A recent study released by the website Nerd Wallet lists Fort Smith as one of the cities in America "that are borrowing the least smart," but according to a Walton College of Business expert, the study may not mean doom and gloom for the Fort Smith area economy.

The study, which ranked the 10 areas that are "borrowing smart" as well as the 10 that are not, analyzed borrowing in comparison to income.

"We divided each metro area’s average amount of consumer debt into its median household income to get a better sense of the places that are carrying truly heavy loads. A high ratio of average debt to median household income indicates danger on the horizon," Nerd Wallet analyst Lindsay Konsko wrote.

The website made clear that the percentages created were not to be understood as the area's debt-to-income ratio. It also made clear that debt levels included credit cards, auto loans and personal loans, but not mortgages.

The study showed that Fort Smith ranked as seventh worst in American metro areas not borrowing smart, with the debt as a percentage of household income at an average of 72.9%, the second highest in the nation trailing Monroe, La., at 73.3%.

HOUSING COST FACTOR
Kathy Deck, director of the Center for Business & Economic Research at the Walton College of Business at the University of Arkansas in Fayetteville, said the study does not mean the local economy will suffer due to the higher levels of debt to household budget.

"The first thing, and they say this explicitly, is it excludes mortgage debt. It may also exclude student loan debt," she said. "When you think of the overall debt load, it might not be surprising in a place like Fort smith with relatively low incomes that folks also have relatively low mortgage debt because houses are affordable."

Deck said with low mortgage debt, it was reasonable to assume that some households could afford to take on higher levels of other debts.

"So the distribution to more household consumer debt is not necessarily surprising in an affordable housing market like Fort Smith," she added.

She said other comparable communities on the list of "least smart" borrowers included southern cities with low cost of living such as Monroe, La., Jackson, Miss., and Waco, Texas.

"If you look at a lot of the other communities, and I don't know what their housing prices are off the top of my head, but you imagine it would be comparable."

MORTGAGE DEBT COMPARISON
And while Nerd Wallet has ranked Fort Smith as among the regions with the "least smart" borrowing practices, total household debt outside of mortgage debt is not that different from cities ranked as some of the smartest in terms of borrowing.

The average debt of the 10 cities making up the smartest borrowing cities is $25,480 while the average for the 10 metros who were not the smartest about their borrowing was $26,520. The difference amounts to only $1,040. In Fort Smith, the figure is even lower with average consumer debt of only $26,296.

The figure ranks nearly even in terms of overall debt with the San Francisco metro, with its average consumer debt of $25,828 in spite of being ranked the third smartest about its borrowing. The big difference initially appears to be household incomes (San Francisco's average household income is $74,922 versus Fort Smith's $36,061).

But Deck said if mortgages were factored in, Fort Smith could be ranked closer to many of the cities labeled as the smartest borrowers.

"The others with the low (overall) debt are in the (most expensive) housing markets in the country. All of those have relatively high housing costs," she explained.

So even though the ranking may on its surface look rough for Fort Smith, she said overall it would not hurt job growth and consumer spending in the Fort Smith region.

"In a typical household, you have the budget to service that debt and this doesn't mean it is necessarily detrimental to the economy."

Deck added that used wisely, debt in and of itself is not a bad thing and actually helps to grow the economy versus shrinking it.

"When you look at the overall economy and retail sales across the board, there are only two ways to increase consumer spending — more income or more borrowing," she said, adding that as the economy has improved, credit has loosened to allow more consumer spending.

"It may seem perverse, but when credit conditions loosen like this, it is indicative of an improving economy. And when people spend more, employment goes up. And when employment goes up, it's good for the economy."

No one told Keith Scheffler that moving his plastics manufacturing business from Asia to Lowell, Ark., would be easy, even if Wal-Mart Stores is the company’s largest customer.

Scheffler, owner and CEO of Creative Things, said onshoring the business has been a five-year process and he’s still trying to figure it all out with the help of lead lender Signature Bank and a state and local economic officials.

“Five years ago Gov. (Mike) Beebe gave me a direct challenge. He said, ‘It’s great that you are doing so well with your foreign operation, but what are you doing to help Arkansas and your local communities?’ It was a wake-up call to me,” Scheffler said.

Creative Things was already selling plastic products – dog toys, cell phone cases, etc. – to Wal-Mart as an importer when the retailer announced its 10-year, $250 billion additional product commitment for items made in the U.S., which helped to accelerate Scheffler’s timeline to get the business moved.

“We picked up our operation in Asia and moved it here, all but two lines, one of which will be moved over in the next few weeks. There were several challenges in getting the local site up and running smoothly with orders also increasing,” Scheffler said.

Creative Things has been able to create 64 jobs since last fall and plans to add 40 more  within the next six months to the operation now based in Lowell. The average wage is $15 per hour and finding the skilled labor has been a tedious process.

“We must have sorted through 300 to 500 applicants before we got to the 64. We are pulling folks in with no manufacturing experience in some cases and training them. But getting the right team in place is critical,” he said. “We feel so strongly about the shortage in skilled manufacturing labor we are working with area schools and the state to get more training programs in place.”

The plant is now running at about 70% capacity and more equipment is needed for the pending expansion.

FUNDING PUZZLE
Grant Tennille, executive director of the Arkansas Development Commission, said the work to help fund the company’s move also has been a challenge.

“Piecing together the funding has taken some creative effort. It’s been challenging at times because Keith’s operation was viewed as a startup, despite his track record,” Tennille said.

Tennille said the state extended Creative Things a $280,000 grant for the first jobs it created. That was to be part of a $784,000 commitment to help gear up manufacturing jobs.

With funds running short in the Governor’s Quick Action Closing fund and the steep costs related to equipment needs for automation, Tennille said it’s taken the help of some local banks to extend operating capital toward this project.

He explained that the nature of this business, high front-end startup costs to make products for one customer in a short time window entailed risks that fell outside the return on investment capital requirements by the state. That said, the state has worked with a lending group who can syndicate loans for reduced risks and still get Creative Things the funding it needs for expansion, Tennille said. The state is then able to guarantee a portion of the loan.

Scheffler said he had no track record of manufacturing in the U.S., despite the fact he owned two plants in Asia. That lack of local financial history is like someone with a zero credit score trying to get a loan. He said Signature Bank has been a huge part of his ability to proceed with the planned expansion. 

Gary Head, president of Signature Bank, also spoke highly of Scheffler. 

“As a twice-wounded soldier, he exemplifies the word ‘bravery’ and we at Signature Bank know what it’s like to be a startup and face challenges. We believe in Keith’s ability to expand and grow this business and we feel good about the fact that his largest customer, Wal-Mart, can pay their bills on time,” Head said.

He said the bank is just doing its job in helping Creative Things expand and create jobs.

“That’s the very thing a community bank should do,” Head said.

THE “WHY” OF IT
Scheffler told The City Wire there were plenty of reasons as to how he moved the operation, but none of them are as significant as why he did it.

“We wanted to bring solid jobs and ongoing personal involvement into our community,” he explained. 

He said there is real opportunity for growth, not only in his own business but also in the ancillary supplier relationships he has been to cultivate in recent months.

“We work with Alpha Packaging down in Greenwood (Sebastian County) for all of our printing and packaging needs. They work with me on a ‘just in time’ basis. We also have worked with a local temp agency and of course Signature Bank,” Scheffler said.

He said managing the supply chain of his products sold to Wal-Mart has become much easier since he onshored the operation. He’s saving between 10% and 12% on items by not having to ship from Asia.

“I have erased the uncertainty related to customs and potential dock worker strikes that can hold up shipments, that already takes a minimum of 120 days to import. This shortened time window is huge in seasonal and trendy products that I can now turn out as needed and just in time. This also gives me much better inventory controls,” Scheffler said.

Jeff Amerine says there is no cure for serial entrepreneurs whether they are age 17 or 37 or 97. Even if launching a startup venture and seeing it through two years or more is likely to age the founders in dog years, he said during his emcee duties at the Northwest ARK Challenge Demo Day held Thursday (Sept. 4).

Amerine, director of technology ventures at the University of Arkansas, said the idea of building and sustaining a knowledge-based economy is the core mission of the ARK Challenge partnership. The Challenge was launched in 2012 through a deal with Winrock International, UA and NorthWest Arkansas Community College with funding from state and federal agencies. The 2014 program is state funded and active in Northwest Arkansas with a brand new cohort added in Central Arkansas.

Five entrepreneurial teams, each with local ties, could barely contain their excitement as they took the stage for 10 minutes to pitch their ventures to a room full of investors, mentors and other entrepreneurial junkies, including Rick Webb, senior vice president of global business processes at Wal-Mart Stores. The event was held at Crystal Bridges Museum of American Art in Bentonville.

Webb, a self-proclaimed geek and a mentor in the ARK Challenge for all three years, said he identified with the teams and their longing to find solutions to big problems using technology and processes.

Amerine said this year’s competition — a 2.0 version and new iteration of the past two years — was tweaked to try and bring more mature ventures along faster to fully scalable levels.

Five teams were chosen out of 70 ventures from around the world seeking entry into the 12-week startup bootcamp. Each team gave up a 6% stake in their business for $50,000 in seed money and unlimited mentorship and counseling over the 12-week period. The Demo Day was moved to the middle of 12 weeks to give each team more time to make connections and secure funding that can ensure a viable future.

“This is just the beginning of a process that takes the entire community’s support to keep this fire burning,” Amerine said. “It’s not possible without our angel investors and our mentor base.”

Amerine said all of the teams in the 2.0 cohort have the opportunity to be “positive disruptors” in their space bringing solutions to real world problems.

Edward Haddock, senior area manager of the U.S. Small Business Administration, said he was pleased to see teams in this cohort focused on helping small businesses solve real problems.

THE TEAMS
• HIPAA RISK MANAGEMENT
Anne Drachenberg, co-founder of HIPAA Risk Management, said her team has had their company up and running for several months, and they assumed they would need to travel to Silicon Valley or elsewhere for funding and mentorship.

“We have been to Seattle and San Francisco for funding, but neither of those markets offered anything like the ARK Challenge with the cohesive mentorship program 24/7 over a 12-week period. It’s been amazing to have this opportunity in our own backyard. We have made valuable connections through mentor introductions to people that would never return our call otherwise. I can’t say enough about the benefits we have received in just five weeks,” Drachenberg said.

The HIPAA team sells a cloud-based data security tool to small health care organizations at risk of data breach. She described their product like TurboTax for HIPAA compliance. Their target clients are doctor’s offices, county health departments pharmacies and community hospitals. 

The company has ready garnered 90 customers with $250,000 in revenue contracts. At this time the business is generating $20,000 per month, expected to reach $80,000 per month by this year. Sales projections are $10 million by end of 2016.

Drachenberg has made a believer out of investors so far raising $350,000 of the $550,000 needed to continue marketing their service. The company signed on with the Texas Medical Association and will soon be in front of 750 potential clients.

• SKOSAY
Justin Urso and Jason Kohring, founders of Skosay, offer small businesses a way to manage their customer service more efficiently. 

Urso said consumers today want their voices to be heard but just 1 in 27 actually say something. He said comment cards and 800 phone numbers are antiquated systems for gathering feedback and they don’t get the job done.

The local manager at Chick-fil-a in Fayetteville told Urso that he spends up to three hours a month combing through the comment cards – ime he would rather spend with his customers.

Urso explained that when a consumer has a bad experience and they don’t get it rectified, 91% won’t return. He said companies spend $60 billion annually trying to improve customer service based on feedback.

Their product provides a private two-way communication channel for customers and business owners or key managers. The comments are made in real time with chat platform on mobile web application.

Skosay has already enlisted Piggy Back shuttle service in Fayetteville and Impressed Cleaners in Bentonville to use their service beginning this fall. Northwest Arkansas Regional Airport has also expressed interest in the service. The service is subscription based at $100 a month per location for retail users, and free to consumers. The company is seeking $250,000 to take the venture from beta testing to a full sales operation within the next year.

Cade Collister, creative director at Acumen Brands, said the Skosay duo could have started their company anywhere but chose to plant their passion in Northwest Arkansas.

• CROWD TO GO
Jet Castro wants to solve the last-mile delivery problem for retailers, restaurants and consumers. He see’s his company using vetted crowd sourced personnel to deliver lunch to Wal-Mart suppliers during crunch time or run small packages from retailers to consumer homes in a particular area.

The company is seeking between $250,000 and $500,000 to fully market this alternative delivery system. He owns a software development company in Asia employing 40 developers crafting the product.

Castro said he was glad to see Wal-Mart IT execs at the demo day event and was excited they offered to schedule a meeting on his behalf.

• HUMAN LINK
Ven Vadiamani, co-founder of Human Link, said his startup was rooted in an experience he encountered recently in trying to find in-home care for his ailing 84-year-old grandmother in India. 

“I had to find that care from here in the U.S,” Vadiamani said.

Human Link applies a LinkedIn strategy to find vetted in-home health providers that best meet a consumer’s needs. He explained the system today is a franchise, a list of possible health care associates that may not be compatible with a loved-one. He said finding the right match is time consuming.

The in-home health care market is valued at $75 billion today, expected to grow to $200 billion by 2030. Vadiamani said the Human Link service does not have a subscription fee for caregivers or consumers. The company works off of a 6% to 10% fee per transaction, a cost they are working to reduce which can be passed on to the user. 

His firm is seeking $750,000 to $1 million to market their platform around the world.

• NEO
Cyber security is an ever present threat in today’s marketplace. NEO founders Justin Farmer and Travis Fischer operate a parent company known as Kernel, in which they do cyber security work in the Middle East with oil companies and government entities. 

They said this type of ongoing cyber protection is costly, and oil companies can afford the costs. However, Urso said small businesses are often not able to afford cyber security services.

Neo is a product they have developed to “democratize” a high level of cyber security down by offering it to small businesses at $49.99 per month, which includes the hardware.

The team is seeking $300,000 to $400,000 to build their team and bring the product to market. They expect a project market launch by the end of next year and said it will take selling 750 units to break even. 

Target applications for Neo includ health care HIPAA audits, the legal industry, and financial services.

FLASHBACK UPDATE
Mark Brandon, CEO of QBox, formerly Stack Search, gave the audience an update on his startup which was one of three original ARK Challenge winners in 2012.  Brandon said he’s aged 10 years in the three years and his venture has come within a week of closing at least four times but things are finally looking up.

“We have nearly 700 customers for QBox at this time and we finally became profitable in August for the first time since we launched,” Brandon said as the crowd applauded. “We are managing data on five continents today.”

He said revenue is growing at 15% to 25% each month. Brandon and his small team are ready for a Series A funding round for $1 million to heavily market the product and build out their team.

“Raising this funding has been challenging. I have been coast to coast and we have had four investors tell us they would be a second lender but we are still looking to take the lead in this Series A round,” Brandon said.

QBox helps companies manage their big data analytics in dash board format. He too, was excited to hear from a Wal-Mart executive who offered to get him a meeting with the retailer’s chief technology officer.

“That alone makes my day,” Brandon said.

Voters in the Greenwood School District will go to the polls on Sept. 16 to decide whether to increase the district's millage rate by 1.9 mils and generate an estimated $590,000 more in annual district revenue.

The money would be used to alleviate capacity issues by constructing a freshman center and realigning other grades in the district, Superintendent John Ciesla said.

The district's millage rate is 38.7 mils. Should voters approve a bump to 40.6 mils, the owner of a home valued at $100,000 could see their personal property taxes increase by $38 per year, according to figures provided by the Sebastian County Collector's Office. A $150,000 home could see an increase of $57 per year.

Ciesla said construction of a freshman center adjacent to the district's high school would add 23 classrooms to a district that saw 568 more students this year than in the 2001-2002 school year.

"It would include 23 rooms — 15 regular classrooms and seven labs for classes including science, large groups, computer labs, etc.," he said. "It would be about 53,000 square feet. One of our biggest concerns as a district is growth."

The new freshman center, with a price tag estimated to be between $10 million and $12 million, would remove freshman from Greenwood Junior High and allow the district to move fifth graders from the district's two elementary schools to a new fifth and sixth grade middle school, shifting seventh graders to a new seventh and eighth grade junior high.

The configuration of the sophomore through senior high school would remain the same, though the high school's amenities would be used by the freshman center, Ciesla said, indicating that the cafeteria, performing arts center and other facilities would be used by all four grades and would save the district money by not constructing those as part of the new campus.

Of the millions needed for the project, the state has already committed $2.3 million to the project through matching funds, Ciesla said, due to overcrowding issues in the district.

He said while there is a cost benefit for the freshman center and a space benefit for the other grades should the millage pass, there is also an issue of introducing students to high school and helping those students find success.

"Obviously you get more space, but that ninth grade year is such a transition. … Everything is starting to count as far as credits and we cut down on those transitions of students moving campuses. We have those classes just down the hall and there's an easier, smoother transition to the high school experience."

The building, which will be built by Beshears Construction should the millage pass, will have a capacity of 360-400 students. Greenwood Schools has 3,720 students from pre-K through high school at five different campuses.

As for how long the freshman center could meet the needs of the district, Ciesla said it is hard to predict because of growth happening at the north end of the district's boundaries in Fort Smith.

"With Chaffee Crossing and I-49, those are becoming a reality with growth. It is our hope that this will meet our needs for some time. But a number is hard to predict,” he said.

Should the millage pass, Ciesla said he hoped to break ground on the new freshman center by the start of 2015 with occupancy by the fall of 2016. And should the millage increase not pass, Ciesla said there is not a plan B at this time.

"We haven't decided that. We are full. It's a difficult situation. Both of our elementary schools have zero additional space. I feel like it is very important that this pass."

Early voting will begin Sept. 9 and run through Sept. 15. The special election will be held Sept. 16.

Voters in March 2010 rejected – 58% against to 42% for – a 2.8 mil increase that would have funded a third elementary building estimated then to cost $14.2 million.

Food insecurity is a problem that has only grown in severity since the financial crisis of 2008, according to a local food bank executive. Arvest Bank is teaming up with local organizations to reduce the number of hunger in the Fort Smith and Northwest Arkansas regions.

Arvest Bank has partnered with the Rice Depot, the Community Services Clearing House and more than a dozen other organizations to collect nonperishable food items at its branch locations across the Fort Smith and Northwest Arkansas regions in an effort to fight hunger.

According to Ken Kupchick, director of marketing and development at the River Valley Regional Food Bank in Fort Smith, events that raise awareness of the issue of food insecurity facing our neighbors and friends are needed to bring an end to the crisis.

"The issue of hunger has been on ongoing one and at the height of the recession, it captured the hearts of so many people," he said. "Memories are sometimes short. There is a bit of issue fatigue, so having events like this is really important. Hunger has lagged the recession in terms of impact and is a bigger problem now than in '09 and 2010, so events like this and September being Hunger Action Month, it's very important.”

According to data provided by the River Valley Regional Food Bank, three of the top four counties in the state of Arkansas for food insecurity by total population are Washington County (34,740 people), Benton County (31,160), and Sebastian County (22,640). The only county in the state to outpace the three local counties was Pulaski County with 78,100 people, or 20.4% of its population, facing food insecurity.

When it comes to the number of children facing food insecurity, the top 10 list of overall population includes the four counties from Fort Smith to the Missouri border. Benton County comes in second place with 14,840 children facing food insecurity, followed by Washington County (14,100), Sebastian County (9.440) and Crawford County comes in 10th place with 4,760 children facing food insecurity.

Kupchick said efforts like those at Arvest Bank are part of the solution to fighting hunger. And he said not only does it help local men, women and children get fed, but it also helps the local economy to fight food insecurity.

"By helping people feed their families, we're also helping pay their bills, put gas in the car and take care of themselves," he said. "It means people are more productive and the motor of the economy is fueled. The benefits go far beyond the obvious.”

And while it may seem like a daunting task to raise a million meals as Arvest is attempting to do, figures from the River Valley Regional Food Bank show just how efficiently an individual can be fed.

In Sebastian County alone, providing a meal to someone who is facing food insecurity only costs $2.54 per meal. In Washington County, the figure is only $2.56 while Crawford County's total is $2.66. In Benton County, the average meal is only $2.65.

Kupchick noted figures from the Hunger in America study that showed the food insecurity problem in America is affecting all groups.

Nearly all individuals receiving assistance at food pantries are American citizens, according to the study, while only 1% are homeless. Eight out of 10 are white non-Hispanics and seven out of 10 have at least a high school diploma. Ten percent of those receiving assistance are labeled as having had professional or managerial careers, the study said.

According to Kupchick, events like the Million Meals campaign are what drive awareness of the facts, but locals still may not be aware that those using the shelter are by and large working adults trying to feed their families.

"So many people that we help are employed and working. What used to be an emergency provision due to unexpected medical expenses or short term unemployment … we're now feeding people that are chronically dependent on food pantries to make it month to month. That's the difference we're seeing.”

The Million Meals campaign will kick off Friday (Sept. 5) at the Arvest Bank Tower in Fort Smith at 10 a.m. on the fourth floor. The plan, according to Vice President and Marketing Director Beth Presley is to pack 7,500 meals in one hour during the event. More than 40 Arvest employees gathered at the bank’s main location in Fort Smith on Friday to package 7,500 meals. The employees worked at several “funnel” stations in which ingredients were poured in an orderly fashion through the funnel and into a bag. Once the bag was weighed, it was sealed and then packed into boxes for shipment to the Community Services Clearinghouse. Each bag is capable of producing a meal that will feed six people.

The Arvest Plaza branch on the Fayetteville Square will meet Saturday, Sept. 13, from 9 a.m. to 12 p.m. in an attempt to pack 10,000 meals. Other branches across Northwest Arkansas will be hosting events, as well. For more information, contact individual branches.

The proposed Arkansas College of Osteopathic Medicine announced the formation of an atypical construction management partnership at the Fort Smith Regional Chamber of Commerce's First Friday Breakfast this morning (Sept. 5).

According to Kyle Parker, president and CEO of the Arkansas Colleges of Health Education, Beshears Construction and Nabholz Construction in Fort Smith brought strengths to the table when applying for the construction manager position.

"But individually, they would not have won the bid," he said, adding that Beshears had expertise in construction of educational facilities while Nabholz is ranked 22nd in the United States for healthcare facility construction.

"They've done over $1.5 billion alone in the last five years in healthcare building," Parker said of Nabholz.

Nabholz will manage all of the pre-construction work, pricing and implementation of energy efficiency standards before construction, Parker said.

ENERGY SAVINGS
In the area of energy efficiency, Parker said the new osteopathic school — which will be housed in a three story, 100,000-square-foot building valued at more than $31 million in Chaffee Crossing — would include many energy efficiency features unique to the medical school. Parker is familiar with energy efficiencies, having worked with officials at the University of Arkansas at Fort Smith to save more than $1.4 million per year in energy savings through his work as the university's former vice chancellor of operations.

Working with Nabholz and Beshears, Parker said he knew the right energy questions to ask and was able to work with the companies to get amenities such as darkened skylights, a specially-designed roof that is cooler than typical as well as the college having its own wells dug on site to water lawns and provide some of the school's water needs versus having to tap the city of Fort Smith's water supply for all of its needs.

The companies themselves expressed excitement about the unique construction management arrangement for the project.

"We are so very excited to be working with the college and the community on this project," said Travis Beshears, executive vice president of Beshears Construction. "Not only does it represent keeping the construction responsibility local, but it's the first time we've had the opportunity to partner with another local group on something of this scale."

Rob Dodd, senior project manager at Nabholz, said the company was excited to be a part of "something so special and important to the region."

"Combining the talent and resources of both our firm and Beshears will mean the college will get unprecedented focus and quality for the project. As a lifelong resident of Fort Smith, I am thrilled to have the opportunity to be involved in a project that promises to have such a positive impact on the community."

Parker said using the two companies allowed the ACHE to keep management local and pump money back into the local economy while advancing the school from a proposed concept to reality.

"Our team is very pleased that both Beshears and Nabholz could be a part of this effort," he said. "From the very beginning, our Board of Trustees had a goal of trying to keep as much of the work local as possible. This is a significant step in that direction."

MORE MONEY SUPPORT
In addition to announcing the construction management partnership on Friday, Parker also announced funding from the federal Economy Development Agency in the amount of $1.2 million which he said would be used to expand Chad Colley Boulevard in front of the medical school, as well as construct a new road into the school's site.

Parker also broke news of a $200,000 gift to the school from the Fort Smith Regional Chamber of Commerce, bringing total donations and other funding committed in some form to the proposed school up to $106.9 million, according to figures included in Parker’s presentation on Friday.

The largest amount of funding — $60 million — came from the Degen Foundation, while an additional $14 million came from an anonymous donor. The Fort Chaffee Redevelopment Authority donated the land valued at $5 million while the city of Fort Smith has committed to infrastructure and other improvements in and around the site of the school at a cost of $1.5 million.

Additionally, Parker said a “local financial institution” has offered to loan the school $25 million at an interest rate below the market rate.

"That puts us at $107 million (of access to working capital)," Parker said, adding that while the school did not require a loan for operations, it would "be crazy" to not take the offer of credit at such a low rate.

All of the donations, community support and the offer of below-market lending, he said, is overwhelming.

"I mean it straight up — I've been overwhelmed with the generosity of the community involvement," Parker said.

And it is more than just monetary contributions from the community, but also time the community is putting in. Parker announced the addition of four local doctors to the ACHE Board of Trustees including Drs. Cole Goodman, Chris Greer, Esther Tompkins and Jim Zini. The four join Chair John Taylor, Vice Chair David Craig, Secretary/Treasurer Ronnie Hawkins, Jeff Beauchamp, Dr. Judy Boreham, Dr. Benny Gooden, Jim Patridge, Karen Pharis and Mike Rappeport on the Board.

MOVING THE NEEDLE
Fort Smith Regional Chamber of Commerce President and CEO Tim Allen said the financial show of support was an easy decision.

"There's never a magic formula on our participation. We sat down with Kyle and his team and said, 'Look, there's a lot of people already participating. What can we do?' So, we sat down and we identified some capital expenditures within the building and on the property,” Allen said. “And so the Chamber, we have limited funds like most chambers do, but we just felt there was enough passion behind this thing to say, 'Hey, look, we've got to be a part of it. Let's drive it home.'"

In order to receive the full funding, Allen said the school would have to meet certain unspecified contractual deadlines for construction and other aspects of getting the school operational. Once obligations are met, funding would be released to the school, he said.

Allen said the deal will “move the needle” in terms of economic impact for the region.

"For me, the school is awesome in itself. But you heard the residency story and 70% of the people who go through the school, they're here for such a very long time and they end up usually staying in the community. (It is) good for real estate agents and the ripple effect through the community of the selling of houses, the leasing of apartments. I mean, it really is the type of project that actually moves the needle in a community for a very long time. A $100 million impact … it just doesn't get any better than that, right? It's awesome."

CONSTRUCTION, ACCREDITATION TIMETABLE
The news kept coming from Parker Friday, announcing in addition to the construction managers, funding for the school and the new board members that bids would be put out later Friday for pad work for the school, with the hope of awarding the bids by Sept. 15 and getting bulldozers on site to complete the pad site before letting the bid on the initial more than $31 million in building, parking and other facility construction.

The plan, he said, was to have construction complete by April 2016 so the first cohort of students could begin classes by that fall.

While plans are advancing to get the school from concept to reality at Chaffee Crossing, plans are also advancing to get the school from concept to reality academically, as well.

Parker said reserves have been established in compliance with the Commission on Osteopathic College Accreditation (COCA), and that applications had been put in for accreditation with the commission for accreditation. He said ACHE expects to hear back from COCA in the next 15-30 days regarding an on-site visit, with an expected Dec. 2 pre-accreditation hearing to follow.

"At that point, at pre-accreditation, we have to have under contract our associate deans and there are three associate deans that have to be under contract. Of which, we have all three of them. We're going to announce that closer to the end of December because they're under contract right now and they're not here in Arkansas. We're bringing them all in (from around the nation)," he said.

The school also established more than 200 slots for residencies for its students. Parker said recruiting of students for the first 150-student class scheduled to begin in fall 2016 could begin once the school receives provisional accreditation, which is expected as soon as April 2015.

If you’re tired of Republicans and Democrats, there may be an alternative for you in the November election.

In the Governor’s race, the focus has been on major party candidates Democrat Mike Ross and Republican Asa Hutchinson.

Two other candidates who have qualified for the ballot are Libertarian candidate Frank Gilbert and Green Party nominee Josh Drake. Both men appeared on this week’s edition of Talk Business & Politics for an extended political roundtable conversation.

A constable in the Dekalb Township of Grant County, Gilbert is a former mayor of Tull and has served as coroner for Grant County. He’s also a former president of the Bauxite Education Association. Gilbert graduated from Van Buren High School, attended Ouachita Baptist University, and is a U.S. Navy veteran. He has had a career in private security and serves as a minister of Universal Life Church.

Drake, a Hot Springs attorney, was born in Germany. He graduated college from Rhodes in Memphis and received his juris doctorate from the University of Georgia School of Law. Active in several civic organizations in Garland County, Drake has run for office before. He’s been a Green party candidate for U.S. Congress in the Fourth District in 2008, 2010 and 2012.

As statewide candidates this year, both Gilbert and Drake hope to pull at least 3% of the general election vote in order to help their political parties meet a threshold for recognition as a political party in future elections.

On key issues, Gilbert and Drake have major differences with each other and the major party candidates; take taxes for instance.

Drake likes Mike Ross’ income tax bracket reform proposal, which would retroactively index Arkansas income tax brackets taking a 1997 state law and applying it to the 1971 realignment of the tax code. However, Drake thinks there needs to be a higher income tax percentage on larger incomes.

“I think we should be raising them [taxes] to some extent,” Drake said. “The family making $50,000 a year in Arkansas pays the same percentage of taxes as the family making $5 million and I don’t think that’s fair. ... The people that are making the money, that are doing the best, they can more afford to pay a higher percentage of their taxes because this economy, this economic environment we have, is obviously good for them.”

Drake also advocates for an eventual elimination of the sales tax, which he says disproportionately hurts lower income families.

“It hurts the hard-working people that are working 40 or 50 or 60 hours a week and spending every dime they make on groceries and fuel and rent and education for their kids and clothes and so forth. They put it back in the economy,” he said.

Gilbert wants to eliminate the personal income tax completely. As income taxes account for nearly half of state tax revenues, Gilbert said it couldn’t be done all at once without wreaking havoc on state services. But he says it could be done over a multi-year period.

“If there was a switch, I’d throw it,” Gilbert said, acknowledging that the state Legislature would likely buck such an effort. “Corporate welfare in Arkansas is $200 million a year. We can cut that back. The average Arkie is not going to feel it, the fat cats that are getting it aren’t going to feel it that much either and they don’t’ deserve it anyway.”

“I would go as far as selling the Governor’s mansion,” he added as a symbolic gesture to cutting what he perceives as unnecessary government expenses.

Rick Webb is tasked with helping solve big problems and improving global processes at the world’s largest retailer. He leads a team of other engineers dispersed around the planet who depend on science, technology and math.

Webb, keynote speaker at the recent ARK Challenge Demo Day in Bentonville, said there are not enough advanced degreed scientists, technologists, engineers and mathematicians (STEM) in or entering the workforce. It’s why Wal-Mart and other STEM advocates continue to push for more educational opportunities.

He said engineering schools and universities need to do a better job integrating the colleges of business and technology with engineering and math disciplines so the graduates are better equipped to work on complex problems.

ENGINEERING PUSH
Wal-Mart’s fascination with hiring engineers is not new, according to retired Wal-Mart exec Andy Wilson. 

“The fascination of engineers have been going on for many years and it begin when Sam was alive. Sam understood that our competitive advantage was developing a distribution and supply chain systems. Building stores, stockrooms, transportation of merchandise, customer traffic flow, and flow of merchandise from stockroom to sales floor shelf has to be accomplished at a high rate of speed and efficiency. Every time a person touches a piece of merchandise it reduces the profit on the item and adds cost,” Wilson told The City Wire.

“The use of engineers has increased over the years due to size of stores, distribution and supply chain cost  and high sales per square foot to help control cost and improve efficiency,” Wilson added.

Over the past few years the retailer has added at least 600 engineers to its ranks to continually look at each process from the supplier to store shelves with goals of streamlining logistics and reducing costs.

“The bottom line is that engineers are critical to accomplishing the global footprint and profitability of Wal-mart,” Wilson said.

OPTIMIZING RETAIL WITH STEM
Webb said in his prior job with Walmart U.S., his team was focused on optimizing supercenter performance. Today as a senior vice president of Wal-Mart’s global system processes, Webb said his international team of engineers look at “whole” problems on a global scale.

“We see Wal-Mart as a global operation taking the best practices — those we build and  those we borrow from other retailers — configure ways to efficiently implement them on time. Take grocery delivery, which is already successful at ASDA, the next step was to build out a cross-functional team in Denver to fully test this service in the U.S.,” Webb said.

He said creating solutions with the use of technology is just part of the job because real solutions also must include process applications down to the hourly employee level. For instance, the new “Pickup Grocery” delivery model slated to open soon in Bentonville involves many processes that have to be perfected after the technology solution is complete.

“This Drive Up Grocery solution is a new concept in the U.S. but it’s quite common in France. In order for Wal-Mart to test it here, there was a lot of collaborative work to do to get this up and running,” Webb said.

He explained that on the tech side it starts with website capabilities that are user friendly with electronic and digital payment options. He said the logistics team that gets the order also will get some type of routing detail that tells them where the product is located in the small warehouse, so they don’t wander around looking for each item.

But the pickers also have to be trained in processes that require human discernment. For instance, what constitutes a ripe and suitable tomato for a customer who orders a pound or two online?

He said the consumer will scan their phone receipt into the kiosk when they enter the Drive Up facility. They will be prompted to pull into a covered lane area where they will wait for their order to be delivered within five minutes by an hourly employee.

Webb said complete cross-functional teams including engineers were put in place by Wal-Mart for Denver home delivery test and new Pickup Grocery center in Bentonville.

STEM ADVOCATES
Webb said Wal-Mart is working to boost STEM education around the world. Karenann Terrell, chief information officer for Wal-Mart Stores and an engineer, recently shared similar concerns for the lack of engineers and technologies available for hire.

At the NWA Tech conference in August, Terrell said Wal-Mart is a retailer and that will never change, but it’s also tech invested and that’s the future for giving customers what they demand. She said Northwest Arkansas institutions must do a better job with STEM education.

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

Webb agreed, saying that with “Big Data” usage now becoming mainstream, demand will rise around the world and in all business sectors for technologists and engineers. He said the region, state and nation needs to do more to support STEM education, which he said is now a fragmented effort. 

“The world is watching,” Webb said.

Supervising an army of more than 500 IT and computer scientists, Terrell said the UA and most colleges have to put more emphasis on computer science graduates because just one in 17 technologists nationwide graduate with a degree in computer science. Terrell said technologists now working in retail today often earned a business degree

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

STAY FASCINATED
Webb also is a strong advocate for mentoring others who work and innovate with technological applications. He said the time he spends mentoring startup teams in Northwest Arkansas is one of the ways he keeps abreast of the newest ideas and technology uses.

“I have been challenged with staying fascinated in the midst of the constant retail grind. Working with these startup teams of entrepreneurs (NWArk Challenge) gives me a glimpse of what’s coming and I am always looking for applications for Wal-Mart,” Webb said.

He adds although 95% of Wal-Mart’s efforts are still focused on making sure its stores run smoothly and efficiently, it’s crucial to embrace the 5% spent on innovation.

“My supervisors have challenged me to plug into mentoring and other advocate positions that help to support STEM education and innovation. This leads me to wonder what we all might accomplish if we collaborate with this common purpose and a singular vision,” Webb said.

Mary Beth Brooks, president and CEO of Bank of Fayetteville, has been appointed by Gov. Mike Beebe as a member of the Arkansas Economic Development Commission, the 16-member panel that provides guidance and direction to the state agency focused on job recruitment and retention.

She replaces Mary Ann Greenwood, chairman of Fayetteville-based Greenwood Gearhart Inc., and the appointment expires Jan. 14, 2017.

The University of Arkansas graduate grew up in Fort Smith, the daughter of the politically active and politically connected Mary Ellen and Brad Jesson. Her more than 26 years in banking has included stops in Fort Smith, Little Rock and Memphis.

Brooks, 49, also is a member of the Northwest Arkansas Council, a member of the Fayetteville Public Schools foundation board, advisory board member for the Yvonne Richardson Community Center, is a former board member of the Beaver Water District and former board chair of the Fayetteville Chamber of Commerce.

Brooks is married to U.S. District Court Judge Timothy Brooks, who was confirmed March 5 as a federal judge for the Western District of Arkansas.

“I’m as honored as I can be. I love Arkansas and I’m such an advocate and I’m ready to do anything to help,” Brooks said Monday when asked about the appointment. “If you look at the (AEDC) list, you will see there are a lot of accomplished people on it, and I just hope to be able to be a contributor.”

Brooks said the post will also give her another chance to tour Arkansas. The last time she was able to frequently visit different parts of the state was in the 1980s as a bank examiner. She looks forward to learning more about economic development efforts around the state and then compare those to what is happening in Northwest Arkansas.

“All of that could shed some light on lessons learned, in Northwest Arkansas or wherever, ... and then how we use those to make the state better. Whatever is good for one part of the state is good for the entire state,” Brooks said.

Fayetteville native Mike Malone, the president and CEO of the Northwest Arkansas Council, has known Mary Beth Brooks since he returned to Northwest Arkansas in 2006.

“Mary Beth Brooks is a great business leader in Fayetteville and Northwest Arkansas,” Malone said in a statement. “She understands economic development through her banking experience and in the roles she’s taken on with the Fayetteville Chamber of Commerce and the Northwest Arkansas Council. She’ll do a fantastic job with the AEDC.”

Other AEDC members are:
• Stuart Dalrymple, president of Dalrymple Commercial and Residential;
• Ed Drilling, president of ATT Arkansas;
• Steve Edwards, owner and president of Food Giant Supermarkets;
• Doug Falls, president of Trinity Lighting;
• Gene Hill, president and CEO of Highland Industrial Park (east Camden);
• Loutelious Holmes, assistant superintendent of federal programs, West Memphis High School;
• Thomas Kirk, chairman and president of Tom Kirk Chevrolet and Kirk Equipment Co.;
• Chester Koprovic, chairman of Boyd Metals and Kopco Inc.;
• John Lipton, former member of the Arkansas Highway Commission;
• Jack McNulty, partner, Bridges Law Firm;
• Shelby Moore, owner of Moore Properties;
• Mike Roberts, president, Roberts Law Firm;
• Steve Ronnel, vice president of Metal Recycling Corp.;
• Lee Webb Jr., president of Bellwether Industries; and
• Lang Zimmerman, vice president of Yelcot.

Other Northwest Arkansas residents were included in Monday’s announcement of board and commission appointments.
• John Paul Davis, Fayetteville, to the Criminal Detention Facility Review Committee, Judicial District #4. Appointment expires Jan. 14, 2017. Replaces Boyce Davis.

• Patricia Kulish, Fayetteville, to the Arkansas State Board of Massage Therapy. Appointment expires Aug. 20, 2017. Replaces Lisa Douglas.

• Melinda McIlroy, Fayetteville, reappointed to the State Child Abuse and Neglect Prevention Board. Appointment expires July 31, 2017.

• Michelle Stephens, Bentonville, to the Arkansas Early Childhood Commission. Appointment expires July 1, 2017. Replaces Debbie Malone.

• Elizabeth Williams, Fayetteville, to the Board of Examiners in Speech-Language Pathology and Audiology. Appointment expires June 30, 2017. Replaces Donna Edgmon.

• To the Advisory Council for the Education of Gifted and Talented Children: Dustin Seaton, Fayetteville. Replaces Eunice Thrasher. Appointments expires July 20, 2017.

The local economy is showing signs of strength but area bankers said the competition for new loans is as fierce as ever as they also continue to face regulatory-related expenses that pressure margins and reduce profits.

Fifteen banks either based in Northwest Arkansas or with a substantial percentage of deposits in Benton and Washington counties cumulatively have pocketed $131.453 million in the first half of 2014. Profits are 5.153% lower than they reported in the same period last year, according to financial reports filed with the Federal Deposit Insurance Corporation. Half of the 15 banks reported less profits from a year ago.

The banks polled in this report rate the local economy between a B and B- through the first half of this year and they expect similar results in the bank half.

REGULATORY ANGST
This local banking sector includes the largest, midsize and small community banks, all of which expressed concerns about higher regulatory costs to comply with the Dodd Frank legislation. Don Gibson, CEO of Legacy Bank in Springdale, said they have added a full-time compliance professional to try and create a safe haven in the midst of burdensome regulation. 

“I recently attended training in Memphis. The very first slide of the training showed the number of pages in the Dodd Frank legislation against all other banking acts. Content wise, Dodd Frank has volumes of requirements that will end up costing consumers more in the long run,” Gibson said.

He said capital requirements will likely force more consolidation among the smallest of banks because of the mark-to-market requirements of tier 1 and tier 11 capital reserves. In addition, Gibson said the method future loss rates are to be calculated with Dodd Frank compliance requires more capital.

Legacy National Bank reported net income of $981,000 through the first half of this year, up 5% from a year ago.

Bob Taylor, CEO of Parkway Bank in Rogers, said his small bank has added two new people to help with compliance issues and they are also outsourcing some of the added workload. 

“I think we as bankers have a done a poor job educating the pubic at large about the looming costs of implementing Dodd Frank legislation, which was intended to protect consumers from banks,” Taylor said, adding that community banks don’t typically abuse consumer rights.

“We need them and they need us and this added regulation is costing everyone more and could mean less services for consumers in the end,” Taylor said.

Parkway Bank reported $449,000 in net profits through two quarter of 2014, down slightly compared to $474,000 in same period last year. 

LOAN DEMAND, PERFORMANCE
The bankers said loan demand in the local market is improving, but there is not enough quality deals to go around. That said, a few of the bankers shared local projects they were proud to be financing. Mary Beth Brooks, CEO of the Bank of Fayetteville, said they are handling financing for the new Whole Foods store under construction in Fayetteville.

“We are really proud of that and the new jobs this project will add to the local community,” Brooks noted in an email.

Brooks added that the Bank of Fayetteville has pulled through the recovery and is doing well.

“Our numbers look good and are regulators are happy. It’s a good place to be,” she said.

Bank of Fayetteville had net profits of $1.254 million in the first half of 2014, down about 31% compared to the same period in 2013.

Taylor said Parkway Bank is financing two large commercial projects for the local retail vendor community from the ground up.

Gary Head, CEO of Signature Bank, recently told The City Wire he was excited to finance a manufacturer’s move from Asia to Northwest Arkansas. Creative Things has put 64 people to work with plans to add 40 more manufacturing jobs in Lowell in the next six months.

Signature Bank was one of seven in the 15 to show a net income gain in the first half of 2014 compared to the same period in 2013. The bank recorded $1.031 million in net income through the first of half of this year, up 92% from the same period in 2013. 

While increasing profits was not an easy feat, the 15 banks did report better overall loan performance compared to a year ago. The cumulative loans reported as non-accrual through half of this year totaled $184.201 million, down 39% from $305.892 million in the same period of 2013.

Real estate still held as non-performing assets among the 15 banks totaled $257.98 million at the end of June, down from $283.46 million in the year-ago period.

CONSUMER ASSESSMENT
Consumer spending comprises nearly 70% of the nation’s gross domestic product so any change in behavior is of interest to bankers and those depending heavily on consumers and their desire to spend.

Craig Rivaldo, president of Arvest Bank in Benton County, said local mortgage activity for home purchases remains strong, but there has been a slowing with some refinances.

“Our consumer and commercial loan activity has been good and our wealth management division has had a great year thus far,” Rivaldo said.

For the bank as a whole, Arvest profits were down in the first half of the year to $56.644 million, compared to $69.646 million earned in the same period of 2013. 

The local bankers canvassed for this report said they do sense tightening in consumer sentiment, which is perhaps linked to uncertainties in health care costs and stagnate wages in many employment sectors.

The Arvest Consumer Sentiment Survey also found Arkansas consumers planning to save more in the coming months, more so than consumers polled in Missouri and Oklahoma.

Banker consensus is that interest rates will begin to move higher in 2015, which they fear will have a negative impact of their operating margins and hinder borrowing.

“With a large portion of our mortgage activity in purchases versus refinance, I believe the mortgage activity will be affected slightly by higher rates. But, consumers moving into Northwest Arkansas should continue to buy houses. That said, I believe higher rates could have an adverse impact on commercial and retail activity,” Rivaldo said.

Gibson said higher rates by the second half of 2015 will limit a consumer’s ability to sell their property and move up, even if their home values continue rising modestly.

BANK NUMBERS – JAN.-JUNE 2014
Arvest Bank 
2014: $56.644 million
2013: $59.646 million
Return on Assets: 0.78%

First Security Bank
2014: $49.246 million
2013: $50.314 million
Return on Assets: 2.23%

Signature Bank
2014: $1.031 million
2013: $536,000
Return on Assets: 0.43%

Bank of Fayetteville
2014: $1.254 million
2013: $1.814 million
Return on Assets: 0.75%

Legacy National Bank
2014: $981,000
2013: $933,000
Return on Assets: 0.71%

Simmons First National
2014: $15.046 million
2013: $7.423 million
Return on Assets: 0.86%

Chambers Bank
2014: $2.149 million
2013: $3.383 million
Return on Assets: 0.56%

Pinnacle Bank
2014: $264,000
2013: $77,000
Return on Assets: 0.56%

First Bank
2014: $1.485 million
2013: $1.212 million
Return on Assets: 0.95%

Decatur State Bank
2014: $-444,000
2013: $-464,000
Return on Assets: -0.65%

Today’s Bank
2014: $1.194 million
2013: $675,000
Return on Assets: 2.36%

Bank of Gravett
2014: $659,000
2013: $139,000
Return on Assets: 1.06%

United Bank
2014: $816,000
2013: $955,000
Return on Assets: 1.18%

Parkway Bank
2014: $449,000
2013: $474,000
Return on Assets: 0.72%

First Western Bank
2014: $679,000
2013: $750,000
Return on Assets: 0.44%

The rash of earthquakes plaguing the state of Oklahoma have the state's governor and insurance head pushing for new regulations for insurance agents, but at least one local agent said any consumers fearing the big one should probably not worry.

The new emergency rule authorized by Gov. Mary Fallin, R-Okla., would require agents selling plans in the state, which could include Arkansas-based agents selling to consumers across the state line in Oklahoma, would require at least one hour of continuing education involving earthquake insurance every two years.

"This emergency rule will ensure insurance agents in our state stay up-to-date on earthquake information," Fallin said. "It's important as the market for earthquake insurance expands in Oklahoma that residents get reliable and accurate information from insurance agents to help them consider whether they need this additional coverage."

According to Michael McNutt, Fallin's press secretary, the new continuing education rule will affect any insurance agencies licensed to do business in the state of Oklahoma beginning Jan. 1, 2015, meaning many Arkansas agencies doing business over the border will be impacted.

Nathan Cooper, an agent with State Farm's Brad Scott Insurance in Fayetteville, said the rules will be new for many agents in the area since Arkansas has functioned like Oklahoma for many years, not requiring earthquake insurance education. Even though neither state has required the professional education hours in the past, Cooper said when customers have asked, he and others in his office have been educated on what are known as "riders" on homeowners and renters policies.

According to Cooper, while the frequency of earthquakes has increased in central Oklahoma with some even being felt as far away as Arkansas, there is not much reason for Fort Smith and Northwest Arkansas area residents to run out and buy a policy.

"I would say for my clients, 90-95% of them do not have earthquake coverage just because of the part of the state we live in and the threat is not imminent like it is in the eastern part of the state (near and along the New Madrid Fault Line)," he said.

For individuals interested in earthquake coverage, he said earthquake coverage is typically covered in most homeowners policies — at least the ones he sells through State Farm — and actually require a written opt-out form to drop the coverage from a typical homeowners policy. As a result, many times the issue is discussed with customers whether they inquire about coverage or not.

Cooper said the key to whether you might need to consider coverage in a non-seismically active area like eastern Oklahoma and western Arkansas is how your home is constructed. He said if a home is a typical frame home, there would be enough give to allow for swaying in the unlikely event of an earthquake. But for brick or stucco homes, or homes that are multi-story, he said it would not be a bad idea to keep the earthquake rider or add one if your policy does not already cover earthquake damage.

The total cost will run between $50 and $70 per year on average depending on the price of your home and the level of coverage. The deductible, he said, would also be a factor.

But even though local residents are not near active seismic zones, he said professional education like Oklahoma is mandating is not a bad idea since agents near seismic zones in central Oklahoma and eastern Arkansas need to be able to accurately discuss coverage and costs with customers.

"The closer you get to a real active fault, those (insurance) options (and costs) change," he said, adding, "The greater the risk, the greater the cost."

Oklahoma Insurance Commissioner John Doak echoed Cooper sentiments, adding that the continuing education requirement for agents like Cooper and others who may do business in Oklahoma was important for consumers wanting to know their options in terms of earthquake coverage.

Whirlpool submitted a proposed supplement to its Final Remedy Work Plan on Monday (Sept. 8) to the Arkansas Department of Environmental Quality that would add additional injections of chemical oxidant combined with soil removal to remedy an area near the northwest corner of the Whirlpool site where additional trichloroethylene (TCE) has been found.

The potentially cancer-causing TCE was used as part of a degreasing agent by Whirlpool until the 1980s at its now-closed Fort Smith plant. According to Kristine Vernier, senior manager of global public relations at Whirlpool, the supplement builds "on the remediation activities that are already underway.”

There are four areas of remediation activities proposed for a portion of the TCE plume known as "Area 1" that is found on the Whirlpool site's northwest corner. The first of the proposed activities involves removal of nearly 300 cubic yards of TCE-impacted soil using "large diameter borings.”

"This impacted soil will be properly characterized and permitted for disposal off site," according to a press release from Whirlpool. "Soil removal provides certainty regarding the effective removal of TCE impact in soil in Area 1 and the linear drainage area.”

Following the removal of the soil, Whirlpool's environmental consultants at ENVIRON propose placement "of crushed limestone backfill in the large diameter borings to increase the naturally low Ph of groundwater in Area 1 and the linear drainage feature to enhance natural attenuation of TCE in groundwater and provide a platform for potential future activities.”

Whirlpool has also proposed a third round of chemical oxidation injections that would take place at the northwest corner of the closed factory site and the drainage feature "via permanent and temporary injection points to remediate TCE impacts characterized in saturated soil and groundwater in the vicinity.”

The company said the supplement submitted to ADEQ on Monday was consistent with what was outlined to the Fort Smith Board of Directors at its July 8 study session. Whirlpool said the supplemental work would take place under the "Adaptive Remedy Approach" that is being used at the TCE plume site. The plume extends north of the Whirlpool site, under dozens of homes which have seen their values reduced by the Sebastian County Assessor's Office, some by more than 50%.

A class action lawsuit filed by residents in the area has seen an offer of settlement made to residents impacted by the contamination, though it is unclear how many have accepted the offer from Whirlpool that would recover the lost value of their homes.

The area of the TCE plume includes an area where the city of Fort Smith is about to commence work on a road widening project, with Whirlpool and the city agreeing to a donation of land and monitoring by the company of the TCE in the area.

"So we've drafted an agreement with Whirlpool that would give them access to the construction site if they need it. It would also require that if the city has to take extraordinary measures during the construction because of the TCE contamination, that Whirlpool would reimburse the city for the cost of implementing those measures to deal with the TCE contamination," City Administrator Ray Gosack told the Board at its Sept. 2 meeting, when an agreement between the two parties was approved by city directors.

Following a review of the proposed supplement, Whirlpool said the proposed remediation activities would begin.

"Following ADEQ approval, receipt of all necessary permits and mobilization of contractors, the proposed work will be implemented over a period of approximately 8 to 11 weeks," Whirlpool's press release said.

Mel Redman was the early face of the much-publicized effort by Wal-Mart Stores Inc. to return manufacturing jobs on the U.S., but his company faces a troubling hitch in plans by to make battery-operated ride-on toys in Redman & Associates spacious new assembly plant in Rogers.

Sales Chief, Redman’s Hong Kong-based manufacturing arm cut off the 60-day credit line with Redman and demanded full payment for the toys ordered for the holidays, according to a lawsuit filed by Redman in Federal court on Friday (Sept 5).

Redman was forced to suspend its small operation in Rogers until this matter can be resolved.

“This is a very sad day for Arkansas and for the many associates who dedicate themselves to bringing jobs back to America. Closing our upstart manufacturing program is something that was done only as a last resort,” said Mel Redman, chairman and CEO of Nuvzn Technologies, the parent company of Redman & Associates.

Wal-Mart seems undaunted by the action and released this statement through spokesman Kory Lundberg: “The circumstance in this situation appear to be specific to this manufacturer and its 3rd party supplier and it’s best for any comments to come from them. I will tell you that we are excited about the progress being made on our $250 billion commitment to support U.S. manufacturing and U.S. jobs. We continue to see growth in the number and type of suppliers who are bringing us products that support our commitment.”

Wal-Mart said it was not aware of any other similar problems with other onshoring efforts.

Redman was the first big announcement in Arkansas related to the Wal-Mart onshoring plan. Gov. Mike Beebe and then Walmart U.S. CEO Bill Simon were part of an Oct. 7, 2013, press event in Rogers announcing the deal. Beebe at the time credited Wal-Mart for stepping out to help facilitate suppliers and economic teams to make success stories like this happen.


DELIBERATELY TIMED DISRUPTION
Redman claims in the lawsuit that Sales Chief knew by breaching the 60-day payment arrangements the partners have used for the past two years it would disrupt the supply chain and hold ordered product hostage resulting in Redman’s inability to fulfill its large holiday orders to Wal-Mart.

The suit claims that Ellen Liu, executive director for Sales Chief, made clear her intention to derail the “Made in the U.S.” plan earlier this year. Between March and May, Sales Chief shipped $3.4 million of inventory to Redman in the U.S., but on May 24, Sales Chief revoked Redman’s credit terms requiring full payment of goods ordered, shipped and those in transit.

Redman said the disruption was deliberately timed. The company worked to gather money to get some of the product released but in so doing they depleted their working capital. He said the freight storage fees on inventory sitting in containers has already accrued to $1.4 million – product they don’t have access to but are billed for storage.

BACKDOOR MEETING?
The suit also claims that Sales Chief contacted Wal-Mart directly to try and sell the product, cutting Redman out of the transaction. Wal-Mart notified Redman of this backdoor meeting and invited them to attend, which they did on Sept. 4. However, on Sept. 5, Redman notes in the suit that Sales Chief had a meeting with Wal-Mart to which Redman was not invited. Wal-Mart would not comment on alleged meetings when asked by The City Wire.

“Continuing forward, we will put our focus on retail operations and supply chain logistics. Our current inventory and future sales projections should allow us to repay and honor our financial obligations to our lenders and the state going forward,” said Wyatt Watkins, chief financial officer of Redman & Associates.

For now the 275,000-square-foot Redman facility in Rogers is dark and 24 workers have been laid off.

Grant Tennille, executive director for the Arkansas Economic Development Commission, said the state did give Redman a few incentives to move their manufacturing operation from Shanghai to the Natural State. Those incentives included $2 million that goes toward building and equipment costs for Redman, and the Arkansas Advantage 1% state tax credit on wages paid for five years. In addition, Redman was to get a sales tax rebate on manufacturing equipment purchases relating to its startup.

Tennille said the tax credits occur retroactively. Redman said the incentive package helped to seal the deal, but some of the incentive money will have to be repaid if the contract terms are violated.

“We were informed that our company was the talk of China, and not in a good way. Our supplier’s unexpected departure from years of business dealings hurt the supply of goods to Wal-Mart. Unfortunately for the people of Arkansas, and especially our associates and their families, their underhanded strategy worked,” said Redman.

“Our plan is to do what we know best, which is providing quality goods to Wal-Mart at the best possible price for the consumer, as we have done for years,” Redman added.

Dried rice, soy protein, vitamins and minerals fed through a funnel collected in a plastic bag, weighed and sealed by volunteers might seem like an easy task. But it’s also how The Pack Shack, a local charity, is working to stamp out hunger one party at a time.

On Sunday (Sept. 7), roughly 50 volunteers from Sam’s Club in Bentonville, stayed after hours to pack 10,100 meals that will go to the Samaritan Community Center in Rogers. The 25-cent per meal cost was donated by Sam’s Club as was the labor for filling the bags. They completed the task in about an hour’s time, working together in five different task teams.

Bret Raymond and Jarod King, co-founders of The Pack Shack charity, each spent time in Rwanda and have worked with the World Health Organization to configure the most efficient and nutritious food packs that only requires added water.  Raymond said each pack is carefully weighed to make 16 servings and when mixed with water and the rice protein meal cooks in 20 minutes. He said each bag is heat sealed and will last up to two years in storage.

Sam’s Club Manager Jason Schwindt told The City Wire he had no trouble getting volunteers for The Pack Shack party event. 

“Some stayed on past their shift. Others came in with their kids on their day off to help us pack these meals for the Samaritan Community Center food pantry,” Schwindt said.

He said the local club also provides soon-to-expire meat and bakery items to local food pantries. Sam’s Club gave $72.81 million last year to charities and organizations around the state.

Raymond said the local charity works with Sam’s Club when it hosts events in other cities such as a large event it’s holding for Tyson Foods in Iowa in the few weeks.

“Sam’s is great to work with because they let us order the rice through their stores in areas where we are going to be. We just pick it up there and don’t have to haul it,” Raymond said.

Another major perk when working with Wal-Mart Stores and Sam’s Club are the VAP money rewards that come in the form of a check payment after the event has taken place. VAP – Volunteering Always Pays – is a cash donation for each hour a employee donates to helping a charity.

“We just got our first VAP check and were blown away. It’s a great concept,” Raymond said.

The idea for The Pack Shack “Feed the Funnel” parties comes from similar events hosted by the World Health Organization on a global scale. Raymond said his business partner tried get a local chapter of that organization in Northwest Arkansas to no avail. 

“They just kind of laughed at us,” Raymond said.

But Raymond noted that hunger and food insecurity is a real issue in Arkansas and in Benton and Washington counties.

“Many people don’t know that Arkansas is at the worst when it comes to food insecurity in children and senior citizens. In the U.S. there are 50 million people who are food insecure — that’s one in six. In Arkansas it’s one in five people. Among Arkansas kids it’s one in four and in Arkansas seniors it’s one in three,” Raymond said

He adds that single moms have a 30% chance to face food insecurity at some point in the year.

“We have seen that plenty of folks in this region want to make a difference. We are on track to pack and donate roughly 2 million meals in our first full year of operation ending March 2015,” Raymond said.

He said it takes just four things to host a feed the funnel party — space, tables, people and 25 cents a meal donation, which includes the food, packaging and administrative costs. Raymond said the party sponsors can chose the charity they want their effort to support which keeps the food local in most cases. He said their lean team is looking to host more Feed the Funnel parties before the holidays. For a look at a party event visit this link.

There’s a major shift underway in how health insurance costs will be covered as corporations are transferring more of the burden toward employees. Higher deductibles, spousal surcharges and reduced availability for retirees have become the new reality for millions of Americans since The Affordable Health Care Act – aka, ObamaCare – become law.

The annual survey of Towers and the National Business Group found that 80% of the 1,000 employers surveyed in 2012 said they will continue to raise the share employees pay for their health care over the next three years. A recent report by the Kaiser Family Foundation states the cost of medical care per-person in the U.S. $13,700.

The average cost for health insurance benefits was $2.36 per hour worked in private industry according the March report from the federal Bureau of Labor Statistics. That represents 7.9% of total compensation. In March 2004, employer costs for health benefits averaged $1.53, or 6.6% of total compensation.

Employee share of premiums increased 8.7% between 2012 and 2013 with the dollar burden rising from $2,658 to $2,888, according to the Towers survey. Employees contribute 42% more for health care than they did five years ago and out-of-pocket costs are up 15% over the past two years. Meanwhile, annual incomes rose just 1.6% over the past three years, according to the Towers report.

In addition to funding less for employees, corporations are also implementing surcharges for spousal coverage averaging $100 per month. About one-third of the companies surveyed by Towers already do this. Employer subsidies for retiree medical coverage have declined with just 15% of those surveyed still covering it.

Jennifer Parks, owner and broker of Fort Smith-based HealthPointe Insurance Services, said the small groups she represents have seen between a 7% and 15% premium increase for 2015, with the average being 8%. She said this is lower than the standard 12% increases employers faced each year over the past decade, which many times were not fully passed on their employees.

“Some folks are experiencing sticker shock this year, especially those coming from employer-sponsored group plans into individual plans. I gave a quote to a lady last week who said to that the price was anything but affordable, like the law claims,” Parks said.

Higher prices also are hitting public sector workers around the nation – especially teachers.

“Our teacher insurance doubled for the same type of coverage we had last year,” said Kathy Whitfill, a teacher in east Texas. “It will cost us $1,000 a month for a family of three to be covered this year.”

Parks said teachers in Arkansas have experienced similar shock, in part because that demographic has proven to be frequent users on a national scale. 

An Arkansas-based media company recently told its 2,600 employees they would have the choice of two plans. The self-insured group offers a basic plan with 3,000 annual deductible and a premium option with 1,000 deductible, prescription benefit and doctor copay. The cost increase for the premium plan rose more than 200% for this coming year. The standard plan rose modestly. 

Parks said employers are asking their employees to make a choice: pay more if you want all the benefits or pay less if you don’t. She said those who are frequent users of prescription cards and doctor copays should pay more for that benefit. Under the previous system, Parks said frequent users hiked up the costs for everyone in the group. This new model is a more practical solution.

HIGHER DEDUCTIBLES
Parks said companies and individuals have moved toward higher deductibles for the past few years to keep monthly premiums affordable. But this has raised concern among health providers and consumers.

Don Gibson, CEO of Legacy National Bank in Springdale, said higher health care costs are ever present on the minds of small business owners he speaks to regularly. He said many of them are shifting more of the cost burden toward the employees who are choosing high deductibles.

“I expect to see more consumer bankruptcies as an indirect result of higher health care costs in the future,” Gibson said.

Kaiser found that higher deductibles are more popular than ever. Employers like higher deductibles because it requires employees to be careful about how they spend their heath care dollars. 

Mike McCurry, chief operating officer of Mercy Health, said during a June meeting in Rogers that more large employers such as FedEx Corp., Home Depot and Walgreens as are making radical changes to their plans, eliminating health care options for retirees and non-spouses and raising the minimum deductibles to keep costs down.

“The biggest growth area impacting Mercy’s charity care fund are insured people who can’t afford the deductible. We are seeing $5,000 deductibles and higher among people who need to have a procedure but are not able to cover that on the front-end. Mercy has had to help patients set up payment plans to payout the deductible after the procedure has been performed,” McCurry said.

The other dynamic at play is that insured individuals are being advised to have tests and procedures but do not have them because they can’t meet the deductible.

“This is of great concern, because it will likely come back to haunt everyone,” McCurry said. “Patients are also shopping services like never before, looking for lower cost alternatives. As Mercy moves more of the diagnostic testing and procedures out of its primary care clinics the cost for customers will go down.”

He estimates that will sting Mercy’s annual budget by $30 million a year. McCurry said Mercy’s systemwide budget is operating on $120 million less revenue coming into this year as a result of the Affordable Care Act and the reduced payments. The cost of treating the uninsured is expected to be $17 million this year for Mercy Health, he said.

INNOVATIVE SOLUTIONS
Companies across the country are finding unique new ways to help reduce their own costs and assist their employees with added cost burdens.

Wal-Mart Stores plans to open 12 in-store clinics this year, bringing lower cost heath care to its employees and shoppers in select markets. Rogers is one of those test markets. Why the clinics? The retailer is facing $500 million in added health care costs this year as a result of the Affordable Health Care Act.

Former Walmart U.S. CEO Bill Simon has explained that when a Walmart worker visited a doctor they paid a $20 copay and the company wrote a check for $120. He said the in-store clinics will allow Wal-Mart to better control those costs and reduce copays to $4 for its insured workers and dependents, and $40 for customers. The first clinics opened in Texas earlier this summer and are doing well, according to Wal-Mart.

Siloam-Springs-based Simmons Foods has used a similar system for several years and said it has brought down the cost of its insurance overall.

WEHCO Media, the parent company of the Arkansas Democrat-Gazette, recently told its employees that its own credit union would be available to make loans to those who need help with their deductible ahead of medical procedures. WEHCO officials did not return The City Wire’s request for further comment about this service.

COST UNCERTAINTY
Parks said there are some opened-ended costs associated with the new law which have insurance companies scrambling to try and gather enough premiums for possible exposures. She said under the new law the basic plan offers an annual routine exam, one mammogram a year and a colonoscopy every decade, as well as an annual eye exam with no out-of-pocket costs to the insured. She said older plans sometimes capped these wellness benefits, but there is now no cap.

No limit policies and the “habilitative” care requirements create uncertainties on the part of insurance companies, she said. Habilitative care, Parks explained, is treatment, medicines and therapies never before covered. For instance habilitative treatment could help someone born blind get their sight, or provide therapy for a person born lame to learn to walk. Because such treatments have never been covered it is difficult to gauge what the cost will be, Parks said.

Executives with Wal-Mart Stores Inc. gathered Tuesday (Sept. 10) for a meeting designed to reinforce efforts to empower women like 20-year-old Avani Bhadra of India, and Veronica Moreno, a tortilla baker from Atlanta, Ga., and help them reach bigger dreams through their Women’s Empowerment initiative.

The retail giant held its first Woman’s Empowerment Summit in Bentonville to celebrate a three-year milestone toward three primary goals:
• Sourcing $20 billion of U.S. product from women-owned businesses;
• Double what is sourced from woman-owned businesses internationally; and
• Train almost one million women around the world by 2016.

“We met the annual goals in the first two years and our spending since then is $432 million ahead of our $20 billlion goal,” said MiKaela Wardlaw Lemmon, senior director for women economic empowerment at Wal-Mart.

Wal-Mart Stores CEO Doug McMillon opened the meeting noting that empowering women goes beyond making sound economic sense.

“It’s the right thing to do,” he said. “We know that women invest 90% of their income back into their families and communities supporting causes that matter like education.”

He shared a story of how the Wal-Mart initiative helped elevate a small sister-owned wine operation in South Africa. 

When Vivian Kleynhans was a child, the system of Apartheid law her and her siblings out of their small South African hometown. Twenty years later, the country’s changed political landscape opened doors for their dream of starting a business and now they produce wines not only sold in South Africa, but on two additional continents.

McMillon said working with Wal-Mart, Seven Sisters Wines now supplies products to more than 500 U.S. Walmart Stores. The wine products are imported by Heritage Link Brands, an African-American woman-owned company.
 
By investing in Seven Sisters, he said the investment is not only furthering the success of a woman-owned business – but also supporting growth in Africa.

WOMEN LEADERSHIP
Ryo Kanayama, senior vice president of corporate affairs for Walmart Japan, attended the meeting via webcast. He said women are under-utilized assets in many countries around the world.

David Cheesewright, CEO of Walmart International, agreed, saying businesses are the most successful with they connect the “heart with the head.” He said it doesn’t take a grand scale program to make a difference.

Cheesewright said he is proud of efforts by Walmart Canada to increase its number of women managers all because someone inside expressed the idea. He said a team worked on a game plan and within two years the number of women managers in Walmart Canada has risen from 17% to 26%. In Chile, the same program has helped increase the number of female managers from 35% to 70%. Cheesewright said when it works in one country the other markets will adopt quickly.

Wal-Mart also notes that it has double the female corporate officers — executive and senior vice presidents — than the Fortune 500 average. Female U.S. store managers have risen to 27%, up from 18% in the past years.

WOMEN SPEAK UP
Valerie Jarrett, a senior advisor to President Barack Obama, was in Bentonvillle for the Wal-Mart event. She shared a story illustrating how important it is for women to let their bosses know when they must wear the mom hat.

Jarratt said years back when she worked in the Chicago government she was called into a meeting in the mayor’s office with the another female, a member of his corporate council. 

“He was talking and we were both looking at our watches. He asked what we were doing because we were both so distracted. In a moment of courage I spoke up and told him that the Halloween parade started in 25 minutes. To which he answered, ‘Then what are you doing here,’” Jarrett said.

She said from that moment on she was loyal and hardworking as ever because he understood and appreciated her position and respected her needs.

“I would say to working moms today to make sure you have the courage to speak up and make your needs known. If your boss doesn’t respect them then you might want to find another place to work,” Jarrett said.

FAMILY SUPPORT
Avani Bhadra knows all about standing up for her needs. The 20-year-old began working outside her home in Anhar, India, to support her three sisters and a younger brother, her parents and her grandmother.

Bhadra traveled to Bentonville for the Women’s Empowerment Summit though she does not speak English. Through an interpreter Bhadra said it was her mom that encouraged her to take a job outside the home, an act rarely practiced by unmarried women in her village.

She said economic times were bad and she was glad to take work at Wellspun, a Wal-Mart supplier near her home. Two years ago she began as amachine operator but was quickly promoted to a supervisory training role.

“I never saw myself working for a large corporation, but others have believed in my potential and are helping me to realize bigger dreams. Now that I am working, others in my immediate community are following along. I also have risen to a higher status in my family and I have a bigger voice in family decisions,” Bhadra said through the interpreter.

In five years Bhadra said she hopes to be married, working toward a college degree and moving higher up within the company. She said the job helps her reach her dreams and provide a better standard of living for her family. By teaching others the skills she’s learned, Bharha said she’s passing that legacy on to help lift her entire village.

WAL-MART LEVERAGE
Kathleen McLaughlin, president of the Walmart Foundation, told The City Wire one of the reasons she joined Wal-Mart was because of the massive scale of Wal-Mart and its ability to impact real change around the world.

“One of my personal passions is the role of the private sector in the role of development. I have been working in that space for many years. There is no better place to do that from than Wal-Mart. ... To see Wal-Mart making as much of a difference as say a Gates Foundation in certain areas of development is powerful. We can take what is intrinsic to us — the purchase order — which is really a powerful tool and quite different from aid. While aid is important, so are our purchase orders. We are using the purchase order as means to elevate women who then invest back into their communities. It’s economic development,” McLaughlin said.

She said the training piece of the commitment is also critical because it allows entire regions to benefit. One example given during the event was the training of 500,000 women farmers working in emerging markets around the globe. In China, for instance 70% of the apple crop is planted and harvested by women. Bhartra was one of the 32,400 women to receive workforce training as the company works toward its 60,000 goal.

While the Walmart Women’s Empowerment campaign is global in nature there were also some U.S. results spotlighted at the meeting.

Veronica Moreno, CEO of Atlanta-based Ole Foods, was invited to attend the Bentonville event. Moreno said she began selling tortillas on street corners after purchasing her first press in 1988. The business, grew slowly with regional sales until she became a Wal-Mart supplier. Since that time Moreno has expanded into 3,000 U.S. stores and she employs 1,000 workers, and 50% of them are women.

Wal-Mart has roughly 1,000 suppliers who made their way on to the retailer’s shelves through the women-owned business initiative. Women-owned businesses contribute more than $1.3 trillion dollars to the U.S. economy and women are responsible for more than 80% of the consumer decisions globally, according to figures provided by Wal-Mart.

Ground was broken on a fourth Centennial Bank location at 5801 Rogers Ave. on Tuesday (Sept. 9), bringing an investment of more than $1 million to the local economy.

The 5,500-square-feet location is a relocation for a now-closed branch of the bank that had been located behind Chick-fil-A and Outback Steakhouse on Rogers Avenue, according to Centennial's Area President Greg Rotter.

"It wasn't an ideal location. It was hidden and a lot of people had a hard time finding it. So this location gives us a much better opportunity for visibility and accessibility for our customers," Rotter said, adding that the previous location had more space than the bank could make use of.

The bank's new location will be part of a development built on a former hotel at the site. Fort Smith-based The Westphal Group bought the 3.36 acres where the former Hometown Inn and Suites once stood in October 2013  for just under $1.5 million.

Rotter said the new branch will offer traditional retail banking services, such as new accounts, mortgage lending and commercial lending. Any new services, he said, could come at a later time.

"There are things that I'd love to do in the future. Right now we just want to get this one open, make it a success and look to see what we can do in the future to continue to help us grow in the market."

With the new Rogers Avenue location, Centennial's portfolio of bank branches in Fort Smith and Van Buren will grow to four, along with a drive-thru location on Boston Avenue, Rotter said.

Fort Smith Mayor Sandy Sanders said at the groundbreaking Tuesday that banks like Centennial making an investment in new branches and loan offerings are part of what is driving job growth in what had been a depressed Fort Smith job market only a few years ago at the height of the recession.

"A financial institution like Centennial Bank does not make this kind of investment, this kind of a commitment to the community unless they do have confidence in how we're growing, how we're moving forward," he said, pointing to the more than 2,000 jobs announced in the Fort Smith region in the last two years.

Centennial Bank's North Arkansas Regional President Davy Carter said part of the investment in the building of a new branch — which he told The City Wire was an investment of more than $2 million — was due to the great success story of the branches already operating in the Fort Smith region and the growth of new and existing businesses in the Fort Smith market, adding jobs, retail dollars and a population in need of banking services.

"Those kind of announcements you have with jobs and all the great economic activity that's going on in Fort Smith, you ought to be very proud of that. Indeed, that's part of the reason why we continue our investment here in Fort Smith," Carter said.

He added that Centennial's parent company, Home Bancshares of Conway, is a $7 billion bank that is making decisions locally and investing in cities across the state, like Fort Smith.

"They are making decisions right here in Fort Smith, Arkansas," he said. "You have loan decisions right here in Fort Smith, Arkansas. You can have an $80 million loan credit and it won't get out of the state of Arkansas. We make the decisions, they're local decisions. We believe in that. They're local people. We give them the ball and we let them run with it."

Home Bancshares/Centennial entered the Fort Smith market with the more than $280 million acquisition of Jonesboro-based Liberty Bank. The deal, announced in June 2013, closed in the fourth quarter of 2013.

Rotter said even with increased regulation of the banking industry through federal legislation like the Dodd-Frank Act, Centennial has been able to adapt and grow in recent years.

"We're still going at a good clip. Obviously banking has changed a lot in the last few years and it change sometimes it feels on a daily basis, but we've adjusted well and everybody learns and adjusts on the fly. But as far as our service and our ability to do loans, it hasn't hampered that. We handle it the best we can."

He added that the new branch would employ between 10 and 12 staff, with many of those having come from other branches including the closed branch behind Chick-fil-A. Rotter added that two to four new staffers could be added to the new branch.

Construction is scheduled to be completed in March 2015, with a grand opening planned for April 2015.

Centennial Bank's reported income of $57.522 million for the first half of 2014, an increase from $36.443 million during the same period of 2013. It reported total assets of $6.749 billion.

The share price of Home Bancshares closed Tuesday at $30.25, down 45 cents. During the past 52 weeks the share price has ranged from a $38.98 high to a $27.10 low.

The Fort Smith Board of Directors received an update on the effort to update the city's comprehensive plan that has been underway since last year. Senior Associate Silvia Vargas of consulting firm Wallace Roberts & Todd said the comprehensive plan update was scheduled for completion later this year.

"We are in the process of getting the policy framework completed. Yesterday, we had a meeting with the (Comprehensive Plan) Steering Committee in which they reviewed the first completed draft of what we call the policy framework. They're taking it all into review more carefully, getting feedback from them and in a couple of weeks, we will be starting to put flesh on the bones of that framework and adding all the other pieces that will be a part of the comprehensive plan."

Brian Traylor, also of WRT, said the policy framework contained four sources — retaining and enhancing community character and quality of life; promoting sound growth and development; growing and diversifying the economy; and uniting people, institutions and government.

"The Steering Committee has approved in its current format the policy framework. They spent the last two months going through each policy, each goal, each action and its based off of four sources," he said.

Within the frame work are seven different focuses that Traylor said would work together to move the four policy framework sources forward.

Following are excerpts from Traylor's discussion with the Board on each of the seven focus areas included within the policy framework:
• Future land use: "It's about creating more livable and walkable centers, understanding the growth and that residential development and commercial development happen consistently, and taking the time to prioritize different centers."

• Economic development: "One of the issues is the growth trends that we identified is fairly monotonous … or (has a) lack of diversity. So one of the key things also with the economic base is (it needs to be) diversified, as well. Maintain the manufacturing economic base, but look at more information and connections with the university to get a little more cutting edge (economic development."

• Housing and neighborhoods: "Balancing the preservation of the existing neighborhoods — there's a lot of great neighborhoods in the city. … There's talk of maintaining those neighborhoods and protecting them, but also identifying new opportunities for redevelopment and infill."

• Community and character design: "Improving aesthetics. I know the city is already doing that with beautification and this is just to try to reinforce that, but also look at identifying or promoting more of a community for the city as a whole but also there's a language in the policy framework talking about neighborhood identities and trying to bring about that identity within communities in different parts of the city."

• Transportation and infrastructure: "Maintain and enhance is the theme of this. The city has been addressing access issues, but there's always room for improvement and not just for vehicular traffic, but to make places more walkable, more bikeable."

• Public facilities and services: "I think the Future Fort Smith community engagement process that's been going on for the last year is sort of setting the stage for a different type of dialogue between residents and maybe more of a community-based vision and maintaining that connection between what the city's doing and what the plans are and relating that back to the city through things like FutureFortSmith.com and the community forums that we've been taking on."

• Natural and cultural resources: "Talking about how the environment can play a role for parks and recreation, but also as an environmental and natural resource and in terms of infrastructure for the city in terms of green infrastructure throughout the city."

Steering Committee Co-Chair Galen Hunter said the committee is still at work even though much of its work is drawing to a close.

"Some of them got combined together, a lot of them reach across different goals that we do and we'll make sure we've got them slotted in the right places. We're still looking at some actions that will go with these and how we track those actions so that we know that the plan's successful."

Vargas said it is her intent to have a final version of the comprehensive plan update available for a vote of the Board of Directors before the end of the year. (Link here for a PDF – large file – of the working document.)

In other business, the Board received an update on a planned $2.8 million Riverview Hope Campus to be built at 301 S. E St., southwest of the heart of downtown Fort Smith. Debbie Everly, director of homeless programs at Riverview, said the proposed center would initially be able to house up to 75 individuals and would feature on-site medical clinics and continuing adult education provided by the Fort Smith School District.

A capital campaign is underway, Everly said, with Kansas City, Mo.-based Hartsook Companies working with the group as a fundraising consultant.

The project is expected to receive a $225,000 bridge loan from the Fort Smith Housing Authority, as well as a five-year, $500,000 bridge loan from First National Bank of Fort Smith to help get the project off the ground once pledges are in-hand, according to Fort Smith Housing Authority Executive Director Ken Pyle.

The Board also discussed creation of a beautification commission and will vote on its formation and appointments to the commission at future regular meetings of the Board.

The amount of land to be purchased for a voter-approved, bond-financed $20 million county jail facility in Crawford County could be growing in size if a plan discussed at Tuesday evening's (Sept. 9) Jail Committee meeting is approved by the full Quorum Court at its regular meeting next week.

According to Justice of the Peace Lloyd Cole, chairman of the Crawford County Quorum Court's Jail Committee, the county already has under contract an agreement to purchase about eight acres of land along U.S. Highway 64 just outside of the Van Buren city limits for about $275,000.

A landowner to the east of the land under contract has made an offer to the county to sell it another 7.66 acres of land, Cole said.

"The purpose of the meeting is to explain to the JPs the proposed site that we want to purchase that we told the voters. And we have an opportunity to buy 7.66 acres to the east for the amount of $191,000, which I think is a bargain and it is within our budget," he explained. "The $20 million construction cost, it is within that budget to spend up to $450,000 for land purchase. So we can buy that without having to increase any costs.”

According to Cole, the landowner had originally planned to build at least one subdivision on the land tucked between Interstate 40 and U.S. 64, but the selection of the adjoining property by the county for the voter-approved jail project scuttled the developer's plans.

"The owner of this was going to build subdivisions and said, 'Hey, my plans to build houses is not going to be very good with the jail right next door. Why don't you guys buy the whole thing from me?' So, he's given me a good price and we have under contract pending Quorum Court approval to go ahead and buy that 7.66 acres.”

The land will allow the county to more easily expand the jail if needed in future decades, according to Cole, who showed the land that was already under contract would have been usable but would have required more dirt and fill before being usable and could have run up a higher total cost on future expansions.

"It'll cost that much just to prepare that land for a (future) structure as (we're paying for) the land we're trying to buy right now," County Judge John Hall interjected.

He also said expanding the jail to the west of the proposed jail on land the county had already planned to buy would have made prisoner escorts through the facility more dangerous since there would not be a direct link between the sheriff's intake center and any future expansion without first having to go through the original jail. Having the additional land will allow the county to build any future expansion closer to intake and reduce the distance inmates would have to be transported.

"If you're bringing a prisoner in, you've got to escort through one controlled facility all the way to get to another facility. Well, as someone who's escorted inmates before, you don't want to escort them any further than you have to. You have a lot of things going on," Cole said.

"You've got a control center right here with 350 inmates. There's a lot going on. I don't want to have to transfer them through there. If we come up and make a 'Y' through here, we can purchase this over to the east – the wagon wheel, we call it – and at some point add another facility right here.”

Cole said any expansion of the new facility would likely not take place for another 20 to 30 years since the new facility in the planning stages is expected to meet the county's capacity needs for at least the next two decades or more. And while planning is taking place to ensure enough space is available for future growth of the jail, Cole said enough land would be purchased so other county offices could relocate in future years.

"You know, we used to be proud of the fact that we have the oldest operational courthouse west of the Mississippi (River). I'm not so sure (that's) something to be proud of. We've got an old building we've got to keep maintaining. At some point, they (may) want to build a new courthouse over here. They may want to move all the county government buildings in this area. You know the jail can expand right here, but we still got all this. So at some point, we consolidate all the county government building in one location. It's right between Van Buren and Alma.”

Hall said bonds sold last month are scheduled to be released to U.S. Bank as trustee for use by the county on Sept. 24, with closing on the purchase of the two properties on U.S Highway 64 scheduled for Sept. 26.

He added that bids on the project are expected to be let in December, with construction on the new jail beginning in late January or February with a scheduled completion within 18 to 20 months.

The Crawford County Quorum Court will vote on the land purchases at its Monday (Sept. 15) meeting.

Wal-Mart toy buyers said kids’ tastes are changing and they’re gambling on 20 top picks that show an appetite for imagination and creativity.

“The kids surprised us this year with their changing tastes in toys, but we were ready to react to their feedback,” Anne Marie Kehoe, vice president of toys at Walmart U.S., said Tuesday (Sept. 9) during a presentation at the Walmart Supercenter on Pleasant Grove Road in Rogers. “When we saw specific trends emerge, we worked closely with our toy suppliers to make sure we were stocking our toy shelves and e-commerce distribution centers with the items kids really want this holiday season.”

That said, classics like Barbie accessories, Little People play sets and Hot Wheels also got votes of kid approval this year.

This is the second year Wal-Mart let kids weigh-in on their buying decision from suppliers. In February, former Walmart U.S. CEO BIll Simon said the entertainment segment which includes toys, posted a mid single-digit negative comp during the first quarter of fiscal 2015 which included the 2013 holiday season.

He also said the retailer grew market share in toys during the 2013 holiday season, which he attributed to the “Chosen by Kids” program and a strong Black Friday event. The new management’s emphasis on increasing sales and reducing excess inventory puts mounting pressure on buyers to get the toy mix right given the vast majority to annual toy sales occur between Black Friday and Christmas Eve.

To encourage early shopping the retailer said it’s kicking off the holiday layaway option in stores this Friday (Sept. 12). Wal-Mart also said all 20 of the kid-approved toys would be covered on its Savings Catcher program beginning Wednesday (Sept. 10).

THE TOP TOYS
Kehoe unveiled the top 20 kid-approved holiday toy list today before a dozen of area school children invited to the Pleasant Grove Road Walmart Supercenter by the Salvation Army.  Lt. Curtis Sadler of the local Salvation Army said the children were selected from the Fayetteville and Rogers school system and regularly take part in Salvation Army programs.

“They had no idea why they were invited to the store after school today,” Sadler said.

When Kehoe pulled back the curtain to unveil the toy display she told the kids they would each take one toy home for an early holiday gift. She said focus groups of children made their favorites clear. Wal-Mart groups the toy picks into five categories.

• Creativity
Spin Master Sew Cool Sewing Machine
Moose Toys Beados
Maya Group Make Your Case Cell Phone Cover Kit
Kehoe said creativity crafts are one of the fast growing toy categories at Walmart.

• Movie/TV fans
Jakks Snow Glow Elsa Doll
Just Play Doc McStuffins Get Better Talking Mobile
Disney Palace Pets Magic Dance Pumpkin
Licensed toys from Frozen and Doc McStuffins topped the favorite list, Wal-Mart said.

• Ride-on scooters, racers
Razor Crazy Car Spinning Go Kart
Based on last year’s sales Wal-Mart said it added this category for the focus groups and the kids picked the Razor Go Kart.

• Electronics
Spin Master Flutterbyte Light Up Fairy
Spin Master Zoomer Dino
Leapfrog Leap TV
Vtech Kidizoom smartwatch
Hasbro FurReal Friends Walking Pup Pet
Spin Master Air Hogs Zero Gravity Laser Racer

• Throwback classics
Mattel Hot Wheels Street Remote Control Flying Car
Nerf N-Strike Elite Demolisher 2-in-1 Blaster
Zing Airstorm Firetech Bow
Vtech Go! Go! Smart Wheels Amazement Park Playset
Mattel Barbie Glam Camper
Mattel Hot Wheels Track Builder Turbo Takeover
Fisher Price Little People Musical Preschool

TOY WOES
One local toy supplier Redman & Associates had planned to sell ride-on toys in Wal-Mart this holiday season. Last year, Redman sold 1.1 million battery-powered ride-on toys in the United States as made in China. A recent dispute between Redman and his China manufacturer Sales Chief has rendered Redman unable to take receipt of some $10 million in inventory headed to retail shelves for the holiday.

Wal-Mart has declined to say whether it will have Redman-assembled ride-on toys in its stores this holiday season, but there were several models on display at the Walmart Supercenter in Rogers at Pleasant Grove Road on Tuesday.

Redman has sued its Chinese manufacturer in federal court for $20 million in damages from the supply chain disruption for its products.

CEO Mel Redman said he expects to continue providing Walmart with toys, but did not disclose where or by whom they would be manufactured.