAN’
As national security adviser in the first term of President George W. Bush then secretary of state in his second term, Rice met several times with Putin.

"He's an intimidator. He's a ruthless man. He's former KGB," she said. "He has to be reminded that after the Cold War that most of Eastern Europe has chosen to move to the West," meaning capitalistic economies and democratic governments.

Rice gave one anecdote of his intimidating personality. She met with him in 2007 about the former Soviet republic of Georgia.

"My job for President Bush was to deliver the message that any move into Georgia would damage relations with the United States. I delivered the message. He stood up. He is standing over me. I instinctively stood, too. I'm 5-10, and I had heels on, too. He's about 5-7, and he moved away. He will not intimidate the United States of America."

Rice was Bush's second secretary of state, following Colin Powell, and served throughout Bush's second term. She is the nation's 66th secretary of state. Rice, 59, was born in Birmingham, Ala., and earned her doctoral and bachelor's degrees from the University of Denver, a master's from Notre Dame, all in political science.

Rice in the 1980s was a political science professor at Stanford University in Palo Alto, Calif. Her first federal position began in 1987 as an adviser to the Joint Chiefs of Staff. In the 1990s she served as Stanford's provost. In 2001, Bush appointed her national security adviser. After her government service, she returned to the Stanford faculty.

THE POST-911 WORLD
In the main body of her speech Rice noted the the century's chaos began with the terror attacks of Sept. 11, 2001, but did not end there.

"Every day after seemed like Sept. 12," she said.

The devastation of the planes was relatively inexpensive, by military standards, costing al Qaeda about $300,000. "That is why even today we worry about ungoverned spaces and ungoverned territories, like Afghanistan. ... Our conception of national security would never be the same."

U.S. security, she said, also is threatened by the continuing effects of the banking and housing crisis that began in 2008 and "continues to reverberate throughout the world." China looks like it's weathering the recession but Rice sees that as temporary.

"The Chinese Communist Party has legitimacy based on prosperity. But China is going to get old before it gets rich, due to its one-child per family policy,” Rice explained.

She also cited the country's high levels of air pollution.

The third threat to security are the civil wars and revolutions throughout the world – Ukraine in recent weeks but also Syria and Egypt. Rice called it the "Ceausescu syndrome," after Romanian President Nicolae Ceausescu who was deposed in 1989 then with his wife were executed by military firing squad.

"The fact is whenever people have to take their rights it is chaotic until there's a constitution. They have to balance the rights of a citizen and the responsibilities of the state," Rice said. "We are lucky to have had the forefathers we did."

BENGHAZI, CURRENT AFFAIRS
Rice's remarks lasted about 30 minutes, but she took questions for nearly an hour. All the questions were picked beforehand, and the selected students stood in line before microphones in the aisles to ask them.

Rice did offer comments on the fatal attack on the U.S. diplomatic compound in Benghazi, Libya, on Sept. 11, 2012, in which four Americans including its ambassador to Libya were killed. She is not troubled by the administration having different explanations at different times, as "that happens." What concerns her greatly was the underestimation of how dangerous the area was for foreigners.

Rice said the Pentagon's proposal of a drawdown of personnel and bases may become a victim of coincidental bad timing, as the plan was announced about the same time as the trouble in Kiev. The United States must not leave a vacuum in military power, she said. Allies and friendly nations may not fill in.

"What steps into the vacuum is groups like al Qaeda, China in the South China Sea, and Vladimir Putin."

STUDENT ADVICE
A large part of Rice's talk resembled a commencement speech, advising students on setting goals, establishing self-discipline and finding good mentors. She related her own life story, raised in a middle-class African-American family in Birmingham, Ala., with aspirations to be a concert pianist. In college she realized that "I'm about to teach 13-year-olds Beethoven, I may play in a bar, but I'm not going to play Carnegie Hall." She explored other subjects and found her passion for the international relations wing of political science.

Her advice: Find good, personal role models. Pick some hard tasks: "You will not fail if you work hard and find people to help you." Study abroad, or learn a foreign language or even befriend foreign student on your own campus. "Listen to people who are completely different from you." And spend time helping people less fortunate. She also advised all students to take courses in economics and statistics.

She said she never has an interest to run for office. "I've never run for anything, even student body president." Now that she's had the highest post possible in her life, secretary of state, she works on public service projects while continuing to teach at Stanford. Rice did recommend that students interested in careers in international relations help in domestic political campaigns, as the experience will show them how policies get developed.

Rice foresees a female president in the near future, with a perhaps unexpected explanation. As most presidents come from the Senate or terms as governors and more women are taking those positions, then it's only a matter of time, she said.

One student asked about government gridlock, which Rice explained by noting that the federal government was designed to work slowly, which modern communications has made even more troublesome.

Consumer debt, and not just wicked winter weather, is having a chilling effect on retail sales. Consumer debt rose by $241 billion in the fourth quarter of 2013, the largest period increase seen since the fall of 2007, according to a recent study by the Federal Reserve Bank of New York. 

At the same time consumers were taking on more debt, retailers from Abercrombie and Fitch to Wal-Mart reported lackluster sales largely blamed on inclement weather and deflationary margins. Fourth quarter revenue for Wal-Mart Stores Inc. totaled $129.706 billion, up 1.5% compared to the fourth quarter of the prior year but was below the consensus estimate of $130.23 billion. Operating income during the quarter was $7,347 billion, down 14.4% compared to the previous fourth quarter. Net income during the quarter was $4.431 billion, down 21% compared to the previous year.

Consumer indebtedness rose to $11.52 trillion as of Dec. 31, up 2.1% from the third quarter. The report found that 2013 was first four quarters to register a net annual increase ($180 billion or 1.6%) in debt since 2008. 
                                                                    
While consumer debt remains 9.1% below its peak of $12.68 trillion in the late 2008, relatively stagnant income among the shrinking middle class is problematic for sectors like retail that rely on discretionary spending.        

Rich Yamarone, chief economist with Bloomberg Brief, recently told The City Wire that he expects a tough year for retailers if they are depending on the middle to lower middle class consumers.

“Middle class and lower income consumers are having a tough time, paying higher taxes this year and Mother Nature isn’t doing anyone any favors. Budgets are tighter and there is less fuel in the tank to move this economy forward,” Yamarone said. 

He said as household debt levels rise, consumers will have less money for movies, dinner out or new clothes. 

Analysts note that most middle class consumers did not personally benefit from the wealth created last year with record stock prices and still have most of their wealth wrapped up in their homes. With that, the Federal Reserve study notes mortgage debt stood at $8.05 trillion at the end of 2013. For the full year, mortgage balances saw a net increase of $16 billion, ending the four year streak of year over year declines, the study notes. The balances on home equity lines of credit dropped by $6 billion (1.1%) and now stand at $529 billion.

The biggest drain on consumer balance sheets at the end of 2013 were $18 billion in new auto loans originated in the fourth quarter, $53 billion in added student loan balances and $11 billion charged to credit cards.

Experts warn that as consumers ante up for big ticket items like new cars, those are debts that will stay on balance sheets for an average of 48 months and longer. Phil LeBeau, a CNBC analyst, this week reported that consumers are borrowing a record rate to pay for their new rides. He said the average amount borrowed by car buyers last quarter climbed above $27,000 for the first time ever. Experian Automotive data show that the average auto loan in fourth quarter 2013 was $27,430 — an increase of $739 compared with the same period of 2012. The average used car loan was $345 higher, coming in at $17,974.

The increases mean higher monthly payments for longer periods of time. Experian said monthly payments are rising and expected to top $500 on average this year. J.D. Power said last week that February was on track to have one-third of new car auto loans extended out to six years because of the higher purchase prices and desires for lower monthly payments.

The Federal Reserve report also looked at consumer delinquencies and found auto loan performance to be stable with 3.4% of the notes at least 90-days past due.The number of credit inquiries within six months – an indicator of consumer credit demand – remained unchanged from the previous quarter at 169 million.

Looming student loan debt is also a major concern. Student debt rose $53 billion in the recent quarter to $1.08 trillion. More than 11.5% of student loans are 90-days delinquent or in default.

"Young people with student loans are less likely to buy a house or a car or contribute to a 401(k), said Wilbert van der Klaauw, a senior vice president of the New York Fed's research and statistics group.

The report notes that young consumers with large debts will have less spending power until the debt is satisfied as student loans are not dischargeable by bankruptcy.

The CEO of Union Pacific Corp., the railroad transportation giant, told a Little Rock audience that he sees positive signs in the U.S. economy, particularly in the agricultural, chemical and auto business.

John J. “Jack” Koraleski, who has served as CEO since 2012, told the Arkansas Economic Development Foundation – the non-profit arm of the state’s economic agency – that early trends in his transportation portfolio are off to a good start in 2014.

“We think the agricultural markets are going to be pretty darn strong,” Koraleski said. “Overall, we think its going to be a pretty stable year for agricultural products.”

He also said a rebound in car sales are “almost back to what we would consider normal.”

But the energy business may be the biggest driver of new business for Union Pacific and the overall economy. Koraleski said shale production in the natural gas business has been steady across Union Pacific’s territory as fracking sand and chemicals as well as steel materials for pipelines have been a rising source of revenue.

He also said the coal business and a harsh winter have boosted the company’s bottom line. Koraleski said cold weather has been a big benefit to his firm, but he was no longer a fan of the freezing temperatures, despite its good economic news for Union Pacific.

“I’m ready to give up that strategy. I’m ready for it to not be cold anymore,” he joked.

Koraleski also noted that onshoring efforts – the move of foreign manufacturers back to U.S. soil – is expected to benefit Union Pacific and the overall economy in part due to competitive labor and low energy costs in the U.S.

“We’re starting to see more and more parent companies from the Eurozone look to the U.S. for manufacturing,” he told the audience.

KEYSTONE PIPELINE A ‘WIN-WIN’
The controversial Keystone XL Pipeline project has been a hot potato for business and political leaders nationally.

Koraleski said his company will win regardless of the project’s ultimate fate.

“If they build it fine, if they don’t, fine. We’re kind of in a very fortunate position,” he said.

Koraleski said if it is not built, his company will be a major transporter of the 700,000 barrels of oil coming from Canada to Mexico. If it is built, it will require 1,200 miles of pipe, rock, and concrete as well as provide jobs for 9,000 workers who will need trucks, tools, and housing.

“We haul all that stuff,” Koraleski said. “We’re lucky because we win either way.”

FACTS & FIGURES
Omaha-based Union Pacific reported its strongest ever quarterly and full year financial results last year. The company posted net income of $4.388 billion in 2013 on revenues of $21.96 billion. Those numbers were 11% and 5% higher respectively.

The company’s stock (NYSE: UNP) has been trading toward the high end of its 52-week high of $187.09.

Union Pacific has major and minor operations throughout Arkansas including in Hoxie, Jonesboro, Bald Knob, Pine Bluff, North Little Rock, Van Buren, Hope, Camden, and Texarkana. Union Pacific covers 23 states across two-thirds of the U.S. and has locations across North America.

Several years ago, it opened a 600-acre intermodal facility in Marion, Ark., that Koraleski said is the “standard” for the company’s new endeavors.

In Arkansas, Union Pacific employs 2,074 workers with an annual payroll of $230 million. It invested $173.3 million in capital expenditures in the last year.

Koraleski has served in a number of roles with Union Pacific, where he has worked since 1972. He has served as controller of Union Pacific Corp., executive vice president of marketing and sales, and executive vice president of finance and information technology for Union Pacific Railroad. Prior to that, he worked in the real estate and administrative departments.

Koraleski earned a bachelor’s and master’s degree in business administration from the University of Nebraska at Omaha.

Men today have dropped the book on traditional roles and picked up the household shopping list, according to a recent study by Defy Media. “The Acumen Report: Brand New Man,” found that 65% of respondents said they now hold the primary shopping responsibility for the household.

About 54% said they shop for groceries and household supplies more than their spouse. An interesting finding in the study was a growing number of men (50%) said their spouses do not tell them what brands to buy and about that many said they ask family and friends for recommendations about certain products

Jason Long, CEO of Shift Marketing Group, said suppliers can’t afford to miss this demographic opportunity, yet many of the shopper marketing data still target female consumers.

Carol Spieckerman, CEO of NewMarketBuilders, said multiple studies that revealed the degree to which women influence purchases, even those that are made by men, created a “better safe than sorry” mentality among brands and retailers. She said the logic assumed that men would not be put off by female-centric marketing in non-gender-specific categories so the rewards would outweigh any risks. As a result, many retailers and brands have gone too far.

“I’m surprised by how many retailers refer to their customers as ‘she’ and ‘her,’ for example, and when feminized language is institutionalized, you have to believe that it marginalizes male customers in the end,” Spieckerman said. “The answer isn’t for the pendulum to swing too far back, though, as Burger King, Go Daddy and others have learned the hard way. Female-focused marketing may not offend men, but a big push in the opposite direction can get brands into trouble.”

CULTURAL SHIFT
“About 35% of men don’t have a significant other, many are marrying later,” Long said. “They routinely shop for what they need and that continues even after they get married.”

The average age of a marrying male today is 29, versus 25 in the 1980s. About 43% of the men between the ages 18 to 49 live with a spouse, and 22% live with parents. That leaves 35% of men flying solo when it comes to making brand decisions and filling up the shopping cart.

Long said the explosion in cable programming geared toward men in recent years shows the tremendous market potential that has has more or less snuck up on suppliers and the retail sector.

INFORMAL SURVEY
An informal survey by The City Wire found 66% of respondents who said the male in the household does nearly all of the grocery shopping, and at least some of the cooking.

“(My husband) Lynn does mostly all of the grocery shopping, I couldn’t tell you the last time I actually bought more than a loaf of bread and milk,” Jana Isabel noted in her response to the The City Wire survey. The Isabel’s reside in east Texas.

The same was true for Kim Borrelli, a Texas banker who said her husband Joe does 100% of the grocery shopping and 75% of the cooking.

“I wouldn’t have it any other way, I love it,” Kim Borrelli said. 

Rod Coleman of Fort Smith also does most his family’s shopping for as long as daughter Elizabeth Coleman Voris can remember. 

“I do most of the shopping for us because I'm a stay at home mom and Justin just doesn't have the time with his job,” Voris said of her own household.

David Reese said he enjoys the grocery shopping and is always looking for an excuse to run to the store. Reese owns a real estate business and was raised in the grocery business.

Each of these respondents, except Voris are boomers but the two surveys found Gen X and Millennial men also prefer shopping more when time allows. Ashley Lemley, 28, of Fort Smith said her husband James does the grocery shopping and 99% of the cooking, Tim Sabo a Gen X executive from Dallas, said he also does most of the grocery shopping for his family of four.

INSIGHTS REVEALED
The Defy Media report outlined four key ideas about how men approach a new brand relationship. They refer to these as the 4 - E’s: Exposure, Education, Experimentation, and Eureka.

The first three E’s largely involve marketing. The research indicates men rely heavily on the information provided by brands to get them though the process. Researchers said suppliers can jump-start a man’s journey to a new brand relationship by giving him a reason to seek a new brand; educating him about the brands and product categories; catching his eye at the point-of-sale; and offering ways for him to evangelize the brands he loves.

Creating a need is key as researchers note that without a compelling new need, men have no motivation to change the brands they use. Many of the respondents said they consider seeking a new brand a drag, especially given the numbers of brands from which to choose.

Defy said men can and do ask for directions and they research products online. The biggest influencer of men in the Defy report was recommendations from friends and family, followed closely by advertising and coupons. Nearly 40% said they became aware of a brand after first trying it at friend’s house. About one-third said the brands they use are closely linked to those used by their parents, but just as many said they found new brands via social media.

THE EUREKA MOMENT
Once brand awareness occurs, researchers said men are quite comfortable “buying and trying.” The men interviewed said they love getting a deal, because they can experiment with little risk, the study noted.

Researchers said a guy won’t buy a product just because it’s on sale — there has to a need — and if the new product disappoints, he is unlikely to buy it again, even if it’s on sale. Men also can be enticed by advertising that speaks to them. More than half of the Defy study respondents said they had bought and tried a new beer because of the advertising.

The Eureka phase means that he has found a brand to love. Research shows that when a male shopper reaches the Eureka phase they are very likely to tell their friends and family. The survey found 79% had recommended beer, other beverages and snacks were recommended by 53% and 56%, respectively.

Spieckerman said most consumer brands are still erring on the side of female-centric marketing but she likes the way some retail concepts are taking a fresh and relevant approach to men.

“French apparel retailer, Loding, which just opened its first North American store in Toronto is a great example. Loding offers no promotions, sales or discounts and simplifies decision-making by pricing every item in a category (shirts, belts, shoes, etc.) at the same price regardless of style and even quality. Instead of using gimmicks or risky marketing strategies, Loding looked at how men like to shop and served up a solution,” Spieckerman said.

The effort to build a new jail in Crawford County has taken another step forward with the tentative selection of a location for the proposed facility. According to Sheriff Ron Brown, the county has selected a location just east of Van Buren on U.S. Highway 64.

"It's right within a quarter mile of the I-540/40 interchange," he said. "Also, it's adjacent to the city and it's within a few hundred yards of (Arkansas Highway 282)."

County Judge John Hall said the 8.5 acre site was offered to the county by two sellers, Sharon Lewis who is selling 3.5 acres for $225,000, and Sharon White, who is selling five acres for $50,000. The physical address of the property is 4301 Alma Highway.

Hall said while the tentative deal with the property owners, who offered their properties for sale to the county after the county put out bids to acquire land for the jail, there were several issues that had to be worked through before finalizing a plan to possibly place a new jail at the site.

First, the county would have to conduct an environmental impact study to make sure the area was suitable for a large-scale jail capable of housing hundreds of inmates.

Second, a proposed set of sales taxes to fund construction of the jail and subsequent law enforcement operations would have to pass in an election to be held May 20. The two ballot questions will ask voters to pass a half-cent sales tax for nine years to fund construction of the jail and a permanent quarter-cent sales tax to fund law enforcement operations in the county, including jail operations. If passed, the county's largest cities of Van Buren and Alma will see sales tax rates of 10.25%, among the highest local sales tax rates in the nation.

Hall said a third obstacle that would have to be formally overcome is a vote of the Quorum Court, though he said eight members of the Court were on a site-seeing trip to the proposed jail sites around the county and the consensus was the Alma Highway location.

The fourth issue is whether the county's architect will find the location feasible for not only the jail, but a new sheriff's department. Hall said the announcement of an architect for the project will take place Wednesday at 10 a.m.

Brown said the location, in his opinion, is far more preferable than the jail and sheriff's office current location on Main Street in Van Buren.

"The (proposed new site) also has a paved crossover to cross the median, so deputies leaving the office needing to respond to the east side of the county can cross right there. Also, for a response to Rudy, we're right at (Highway) 282. And it gives us interstate access for far western parts of the county."

Hall said the proposed location would give "every city in the county …access to the jail and it will have centralized access. Van Buren is right there. Mountainburg and (other cities) can all come down Interstate 40 and get to it. It's got the access and the easy way to get in and out. You won't have to spend time behind the railroad tracks (in downtown Van Buren) or in traffic."

The judge said the county had submitted a tentative contract to the landowners, though he said anything could happen at this point.

"We signed a deal to do this, but I have not received the papers back from the landowners. The real estate (company, Coldwell Banker, is) handling it. They're the ones doing it. They've submitted the proposal and costs. …But there's nothing that can't change if somebody decides something different. But I have received no documentation back from the owners that they would accept what we proposed (with price)."

Brown said the county had also placed a contingency clause in the contract giving the county an out should the still unnamed architect say the site is not large enough to house the jail. But Brown believes the site is large enough not just for the new jail, but also for expansion.

"Back in 2012, maybe the latter part of 2011, I hired an architect company to show them what our needs were. We used a similar site to that and they said it would leave us a large enough site and room around it to accommodate the (future) need."

A dearth of political candidates for legislative seats, tough allegations against the poultry industry, growth in Hispanic buying power and comments about “intimidator” Putin are part of the Northwest Arkansas Friday Wire for March 7.

NOTES & ANALYSIS
• The (almost) non-election election cycle
The list of folks who filed to run for legislative seats in districts representing the Northwest Arkansas and Fort Smith areas turned out to be shorter than a grocery list on a $5 budget.

It must have been disappointing for those who thought the creation of a two-party system in Arkansas would result in more competition for legislative races. Of the 30 Fort Smith and Northwest Arkansas House and Senate districts up for election in 2014, only 12 are contested. And of those 12, six are contested in the GOP primary only. And of the six that will have a November general election contest, only four will see a Democratic-Republican matchup. The other two will see a Republican candidate square up against a Libertarian candidate.

In the Arkansas Senate, 17 of the 35 seats up for re-election. Of the 17, only four will have a November contest. In the 100-member Arkansas House, only 38 seats will see a November contest.

Overall, Republicans had 132 candidates file for 98 different federal and state offices, while Democrats had 88 candidates file for 81 different federal and state offices, according to a report from Talk Business writer Jason Tolbert. Libertarians had 19 candidates file, the Green Party has two candidates, and only one candidate filed as an Independent.

Kudos to those who were pining for Republicans to “win” the political filing season. However, if you were hoping for a healthy slate of candidates under the belief that competition improves the chances for better government, well, better luck next cycle.

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 ...

• The Supply Side: Pursuing the Hispanic market
Hispanic and Latino shoppers across the United States wield more than $1.2 trillion of buying power annually with projections of $1.5 trillion by 2015, according to Nielsen. That economic power is why Wal-Mart, Home Depot and most major retailers invest in marketing efforts to woo this important demographic.

• Stable NWA apartment sector
A growing local economy and increased enrollment at the University of Arkansas kept multifamily occupancy levels stable at 96.5% last year, despite the opening of 823 new student housing units since the fall of 2012.

• Negative statewide tax revenue trend
The growth of year-to-date tax collections in Arkansas is on a downward trend, and the February gross revenue number was below the budget forecast. The February report also showed a continued decline in collections related to consumer spending.

NUMBERS ON THE WIRE
$140 billion: The combined net worth of the Walton family heirs, dubbed the world’s wealthiest family, according to Forbes Annual Billionaire List. The children of Sam and Helen Walton saw their wealth rise 20.9% during 2013 spurred on from the bull market and record stock prices last year.

$1.2 trillion: The buying power of the Hispanic demographic across the U.S. this year, according to Nielsen.

$444 million: A three-year contract value between Tyson Foods and the U.S. Department of Defense to provide meat for commissary sales to military personnel.

$241 billion: The amount consumer debt rose in the fourth quarter of 2013, the largest period increase seen since the fall of 2007, according to a recent study by the Federal Reserve Bank of New York. 

OUTSIDE THE WIRE
• A meat racket?
Christopher Leonard's new exposé on the chicken industry, The Meat Racket, doesn't devote much ink to the physical object on our plate, the chicken meat itself. Instead, Leonard focuses on the economic machinery that delivers the meat to us, or, as he puts it, "the hidden power structure that has quietly reshaped U.S. rural economies while gaining unprecedented control over the nation's meat supply."

• Southern issues
Look, there are lots of things to love about the South. It's clean and quiet. There's delicious food, good people and often amazing weather. But that's exactly why it makes us so sad to think about all the ways in which the region is struggling today.

• Selfies Bring Ashtags to Lent
Gaby Driessen stopped by St. Peter's Church here and a priest put a thick smudge of ash on her forehead — a traditional way Catholics and other Christians physically show their commitment to the faith on Ash Wednesday, the first day of the season of Lent. Then she did what many 24-year-olds would. She took a self-portrait, or selfie, with a friend and they posted it on Instagram.

WORD ON THE WIRE
"He's an intimidator. He's a ruthless man. He's former KGB. He has to be reminded that after the Cold War that most of Eastern Europe has chosen to move to the West.”
– former U.S. Secretary of State Condoleezza said during a Wednesday lecture at the University of Arkansas

“While I appreciate that the President finally heard my concerns about his proposed cuts to Social Security, I’m frustrated to see more of the same in his budget blueprint. Once again, we see lopsided tax increases, as well as cuts to the Corps of Engineers, the Small Business Administration, and drinking water improvement programs — to name a few.”
– U.S. Sen. Mark Pryor, D-Ark., in criticizing the 2015 federal budget proposed by President Barack Obama

“The drive-through (depot) options for (pick-up) play heavily on convenience and will be particularly effective in driving incremental business with shoppers who already trust Wal-Mart yet may shop elsewhere for fill-in trips. This is a powerful attack on drug retailers and dollar stores that continue to expand into consumables and fresh produce in particular. Until Wal-Mart’s small format stores proliferate, drive-through options are a great way to keep convenience-focused, price-sensitive customers from seeking other options.”
– Carol Spieckerman, CEO of NewMarketBuilders, about a plan by Wal-Mart to tether its retail network

A dearth of political candidates for legislative seats, tough allegations against the poultry industry, thoughts on “New Tech” schools and an excited trucking exec are part of the March 7 Friday Wire for the Fort Smith region.

NOTES & ANALYSIS
• The (almost) non-election election cycle
The list of folks who filed to run for legislative seats in districts representing the Northwest Arkansas and Fort Smith areas turned out to be shorter than a grocery list on a $5 budget.

It must have been disappointing for those who thought the creation of a two-party system in Arkansas would result in more competition for legislative races. Of the 30 Fort Smith and Northwest Arkansas House and Senate districts up for election in 2014, only 12 are contested. And of those 12, six are contested in the GOP primary only. And of the six that will have a November general election contest, only four will see a Democratic-Republican matchup. The other two will see a Republican candidate square up against a Libertarian candidate.

In the Arkansas Senate, 17 of the 35 seats up for re-election. Of the 17, only four will have a November contest. In the 100-member Arkansas House, only 38 seats will see a November contest.

Overall, Republicans had 132 candidates file for 98 different federal and state offices, while Democrats had 88 candidates file for 81 different federal and state offices, according to a report from Talk Business writer Jason Tolbert. Libertarians had 19 candidates file, the Green Party has two candidates, and only one candidate filed as an Independent.

Kudos to those who were pining for Republicans to “win” the political filing season. However, if you were hoping for a healthy slate of candidates under the belief that competition improves the chances for better government, well, better luck next cycle.

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 ...

• Positive permit tally
February building permits came in at a combined $7.405 million for the cities of Fort Smith, Greenwood and Van Buren. The total is an increase of 12.04% over the same period last year, which saw only $6.609 million in permits across the region's three largest cities. The total is also an increase of 8.96% from February 2011's total of $6.796 million.

• Negative statewide tax revenue trend
The growth of year-to-date tax collections in Arkansas is on a downward trend, and the February gross revenue number was below the budget forecast. The February report also showed a continued decline in collections related to consumer spending.

• Political education partnership
Three faculty members with the University of Arkansas at Fort Smith and The City Wire will collaborate to deliver a series of political-based essays and reports beginning in March.

NUMBERS ON THE WIRE
$4 million: The cost of constructing Rogers New Tech High School. The district retrofitted an existing building in two different phases in order to build the "New Tech" high school, which Rogers Public Schools Chief Financial Officer Kathy Hamlon said was an alternative to the construction of a traditional new high school, which would have cost the district tens of millions of dollars.

12%: The increase in building permit values from February 2013 to February 2014. The increase was largely seen in Fort Smith, where $5.962 million in permits were issued, while Van Buren saw permits totaling $978,376 and Greenwood saw permits totaling $464,485.

$1.6 million: Contract amount awarded by the city of Fort Smith to River Valley Sports Complex, a non-profit, to build a softball and baseball event complex at Chaffee Crossing.

OUTSIDE THE WIRE
• A meat racket?
Christopher Leonard's new exposé on the chicken industry, The Meat Racket, doesn't devote much ink to the physical object on our plate, the chicken meat itself. Instead, Leonard focuses on the economic machinery that delivers the meat to us, or, as he puts it, "the hidden power structure that has quietly reshaped U.S. rural economies while gaining unprecedented control over the nation's meat supply."

• Southern issues
Look, there are lots of things to love about the South. It's clean and quiet. There's delicious food, good people and often amazing weather. But that's exactly why it makes us so sad to think about all the ways in which the region is struggling today.

• Selfies Bring Ashtags to Lent
Gaby Driessen stopped by St. Peter's Church here and a priest put a thick smudge of ash on her forehead — a traditional way Catholics and other Christians physically show their commitment to the faith on Ash Wednesday, the first day of the season of Lent. Then she did what many 24-year-olds would. She took a self-portrait, or selfie, with a friend and they posted it on Instagram.

WORD ON THE WIRE
“I’ve been with the company for nearly 17 years, and I can honestly say that I’ve never been so excited about the opportunities that lay in front of us today that are within our reach.”
— Arkansas Best Corp. President and CEO Judy McReynolds said during a March 4 investor conference in Orlando, Fla.

"He's an intimidator. He's a ruthless man. He's former KGB. He has to be reminded that after the Cold War that most of Eastern Europe has chosen to move to the West.”
– former U.S. Secretary of State Condoleezza said during a Wednesday lecture at the University of Arkansas

“While I appreciate that the President finally heard my concerns about his proposed cuts to Social Security, I’m frustrated to see more of the same in his budget blueprint. Once again, we see lopsided tax increases, as well as cuts to the Corps of Engineers, the Small Business Administration, and drinking water improvement programs — to name a few.”
– U.S. Sen. Mark Pryor, D-Ark., in criticizing the 2015 federal budget proposed by President Barack Obama

Members of the Fort Smith Regional Chamber of Commerce received an update Friday morning (March 7) on the current state of the so-called Private Option, Arkansas' answer to the Affordable Care Act (aka Obamacare), where money that would be spent on Medicaid coverage for poor Arkansans is instead used to purchase private insurance for individuals generally earning less than $15,000 per year.

According to Craig Wilson of the Arkansas Center for Health Improvement, before implementation of the private option, more than 400,000 Arkansans were living without healthcare. And according to Wilson, the years and even decades before the implementation of the Obamacare at the federal level and passing the Private Option legislation in the state's General Assembly had left many people with high premiums, cuts in services and spending caps on their insurance policies, which were becoming more and more expensive with time.

He said overall, the goals of Obamacare were good but hard to implement all at once. Those goals included improving the quality of care and access to care while reducing costs.

Due to the way the federal legislation was crafted, Wilson said many Arkansans qualified for some level of subsidy to assist with costs under Obamacare, which allows individuals to obtain coverage assistance even if their income is up to 400% of poverty level. The Private Option maxes out at 138%, he said.

But he said while many individuals may have been opposed to Obamacare, he said it would be hard to show that Arkansas' Private Option was not a good alternative. He highlighted two specific reasons why it was necessary for Arkansas to have taken the lead nationally in the creation of the Private Option, which is now being looked at by several states as a model for providing health care to its citizens.

"The cost of care for others when they show up at the emergency room and don't get the preventative care that they need prior to that … that's what costs. It's not the uninsured are not accessing care, they were just accessing it in the most inefficient way possible by showing up at the emergency room," he said, before highlighting the numerous delays in the full implementation of the federal healthcare legislation. "So because of the issues that we had before and because of the changes and delays in the Affordable Care Act, we know that we must take the reigns as a state and do something for our citizens to meet their healthcare needs."

Wilson said making private insurance available to the hundreds of thousands of Arkansans who are likely eligible for coverage under the Private Option would save those individuals and taxpayers at large bundles of money as this program not only provides coverage, but also "teaches (people) how to use insurance effectively."

He also said the Private Option is fully funded by the federal government through the year 2016, which gives Arkansas time to implement the program at virtually no cost to the state's taxpayers.

As a whole, Wilson asserted that the Private Option is reforming the healthcare model in the state of Arkansas and will ultimately have a positive impact on individuals, businesses and the economy. He said the program was digitizing much of the medical records in the state through mandated requirements and was opening coverage to a variety of different insurance providers who previously had not been in the Arkansas marketplace.

In all, he said there was nothing Arkansas could have done to keep the Affordable Care Act from becoming law and by making significant changes to the program through state legislation, the state economy would recapture as much as $1.1 billion worth of money that had been going out of state.

Already, as of late February, Wilson said 26,000 people had enrolled in the Health Insurance Marketplace and "had been transmitted to the (health) insurance carriers."

Regarding the Private Option, Wilson said there had been more than 190,000 applications by late February, which he said "demonstrates the need that was out there." Of those that applied, he said 127,000 had been determined eligible for the Private Option. Of those, about 11,500 were determined to be better served by Medicare due to having serious medical conditions while another 94,000 of the eligible individuals have been enrolled in private insurance, well more than a third of what Wilson said was anticipated.

"We're very much nearing the halfway mark, and getting over the halfway mark, in terms in meeting the expectations for enrollment. And what that means when you look at both the Private Option and those individuals who are receiving subsidies through the Health Insurance Marketplace, that's about 130,000 individuals that received coverage in the private marketplace. That money is turning over in the private market and those people are getting coverage, they're getting care."

For anyone who has ever wondered how the order of candidates is determined on a ballot, the answer came at the Sebastian County Election Commission Friday morning (March 7) as the ballot draw for the 2014 primary election was held.

According to Election Commission Chairman Lee Webb, the ballot draw dates back to the 1960s and is mandated by state law.

"The statute that prevails on the ballot draw basically just says draw for positions. It's been changed about about 14 times since 1969," he said.

The statute does not require any fancy way of doing it. Some counties place names on pieces of paper and then draw from a hat. In Sebastian County, candidates or their representatives (a local party chairman or a family member) drew a wooden number from a box to determine the position of their name on a ballot.

As for determining which candidate draws first, Webb said the commission asks whichever candidate filed for office first, meaning a candidate could get to draw from the box even if they got their filing completed with the County Clerk just one second before their opponent.

Webb said it was not common to see a large number of candidates actually showing up for the ballot draw, with only about five candidates present for Friday's draw.

"Usually, it's all (the) local candidates. And not all of those actually show up. You see the county office holders — the Assessor (Becky Yandell) and the Treasurer/(Collector Judith Miller) — were here today, I believe they're the only ones that were here. …So we had a good turnout considering everybody that was from the county (incumbents) showed up to draw."

As for whether the position on the ballot actually has an impact, Webb said he's not ever seen evidence to prove that it does.

"I haven't actually seen anything in writing, but you know there are some people who believe being first on the ballot gains you a little bit. By a little bit, 1-3% maybe. That's just my opinion."

That said, Miller — who drew the second place on the ballot behind challenger Steve Hotz — said she thought the position made a big impact.

"I was first (in the last two elections)," she said of her ballot position. "Yes, it helps. But I'm also an incumbent, so I get to put my title on the ballot. That helps. …I don't know (how many votes the position gained), but I carried both of the elections over 70%, around 72%. So I don't know. The first time I didn't have the (title on the ballot). The second time I did. I still drew 72% (of the vote)."

Asked if there could be a more effective way to determine ballot position, Webb said he doubted it.

"It's a pretty effective and quick way," he said. "Like I say, each election commission does it differently. We used to do just pieces of paper with numbers wrote on it. …People (said) grab the one (piece of paper) that's bent, so we kind of moved toward some wood blocks where you can't tell which is which and it works out. There's not ever a problem. No one ever complains. If they drew 1, 2, 3, 4, or 5, they accept it and say OK, that's where I am on the ballot."

Following is a list of contested races and how they will appear on the ballot in each race's respective primary:

DEMOCRATIC PRIMARY
Governor
• Mike Ross
• Lynette "Doc" Bryant

REPUBLICAN PRIMARY
U.S. Representative in Congress, District 4
• Tommy Moll
• Rep. Bruce Westerman

Governor
• Curtis Coleman
• Asa Hutchinson

Lieutenant Governor
• Rep. Andy Mayberry
• Rep. Debra Hobbs
• Congressman Tim Griffin

Attorney General
• Leslie Rutledge
• Patricia Nation
• David Sterling

Treasurer of State
• Rep. Duncan Baird
• Circuit Clerk Dennis Milligan

Auditor of State
• Rep. Andrea Lea
• Ken Yang

State Senate, District 9
• Rep. Terry Rice
• Sen. Bruce Holland

State Representative, District 76
• Bobby Altes
• Mathew W. Pitsch

County Assessor
• Ken C. Colley
• Assessor Becky Yandell

Treasurer/Collector
• Steve Hotz
• Treasurer/Collector Judith Miller

Van Nuys, Calif.-based Superior Industries, one of Northwest Arkansas' largest manufacturers, reports a challenging start to 2014, as its biggest customers Ford, General Motors, Chrysler and Toyota work through unsold inventories on the heels of back-to-back record years.

Superior makes aluminum wheels for the auto industry and operates plants in Fayetteville and Rogers, employing about 1,400. There also are three plants in Mexico, with a fourth slated for completion early next year.

Superior reported 2013 net profits of $22.8 million, or 83 cents per diluted share. Profits declined 26% from the prior year as the wheel maker faced a $10.4 million increased tax provision. Profits were $30.9 million, or $1.13 per diluted share in 2012.

Consolidated net sales slid 4% in 2013 to $789.6 million as the company faced production downtime for plant improvements in Rogers and Fayetteville. Unit shipments decreased 5% in 2013 from last year, the company noted in the release on Friday, March 7.

While total sales were down, the capital improvements and more select product mix did help to raise the manufacturer’s gross margin — meaning the company kept more of the money it made than in the prior year. Superior’s gross profit for 2013 increased to $64.1 million, or 8% of net sales for 2013, from $60.6 million, or 7% of net sales for 2012.

“I continue to be pleased with the year-over-year gross margin growth being achieved, demonstrating that the ongoing investments being made in our existing manufacturing facilities have contributed important efficiency gains,” said Steven Borick, chairman and CEO.

He said the company still has opportunities to further improve its manufacturing performance and flexibility, citing the actions being taken at existing manufacturing facilities, particularly in the U.S., that are resulting in lower operating costs and productivity improvements.

“We are making excellent progress with the construction of our new, state-of-the-art manufacturing plant in Chihuahua, Mexico, which will add needed capacity, further enhance efficiencies and complement our three existing Mexico-based facilities. The project is on plan and scheduled for completion and initial testing by the end of this year, with commercial production anticipated for the first half of 2015,” Borick said.

The company ran at 99% capacity during 2013, and turned away business to become more selective on program bidding because of its capacity constraints.

Superior’s shipments to Ford totaled 5.055 million wheels, a 9% gain from the prior year. Trucks comprised the majority of those sales for the F-Series, Explorer, Flex and Edge models. Roughly 1.140 million of the wheels sold to Ford were for passenger cars. Superior said the Fiesta and MKZ models sold better than Fusion and Mustang which suffered losses.

Shipments to General Motors declined 11% from the prior year, as Malibu orders plummeted 57%. Superior shipped a total 2.935 million wheels to General Motors last year, the vast majority were for light trucks. Superior said shipments to Chrysler fell 17% in 2013, led by a 19% decline in light trucks overall. The majority of losses were related to the Jeep Grand Cherokee, Dodge Caravan and Journey. Dodge Ram shipments rose.

Borick said Superior made up for some of the declines from General Motors and Chrysler with a 21% gain in sales to Toyota. He said sales to Toyota were for largely for passenger cars. However, the biggest seller for Toyota last year was the Corolla, which is not among the models in Superior’s wheel portfolio.

Shipments to Nissan plummeted 41% last year as Superior walked away from the Sentra model. Total shipments to Nissan last year were 663,000 wheels, down from 1.117 million shipped in 2012.

Borick said deflationary pressures in aluminum also contributed to lower overall sales in 2013. But prices have risen 7.5 cents a pound since the start of 2014. He said for every 1 cent move up in aluminum prices another $1 million is needing working capital.

He said there are some immediate negative issues being felt by the auto sector supply chain, as dealers work through higher than wanted inventory levels, in part from weaker sales at the tail end of 2013 and start of 2014. Borick attributes this to harsh winter weather and shorter downtime for the automakers themselves.

Shares of Superior Industries (NYSE: SUP) rose 3.16% to $19.49 on Friday, following the earnings release. For the past 52-weeks the share price has ranged from a $16.89 low to $20.75 high.

Democratic gubernatorial front-runner Mike Ross received the endorsement of the statewide teachers’ union on Saturday and his probable Republican challenger wasted no time tagging Ross with a “liberal” label.

Ross – whose mother was a teacher and whose father was a teacher, principal and superintendent – said he would be rolling out planks of an education plan later in his campaign, but his focus would be on “reducing the state’s achievement gap” and encouraging innovation. Ross said his education platform would also include more local control over curricula and flexibility to meet community needs.

“Both my parents were public school educators, so I understand, appreciate and respect the important role our educators and education support professionals have in the future of this great state, and I am very proud to accept their endorsement,” said Ross in accepting the endorsement of the Arkansas Education Association (AEA).

“Strengthening public education in Arkansas will be one of my top priorities, because we need a well-educated, highly-skilled workforce to attract the jobs of the future and to ensure our children can compete in a rapidly-changing global economy. I want our children to start sooner and finish stronger, with more children attending pre-kindergarten classes and making sure every Arkansas high school student graduates both college and career ready.”

AEA President Brenda Robinson, a Little Rock school teacher, announced the group’s endorsement, touting Ross as the best candidate to improve public education in Arkansas.

“Mike understands that when parents and educators work together, they give students a great chance to grow and learn, so he will expand opportunities for collaborative family, school and community partnerships,” said Robinson. “He supports quality after-school programs, summer learning programs, and early childhood education. For all these reasons, the AEA believes that Mike Ross will fight to continue the progress Arkansas public schools are making in preparing our children for today’s competitive economy, and AEA members and leaders will work tirelessly for his election.”

Ross faces Democratic primary challenger Lynette Bryant of Little Rock in the May 20 primary.

Ross’ likely Republican opponent – Asa Hutchinson, who faces GOP challenger Curtis Coleman of North Little Rock – issued a statement through his campaign spokesman calling Ross “out of touch.”

Describing the AEA as the state affiliate of the “left-leaning National Education Association,” Hutchinson spokesman Christian Olson said the teachers’ endorsement didn’t support Ross’ contention that he is independent.

“Congressman Ross demonstrates yet again how out of touch he is with Arkansans. This union endorsement is another example that Congressman Ross pretends to be an independent in Arkansas but given the chance will side with his liberal friends,” said Olson. “In this case he has joined with the national teachers unions who put their liberal ideals ahead of our kids.”

The Democratic Party of Arkansas responded to the Hutchinson campaign statement. DPA spokesman Patrick Burgwinkle said, “Congressman Hutchinson’s attack on Arkansas teachers is shameful and he should apologize. Saying Arkansas teachers put anything ‘ahead of our kids’ when you have an education record as bad as Congressman Hutchinson’s is cynical D.C. politics at its worst.”

Hutchinson served in Congress representing Arkansas’ Third District from 1997 to 2001.
“When Congressman Hutchinson went to Washington he left Arkansas’ teachers and students behind. Congressman Hutchinson voted to cut education funding repeatedly, even voting several times against increased funding for special education, after-school centers, Head Start and class-size initiatives,” Burgwinkle added.

The Ross campaign provided a transcript of Ross’ remarks after the AEA endorsement. It also provided comments made by Tom Dooher, executive director of the AEA.

Mike Ross, Democratic gubernatorial candidate:
“Now, moments before I got here, Asa Hutchinson has already put out a statement blasting these teachers and education support professionals behind me. What Asa fails to mention in his statement is that he came to Little Rock, he sat in that room over there, and he interviewed and asked these teachers for their endorsement. And, after he didn’t get it, here’s what he now says: he says these teachers are nothing more than union bosses and that they remind him of Pelosi & Obama. Look it up. Next thing you know he’ll be blaming the ice storm on Pelosi & Obama.

“I think Asa Hutchinson has spent too much time living, working and voting in the Washington, D.C. area, because he seems to think this is a race for President, or Senate or Congress. But, Congressman Hutchinson, let me be clear, I don’t know about you, but I’m running to lead the state of Arkansas.

“This race has nothing whatsoever to do with Washington. The last thing we need is to see Washington partisan politics right here in this State Capitol. I’m committed to working with everybody – Democrat, Republican, Independent – to get the job done. He says in his statement – Asa says that these teachers do not care about our children.

“Asa Hutchinson, you can attack me. I’m willing to take the hits if that’s what it takes to improve public education in Arkansas and to create more good-paying jobs in this state. “But, do not attack these teachers and education support professionals standing behind me today – the same teachers and education support professionals that you sought an endorsement from just a few weeks ago.

“So, today, I am publicly demanding that Asa Hutchinson apologize to the teachers and education support professionals of Arkansas. Thank you very much.”

Tom Dooher, Arkansas Education Association Executive Director:
“My name is Tom Dooher, I’m the executive director of the Arkansas Education Association, and we have [a] few questions for Congressman Hutchinson.

“Is it left leaning that all of our children in Arkansas have early childhood education opportunities? Is it left leaning that they have a safe school and that they’re transported safely with qualified bus drivers? Is it left leaning that we have our children with the opportunity to go to college or get a career-ready education when they leave our public schools?

“So, Congressman Hutchinson, the teachers and education professionals behind me ask you those questions and we want you to come and help us develop a world education system here in Arkansas. And, we are supporting Mike Ross because he believes that our children are the future and that Arkansas’s great economic development will land on the children of our state. Thank you very much.”

Private investment is beginning to trickle back into the commercial real estate sectors in Benton and Washington counties. Several announcements and other pending deals have prompted real estate professionals David Erstine and Clinton Bennett of CBRE Northwest Arkansas to launch the I-540 Interchange Report.

The first edition (January 2014) reveals more than 24 new projects in the planning stage, some of those have since moved into the construction phase over the past month. At the same time, the region also has seen the opening of several other projects including Dunkin Donuts in Bentonville and Planet Fitness in Fayetteville.

“For a such a long time when we would drive from Fayetteville to Bella Vista we would see dirt flying and projects coming to life, but around 2009 it just stopped. There was nothing going on, no deals to speak of in the commercial sector,” Erstine said.

He said the market downturn over the last three to five years gave local municipalities time to catch up on infrastructure projects that were sorely needed from the rapid population growth of the previous decade. 

“Now that these infrastructure projects are well on their way — (Don Tyson Interchange in Springdale, flyover in Fayetteville, widening of Hwy. 265 between Fayetteville and Springdale, a western loop in Fayetteville and more connectivity in western Rogers around the AMP down to the Pleasant Grove exit) — I think you are going to see private investment made as the cities forge on ahead with their projects,” Erstine said.

WASHINGTON COUNTY
Bennett added that as better road access is given to certain areas, commercial investment will follow. He points to the Highway 265 widening project and the eastward extension of the Don Tyson Parkway and the impact that is already having near the Butterfield Coach Road area along U.S. 412 in east Springdale.

The Walmart Neighborhood Market has been there for a few years, but Bennett said now that the infrastructure is nearing completion he has property in the area that is drawing the attention of several prospective suitors for commercial development.

In West Springdale, the improvements made to Elm Springs Road and the new Walmart Supercenter under construction has drawn the attention of McDonald’s. Arvest and Verizon who have planned projects in that immediate area, according to the CBRE report. 

Erstine said the completed interchange work at Mount Comfort Road in west Fayetteville has prompted Kum & Go to build a convenience store in that area — the first commercial project since hundreds of homes were built in that area 10 years ago.

West on Wedington, CBRE reports Freddy’s Frozen Custard and Northwest Health have projects on the drawing board. Walgreen, Super Cuts, First Security Bank, Casey’s General Store, Dickies BBQ and Slim Chickens are already under construction in the area.

An interesting redevelopment project rumored in Fayetteville is Whole Foods scouting out property on North College Avenue near Millsap Road. Estine said the site most talked about is the former Mercedes dealership. His firm does not represent Whole Foods, but he said such a store could have a big impact on redevelopment along that portion of U.S. 71 (College Avenue).

“We see clients who want to locate retail to the region but in the Fayetteville area they all want to be near Joyce Avenue and the mall area. College Avenue does not fit their criteria. If a national player like Whole Foods does decide to invest on College Avenue, it could open the possibilities for others,” Erstine said.

Whole Foods did not return calls seeking comment for this story.

Further south on Martin Luther King Boulevard in Fayetteville, Bennett said Dunkin Donuts and San Antonio, Texas-based Whataburger are scouting locations, but no deals have yet been struck.

Bennett said Dunkin Donuts, which recently opened in Bentonville, has planned at least three locations in this market. He said CVS Caremark, already under construction in Bella Vista and Fayetteville, recently secured property at U.S. 412 East and Thompson Avenue in Springdale for a third pharmacy.

BENTON COUNTY
Bennett said the new Wal-Mart AMP (Arkansas Music Pavilion) will no doubt drive more commercial development in western Rogers and it will also be viewed by investors as a major step forward in the “quality of life”  metric that has become an important recruiting tool. He points to the Wal-Mart AMP and the Razorback Greenway in helping to deliver high marks for “quality of life” criteria.

Bennett said there are numerous large projects (retail and office space) in the Pleasant Grove Road and Promenade/New Hope Road areas that are in the planning stages. At Pleasant Grove Road, the Pleasant Crossing Shops, is a 20,000-square-foot retail shopping center, near the Wal-Mart Supercenter. SNAP FItness, two restaurants and a nail salon are reportedly going into that space once completed by late 2014 to early 2015.

A liquor store and Cavender’s Boots are also planned projects in the Pleasant Grove area of western Rogers, according to the CBRE report.

Erstine said Country Club Plaza is planned near the gates of Pinnacle Country Club, which will be office/retail space. Hunt Ventures has planned to construct a nine-story Class A office building totaling 220,000 square feet. Another private investment deal for 40,000 square feet of office space is slated near the Shoppes at Pinnacle Hills, as well as 60,000 square feet of additional space in Metro Park.

Collective Bias is planning to build along New Hope Road, which will free up a large space the firm now occupies just one block off the Bentonville Square.

Bennett said once this office space is completed in the Rogers area, there will be some softening in the market, which is now fairly tight with respect to Class A space.

“I really think this space will be absorbed. We continue to see Wal-Mart vendors and third party suppliers expanding their offices and personnel,” Bennett said. 

The CBRE group said Wal-Mart is also worth watching as they have already announced seven new stores in the the two counties from Farmington to Pea Ridge.

Tuscaloosa, Ala.-based Peco Foods will invest $165 million in the construction of a new fully integrated processing operation near Pocahontas in northeast Arkansas. The operation is expected to employ about 1,000 when completed.

A fully integrated facility means the company will have a processing plant, hatchery, feed mill and farm operations in the area. The processing plant and hatchery will be located just outside of Pocahontas’ city limits and the feed mill will be in Corning, according to a statement issued Monday (March 10) by the Arkansas Economic Development Commission.

The AEDC note also said groundbreaking on the feed mill site is set for April and the first stages of work on hatchery and processing facilities will begin in July.

The announcement was made Monday in the Governor’s Conference Room at the State Capitol, with Mark Hickman, president and CEO of Peco Foods, Gov. Mike Beebe, Delta Regional Authority Federal Co-Chairman Chris Masingill and leadership from Randolph and Clay Counties attending.

“We are extremely pleased to formally announce this new project today,” Hickman said in the statement. “Arkansas is an excellent place to do business, and we look forward to providing new jobs and an economic boost to Randolph and Clay Counties. As we have experienced firsthand with our complex in Batesville, this state is home to an outstanding workforce that shares the goals and values of our company. I want to thank Governor Beebe and his team for their assistance in making our Northeast Arkansas expansion a reality.  We look forward to a long and very successful partnership.”

Peco acquired in 2011 the poultry operations in Batesville from Townsends, which had filed bankruptcy. Peco reportedly paid $51.4 million for the operations. In addition to the Batesville facility, the company also operates a feed mill in Newark, Ark.

Peco Foods is the 8th largest poultry producer in the United States and privately held and family operated. The company has a processing capacity of 24 million pounds of poultry per week in its six other slaughter and processing plants located in Alabama and Mississippi.

“When Peco Foods acquired an existing Arkansas facility a few years ago, it made a significant investment in the workers of Northeast Arkansas,” Beebe said. “That investment has ultimately led to this major expansion. We are here today because Peco Foods knows the workforce in Randolph and Clay Counties has the necessary skills to take the company to the next level of success.”

A vote on unionization at O.K. Foods that was expected to take place in late 2013 is now likely to take place later this year, according to a union that has been organizing employees at the company's facility in Fort Smith, as well as facilities in Muldrow and Heavener, Okla.

Anthony Elmo, a spokesman for the United Food and Commercial Workers International Union (UFCW), said the delay was a result of the company providing the UFCW with a larger than expected manifest of employees in the run up to the planned vote.

"In the process of giving us the list, which they have to do by law, that list was 600 (more) people (than the union was aware of). We didn't feel we could have a fair election (on whether or not to unionize) until contacting those workers to see if they supported the union or not. So that's where we are."

He said the unionization efforts began long before the proposed vote was to take place, with the Fort Smith location seeing the beginnings of the unionization push in about January or February of last year, while the Oklahoma sites started to see the push in the Fall of 2013. The purpose for pushing the unionization effort, Elmo said, was about fairness.

"Across the three plants, we got people coming to us," he said. "Their main issues revolve around wages, being low for the jobs they're doing. There was also a general level of unease."

Elmo said the UFCW, an international union that represents 1.5 million grocery and food production workers in the United States and Canada, was responding to the requests of many workers in the three facilities with a goal to "get workers the best possible contract, wages and benefits from their employer. Our philosophy is they have more leverage as a group than individually."

"Right now, they have a one to one relationship. The employer holds all the chips. All the employee can do is quit. We don't feel that that is right. We feel they should reform. We want to help these workers to fix OK Foods and make it a more fair workplace — with better insurance, a better retirement package. We want a more fair future."

Christopher Roy, officer-in-charge of the Memphis office of the National Labor Relations Board, confirmed the unionization efforts in a telephone call Thursday (March 6), though the NLRB was unable to provide publicly disclosable documents on the OK Foods case by publication.

"A petition was filed (to hold an election on whether to unionize or not) and then after the petition was filed, we undertook efforts to arrange with the parties a mutually agreeable date, time and place to hold the election," Roy said.

Elmo said while the petition has been withdrawn, it was not due to any unnecessary pressures from OK Foods but instead was simply due to the large number of people who he said had a right to know about the vote and what it could mean for their future.

And he said it is a future that the majority of employees in Mexico of OK Foods' parent company, Industrias Bachoco, have already decided should include a union.

"OK Foods, the American side, is not unionized (at any locations). But Bachoco, that company is a majority union company. Sixty percent of their employees are unionized with very fair contracts," according to Elmo.

Industrias Bachoco, which was trading on the NYSE at $43.10 late Thursday, had estimated earnings per share of $2.92 and total net income of $146.03 million, reason enough for Elmo to suggest that workers at the Fort Smith and Oklahoma facilities vote in favor of unionization when the issue comes back up later this year.

"(OK Foods is) a very successful company," he said. "It's part of why Bachoco bought them. I don't think paying better wages is going to hurt this company. I think it helps. It will reduce turnover. Right now, this company blows through employees. They are constantly bringing in new help. My argument to this company would be if these people thought these jobs were better and more stable, the turnover would go down and you would see increased cost savings from that. From a corporate perspective, I would say they may want to give this a look."

OK Foods did not respond to a request for comment.

If she'd had a career goal starting out two decades ago, Laura Jacobs met it a month ago.

Earning a double major in English and communications at the University of Arkansas in her hometown of Fayetteville, she simply was looking for work. She took a job as editorial assistant with a local newspaper, the Northwest Arkansas Times, where she answered the phone and typed obituaries and wedding announcements into the computer system. On weekends, she waited tables at the now-closed 36 Club restaurant on Dickson Street.

Jacobs had taken no journalism classes, but then-editor Mike Masterson moved her into writing occasional articles and book reviews, as well as graphic design, laying out pages. Then she spent about a year in design and advertising for the newly begun Northwest Arkansas Business Journal.

The graphics skills brought Jacobs to UA's University Relations office in 1998, where her responsibilities regularly were increased. She left in fall 2011, returning to the school's communications and public relations hub Jan. 27 as its executive. The title is associate vice chancellor for university relations. Several weeks in, it's still too fresh for a full assessment, but she moves with confidence in her spacious office in the renovated 1942 Davis Hall on the north side of campus.

Yes, Jacobs is the person hired to help right the Razorback public relations ship after its captain was sacked last summer.

In late August, Chris Wyrick, UA vice chancellor for university advancement, fired John Diamond. The act came in the aftermath of the discovery of a multimillion-dollar budget shortfall in UA's fundraising arm, the Division of University Advancement. Diamond disputed how UA should work with news media on reporting the deficit and its causes.

THE PATH BACK TO THE UA
That 26-month leave from the university was spent as founding director of communications for Bentonville's Crystal Bridges Museum of American Art.

Jacobs was asked to apply for the UA opening but was hired only after a nationwide search, she said in a recent interview.

"I hope that I demonstrated that I was the most qualified kid,” she said.

She learned communications, from writing to design, after her formal education, crediting Masterson and fellow employees at the Times. He remembers her well, saying, "Laura is bright, capable and someone who is not only reliable but knowledgable of the media and its needs."

While she sees herself as having been directionless until joining UA in 1998, she took advantage of its employee tuition discount to earn a master's in higher education administration in 2005.

"This is obviously a position that I had aspired to," of the executive post. "Once I got here (in '98) I really became immersed in the university relations at the University of Arkansas, bitten by the higher education bug."

For a few years prior to 2011 she worked at UA part-time when her two children were young. The Crystal Bridges position was an opportunity to help create its in-house communications department, whose tasks were outsourced prior to the museum's opening.

A by-product of working in Bentonville for about 26 months is that Jacobs sees how the cities of Northwest Arkansas are knitting together: "As the region grows, it gets smaller. It makes it a lot easier, and more fluid, to act as a region."

GETTING REINTRODUCED
Her plan is to hold the course with no immediate plans of expansion in University Relations. She wants to refine the tasks it already holds: all university communications and media relations, including social media; marketing and branding; promoting and publicizing fundraising; supervision of website design and development; university design, photography and videography production; and on-campus crisis communications.

"Because I was here before, I think I was able to hit the ground running in a way that nobody would be able to," Jacobs said. "I can only imagine coming in without any sort of context to know who to contact, who's over who, the different structures, the 'who's on first.'"

"Before I ever even got here, my calendar was set (by her assistant) for the first three weeks, immediately, for the purposes of reacquainting, reintroducing myself to the people on campus, deans and different vice chancellors and vice provosts. And I'm not done. I'm still making my rounds.

"I'm introducing myself to, or reintroducing myself, to people to get their impressions, to get their sense on the state of the university from a global perspective and then more of a granular perspective on how it affects their world. I'm asking for direct feedback. How have we been serving you, how can we serve you better. What do I need to know to help me do my job. ... Getting to know Chris Wyrick and understand his leadership style."

‘COMFORTABLE TRANSITION’
Chancellor G. David Gearhart made Wyrick vice chancellor in February 2013, replacing Brad Choate, who lost the position for his role in his division's budget deficit. Wyrick had been executive director of the Razorback Foundation, the 501(c)3 nonprofit which runs fundraising for UA's department of athletics.

Acting as chief executive won't be a sudden shift for Jacobs. Although she began in the office as a graphic designer, her titles indicated supervisory duties: manager of marketing and advertising services, then manager of development communications, director or associate director of university relations and editor of Arkansas (the alumni magazine), and for her last year before leaving for the museum, senior director of strategic communication.

"I'm not one who sits next to the designer and points to what should be set what," Jacobs said, "as long as our communications is consistent and well-branded."

"This was a comfortable transition for me. I feel comfortable with knowing what our purpose is. ... I think my job is making sure that we all have the same song sheet so that we know what's expected. We know what we're trying to communicate. We're what we're trying to communicate visually in addition to verbally in writing," Jacobs said. "I think that is my responsibility, to give everyone in this building the tools they need to advance those goals."

University Relations employs about 36 people, she said.

"We have a great team, a lot of talent, a lot of loyalty."

COLLEGE COLLABORATION
The budget under which Jacobs operates does not include salaries for the communications staff of separate schools and colleges, such as business, law, engineering and architecture. But the directors of those meet as a group weekly with Jacobs.

"We gather around the table, and we discuss, we collaborate, we talk. We make sure that we're problem-solving together. While they may not report in to me. They are not part of our budget. We may not be paying their salary. We have a decentralized model but we have centralized support. ... We are stronger when we work together."

Jacobs pointed to a specific UA goal, to be nationally ranked. That bar has been set for many years, but Gearhart pointedly said last September, "It is our goal to be ranked as a top 50 public research university by 2021."

He has two metrics in mind, she said. One is the annual rankings by U.S. News & World Report. The other is the annual report "Top American Research Universities" from the Center for Measuring University Performance, which is coordinated by four universities from across the country.

"Our purpose is to advance the institution's goals and objectives. So what we do is driven by that. That is how we deploy our resources, spend our time."

The Advancement Division's budget deficit caused a hiring freeze. It remains in place and Jacobs had no response for when she might get to beef up her office.

"In a perfect world, we could do more things if we had more people. But also to understand we need to be good stewards of the resources we have. It is incumbent on ourselves to work smarter, to find efficiencies, to be more strategic, to use our time, to prioritize what we are working on."

Jacobs by implication is the university's chief spokesman, but she won't be quoted in news reports often. Journalists with queries are sent to her staff specialists who in turn can make arrangements with faculty members in those fields. General questions, perhaps on campus-wide subjects such as winter closings, are routed to Steve Voorhies, manager of media relations.

She is, however, the go-to person for top management.

"If someone had a question for the chancellor or the vice chancellors, that probably would go through me. ... Day-to-day media relations go with the specialists. Where it requires expertise, we go to the experts."

Fielding more candidates and having more contested primaries has the Arkansas GOP in new territory in modern history and experts argue if the trend could be short-lived or permanent as well as what the new dynamic may mean for the top of each political party’s ticket.

After filing period closed last week, Republicans fielded 132 candidates for state and federal offices, while Democrats field 88 contestants. That’s a dramatic turnaround from the last two cycles.

In 2012, 136 Democrats and 124 Republicans filed for those offices, while in 2010, Democrats dominated with 196 candidates for state and federal office and only 108 Republicans in the field.

Also in 2014, the Arkansas GOP will see more than four times as many contested primaries than Democrats. There will be 19 contested Republican primaries between all of the federal, statewide and legislative races on the ballot. Only four races will size up for Democratic primary challenges. Only one contest – the Democratic Governor’s race – will be a statewide election.

“We’ve done a 180 from the Arkansas John Brummett and I grew up in,” said Rex Nelson, president of the Political Animals Club of central Arkansas. Nelson is also former political editor of the Arkansas Democrat-Gazette and former communications director for then-Gov. Mike Huckabee. “For decades, all the action was in the Democratic primary, the ole tantamount [to victory] ... we’re seeing a transformation that I think is going to last for decades.”

“The issue is whether we’re having more Republican primaries simply because the Republican nomination is now the big thing to have. The Republican Party is the one that’s in charge, it’s vibrant. Or, is this a proliferation of specific battles over the private option,” said Brummett, a political columnist with the Arkansas Democrat-Gazette.

THE PRIVATE OPTION POLITICS
Several Republican incumbents received primary challenges owing to their votes for the controversial private option health insurance program.

The private option, often referred to by opponents as an extension of Obamacare, takes federal Medicaid money and supplements private health insurance plans in an exchange to assist lower income workers. Votes in the 2013 and 2014 legislative sessions ginned up competition in the Republican primaries for several supporters, and it has also matched up Democrats in the general election with Republican opponents.

Three Senate seats drew primary candidates for GOP incumbents – Sens. Bruce Holland, Missy Irvin and Bill Sample – who have voted for the private option in the past, while a fourth open Senate seat pits one of the plan’s chief architects – Republican Rep. John Burris – against two primary challengers.

In the House, three GOP incumbents face primary opponents. Two of them – Reps. Andy Davis and John Hutchison – previously voted for the private option, while one – Rep. Jim Dotson – did not.

PARTY SQUABBLES OR PARTY STRENGTH?
Does the higher level of primary participation work for or against Republicans in the 2014 election cycle?

Dr. Jay Barth, professor of political science at Hendrix College, said it could be an advantage for the GOP this fall.

“Generally, one party having a higher level of primary activity does indicate vibrancy for that party and a sense that the nomination is of particular value. That dynamic is clearly at work for the Arkansas GOP right now,” Barth said.

“That said, if the intra-party competition is grounded in factionalism, particularly ideological in origin, that can be a sign of some difficulty for the party moving forward,” he added. “There are clearly some signs of such GOP factionalism at present – on issues such as the private option – but we simply don¹t know how pronounced they are. If they are significant, there are certainly viable Democratic candidates in many of these races to take advantage of it.”

“To me, these primaries are foreshadowing the general election strengths and weaknesses for each political party,” says Clint Reed, a Republican strategist with Impact Management Group. “This simply shows that the natural political enthusiasm favors the GOP.  This typically shows up in a general election GOTV [get out the vote] advantage for whichever party has this natural enthusiasm.  This enthusiasm is being generated by the referendum on Barack Obama’s presidency.”

Greg Hale, a Democratic political consultant with The Markham Group, thinks the GOP party primaries are a sign of disunity, not enthusiasm.

“The Republican Party is divided – traditional Republican versus Tea Party – and they will be slugging it out at one another in the primary,” Hale said. “Meanwhile, Democrats are united and have a better sense of identity and are focused on winning in November.”

MIKE AND ASA
While there are primaries down ballot in statewide races on the GOP side as well as in two Congressional races – the Second and Fourth Districts – many eyes will be on the margin of victories for the Democratic and Republican gubernatorial front-runners.

Democrat Mike Ross received a surprise May 20 primary challenge from Lynette Bryant of Little Rock.  Some political observers believe with only the Governor’s race and three House seats being drivers of Democratic primary turnout, voter participation among Democrats could be anemic.

Reed is convinced Ross will win solidly in May, but he is unsure about the momentum Ross will carry into the fall.

“I believe it’s relatively indifferent for Ross in the primary – for all intents and purposes he is the Democrat nominee for Governor,” Reed said. “He should win with 70-75% of vote. The real danger for Mike Ross is a passive Democrat electorate in the primary and that carries into the fall.”

Hale, whose firm has ties to the Mike Ross campaign, says primary night won’t affect Ross’ long-term plan one way or another. He said Ross has been focused on building a campaign infrastructure for the November general election.

“I think it’s been pretty clear to everyone that Mike Ross has had a long term strategy in place since he announced last April – especially in terms of fundraising, endorsements, messaging, branding and grassroots building. And, we’re already seeing the proof. Last summer, Ross was down by eight – now the latest polling has him up by three,” Hale said, noting that recent spending of nearly $1 million by the Republican Governors’ Association against Ross is indicative of his gains.

For months, Asa Hutchinson has known he’d be challenged for the Republican nomination Curtis Coleman of North Little Rock.  A third challenger for the Republican Governor’s nomination, Rep. Debra Hobbs, pivoted to the Lt. Governor’s race during filing period.

Hale said that Hutchinson’s primary is likely to be more reflective of what he perceives as a power struggle in the GOP.

“Asa has a much tougher primary than Mike Ross. Asa has had trouble winning over his base from the beginning, and his refusal to take a position on the private option has hurt him even more with them, particularly with Tea Party voters. So, primary night should tell us just how unenthusiastic the Republican base is for Asa – that’s the race to watch,” said Hale.

Reed has a different take.

“The expectation is that Asa will win the primary. The real question for Asa, in my opinion, is how much money does he have to spend to meet the media’s expectation for victory,” said Reed. “It is much more important to reserve resources for the bruising battle ahead with Ross than try to meet an artificial victory percentage in the primary.  So, the margin is less important for Asa than Ross.”

“The thing I will be watching in the primary is not how well each candidate does versus their opponent, but the overall voting numbers within each primary. That will be story,” he added.

Jobs continue to be the catalyst that drives Northwest Arkansas’s regional economy and for the first time since 2009 the small business sector is more optimistic about future hiring, according to a new report from the Northwest Arkansas Council.

The report was unveiled Monday (March 10) by the Council in collaboration with five local chambers of commerce and focused heavily on small business retention. 

Economic development teams met with 529 local businesses in 2013 and found that 2,037 planned new hires over the next three years with $195 million in planned investment out to 2016. One in five of the businesses surveyed said they plan to expand within the next years.

Small businesses accounted for 367 of the companies surveyed last year in this combined effort. Another 167 large or “prime” companies also were interviewed.

“Our Chambers really got out there last year and stepped it up. They talked to a lot of companies. We went from 459 (interviews) to 529. Our annual target annual is 450,” said Mike Harvey, chief operating officer for the NWA Council.

He said the interviews uncovered more than 2,000 new jobs planned, with three employers responsible for about half that number. The rest were small employers planning to add 5 to 10 people. Harvey said this type of activity among the small business sector is significant because it has not been involved in the broader economic recovery for the most part.

“One of the things that really jumped out at me from the 2013 surveys was the number of small companies who reported rising revenue,” Harvey said.

The report shows 57% of the smaller companies surveyed said total revenue in their Northwest Arkansas location is increasing. Another 31% reported stable revenue. Harvey said it’s significant because it’s twice the number reported a year ago and also uses a larger cohort of small businesses, banks, retail and service segments. He said the larger companies reported nearly the same data as last year.

This research, according to the Council, indicates the local small business sector is finally recovering after years of stagnant and even shrinking revenues.

STRENGTHS, CHALLENGES
Harvey said the businesses also saw the local economy as a positive metric, and it was mentioned among the top three strengths. A year ago it wasn’t among the top 10 positive strengths reported by local businesses.

Employers identified more than three times as many “community strengths” as “community weaknesses” when asked about Northwest Arkansas. The “strengths-to-weaknesses” ratio was similar in 2012, Harvey said.

The Affordable Care Act and Dodd-Frank banking regulations were listed among the top concerns of the businesses surveyed. Harvey said lack of public transportation is an area of concern among some of the industrial manufacturers. Road infrastructure constraints were also seen as ongoing  challenge as was the need for competitive airfares out of Northwest Arkansas Regional Airport.

He said there is also a lack of skilled workforce needed for “big data” and information technology (IT) jobs in the Wal-Mart supplier community. Other businesses also reported skilled labor and unskilled labor shortages.

Mike Malone, CEO of the NWA Council, said the council was formed to work on the region’s challenges and promote the good news as well. He said job creation is a big part of that good news. He said the region still has growing pains as its infrastructure is always playing catch-up to ongoing population growth.

“Last year Northwest Arkansas ranked No. 4 out of 400 metro areas for job growth, creating 9,580 job, an increase of 4.56%,” Malone shared at Monday’s event.

BUSINESS EXPANSION
Cindy Christopher, human resource officer at Gates Corporation in Siloam Springs, said the company closed a facility in North Carolina last year and added lines of production to the plant in Siloam Springs. 

She said 30 families have relocated to Siloam Springs as a result. At least two families also brought along grandparents who came out to help with the move and decided to follow along. Christopher said 36 families were offered transfers to Siloam Springs and all but six accepted.

Lance Eads, director of economic development for the Springdale Chamber and Commerce and a GOP candidate in the Arkansas House District 88 race, said one local firm — ORC Products— was recently able to expand its business into a larger location because of contacts made during the routine business retention meetings. The firm does government contract work.

Matt Crafton, president of Crafton Tull in Rogers, said his firm brought on six new engineers last year because of work created from the tax program that is funding road construction in Northwest Arkansas and around the state.

Bill Locke, owner of Admiral Moving Services in Fayetteville, said his firm is a direct recipient of work the chambers are doing to recruit and expand businesses in the region. Admiral has purchased 10 acres in Fayetteville and plans to build a larger facility in the city’s Commerce District.

“We started 11 years ago with four people and two trucks, today we employ 85 and have 45 pieces of equipment. We do commercial and business relocations. Regionally we see a lot of inbound growth to Northwest Arkansas, even though Arkansas is a neutral state. Enough people are leaving Little Rock and the Delta area to make the state appear neutral, but I can tell you this MSA is a vey inbound area,” Locke said.

He also addressed talent shortage in the region. Locke said they do work for a Wal-Mart supplier who furnished IT services. 

“This supplier moves 65 people in here each month, they stay for 90 days and they are shipped out to another assignment. If there were enough local talent for these IT jobs I am almost sure the 185 positions would be filled locally,” Locke said.

Roger Thomas, a principal at Telecomp, said his firm provides computer and telecommunication services for the Wal-Mart supplier community. Swirl, an advertising and marketing firm out of San Francisco, plans to relocate five or six people to Bentonville, but Thomas said the company may bring more from San Francisco over time. He said Swirl is a new client of Telecomp.

The May 20 primary is little more than seven weeks away and the area's first political debate of the 2014 political season took place Monday afternoon (March 10).

Republicans Bobby Altes and Mat Pitsch, the only two candidates for the District 76 House seat, debated nearly an hour on topics ranging from teacher pay to tax cuts to the Private Option in a forum sponsored by the League of Women Voters of Fort Smith.

On the topic of the Private Option, which takes federal money intended for Medicaid expansion and instead uses that money to place low income Arkansans on private insurance, both candidates agreed it was a good alternative to just accepting the Affordable Care Act (aka Obamacare).

Pitsch — who unsuccessfully faced Altes' father, Denny, in the 2012 Republican primary for the District 76 House seat — said while the legislation passed during the 2013 legislative session and re-authorized last week was not perfect, he said he would have voted for the legislation because it met two criteria which he said all legislation should meet.

"Does it create jobs or prevent the loss of jobs? And does it overreach and grow government?" he asked rhetorically. "Well, this is a complex situation because those two aren't in tandem on this question. …It's a creative solution to keeping (businesses) open. …I go back to my scenario (where) we're preventing the loss of jobs. I would have voted for private option."

Altes said the Private Option was not prefect, but "it's the best option we have."

The son of the current representative said he hoped other options would present themselves as time went on, such as insurance reform, in order to eventually move away from the Private Option, "but the Private Option right now is going to take 250,000 people off of Medicaid and put them with private insurance and it will save the state in three years, it is supposed to save the state $670 million. That's quite a cost savings over the Affordable Care Act, but I hope there's another option and I hope to explore that with other legislators in Little Rock. Again, it's not a perfect solution, but it's the only solution we've got right now."

Beyond talk of the Private Option, Altes veered into a discussion on teacher pay and the new Common Core curriculum adopted in the state of Arkansas, which he said gives the federal government control over local school curriculum. Regarding teacher pay, Altes said he was in favor of not only increasing teacher pay in Arkansas but also adding incentive pay.

"I'm also for rewarding teachers' performance. I believe that should they meet their standards, those standards set by the state, that they should be rewarded accordingly."

While Altes said he was against the Common Core curriculum, he did not specify an alternative to the new national standard which he said is controlled by the federal government, a statement that is opposite of how the standards were developed. According to the Common Core website, "State education chiefs and governors in 48 states came together to develop the Common Core, a set of clear college- and career-ready standards for kindergarten through 12th grade in English language arts/literacy and mathematics."

"I'm against the Common Core curriculum because it takes control out of the state hands and puts it in the hands of the federal government," Altes said. "In addition to taking control away from the states and putting that into the hands of the federal government, it sets lower standards for our students."

Pitsch took a different approach in the discussion of education, referring to a policy initiative that is largely in line with that of Republican gubernatorial candidate Asa Hutchinson — increased emphasis placed on STEM (Science, Technology, Engineering and Mathematics) education.

"We have to train in the trades and the skills, as well," he said. "So we as a legislating body need to truly understand what our economy is, what our citizenry need, and we need to understand what the performance is of schools. Are they getting the jobs done or are the students coming out with a degree, a high student loan debt? What are they going to do with that?"

On the issue of tax cuts, Altes was insisted that the state's income tax rate is too high for Arkansas to be competitive with surrounding states in attempts to recruit business and industry. He proposed a 2% income tax cut which would keep enough revenue for state government.

"I think our state needs to cut back and balance the budget, I think that we need to cut our taxes. I think that by cutting our taxes we can stimulate the economy. Spending money is not the way to stimulate the economy, but cutting taxes will stimulate the economy and produce more jobs and that's what we need here in Arkansas."

Noting that the state's budget is required by law to be balanced, Pitsch said the state must also have the money for education and infrastructure.

"We have got to compete with the states around us," Pitsch said. "My opponent brought up that our taxes are higher, but if I'm an outside CEO — and I've been a CEO, I've built a factory in another state before — when I look at another state, I want to know (if) I am going to find a quality workforce? Check. We've got that. Am I going to find transportation? Because when I make stuff a third of my business is bringing raw goods, I perform my magic to it and I ship it out. Do I have good highways, do I have good railroads, can I fly my parts in and out? Is my transportation there so I can compete on a global basis?"

Pitsch also touched on incentives, which he said the state should be performance-based instead of leaving the opportunity for companies to not deliver on their promises. He specifically pointed to the never opened Mitsubishi manufacturing facility at Chaffee Crossing, which was supposed to manufacture components for wind mills.

Following are quotes from both candidates on other topics discussed during the debate:
• Altes on a proposed inland port to be built along the Arkansas River and other area transportation issues: "Our ports that we have right now are underutilized. I think that that might be a future project. I think that right now, it's unnecessary and that it might be a waste of taxpayer money. As far as I-49 goes, they've got a Bella Vista Bypass, they've got a small section here in Fort Smith and they've got a small section down in Texarkana. They are…I heard an estimate of 20 years and then I was talking to that former highway commissioner and he said not in my lifetime. As I proposed, I think if we set aside $10 million a year, that we can get this done. And it will be good for our economy, but I don't think that just building rivers and building roads is going to cause jobs to come floating down the river. We're going to have to get serious, roll up our sleeves, cut up our budget a little bit, lower our taxes and that will cause our economy to come back. To be stimulated."

• Pitsch on diversifying the Fort Smith economy and casting a vision for the future: "Is anybody tired of saying we're the manufacturing base of Arkansas? How about we say we're the osteopathic medicine base? How about we say we have a unique university? How about we say we've become (an) arts and tourism (hub) with the Marshals Museum? We need people to cast a vision when they're in leadership. Now I'm a manufacturing guy. I get it. I'm also a former dean of a college. I get it. But we also have people in this community, Steve Clark downtown, building a corporate headquarters at the end of Garrison Avenue in a building that's old and antiquated. Let's have some vision in our visionary leaders. Let's have some young people led by elected officials to help them do something."

Residents often have a few minutes to take action and seek shelter once a tornado warning has been issued. But a piece of legislation in the U.S. House of Representatives aims to increase the time individuals have to prepare for the worst.

House Resolution 2413, a bill sponsored by Rep. Jim Bridenstine, R-Tulsa, aims to increase warning times beyond one hour by funding a research program at the National Oceanic and Atmospheric Administration (NOAA).

According to Steve Piltz, meteorologist in charge of the National Weather Service office in Tulsa, such advances would be a drastic improvement over current warnings.

"The average (today) is about 14 minutes, give or take a minute or so," he said. "Some will have 30 minutes and some will have zero minutes."

While encouraged by the move to improve warning times, Piltz said any advancements would be extremely difficult to improve warning times.

"To actually do forecasts, you'd have to do it down to the individual clouds. It would take a tremendous amount of data and computer models. It's a very tall order."

And that tall order will be expensive, according to the Congressional Budget Office, which has estimated that implementing the legislation from 2014-2019 would cost $530 million.

Chief Meteorologist Drew Michaels of KHBS/KHOG-TV in Rogers said the variety of factors involved, including financial resources, will probably limit efforts to improve warning lead times in the near future.

"Research is always ongoing, but I still think we're a bit out. We've made some great, great strides in upgrading radar technology," he said. "With dual-pole radar, you can see so much more of the storm. But we're probably still beyond that. I'm not sure, with the amount of money you throw in, if it's really feasible."

Michaels said any effort to increase the amount of times from the issuance of a warning to the actual strike of a tornado would likely involve a combined effort of computer data and storm spotters in the field, similar to what is used today.

"I think you'd need a coordinated effort with spotters, as well, to be watching those clouds as they break the (atmospheric) cap, as they develop. I don't know (how much lead time is possible). I still think an hour's worth of time, we're still beyond that. Do I think we'll get there? I think so. I just don't know when."

Dennis Gilstrap, director of emergency management for Crawford County, agreed with Michaels' assessment.

"It depends on the data that they have," he said. "But if they say they are going to try to get all warnings an hour out, I don't see how they can do that, personally."

He specifically mentioned how he has watched from his office as storm systems rolling across Oklahoma have broken apart before entering Arkansas and vice versa, redeveloping quickly with little to no warning.

Michaels pointed to an instant messaging system local emergency managers and media outlets are using that connects them with the National Weather Service, which he said has increased communication and getting vital information out to the public quicker.

"They have a chat program that allows different emergency managers and television meteorologists to be on there and pick their brain," he said. "We're actually getting that information even faster, which is great. That really is the Weather Service doing their due diligence. Being interactive more than they were in the past. When you have a coordinated effort, it helps."

Piltz said should the legislation pass and scientists make advancements in tornado forecasting, the programs already in place could allow the weather service to get warnings out quicker without causing a panic among the public.

"I could see a tornado warning being as it is (with an average 14 minute lead time), but a manager of a large venue (such as an outdoor concert venue), you can't get them to shelter in 14 minutes. So they would have higher end information coming to them."

Local members of Congress have so far been noncommittal on supporting HR 2413. Rep. Steve Womack, R-Rogers, said he would "monitor this bill and other life-saving legislation closely." Rep. Tom Cotton, R-Dardanelle, said through his spokesperson that he was still reviewing the legislation and would "carefully monitor all legislation dealing with impact of severe weather on Arkansans' lives."

Bridenstine said the research must move forward to save more lives in his home state of Oklahoma, which was hit with a series of tornadoes in May of last year, resulting in the deaths of dozens of people and causing billions of dollars in property damage.

"By making weather research and the protection of lives and property NOAA’s top priority, the bill before us today takes a small but important first step toward achieving this goal.”

A spokesperson for Rep. Markwayne Mullin, an Oklahoma Republican representing much of eastern Oklahoma including the western section of the Fort Smith region, said "we will not be commenting at this time."

As for whether Congress will be able to pass the measure, which has already made its way out of committee and is waiting on a vote in the House, Plitz said it would be difficult to get passage.

"Oh gosh, I don't know. It's something that gets difficult because you have Congress telling an agency what it should be doing."

Wal-Mart Stores has made no secret that it would like to build a Neighborhood Market in Bella Vista, just five miles from retailer’s home office in Bentonville, and also home to hundreds of Wal-Mart corporate employees.

Last month the retailer got one step closer to that goal with a $4 million purchase of 126 acres of property that sits on the Bella Vista line, but is located inside Bentonville because the acreage recently was annexed by the city. The deal for the 126 acres was completed earlier this year, according to a Jan. 30 deed filed at the Benton County Courthouse.

The retailer won’t be sneaking into the sleepy village as it will need loads of dynamite to clear the rocky bluff that greets passers-by at the intersection of Peach Orchard Road and U.S. 71 — the site Wal-Mart now owns. Lowe’s Home Improvement, McDonald’s and a Northwest Health clinic each sit just east of the Wal-Mart property, at the northern most edge of Bentonville’s city limits. While the retail giant has yet to present store plans to the city of Bentonville, city officials did rezone the property from agricultural to general commercial on Jan. 21.

Wal-Mart confirmed it purchased the annexed land in north Bentonville, but Erica Jones, corporate spokeswoman said Tuesday, (March 11) the retailer has no immediate plans to announce a store.

In late 2012, Wal-Mart abandoned plans to build a Neighborhood Market in Bella Vista following an unsuccessful attempt to get another traffic light installed on U.S. 71, and a property rezoning backlash.

GOING SMALLER
Bill Simon, CEO of Walmart U.S., said during a March 4 speech at the Raymond James Investor Conference that Wal-Mart grew its Neighborhood Market stores 40% last year and returned 4% comparable sales for the year, and 5% in the fourth quarter.

He said the retailer is doubling the planned growth this year with about 300 additional stores, and 200 of those will be Neighborhood Markets and 100 will be the smaller Express or convenience format. Simon said the Neighborhood Markets are a pull forward of stores from a pipeline that was scheduled for the next two years. The smaller Express Stores require less planning and are more easy to site.

He said the Express formats will be rolled out in accordance with the density plan that will allow Wal-Mart to capture more of the convenience trip market it is losing to small box competitors. That quick trip shopping market is worth an estimated at $415 billion annually, and Wal-Mart is capturing just 10%, according to Simon. The small formats are Wal-Mart’s answer to picking up their share of the quick-trip sales.

“It is exciting. We think that we have come a long, long way with these two formats over the last three years. We're excited about their opportunity. We believe they represent tremendous growth potential for the company in a retail space that is defined on one end by digital and on the other end by pure physical. These provide the ability to compete as I have talked, across a wide array of competitors and many, many different spaces,” Simon said.

Wal-Mart plans to roll out three of its fully tethered ecosystems by later this year. The ecosystem involves supercenters, tethered to distribution centers and smaller formats as well as physical stores being connected to Walmart.com. The Express Store could be stocked by from a local supercenter, a consumer could order an exercise bike online and pick it up at her local Walmart Neighborhood Market.

SImon said even employees would be interchangeable between the stores within a local ecosystem, perhaps working three shifts at a supercenter and then picking up two others at smaller format closer to their home.

LOCAL EXPANSION, TETHERING?
Wal-Mart’s store expansion in Northwest Arkansas has ramped up in the past year, with eight new stores already announced, including a new convenience store model that is expected to open in the next few weeks. The majority of the announced projects are for Neighborhood Market formats, with the exception of the large supercenter under construction in Springdale and the convenience store in Bentonville.

The retailer’s real estate division has actively looked for other parcels across the region in addition to the recent purchase in north Bentonville and six other deals made in 2013 totaling more than $8.819 million, according to Benton County real estate records. This activity begs the question if Northwest Arkansas is one of three regions setting up for tethering.

Wal-Mart has revealed one of the three regions set up for tethering is in North Carolina where it built a number of stores last year, including Neighborhood Markets and Express formats. Northwest Arkansas has four of the retailer’s 20 smallest formats, soon to be five when the convenience store opens in Bentonville.

Simon said the retailer is testing density and the early data sources show that Wal-Mart captures new sales dollars, new trips and new customers when it puts small format stores between supercenters.

When a “Neighborhood Market is built in proximity to a supercenter we see an additional $300 a year from customer spend based on traceable tender. So this is additive to our business — because they are different trips, because they are shopped differently. A stock-up trip at the supercenter on the weekend; fill-in trip at the Neighborhood Market during the week,” Simon said.

He indicated during questioning at last week’s investor conference that the initial roll-out of the first wave of small formats would capitalize on the company’s strength and support system nearby in rural markets and go out one concentric ring further. That describes what is happening in Northwest Arkansas, with Pea Ridge, Farmington, Centerton and Siloam Springs all on tap to get new Neighborhood Markets this year.