February was another cold and snowy month but homebuilders were able to ramp up their permit paperwork in the region’s four largest cities. Springdale, Bentonville, Fayetteville and Rogers issued new residential permits valued at more than $30.418 million last month, up 5.3% from $28.881 million the year ago period.

Last month the combined cities issued 129 permits for new single family homes planned. This was stable against the 125 permits issued a year ago. However, permit activity was up 84% from the previous month.

THE NUMBERS
Residential Permit Values (February)
Bentonville: $12.801 million, up 18.6%
Fayetteville $8.075 million, up 27.6%
Springdale: $6.324 million, up 13%
Rogers: $5.155 million, down 16.5%

The recent Skyline Report sponsored by Arvest Bank indicates the supply of new, completed homes in the two-county area shrunk by 60% the back half of 2013 amid steady buyer demand.

“The balance between absorption of the existing houses in new subdivisions and the small increase in building permit activity across Benton and Washington counties is exactly right,” said Kathy Deck, lead researcher for the Skyline Report at University of Arkansas. “We are seeing the market move forward without undue concern with oversupply that we have seen in the past.”

Deck said the level of new construction is appropriate to the level of growth in the area.

“This shows us that we are sustaining reasonable growth," she added.

This is good new for homebuilders and their suppliers who have managed to stay busy, particularly in Benton County because of pent-up demand for new home construction. 

CONTINUED REBOUND
Murray Mansch, owner of Flooring America stores in Springdale and Bentonville, said his business was up 15% last year and it continues to rebound from the major housing bust eight years ago.

“About 40% of our business is new home construction. ... We are seeing smaller builders who sat out for a while rekindle their business and others expanding the number of homes they are starting from pent-up demand,” Mansch said. “As home values are coming up, we are also seeing more remodel business that includes new flooring.”

He estimates his own business will grow another 15% this year after recent meetings with his largest homebuilding customers. He said lumber prices are holding steady despite the uptick in demand. Mansch said freight on flooring materials is a big part of the overall costs. He said wood flooring is the most popular choice today and most of it is harvested in the U.S. and shipped to China for manufacturing and then shipped back as wood flooring.

COMMERCIAL WORK
The four cities issued just two new commercial permits between them last month totaling $2.495 million. The number follows an active January with several large permits totaling $25.9 million. New commercial permits declined 49% from the $4.898 million reported a year ago, among the respective cities.

On tap in Fayetteville is a new Slim Chicken’s Restaurant at 3562 Wedington Drive. In Bentonville, Walgreens cleared the way for a new pharmacy located at 1311 S. Walton Blvd., directly across from the new Wal-Mart Convenience Store and gas station.

Local experts expect the commercial sector will pick up steam this year following on the heels of robust residential activity over the past two years.

NanoMech in Springdale broke ground Monday (March 31) for its 25,000-square-foot expansion to its manufacturing research site. The company plans to add between 25 and 50 new employees to its payroll once the project is completed by late summer.

Numerous companies have recently filed permits with the state health department for new projects or expansions of existing businesses. These permits typically precede city permits by two or more months. Legacy National Bank filed a permit for a new 6,500-square-foot banking center to be located 4901 W. Pauline Whitaker Parkway, next to Chuy’s Restaurant in Rogers.

CEO Don Gibson said the bank recently acquired the property from Hunt Ventures and has received approval from the Office of the Comptroller of the Currency to relocate a small branch office in Pinnacle Hills, near Cross Church to the new financial center.

“This new banking center will provide a full range of services like our Joyce Street location in Fayetteville and our flagship bank in Springdale. We plan to break ground in mid-April and expect the bank to be completed by September by Milestone Construction,” Gibson said.

Other Benton County projects include:
• Twin Peaks Restaurant, Promenade Boulevard and Bellview Road in Rogers;
• Maria’s Supermercado, 2503 S. Walton Blvd., Bentonville;
• Advance Pierre Foods, 5507 Walsh Lane, Ste. 201. Rogers;
• The Ice House, SE 5th Street and SE E Street in Bentonville; 
• Walmart Neighborhood Market, 935 S. Holly Street, Siloam Springs;
• Walmart Neighborhood Market, 240 Slack Street, Pea Ridge; and
• Thrive Bentonville, multifamily complex, 401 SW.A Street, Bentonville.

Washington County projects include:
• Regal Nails, 4870 Elm Springs Road, Springdale;
• Springdale Parks Improvements, new park near Butterfield Coach Road, Springdale;
• Wood Stone Craft Pizza, 5575 School Ave., Fayetteville'
• Mr. O’s Nutrition Smoothly Bar, 3980 W. Wedington, Suite 11, Fayetteville; and 
• Walmart Fueling Station, Elm Springs Road, Springdale.

A vote on unionization at one of OK Foods' local facilities will move forward on May 1.

According to Anthony Elmo of the United Food and Commercial Workers Union Local 1000, the National Labor Relations Board will oversee the unionization election for 55 maintenance and refrigeration workers at the company's Heavener, Okla., facility, one of three local OK Foods plants where UFCW officials are working with employees interested in unionizing.

UFCW Local 1000 President Ricky Burris said the company's employees deserved to be treated better by the company, one of many reasons the UFCW had pushed for a unionization vote.

"Their wages and benefits are sub-standard and they are joining together to get a fair deal from OK Foods," he said. "I'm proud UFCW is standing with these workers."

OK Foods has declined to offer comment on the May 1 vote.

A press release sent out by the UFCW on Monday (March 31) said workers at the Heavener facility requested UFCW assistance in December 2013 with a list of complaints including "low wages, expensive healthcare benefits, and unfair and unequal treatment at OK Foods' chicken processing plant in Heavener."

The request for assistance at the Heavener site came the same month that the union withdrew its request for a union vote at OK Foods' Fort Smith facility.

At the time, OK Foods said it was a sign that the union would not be able to secure the votes needed to enable workers to collectively bargain

“The withdrawal clearly indicates the Union did not have the support it needed to win the election,” a company statement said. “Management of the company is very grateful to its employees for their support and confidence, and is looking forward to working together to make OK Foods a great place to work.”

While the company was asserting a lack of support, it did not halt the efforts of the UFCW and company employees rallying the cause, who said withdrawing the request for a vote was due to other factors — mainly a result of the company providing the UFCW with a larger than expected manifest of employees in the run up to the planned vote, according to Elmo.

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

While a vote will now take place at the Heavener facility, what could happen at the Fort Smith or Muldrow, Okla., facilities is still anyone's guess, he said, adding that it is too early to tell what could happen.

"The (Fort Smith), Arkansas, plant is being run by a separate group of organizers," he said. "We've been working with some workers (in Muldrow, Okla.), but we're not at the point where we're ready to file for an election."

Union organizers for the Fort Smith facility declined comment for this story.

The NLRB-overseen election results will be known immediately, Elmo said, adding that the union and employees of the Heavener facility will be ready to negotiate employee demands with the company should the union vote succeed.

"We will probably send the company a letter the next day to see when they'd like to be available for contract negotiations. Then we'd have meetings with employees to voice their concerns and what they would like. They would appoint a bargaining committee. They will work with us and sit across the table from them (OK Foods officials) to negotiate the contracts with them. Immediately, we'll ask the company to come to the table."

Unionization itself is not uncommon within OK Foods' parent company, Industrias Bachoco, with more than 50% of its Mexican plants under union contracts. It is a reason Elmo told The City Wire earlier in March that there was hope that the company could be friendly to union efforts.

"(OK Foods is) a very successful company," he said. "It's part of why Bachoco bought them (in 2011). I don't think paying better wages is going to hurt this company. I think it helps. It will reduce turnover. Right now, this company blows through employees. They are constantly bringing in new help. My argument to this company would be if these people thought these jobs were better and more stable, the turnover would go down and you would see increased cost savings from that. From a corporate perspective, I would say they may want to give this a look."

Should the company choose to not enter contract negotiations, Elmo said Monday that the law would be on the side of the union and its members.

"We would rely on the law, the National Labor Relations Act. There are some stipulations about arbitration and mediation. If the company doesn't want to engage in negotiations, then we would follow the avenues the act allows."

Shares of Industrias Bachoco (IBA) were down nearly a tenth of a point at the close of business Monday, at $43.77 on light trading. In the last year, the stock has fluctuated between $30.19 and $46.16 per share.

Just seven of the 17 publicly held companies based in Arkansas enjoyed a share price gain during the first quarter of 2014, a reversal from the 13 of the 16 followed in 2013 that had share price gains for the year.

The biggest gainer in the quarter was Springdale-based Tyson Foods which saw its share price rise almost $11 to $44.01. The largest drop came from Bentonville-based America’s Car Mart which saw its share price fall almost 13% in the quarter.

The equity markets were just barely able to remain above water during the first quarter. The Dow Jones Industrial Average (DJIA) began the year at 16,441.35, and finished the quarter (March 31) just over 16 points higher at 16,457.66. And that increase was thanks to a 134.6 point rally on Monday. The DJIA was up more than 23% in 2013, rising from 13,412 points to end the year at 16,576.

The broader S&P 500 began 2014 at 1,831.98 and ended the quarter just slightly higher at 1,872.34. Bad winter weather, rate hike rumblings from a new Fed chief (Janet Yellen) and continued concerns with a labor market that struggles to find solid footing have been cited by some economists and market watchers for the relatively slow start on Wall Street.

THE UPS
Fort Smith-based Arkansas Best Corp. (NASDAQ: ABFS), the parent company of less-than-truckload carrier ABF Freight System, closed the quarter at $36.92, up 9.25% compared to the Jan. 2 closing price of $33.82. A return to positive earnings helped shore up the share price. The company reported Jan. 30 that 2013 net income was $15.8 million, much better than the $7.7 million loss in 2012 and the most the company has earned in a year since 2008. The per share earnings of 59 cents also blew past the consensus estimate of 47 cents per share.

Little Rock-based Bank of the Ozarks (NASDAQ: OZRK) ended the quarter at $65.92, a healthy 20.8% increase from the Jan. 2 closing price of $56.32. The banking operation reported Jan. 16 that full year 2013 net income totaled $87.1 million, a 13.1% increase from $77.0 million for the full year of 2012. The bank is on an expansion path, with its most recent acquisition being the $216 million buyout of Arkadelphia-based Summit Bancorp.

Harrison-based First Federal Bancshares (NASDAQ: FFBH) ended the quarter at $9.17, up 5.16% compared to the Jan. 2 closing price of $8.72.

Pine Bluff-based Simmons First (NASDAQ: SFNC), which also is expanding through acquisition, ended the quarter at $37.27, up 2.47% over the Jan. 2 closing price of $36.37. The bank announced March 24 that it entered into an agreement to buy Little Rock-based Delta Trust for $66 million.

Springdale-based Tyson Foods (NYSE: TSN) set a new 52-week high in the first quarter with a strong outlook for the full year. Tyson shares closed March 31 at $44.01, up 2% on the day, while soaring 32.6% in the first quarter. CEO Donnie Smith said the company is able to pass along higher operating costs to customers and is poised for another record year.

Despite troubles with revenue, Little Rock-based Windstream (NYSE: WIN) ended the quarter at $8.24, up 2.87% compared to the Jan. 2 closing price.

THE DOWNS
Seeing share price declines were Little Rock-based Acxiom (down 5.95%); Bentonville-based America’s Car-Mart (down 12.63%); El Dorado-based Deltic Timber (down 2.21%); Little Rock-based Dillard’s (down 4.59%); Conway-based Home Bancshares (down 5.33%); Lowell-based J.B. Hunt Transport Services (down 6.1%); El Dorado-based Murphy Oil Corp. (down 1.31%); El Dorado-based Murphy USA Inc. (down 3.14%); Tontitown-based P.A.M. Transport (down 4.19%); and Bentonville-based Wal-Mart Stores Inc. (down 3.14%).

J.B. Hunt Transport (NASDAQ: JBHT), the largest, most diversified logistics company in this report, saw its shares close the first quarter of 2014 at $71.92, up 2.79% on the day.  The uptick reverses a first quarter downward trend as the share price declined 6.1% from $76.60 where it began trading in 2014. Analysts with Bank of America recently downgraded JBHT shares from a “buy” to “hold” citing lackluster intermodal volumes related to winter storms around Chicago, a major hub for Burlington Northern Santa Fe.

Wal-Mart Stores Inc. (NYSE: WMT) closed March 31 at $76.43, up 42 cents on the day. Wal-Mart missed earnings expectations as did most retailers in the quarter, but analysts view Wal-Mart has a safe haven given its 2.5% dividend yield.

Shares of America’s Car-Mart Inc. (NASDAQ: CRMT) closed the quarter at $36.66, up 3.4% on the day. The Bentonville-based buy here, pay here used car dealer’s share price tumbled 11.8% during the first quarter from $41.96 where it closed on Jan. 2. Car-Mart has reported competitive pressures from an increase in subprime lending options.

Little Rock-based Dillard’s (NYSE: DDS) may have posted a price decline in the quarter but the company posts the highest share price with a quarter-ending mark of $92.40. However, the price was down from the Jan. 2 closing price of $96.85. As have many retailers around the country, Dillard’s has struggled with sales related to winter weather storms, and market watchers are expressing concerns signs the consumer is moderating spending habits.

Tyson Foods is on target to complete its $90 million beef slaughter complex update in Dakota City, Neb., by this summer. The plant slaughter floor overhaul began in 2012 and is entering the final stages, according to company officials.


The plant is the largest in the world in terms of the meat it packs, according to a report from the Sioux City Journal.

Two years ago, the meat company warned that operations at its Denison, Neb., plant could cease after the Dakota City project was finished. But according to the report, Tyson officials recently told their 380 Denison workers that conditions had changed and there now are no plans to close the plant.


The company said falling feed prices for cattle and other plant closures by competitors are creating more opportunities for keeping the Denison plant in operation.
 Tyson said it expects to hire about 200 workers for the expanded Dakota City plant, that already has an annual payroll of $140 million and nearly 4,000 employees.

A proposed $20 million development of the Fianna Hills Country Club is no more after developer Lance Beaty of Fort Smith-based FSM Redevelopment Partners pulled the project from consideration at Tuesday's (April 1) regular meeting of the Fort Smith Board of Directors.

“I believe we had the vote (to approve a zoning request needed for the project to proceed). But it’s not just about the vote. It’s a business decision. It’s mathematics. ... In a deal like this let’s say that 100 things have to happen in an ordered manner for this to transpire. We got to say, number 60 and determined that it was not a deal for us. It’s that simple. We’ve conducted due diligence on this for months, and our risk-weighted analysis is that it is not a deal for us,”  Beaty explained.

Beaty declined to comment about efforts in recent days to scuttle the project, saying instead that, “I may have some additional comments at the appropriate time, but before the vote, I think it unwise.”

Fort Smith City Administrator Ray Gosack said the Board could still take action on the issue. He said the Board could table it, vote on it as is, or amend it. Gosack said Fianna Hills Country Club Manager Jim Shields has asked that the zoning issue be tabled until the May 6 meeting. According to Gosack, Shields said that would give club owners time to determine if there is other interest in the property and to see if the zoning change would help with that interest.

Plans to redevelop the country club first came to light in November 2013 when Beaty confirmed that he and business partner Dr. Stephen Nelson were working with club owners David Mille and Jim Shields to purchase not only the club, but also the 18-hole golf course.

It was the second major planned investment for Beaty's company, which purchased the 35-acre site of the former Phoenix Village Mall when it was nothing more than a poorly-maintained site that included about 10 acres of structures. Since Beaty's purchase of the old mall site in January 2009, FSM Redevelopment Partners invested more than $10.5 million worth of improvements at the site, including a successful expo center that was open for about three years before closing to make room for a regional service center operated by Health Management Associates. In all, the former mall now houses more than 1,100 jobs.

CLUB CHANGES
The proposal from Beaty for the country club included the addition of guest suites for use by members and their guests, as well as the addition of a medical concierge service and other upgraded amenities. The country club would have also been gutted and rebuilt on its original footprint, expanding from a current square footage of 27,000 square feet to 85,000 square feet.

As part of the revamp of the club, FSM Redevelopment had developed a business plan that would have members joining the facility for a $30,000 fee that could be paid out over time, similar to the membership fee members of the club have already been paying. In order to make the club a reality, Beaty had said he would need about 500 commitments with individuals making refundable deposits of $1,000.

While there was some vocal opposition to Beaty's plan for Fianna Hills Country Club, things appeared to be moving in the right direction on March 11. It was on that evening that the Fort Smith Planning Commission approved a planned zoning district at the site of the country club by a vote of 9-0.

As the project moved closer to Tuesday's vote, more opposition started making their voices heard and left the project in limbo.

In statements to The City Wire published March 17, there was not a consensus among the Fort Smith Board of Directors on whether or not the PZD would pass the final hurdle of Board approval. Fort Smith Vice Mayor Kevin Settle said while he supported some aspects of the club, including the renovation and addition of member suites, he had about other uses included in the PZD.

"The concerns that have been brought to my attention by many citizens in the Fianna Hills area are the other potential developments that are being asked in the PZD. These other potential developments are something that I am going to research and get a better understanding on how they could affect the existing homeowner property values."

Fianna Hills resident Lisa Clay was among those expressing concern about the proposed uses within the PZD. Clay eventually launched a petition which garnered more than 200 signatures asking the Board to pass an amended PZD that would have removed several land uses.

Pat Ross, president of the Fianna Hills Property Owners Association, said a conversation with Beaty occured in which Beaty allegedly said he would turn the site into an office complex. Beaty said March 27 that Ross' allegations were "simply not true or is completely out of context."

CLUB CLOSING?
Clay said at the time that she would like to have a company come in and keep the country club just that, adding that she was aware of companies interested in purchasing the facility. But when reached for comment, Mille said no other buyers had approached him about purchasing the country club, which he said is heavily subsidized by his other business ventures, which include Mid-South Steam Boiler and Engineering.

He also said that should the Board not approve the planned PZD for the land he currently owns, he would not waste any time shutting down the country club.

“It’s not an idle threat. I assure you. My problem is that I’ve been subsidizing the operating capital of that club for years, and it’s gotten to the point that it’s taking a toll on me financially. And if he (Beaty) doesn’t buy it, i’m going to close it immediately.  ... when it starts to hurt your other businesses, I mean, I’m just not going to do it anymore.”

Continuing, Mille noted: “These people opposing this and spreading rumors and bad information to try to stop this, they don’t see what they are doing to Fort Smith. I have a lot of friends who are members there and I enjoy having a place for them to buy a drink or whatever, but I can’t keep subsidizing all that just because they are friends. ... Nobody is lining up to do this (buy the club), and so if this (Beaty plan) doesn’t work, you’ll see a lot of weeds and grass on the course, because I’m not doing it anymore.”

Efforts by Wal-Mart to build the next generation of retail has resulted in investments of about $2 billion in tech startups since 2011, according to Leon Nicholas of Kantar Retail. These investments are helping the retailer organize content and win favor with Gen Y, which if successful could place the retailer two big steps ahead of the retail pack.

In what could be a warning to other retailers Nicholas said Wal-Mart isn’t investing in technology for the fun of it, and the company expects a return over time. 

Carol Spiekerman, CEO of NewMarketBuilders, said Wal-Mart’s strategic investment plan to acquire multiple tech capabilities is “smart, bold and aggressive.”

“Instead of sitting on their hands looking for that one big fantasy acquisition, Wal-Mart has instead become an Ubermensch picking up multiple companies at a steady pace, like no other retailer,” Spieckerman said.

Kosmix was acquired in 2011 and is the foundation for @WalmartLabs, which Spieckerman said set the stage for other 10 investments as the company seeks to build out its tech capabilities that she says are key to future sales and user engagement.

Since then Wal-Mart has assembled a global crop of tech savvy professionals at @WalmartLabs who are building a very different type of retail operation. Neal Ashe, CEO of Global eCommerce for Wal-Mart Stores, has said these strategic acquisitions and those to come will take Wal-Mart further and faster toward the next generation of retail which is occurring at intersection of the physical and digital worlds.

Analysts agree that the work at @WalmartLabs is data rich with layers of analytical and predictive capabilities beyond what competitors and suppliers have seen, or are likely ready to process.

CONTENT DRIVEN
Wal-Mart is collecting a slew of consumer related-data from social media, analytical applications and weather patterns that goes way beyond point-of-sale data that has been the key metric for the industry and its suppliers for the past three decades.

“Wal-Mart is a media company and a media spend,” Spieckerman said. “This is the forefront of a retail movement for mainline brick and mortar retailers. Suppliers need to catch up with this concept.”

She said there is a growing data divide between retailers and suppliers, but Wal-Mart continues to extend invitations into its fold. The point-of-sale data is a just small sliver of the data ecosystem today, Spieckerman said. And the same goes for marketshare or other post sale metrics which has been what suppliers and retailers have typically shared in the past. 

That is something Wal-Mart seeks to change. Key marketing executives such as Stephen Quinn have repeatedly spoke of the retailer’s desire to share content strategies with key suppliers.

“I don’t know how many different ways Wal-Mart can say it, invest in our platform and we will invest in you,” Spieckerman said of Wal-Mart’s request. “One hand washes the other. They want to see suppliers hand over the content they have created. Wal-Mart has already made the investments and suppliers can benefit if they also turn over some of their assets in the form user (and) shopper content.”

Stephen Quinn, chief marketing officer at Walmart U.S., said during the recent Year Beginning Meetings that the retailer was focused on the “Big Three: Big insights, Purposeful Positioning, Total Experience.” He said the retailer would use its Big Data capabilities to drive more content marketing. He reiterated Wal-Mart’s desire to partner with suppliers on marketing efforts across multi-channels saying the retailer would measure and report the effectiveness.

Quinn also said Wal-Mart would lever Big Data and Weather Fx – a service through the Weather Channel – to drive merchandising and ad campaigns.

Spieckerman believes the retailer can recoup the value of its acquisitions and add to its platforms and its suppliers’ platforms at the same time when they can partner on content strategies.

USER ENGAGEMENT
The acquisitions of YumPrint and Social Calendar are fostering Wal-Mart’s ability for user engagement, something Spieckerman said is a long way from the old-line retailer mindset of studying sales data.

User engagement is nothing more than getting to know your potential customers who may become loyal shoppers or never spend a dime. By acquiring these two companies, Wal-Mart also gained access to the respective user bases which they can engage. Spieckerman said this path-to-purchase data is a great place for suppliers and retailers to collaborate as they organize and share content around brands, that could eventually lead to user engagement and shopper loyalty.

For example: YumPrint features recipes, which involve food ingredients — a common thread for Wal-Mart and its CPG food suppliers. Spieckerman said suppliers can start by going after this type of low hanging fruit. 

She said the content sharing conversations should not be typically directed to Wal-Mart buyers just yet. But, suppliers should be reaching out to marketing and emerging media personal which are being added regularly to the retailer’s payroll.

“Suppliers can’t be waiting for a magic pill for content, they are going to have to look at niche opportunities, talk to several marketing specialists, it’s not a single person contact. There could even be a whole new criteria for becoming a Wal-Mart supplier. Price is not the only lever the retailer is pulling today. Just like technology is pulling retail along, @WalmartLabs is pulling Head Quarters along,” Spieckerman said.

WOOING GEN Y 
Nicolas said Wal-Mart’s tech investments are very much in tune with their efforts to reach Gen. Y consumers, also referred to as Millennials. According to Nielsen, this 77 million-strong consumer group represents a $200 billion opportunity, with more spending power in the coming years.

“Investing in Millennials is absolutely the thing to do,” said Beth Brady, president, segmentation and local market solutions for Nielsen.

Brady said during a March 25 webinar that retailers and brands should invest now if they want to capture this demographic that is very different from past generations. Personalized deals, resonate with Millennials, something Walmart.com is apt to experiment with at some point given its ability to engage in distinct email specials with its users. A two-way dialogue is also important to Millennials, Brady said. This is also something Wal-Mart is now able to do because of its growing user base from each tech acquisition.

It is no secret that Millennials are plugged in. Some 72% regularly use FaceBook and these users are also adept at other mobile and social applications. She said they are driven by deals, but they also desire authenticity in their purchases. While Millennials are brand loyal, they also seek labels that share similar values and represent good causes.

“They are comfortable with tech and trust social media,” Brady said. “In fact, social media is the new consumer report.”

The value of building permits in Fort Smith, Greenwood and Van Buren were a combined $24.913 million in March, up 203.96% compared to $8.196 million in March 2013.

For the first three months of 2013, permits for the three cities totaled $41.787 million, up 50.9% compared to the $27.691 million during the same period in 2013.

FORT SMITH
The city of Fort Smith issued 191 permits during the month of March, nearly even with the same month last year, but the permit values totaled $20.410 million last month, up 197.7% compared to $6.856 million during the same period last year.

The primary driver of Fort Smith's higher totals was the $13.3 million building permit issued for the new Mill Creek Wastewater Pump Station, located at 210 Navy Road.

Another large project pushing totals higher is an expansion at Darby Junior High, valued at $1.674 million, as well as a $1.1 million permit issued for a new immigration office at 4624 Kelley Highway. The Kelley Highway site is the former home of what is now known as KNWA-TV and its now shuttered Fort Smith newsroom. The station consolidated newsroom operations to its Fayetteville newsroom in 2006 when Oklahoma City-based Griffin Communications sold the station to Irving, Texas-based Nexstar Broadcasting, leaving the former television station mostly unoccupied since that time.

In addition to the three large commercial projects, the city of Fort Smith issued 120 residential building permits worth $1.641 million, a drop from March 2013 when the city issued 125 permits worth $2.525 million.

GREENWOOD
A total of six permits were issued for the city of Greenwood in March, totaling $373,676. That represents a 43.66% decrease from the same period in 2013, which saw $663,300 in permits.

VAN BUREN
The city of Van Buren saw an increase of 510.75% from $676,000 in March 2013 to $4.129 million last month. The higher values in the city last month was largely due to construction of the city's new police headquarters, which is being constructed at the former Sherman's Grocery site. The new police station has an estimated value of $3.567 million.

Other construction in the city was relatively minor, with a spattering of permits issued across various categories, including four permits worth $89,000 for residential remodels, the second largest category after commercial construction.

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

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

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

April is an another active month for the programing at the Schmeiding Center, Bella Vista, according to Nancy Galbraith, program specialist. There are several routine health checks and screenings in addition to lectures on stroke awareness, 911 safety, and fall prevention. All sessions are scheduled at the Highland Center in Bella Vista, unless otherwise stated.

April 2
• 10 a.m to noon: Design Your Mind, presented by Right at Home
• 1 p.m. to 3 p.m.: Hearing aid cleaning and check up, Miarcle Ear

April 3
• 10 a.m to noon: Memory screening, Schmieding Cares.

April 8
• 9 a.m to 11 a.m.: Blood pressure screening, Alliance Home Health

April 9
• 10 a.m. to 11 a.m.: Risk fall prevention, by Health South

April 14
• 10 a.m. to noon: Glasses adjustment, Bentonville Eye Care

April 15
• 1:30 p.m. to 3:30 p.m.:  Smart 911, Bella Vista Fire Dept. at Highlands Church.

April 16
• 9 a.m. to 11 a.m.: Blood pressure and glucose screening, Elite Home Health

• 3 p.m. to 4 p.m.: Rest, Relax, Rejuvenate $10 fee, Tracey Lynn Cox

April 17
• 1 p.m. to 3 p.m.: Hearing tests, hearing aid adjustments, Better Hearing & Balance Correction.

April 22
• Noon to 1 p.m.: Lunch & Learn Stroke Awareness, Pam Adams at United Lutheran Church. Registration is required at (800)734-2024.

April 24
• 9 a.m. to 11 a.m.: Coffee with Elder Law Firm, Todd Whatley of Elder Law

Finalists for the Giving Recognition in Tourism (GRIT) Awards were announced Tuesday (April 1). The awards ceremony will be held on Thursday, April 24, at 6 p.m., at MovieLounge on Rogers Avenue in Fort Smith. The awards are given in honor of contributions to the local tourism and hospitality industry by the Fort Smith Convention and Visitors Bureau.

Nominees, by category, for the GRIT awards are (in no particular order):

Restaurant Partner of the Year:
Golden Corral
MovieLounge
River City Deli
Varsity Sports Grill
 
Lodging Partner of the Year:
Courtyard by Marriott
Holiday Inn City Center
Homewood Suites by Hilton
 
Attraction Partner of the Year:
Chaffee Crossing Historic District
Fort Smith National Historic Site
Janet Huckabee Arkansas River Valley Nature Center
 
Business Partner of the Year:
Belle Star Antiques
Brick City Emporium
E-Fort Smith Magazine
 
Polly Crews Hospitality Person of the Year:
Beth Templeton
Floyd and Sue Robinson
John Bell Jr.
Suzi Strasburg

Last year's Hometown Hospitality Heroes will also be recognized. According to a press release, recipients of the HHH include Sharon Chapman and Melissa Schoenfeld for their work and assistance with the Regional Dance American Southwest Festival 2013; Bill Hollenbeck for his work on the Arkansas Sheriff’s Association Convention for 2013; Brooke Shock and Courtney Shreve, for their  work on the Konsplosion Anime Convention and Mike Alsup, for his work on bringing the Arkansas Recreation and Parks Association and Arkansas Therapeutic Recreation Society Convention to Fort Smith for the last three out of five years.

Fort Smith-based Beall Barclay & Company, PLC, CPAs – one of the state’s largest locally owned certified public accounting firms – have announced promotions in their Fort Smith and Rogers, Ark., offices.

Cassie Curtis, a graduate of Arkansas Tech University and the University of Central Arkansas, was promoted to an in-charge accountant from staff accountant in the Fort Smith office.Curtis holds a bachelor’s degree in business administration-accounting. In 2011, she received her masters degree in accounting.

Shelly Raney was promoted to audit manager in the Fort Smith office. Raney holds a bachelor’s degree in business administration-accounting from Arkansas Tech University. She was a senior staff accountant with Beall Barclay & Company. prior to the promotion. She has been with the accounting firm since 2000.

Robert Jetton was promoted to senior accountant from in-charge accountant in the Fort Smith office. Jetton holds a bachelor’s degree in business administration-accounting from the University of Arkansas at Fort Smith. He received his CPA in 2012. He has been with the accounting firm since 2009.

Kelli McReynolds was promoted in the Rogers office to in-charge accountant from staff accountant. McReynolds is a graduate of Northeastern State University where she earned a bachelor’s degree in business administration-accounting. She has been with the accounting firm for nearly five years.

Overall Arkansas tax revenue is above forecast for the first nine months of the fiscal year, with sales and use tax collections – an indicator of consumer spending – continues to miss budget forecasts. However, March sales and use tax revenue was up more than 7%.

Year-to-date gross revenue (July 2013-March 2014) totaled $4.456 billion, 2.9% above the same period last year and above forecast by 1.1%, according to the report issued Tuesday (April 4) by the Arkansas Department of Finance and Administration.

Collections have declined relative to how the fiscal year began. The gross collections were up 3.4% after the first six months of the fiscal year, and 0.9% above forecast. After the first four months of the fiscal year, the gross revenue was up 4.1%.

Individual income tax collections for the fiscal year totaled $2.154 billion, up 3.1% from last year and 2.1% above the budget forecast. Year-to-date sales and use tax collections were $1.629 billion, up 3% above last year and 1% below the budget forecast. The sales and use tax collections were up 4.8% four months into the fiscal year and up 3.9% six months into the fiscal year. Income taxes and the sales and use tax collections are the two primary sources of state revenue.

The corporate income tax collections for the first eight reporting months of the fiscal year totaled $305.8 million, up 3% compared to last year and 4.5% above forecast.

MARCH NUMBERS
March gross revenue was $546.4 million, up 6.9% above last year and 5.8% below forecast.

John Shelnutt, head of the Department of Finance and Administration’s Economic (DFA) Analysis & Tax Research division, provided this analysis of the March numbers: “All major categories of collections were above forecast in gross revenue terms and lower-than expected refunds provided an extra gain in net available funds. The monthly swing largely offsets the weakness in the prior month and adds to year-to-date gains going into the largest, and potentially volatile collection month of April.

“Results were significantly impacted by: 1) rebound in Sales and Use tax compared to year ago and versus forecast, 2) components of Individual Income tax compared to forecast, and 3) a decline in both individual and corporate refunds compared to forecast and year ago refunds.

“Among smaller revenue categories, most categories exceeded forecast except Tobacco tax collections were down sharply.”

Individual income tax collections during March totaled $246.6 million, up 12.6% compared to March 2013 and above forecast by 9.9%.

Sales and use tax collections during the month totaled $183.1 million, up 7.4% from last year and 3.7% below the forecast. Sales and use tax collections, considered a barometer of consumer confidence, ended fiscal year 2013 on a down note. Collections in the segment for the fiscal year totaled $2.124 billion, up just 1.1% compared to the 2012 period, and 1.4% below forecast.

The DFA in early December updated the projections for 2014 and 2015 fiscal year revenue. Gross general revenues are estimated at $6.203 billion for the current fiscal year (July 1, 2013-June 30, 2014), down about 0.2% from fiscal 2013 collections.

The revenue forecast for fiscal year 2015 is $6.333 billion, up just 2.1% above the 2014 estimate. The 2015 estimate includes an anticipated reduction of $85.2 million from tax cuts approved in the 2013 Legislative Session.

OTHER TAX COLLECTIONS
Alcoholic beverage
July 2013 - March 2014: $37.6 million
July 2012 - March 2013: $36.5 million

Games of skill
July 2013 - March 2014: $28.6 million
July 2012 - March 2012: $25.4 million

Tobacco
July 2013 - March 2014: $162.5 million
July 2012 - March 2013: $167.9 million

Insurance
July 2013 - March 2014: $66.3 million
July 2012 - March 2013: $63.4 million

COLLECTIONS HISTORY
Tax collections during fiscal year 2013 (July 2012-June 2013) totaled $6.214 billion, up 4.9% above the previous fiscal year and up 2.5% compared to budget estimates. One result of the gains was a budget surplus of $299.5 million.

Fiscal year 2013 marked the third consecutive year of year-over-year gains. Arkansas tax collections reversed a negative two-year slide in the 2011 fiscal year, with collections up 4.5% in the July 2010-June 2011 period.

State tax collections for fiscal year 2011 totaled $5.673 billion, up 4.5% above the $5.43 billion in the 2010 period.

The biggest declines in the 2009 and 2010 fiscal years were with individual income tax collections and sales and use tax collections.

The 5th annual The Compass Conference will be held April 17 and will feature an update on economic conditions – based on data from The Compass Report – in the Fort Smith metro area during 2013 and future opportunities and challenges of the regional medical sector.

The luncheon event is set for 11:30 a.m. to 1 p.m., April 17 and will held at the Hennessy Center inside Mercy Fort Smith hospital (see map at bottom of story). Seating is limited, and tickets are $35 each, or a table of 10 for $325. To reserve a seat or table, contact Daelene Brown (dbrown@thecitywire) or Kathy Reed (kreed@thecitywire.com) by e-mail or phone (242-2800).

THE COMPASS REPORT
The conference is part of The Compass Report, which is the only independent economic analysis of Arkansas’ top three metro areas (Central Arkansas, Northwest Arkansas, Fort Smith region). The report, produced and managed by The City Wire, measures four leading and four current economic indicators to provide a grade for a regional economy. Fort Smith-based Benefit Bank has been the primary sponsor of the report for five years, and Cox Communications has been a secondary sponsor.

Regional economic conditions began to improve in 2013, according to the report issued for the third quarter of 2013. Slight but continued improvements in economic trends for the Fort Smith region during the third quarter of 2013 has resulted in the best quarterly grade for the economy since the first quarter 2009 launch of The Compass Report. A third quarter 2013 grade of C+ was improved over the C in the second quarter and the C- in the third quarter of 2012.

Economist Jeff Collins, who conducts the data collection and analysis for The Compass Report, said employment and other data indicate that the Fort Smith region “has performed reasonably well” during the first three quarters of 2013. However, Collins said the improvements will need to continue if the region is to return to employment levels seen prior to the recession.

MEDICAL SECTOR FORUM
A panel discussion on the medical sector will focus on highlighting conditions within the sector. Panelists will be Doug Babb, CEO of Cooper Clinic; Jeremy Drinkwitz, chief operations officer of Sparks Health System; Dr. Cole Goodman, president of Mercy Clinic Fort Smith; and Kyle Parker, chairman of the Fort Smith Regional Healthcare Foundation.

Medical sector expansions, changes in ownership and news of a planned medical college are likely to be the major regional stories in 2014. The sector also continues to be a job generator for the region.

In the regional Education & Health Services category, employment was 16,400 during January, down from 16,600 in December and below the 16,900 during January 2013. Annual average monthly employment in the sector has steadily grown since 2005 when it reached 14,000. In 2012 the average was 17,000, but fell slightly to 16,800 in 2013. Employment in the sector reached a record 17,300 in October 2012.

Following are some of the top news stories from the area medical sector during 2013 and early 2014.

• Fort Smith could soon be home to Arkansas’ first college of osteopathic medicine and one of just 31 in the U.S., thanks to a more than $58 million investment from the Fort Smith Regional Healthcare Foundation (FSRHF) and a grant of 200 acres from the Fort Chaffee Redevelopment Authority (FCRA).

• Naples, Fla.-based Health Management Associates (HMA) announced in April it would build a regional service center in Fort Smith and employ more than 500 with average annual salaries potentially exceeding $40,000. At the time, HMA was the parent company of Sparks Health System in Fort Smith and Summit Medical Center in Van Buren. The facility opened in September. Franklin, Tenn.-based Community Health Systems has since acquired HMA in a $7.6 billion deal.

• Work continued during 2013 on a plan announced in August 2011 by the St. Louis-based Sisters of Mercy to invest $192 million in the Fort Smith area as part of a 10-year plan to invest $4.8 billion in its operations in Arkansas, Kansas, Missouri and Oklahoma. Part of that investment was completion of the $42 million Mercy Orthopedic Hospital in Fort Smith that was estimated to add 100 jobs.

Dennis Smiley, doing business as HDS Holdings LLC, was sued March 25 by Delta Trust & Bank in Benton County, over a personal loan default – it was latest shoe to drop in an unfolding saga surrounding Smiley’s sudden resignation March 13 as president of Arvest Bank Benton County. 

He also faces a loan fraud investigation first reported by Arkansas Business on April 2. This report claims one of the loan payments did not clear Smiley’s bank account on March 10, which raised a red flag that led to his resignation.

Sources who asked for anonymity have told The City Wire that numerous Arkansas banks had lent Smiley money over the past four years and he each time he pledged the same restricted Arvest shares for collateral. Smiley reportedly borrowed an estimated $4.5 million from more than a dozen Arkansas banks dating back to 2009, according to Uniform Commercial Code filings with Arkansas Security of State. 

On Feb. 20, Delta Trust & Bank made its loan to HDS Holdings — H. Dennis Smiley Jr. of Benton County and his father H. Dennis Smiley Sr. of DeQueen — in the amount of $245,126. Smiley pledged 4,264 shares of Arvest Bank stock for collateral. The lawsuit claims Smiley failed to make the first installment on March 20. 

“The defendants have confessed that they are either unable or unwilling to pay the obligations to the lender. The defendants have caused the collateral to be substantially impaired and they are in nonmonetary default under the express terms of the note and security agreement and guarantee,” the complaint states.

The bank has asked for a judgment in the amount of $245,126, accruing interest until the debt is paid. 

Co-defendant Henry Dennis Smiley Sr. is chairman of First State Bank of De Queen, also on the list of banks involved in the federal fraud probe. The Sr. Smiley told Arkansas Business he was brokenhearted and could not talk about his son's financial and legal problems.

MISSED PROTOCOL
In an information age, one has to ask how this could happen given that banks are supposed to file certain protocol when making a secured a loan.

“When a banker makes a loan that is collateralized with securities, they are to file a UCC Financing Statement with the Arkansas Secretary of State. But they are also supposed to check to make sure that collateral has not already been pledged for other loans. When possible, banks like to hold the title or proof of title in their vaults until the loan is repaid,” said Phil Knight, a Northwest Arkansas-based banking consultant and loan broker.

The Uniform Commercial Code finance statements, which are available online, indicate loans dating back to February 2011 where H. Dennis Smiley pledged shares of Arvest Bank Group Stock, which are bestowed to top executives as bonus pay. These shares had value of just under $400,000, according to the last loan made by Delta Trust & Bank. At least 10 banks claimed all or part of the same collateral for loans made between 2011 and 2014.

“Using fraudulent collateral is nothing new. It can happen when banks don’t do their homework and follow through with the proper protocol for loans,” said John Dominick, banking consultant and professor of finance at the University of Arkansas. “This won’t be the last time.”

Garland Binns, attorney with Little Rock-based Dover Dixon & Horne, said banks make loans on good faith and it may be difficult to determine wrongful intentions in advance. He also points to the UCC Finance Statements as the proper protocol for banks to register their interest as lien holders, a record open to the public.

Knight said lenders typically would require a letter of guaranty from the stock issuer in a situation where the stock is nonassignable, such as restricted or closely held stock like Arvest Bank Group.

“Absent that guaranty, or banks asking for it, is done more than you might think. Bankers like to make to loans, and they are unsuspecting of their friends and people they have known for years,” he said.

Arvest has been mostly silent on the high profile resignation, except to say it was of a personal nature.

BANKER BORROWING
Dominick said it is not uncommon for bankers to borrow from other institutions, they do so for independence. 

“A bank has be careful not to make too many loans to its own officers,” he said.

During the Northwest Arkansas real estate boom it was not uncommon for bankers to secure loans from other institutions, especially those dabbling in real estate market themselves. 

Knight said there is never problem until the loan can’t be repaid. He said regulators will also look past these loans as long as they are in good-standing. But, when things go south, there is nowhere to hide.

“Banks have zero tolerance for officers who default on loans made with other banks,” he added.

FALLOUT CONTINUES
The Delta Bank & Trust is the first civil lawsuit filed, but given the scope of the investigation Smiley could face criminal fraud charges. 

It is unclear how many banks are involved and to what extent. Based on the UCC Financing Statements four banks made loans to Smiley since Nov. 27, each pledging the same collateral.
• First Western Bank, Booneville
• First National Bank, Fort Smith
• First State Bank NWA, Huntsville
• Delta Bank & Trust, Little Rock

Legacy National Bank in Springdale also is encumbered by Smiley’s actions, but Legacy President Don Gibson, chose not to comment. Legacy did not file a UCC Financing Statement so it is unclear to what extent that bank is involved.

Other banks known to be involved include:
• First Security Bank
• Chambers Bank
• Bank of Fayetteville
• Signature Bank
• First State Bank DeQueen
• First National Bank of Mountain Home

Collab Health, a wholly owned subsidiary of Catholic Health Initiatives, has executed a stock-purchase agreement to acquire QualChoice Holdings, Inc.

Catholic Health Initiatives (CHI), one of the nation’s largest nonprofit health systems, operates St. Vincent Health System in Little Rock.  CHI announced on Tuesday that it would acquire Mercy’s hospital in Hot Springs, Ark.

Terms of the QualChoice deal were not disclosed. The acquisition must still receive regulatory approval from the Arkansas Insurance Department.

Little Rock-based QualChoice Holdings is the parent company of QCA Health Plan, Inc., and QualChoice Life and Health Insurance Company Inc.

The transaction will provide Catholic Health Initiatives with ownership and control of QualChoice Holdings. QualChoice administers health insurance plans and is licensed in all 75 counties in Arkansas.

“CHI, through St. Vincent Health System, has been a partner with QualChoice since our inception and we are excited to now be a part of a national organization of such high quality,” said Mike Stock, CEO of QualChoice Holdings. “We have always had an excellent relationship with St. Vincent and look forward to working as part of Catholic Health Initiatives in the future.”

“Making an investment in a quality health plan such as QualChoice is integral to CHI’s population health strategies, which we believe will help improve the future of affordable access to health and wellbeing for the people of Arkansas and many other communities we serve,” said Juan Serrano, CHI’s senior vice president, payer strategy and operations. “We regard Arkansas as a fantastic place to develop our health insurance capabilities as we strive to better serve communities here and across the nation.”

David Bursteen and Ines Brigman have spent the past 18 months trying to get their Legends Home Bedding products on the shelves of Walmart U.S. stores. Armed with passion for their work this duo bootstrapped their enterprise in early 2012 first pitching their licensed Elvis inspired bedding to Wal-Mart in a letter addressed to “Dear Buyer.”

“I am persistent and so I waited a couple of weeks and reached out to Wal-Mart again and was told they didn’t feel the product was right for them at the time. But, they encouraged us to enter the ‘Get on the Shelf’ contest. We had no idea what that was, and when we looked it up we had just 48 hours before the contest deadline July 31,” Bursteen said during his recent visit to Bentonville.

The duo said they looked high and low to find someone who was willing to help with them with a presentation entry to “Get on the Shelf” on a consignment basis. 

“We found this guy who did it for $84 upfront with promise of a bigger payment if we won the whole contest, never really believing we would win,” Brigman said.

They stayed up for two straight days working on a slide show presentation, because they didn’t have time to coordinate a video commercial.

Legend’s Home Bedding, was able to tap into the Elvis fan base for vote support and not only entered Walmart.com’s “Get on the Shelf” competition, but they also won it. Bursteen and Brigman’s licensed Elvis inspired bedding was one of two grand prize winners in the 2013 contest.

“During the ‘Get on the Shelf’ contest we contacted the Elvis Presley Foundation and asked if they would help us spread the word. When our bedding popped up on their Facebook page it got 68,000 likes and 4,500 comments in 24 hours,” Bursteen said.

Brigman said they continue to use their Facebook page to stay in touch with fans and test new design ideas.

The bedding, made in the U.S., is sold on Walmart.com as well as virtual competitor sites Amazon and Ebay and the company just signed a deal with Bed, Bath, Beyond. While the duo is excited about the growth of their online sales, they still want to get the product inside Walmart Supercenters which brought Bursteen and Brigman to Bentonville on March 20 to meet with a team of six Wal-Mart buyers for home bedding.

“When we met with the Walmart.com buyers it felt like we were walking on the red carpet having just won the online competition. The buyers in Bentonville were harder to read, though very attentive during our presentation,” Bursteen said.

He added that there is not a category for licensed adult bedding, but there is demand for the product and built-in fan bases with American legends such as Elvis Presley or Marilyn Monroe. When asked what Bursteen’s next step would be, he joked that the duo planned to stay in town until they got a purchase order. However, he said getting on the retailer’s physical shelf is a great deal more tedious than selling through Walmart.com. 

“We are up for the challenge and look forward to our next communication from Wal-Mart,” Bursteen said.

LICENSING THE KING
Bursteen, a collector of Elvis memorabilia, sought to get a license for Elvis inspired bedding in late 2012. It took a little more convincing for Brigman, who just more recently become an Elvis fan. 

“We were sitting around one day (September 2012) talking about the possibilities if we could get the licensing. I thought it’s probably very expensive or it’s not even available. He sends a quick email to Elvis Presley Enterprises asking if the home bedding licensing is available. Within five minutes he got a one-word ‘YES’ reply,” Brigman said.

Bursteen said he told them he would do his best to get the product in Wal-Mart Stores, because outside of music, the retailer has not carried Elvis licensed merchandise. They secured the license in late 2012 with a small investment upfront and royalties on merchandise sold. 

“There are no companies doing licensed adult bedding. It goes against the grain. We know there is demand for the product, but no one has been willing to take the chance, until now. It’s like an intersection with three gas stations, we have opted to put a hand car wash on the other corner,” Bursteen said.

He compared his swim upstream to something Wal-Mart did 30 years ago, when they introduced Sam’s Club. He said back in the day no one thought women would shop a wholesale club like Sam’s or Costco because the packaging is too big and bulky, merchandise is displayed on pallets and there is no service with bagging or carry out.

“We don’t think you have to be a kid to enjoy licensed bedding and our growing business is proof,” Bursteen said.

FUTURE PLANS
The tandem said they are excited about the possibilities of licensing more legends and expanding their bedding line. Four months ago Elvis Presley Enterprises was sold to Authentic Brands Group out of New York.

“Ironically they own a brand called Marilyn Monroe,” Bursteen said. “If we can perform with Elvis, the next logical license would be Marilyn.”

Brigman said the company has committed to manufacture the bedding in the USA, although the fabric is imported from China. This allows the “Made in the USA” tag, which Wal-Mart also prefers. 

“Making the products here involves lots of suppliers for us. It seems there is not a turnkey operation for bedding, which adds to the overall cost. We do believe it’s worth the extra effort,” she said.

The couple told the local buyers they had big plans to help cross-merchandise the product once it gets into the stores, displaying Elvis’ music with the coordinating bedding, that is song inspired, such as the “You are Always on My Mind” collection.

“This year is the 60th anniversary of Rock & Roll and we would like to bring Elvis to life inside Wal-Mart Stores across the country. We would bring in Elvis impersonators to perform and take photos paying tribute to the King of Rock & Roll. We think Wal-Mart is a great venue for this type of celebration as Wal-Mart shoppers and Elvis fans are two demographics the closely overlap,” Bursteen said.

LESSONS LEARNED
Startups are nothing new for Bursteen who said he’s spent his entire career working for startups and dabbling in entrepreneurship. Legends Home Bedding is his first attempt to found and run a company with the help of his two partners.

“The sky is the limit. We are finding out that there is always room for good ideas and those passionate enough to see them through. I would tell other potential suppliers to go for it. If you have a product ready to sell and have found a need, then go for it,” Bursteen said.

The couple said they dumped their savings into making the product as soon as they realized that it would sell. When the time came to test that theory with Get-on-the-Shelf, they were able to deliver the product buyers wanted without long lead times.

“Having the product ready to go is huge because consumers don’t want to plunk down $100 for something they have to wait 100 days to get. There were some really good products that competed against us in the ‘Get it on the Shelf’ contest, but they were concepts only, still several months away from production,” Bursteen said.

Tyson Foods said it will present the Arkansas Children’s Hospital Foundation Clinic in Lowell with $25,000 to help with operating expenses. The presentation is set for April 3 at 10 a.m. at the pediatric clinic, 519 Latham Dr., in Lowell.

No child is turned away from medical care at Arkansas Children’s Hospital or its regional clinics. Last year, the Lowell clinic provided approximately $500,000 in medical assistance for families in need. Tyson Foods’ donation will help defray those costs.

Centers for Children, a collaborative of Arkansas Children's Hospital and the University of Arkansas for Medical Sciences provide access to pediatric subspecialty care closer to home for families in Northwest Arkansas for their children’s clinic visits and follow-up medical care.

Accusations of gender bias have followed Wal-Mart Stores for years culminating in the 2011 class action lawsuit — Dukes versus Wal-Mart Stores. After several years of litigation, the U.S. Supreme Court decertified the Dukes class of 1.5 million women in June 2011.

“To date, none of the regional class action claims filed following the U.S. Supreme Court ruling in Dukes has been permitted to proceed as a class action,” said Wal-Mart corporate spokesman Randy Hargrove.

The most recent of those class denials was handed down this week by the U.S. Court of Appeals for the Eleventh Circuit — Love versus Wal-Mart Stores.

The Florida appeals court, “ has denied the plaintiffs’ petition for an interlocutory appeal of the district court’s dismissal of the class claims. We’ve said all along that if someone believes they’ve been treated unfairly, they deserve to have their timely, individual claims heard in court,” Hargrove said.

Another claimant, Stephanie Odle, of Norman, Okla., got court approval to proceed with her individual case against the retail giant. The U.S. 5th Circuit Court of Appeals ruling on March 31 allows this case to move forward.

Odle told The Dallas Morning News following Monday’s decision that this has been a 15-year battle. Her lawsuit claims that she was unjustly fired and replaces by a man, who wanted to transfer into her position while working at Sam’s Club in Lubbock, Texas.

Wal-Mart moved to dismiss Odle’s case, on the basis that time had lapsed beyond limits in the law. The U.S. District Court in Dallas granted Wal-Mart’s motion and dismissed Odle’s claim. But, Odle appealed, and on Monday, the appeals court said the district court should rehear her case.

Hargrove said the appeals court decision a procedural step that allows the case to go forward on an individual basis.

‘We’ve said all along that if someone believes they’ve been treated unfairly, they deserve to have their individual claims heard in court. The allegations in this case just don’t match the positive experiences that hundreds of thousands of women have had working at Walmart.”

He said Wal-Mart has a strong policy against discrimination, and is are proud of the opportunities it provides for women to work and advance.

It was September 2013 when the Fort Smith Board of Directors directed the city administration to begin a phase-in of more compressed natural gas-run vehicles, as well as other energy alternative vehicles, in the city's fleet.

Since that time, not much movement has taken place with the plan to add more alternative energy vehicles to the city fleet for a variety of reasons, according to Deputy City Administrator Jeff Dingman, though he said it does not mean efforts have come to a halt.

The biggest obstacle, he said, has been the cost and availability of CNG vehicles, the primary focus of the September 2013 policy directive.

"There wasn't a CNG vehicle on the state contract at the time (the city last purchased vehicles)," he said. "And there wasn't anything from the manufacturer ready to go. So realizing that the conversion cost would be 100% on the city going forward to convert a $15,000 pickup (truck), along with spending another $10,000 on the conversion costs, that's a pretty significant thing. We sort of shied away."

The lack of vehicles available for bid from the state has also been a struggle for the city of Springdale, according to Administration and Financial Services Director Wyman Morgan.

"We've looked at some vehicles on the state bid contract, but there's not that many options available at the present time."

CONVERSIONS STILL POSSIBLE
While Fort Smith may be shying from spending money on conversions or new vehicles for the time being, it does not mean the conversions are not possible or probable, according to Dingman, who said during the budget preparation last year, alternative fuel vehicles were made a priority, as requested by the Board.

"When they (Board members) were going through the budget evaluation, they did express interest that we try to include alternate fuel vehicles in the budget. So we did that. As departments proposed capital replacement of vehicles — when we had our department budget meetings — we evaluated each of those and asked, 'Would this work as a CNG or electric hybrid?'"

He said as a result, some departments are designated to possibly receive an alternate fuel vehicle as they replace fleet.

And while the Board has been supportive of the effort, it has not been without some growing pains, with Dingman mentioning that an attempt to retrofit a Fort Smith Police Department cruiser not necessarily being a good fit.

"It was used on patrol for about a year, but it had a rough time staying on the road the whole time. It goes all three shifts and it just had issues with idling and there was some mention of having trouble with it when they had to be in pursuit mode."

As a result, the police department has shifted use of the vehicle to a supervisor vehicle, which sees substantially less mileage less idling.

The city's pilot program, which extended CNG use to a select few vehicles in not only the police department but also the fire department, customer service department and transit department, started in 2012 and saw what Dingman labeled as "moderately successful" results.

TRANSIT BUS ISSUES
What dragged down the program for quite a while was the conversion of the transit department vehicle.

According to Transit Department Director Ken Savage, the "medium cutaway bus" was sent out for a conversion in March 2012, arriving back to the department in August 2012 as the city's only fully-CNG vehicle (the other vehicles in the CNG fleet still have an unleaded gas tank that can be used in place of CNG).

"It was unreliable until mid-year 2013," Savage said. "During that time, we replaced two injectors, two fuel regulators and a fuel line during that time frame. All of it was scattered throughout the year."

The cause of the problems, Savage said, were directly tied to the conversion, though he said performance improved throughout the remainder of 2013, adding that "from that point on, it's pretty much been reliable once we got (the maintenance issues) taken care of)."

In experimenting with the CNG bus, the transit department also realized that the range on the vehicle would be problematic, as the CNG bus would need additional fuel stops throughout the day.

As a result of the testing, Savage said the transit department has found the CNG vehicles to be a good alternative on the on-demand routes since time can be factored in for fuel breaks between pickups. In fact, he said the CNG bus is working so well, the transit department has ordered two newer "small cutaway" buses to use on the on-demand routes, which should eventually be retrofitted for CNG.

In all, he said fuel savings for the first quarter of 2014 were $1,495.38.

SPRINGDALE CNG HISTORY
In Springdale, Morgan said the city has experimented with hybrid technology and has found it to meet some of the city's needs.

"We have operated a couple of hybrids that had a batter backup. I know one pickup that we did use for a good while, I think it was a Chevrolet, that would run off the battery when it needed to, it would run off the gasoline motor."

And while Morgan said the city has not conducted a cost comparison of using an all-gas truck versus hybrid, the reliability of the hybrid truck has lead the city to look at other options, including all-electric vehicles.

"I know we're looking at at using some electric vehicles for ambulance response on our trail system and some police (vehicles that are electric) that we'll use on our trail system.

POSSIBLE AEDC SUPPORT
In Fort Smith, Dingman said grants have helped fund half the cost of the city's CNG fleet (a total cost of $53,950), though no grants are available at this time, further limiting what is possible as far as alternative fuel vehicles.

But he said that could change by the middle of this month after Patti Springs of the Arkansas Economic Development Commission's Energy Office sent out an e-mail notifying recipients of an "announcement regarding the vehicle conversion rebate program."

"At this time, no specifics are available regarding new vehicle purchases or retroactive conversions."

She said when more information is available, she would notify Dingman and others. It is a prospect Dingman is excited about.

"I don't know what that means, but it may mean there is more money available for conversions."

Corn is a hot commodity in the Natural State given the year-round needs of the poultry industry, but this year Arkansas farmers plan to plan 280,000 less acres of corn, a 32% reduction from last year. The U.S. Department of Agriculture’s prospective planting report indicates row croppers are shifting away from corn to more soybeans and rice.

“The University of Arkansas crop budgets analysis this year indicates a better return on rice and soybeans, which is why many farmers are shifting away from corn,” said Matt King, director of market information and economics for the Arkansas Farm Bureau in Little Rock.

Arkansas growers expect to plant 600,000 acres of corn, compared to 3.35 million acres of soybeans and 1.52 million acres of rice, according to the USDA report. Soybean acreage is up 3% from a year ago, and rice acreage is up 41%.

Corn prices have fallen from around $6 per bushel last year to the $4.50 range, which has also impacted the national crop planting intentions. U.S. farmers expect to plant  91.6 million acres, down 4% from a year ago.

King said a long winter has put spring planting behind schedule in the Midwest and parts of Arkansas. With a smaller U.S. crop and increasing demand, King said any signs of drought or other weather impact could push corn prices higher given that U.S. supplies are tight.

LOCAL CORN
Mike Richardson of Triple M Farms near Brinkley said he will plant between 850 and 900 acres of corn this year, down from 1,500 acres in 2013.

“I hoped to have my corn planted by now, but we have rain lately that has kept the fields muddy and we are still dealing with some freezing temperatures at night. I hope to have all my corn in the ground before Good Friday (April 11), Richardson said during a phone interview.

Richardson sells his corn directly to the Arkansas poultry industry delivering to Tyson Foods and Wayne Farms.

“I deliver straight to the feed mills down around Pine Bluff, Pottsville and Clarksville. Once my grain is harvested, I dry it down below the 15.5% moisture level and then market it directly to the poultry companies. I get a better price and they get a higher quality grain without paying added rail charges,” Richardson said.

King agreed that local corn is typically higher quality than what is railed in from the Midwest. He said the local corn is closer to No. 1 quality than the blended No. 2 which is brokered out of the grain belt. Richardson said he stores the corn and markets it throughout the year.

Third generation row cropper Tommy Young co-owns a large farm near Newport. This year his operation will plan 2,300 acres of corn, about 2,300 acres of wheat and soybeans, along with 1,500 acres of rice.

“That is our standard crop rotation and we don’t deviate from it just because the price may be better this year or next. We started planting corn on Monday (Mar. 31) and got about 750 acres planted but we stopped because of rain yesterday. Rain and storms are expected so I imagine we won’t be done planting until around April 15,” Young said in a phone interview.

He said the ground has been cold, which has pushed planting starts back at least a week in his area. Young also markets his corn directly to the poultry and egg industries with feed mills within 200 miles of his farm. Young said as long as corn stays above $4 a bushel there is money to be made by row croppers who can sell locally. 

Young said he sells to Cal-Maine in Searcy, Peco Foods in Batesville and Butterball near Mountain Home, as well as to local brokers who transport his corn to the Springdale area.

“We dry the corn and store it in our elevators and sell where we can make the most money,” Young said. “We get about a 25 cent basis over the Chicago Board of Trade prices, that premium has come down in recent years as more corn has been available.”

He said the Peco complex around Batesville got all the corn they needed last year from local Arkansas farmers.

Todd Simmons, CEO of Simmons Foods, said they source grain from Arkansas, Missouri, and Oklahoma as often as possible. This is typically during the harvest time period

Tyson Foods, the nation’s largest chicken company, estimates its grain costs will be $600 million less this fiscal year compared to the previous year, with lower corn and soybean prices. The meat giant spends roughly $1 billion in feed annually.

CROP INTENTIONS
King said rice is making a comeback in planted acreage in 2014, up 41% from a year ago. 

He said the California crop is short because of drought and U.S. rice suppliers are tighter than they have been in the past. He said as global production has risen, exports have subsided which diverted acreage to soybeans in recent years.

Young said he still plants rice, but he considers himself more of a corn and soybean farmer today because they crops are easier to manage.

Cotton acreage intentions are 340,000 acres this year, up 10% from last year, but still low in historical terms.

King said farmers have moved away from cotton toward corn and soybeans because they are easier to grow and have garnered better pricing.

Richardson used to grow cotton but back-to back years of blight was all he needed to make the shift to corn.

“Cotton comes out of the ground looking to die, corn and soybeans come out of the ground looking to live,” according to King, who said that’s what the farmers tell him.

Notes from the recent Year Beginning Meetings held by Wal-Mart Stores Inc. reveal bold aspirations from the top down. CEO Doug McMillion is not letting any grass grow under his feet, issuing edicts like being “maniacal about growth.” 

He said growing comp sales “is a must” and expects to accomplish that with excellence in merchandising, creative displays and “retailtainment.” In other words, he wants to see more excitement and energy displayed inside the retailer’s physical stores.

Reading between the lines, there could be more celebrity visits surrounding new product launches or more “try and buy” opportunities for suppliers.

SHARP EXECUTION
McMillon’s expectations also raise the bar on in-stocks. Last year Gisel Ruiz, chief operating officer for Walmart U.S., said the retailer made a conscious effort to improve in-stock averages to 96%.

At the YBM event, Duncan Mac Naughton, chief merchandising officer, reiterated the need of improvement in what he calls a $3 billion opportunity — the sales Wal-Mart losses annually when products are out-of-stock.

Mac Naughton said the retailer’s goal is to grow inventory at half the rate of sales, a disciplined approach, while also embracing more localization. His main objective is to grow top line sales, leveraging every tool at his disposal — individualized pricing perks with “Savings Catcher,” more price rollbacks billed as “Amazing Finds” which are three to four items featured in weekly tabs.

He said the retailer expects to see production innovation from its suppliers and Wal-Mart is eager to partner where it can to assist in the process. 

“Wal-Mart’s recent communication clearly signals a ‘take no prisoners’ approach to growing their topline and comp sales. You can hear it in their voices. They’re back on offense and ready to take it to the competition,” said Jason Long, CEO of Shift Marketing Group. 

MORE TESTING
Wal-Mart has proven to be a nimble giant willing to test multiple initiatives and then roll out the learnings much more quickly than the brick and mortar retail industry as a whole. Carol Spieckerman, CEO of NewMarketBuilders, said this agility is linked to the @WalmartLabs “brain trusts” and all the digital talent the retailer has acquired over the past 18 months.

“Wal-Mart gets that it doesn’t have to be perfect. They are testing A and B simultaneously, like never before.” Spieckerman said.

Mac Naughton said this year Walmart U.S. will expand “pick up today.” now being tested in Denver. Consumers can order groceries online and pick up free at the nearest store.  Bill Simon, CEO of Walmart U.S., recently said the retailer is planning to build pick-up depots that will allow shoppers to drive through and get their grocery order that was  placed online earlier in the day.

The “Walmart to Go” grocery delivery test market will also be expanded this year. It is already available in Denver, San Jose, Northern Virginia, Philadelphia and Minneapolis. Wal-Mart also plans to ship product from 50 more of its supercenter locations this year. This effort to tether supercenters to smaller formats and e-commerce fulfillment is key to Wal-Mart being able to better compete for Amazon Prime customers.

“The new Wal-Mart programs and tests will likely take some time to bear fruit, but they have so many irons in the fire that dividends should start to accrue sooner rather than later,” Long said.

In the near-term, Long said, Wal-Mart’s biggest opportunity continues to be picking off unhappy Target customers.  

“A recent report had upper-income customer satisfaction dropping to 70% at Target, down 9 percentage points. Wal-Mart is better positioned than most to pick-up this cross-over business and it’s likely incremental as this shopper probably isn’t shopping their stores today,” Long said.