?Milken? Our No. 1 Ranking

When the Milken Institute announced in June that Fayetteville was the “Best Performing City” in the United States in terms of economic growth, people in Northwest Arkansas knew it was really talking about Bentonville.

To Milken’s researchers, Northwest Arkansas is officially known as the Fayetteville-Springdale-Rogers metropolitan statistical area. But that area also includes Bentonville, a small town by most accounts but home to the world’s largest company and a thriving vendor community.

When Money magazine ranked “Fayetteville” as the seventh-best place to live in America in 1993, the magazine appeared to be considering the attributes of all of Northwest Arkansas.

Obviously, each city in the area has different things to offer. Ed Clifford, president and CEO of the Bentonville/Bella Vista Chamber of Commerce, summed it up about as succinctly as anyone could.

“Each town has its own character, there’s no question,” he said. “We are Wal-Mart town. Springdale is Tyson. Rogers is retail. Fayetteville is the University of Arkansas and retail.”

Although some people think the towns in Northwest Arkansas are as different as Timbuktu and Tontitown, Clifford and several mayors the Northwest Arkansas Business Journal interviewed said the cities are more common than many people think.

Rogers

“There’s not a lot of differences when you start to look across the board at all the numbers,” Rogers Mayor Steve Womack said, referring to the chart on Page 21.

“Particularly with the cities along the I-540 corridor,” he said, “there are a lot of similarities because the communities there are growing in a very dynamic way. They are very balanced communities. Bentonville and Fayetteville may be a little atypical — Bentonville because of Wal-Mart and Fayetteville because of the university, but Springdale and Rogers are more similar. Bentonville and Fayetteville are more dominated by a single-source enterprise. If you took those components out, I think all of these cities are strikingly similar.”

Womack said more people are interested in living in areas like Northwest Arkansas since the terrorism of Sept. 11, 2001.

“I think more people are finding major metropolitan areas are not the places they want to live,” he said. “They’re looking out across America’s heartland.”

Womack said Rogers needs to increase its city park space, but he was proud in particular of the numbers depicting the city’s low crime rate.

“We were the safest of the large communities in Northwest Arkansas in 2002 and second in the state [behind Paragould],” he said.

Womack said the challenge now is for Rogers to grow intelligently.

“We’ve got to continue to keep it balanced,” he said. “There are growing pains … We can’t meet all the demands, but doggone it, we try every day.”

“The movement of traffic continues to be our biggest headache,” he said. “That’s what most people complain about.”

Womack said the retail, dining and entertainment options in Rogers continue to expand.

“There are a lot of people who are now able to take care of matters here at home rather than going to Fayetteville to do it,” he said. “The retail community is now beginning to pay attention to the spending power of central Benton County.”

Historically, Fayetteville has been the center of retail and entertainment in Northwest Arkansas.

Fayetteville

With 10 times more park space than any other city in the area, Fayetteville looks like Eden to many of its residents.

Fayetteville also has more than twice as many restaurants as the region’s nearest competitor and almost four times as many places where beer, wine and mixed drinks are served.

“Fayetteville’s niche — our strengths — are the University of Arkansas, our quality of life and our diverse economy,” said Fayetteville Mayor Dan Coody. “Those three things combined give Fayetteville a personality that is unique in the state. We’re always glad to see the cities of Arkansas prosper, so we bear only goodwill to our sister cities, but we want to retain our position as the center for culture and entertainment in Northwest Arkansas.”

Coody said Fayetteville has to rely on private funding for projects such as a proposed water park.

“We don’t need to build a water park with taxpayer money, but we sure do have some holes in the boat we need to fill,” Coody said.

One of those “holes” is that the city doesn’t have a stadium-seating movie theater, Coody said. Rogers’ Malco Cinema 12 in Scottsdale Center does have stadium seating, so many moviegoers drive 25 miles north from Fayetteville to watch movies there.

Coody said Fayetteville is also working with building developers on design. It’s part of what he calls a “new urban thinking.”

Coody noted that a recent “Survey of Citizens” indicated 46 percent of Fayetteville residents thought it was an “excellent” place to live while 49 percent rated it a “good” place to live. Thirty-one percent of respondents said they live in Fayetteville because of the quality of life.

Coody also noted that Fayetteville’s unemployment rate was 9.9 percent in 2000 because it includes 15,000 students who attend the UA. If the students were excluded, Fayetteville’s unemployment rate would be similar to that of its four neighbors.

Bentonville

“We’re getting what is a rather blended 540 corridor,” Clifford said of the cities along the interstate, adding that he drives from one town to another on a regular basis. “It isn’t like anything stops at the city limits.”

With $244.5 billion in annual revenue, the retail behemoth of Wal-Mart Stores Inc. still holds sway over Bentonville.

With vendors to Wal-Mart and vendors to the vendors clogging the city’s streets, the community that Helen Walton once described as a “sad-looking country town” of fewer than 3,000 people is now a gridlock of commerce. What happens at Wal-Mart’s headquarters affects the U.S. economy in ways that would probably startle Sam Walton today.

An average of 500 “suppliers” call on Wal-Mart every weekday, with a total of about 90,000 vendor visits last year.

“Our daytime population probably exceeds that of the other cities in Northwest Arkansas,” Clifford said. “We fill hotels from Sunday night most of the time through Thursday night.”

To help unclog the congestion, Bentonville voters approved a 1 percent sales tax in August, and 70 percent of that money will go toward roads. Also, the city threw in $5.6 million to goad the Arkansas Highway and Transportation Department into expediting the widening of Arkansas Highway 102 from two to five lanes. That work should begin within the next two years.

With the population boom, housing costs have increased by 74 percent in the last three years alone.

“In 2000, the average house price in Bentonville was $90,000,” Clifford said. “In 2003, it’s $157,000. What’s happening is we have become a center of fairly high-priced housing.”

Clifford, who worked in merchandising at Wal-Mart’s headquarters for 17 years, said employees of the home office and vendors are responsible for the increase in house prices.

“Rogers will catch up in a short period,” he predicted.

Clifford also predicted a boom in Northwest Arkansas’ medical industry over the next few years.

Springdale

Since its founding, Springdale has been the agricultural center of Northwest Arkansas and thus a blue-collar town as well.

“I think that’s probably still Springdale’s reputation,” said Mayor Jerre M. Van Hoose. “I don’t know whether that’s good or bad, but it’s kind of nice to have good hard-working folks in your community.”

The world’s largest meat company, Tyson Foods Inc., is based in Springdale.

Van Hoose said Springdale also has the reputation for having more lower-cost housing than the other cities in the area. The reason for that is largely because of the topography, he said. Building in cities like Fayetteville costs more because it takes more sanitary sewer lines than it does in the flatlands of Springdale.

“And you get fewer square feet of lots out of hilly land,” Van Hoose added.

To most people, affordable housing is a good thing.

Besides that, Van Hoose said Springdale has many other things to offer, including a quality library, the Shiloh Museum and organized recreational activities that help coalesce the city’s diverse residents.

Organized soccer games, for example, have helped Hispanic residents become part of the community. Hispanic and Caucasian parents cheer together on the sidelines for their kids.

“When people get to know each other, they’re not scared of each other,” Van Hoose said. “We have gone from essentially nothing in the late ’80s to a population that’s roughly 20-22 percent Hispanic.”

Van Hoose said the job the city and Springdale School District did to integrate immigrants was “absolutely incredible.”

In the 1960s and 1970s, retail shifted out of America’s downtowns and into malls, shopping centers and big-box retail stores.

“Obviously, Springdale was a loser in that process, and the demographics caused that to happen,” Van Hoose said.

The Northwest Arkansas Mall opened in Fayetteville in 1972. Other retailers vaulted over Springdale and settled in Rogers instead.

“We’re fortunate to see that start to change a little as density becomes greater in the area,” Van Hoose said. “I think we’ll start seeing some fill in between those other revenue areas [Fayetteville and Rogers].”

Lowe’s Cos. recently announced that it plans to build one of its home-improvement stores in Springdale.

In August, Springdale voters approved a $105 million bond issue for transportation infrastructure. Van Hoose said the money will pay for three new east-west roads from the downtown area to Interstate 540.

“Our biggest need right now is to do this transportation program and to push the development of the [U.S. Highway] 412 bypass around the city,” Van Hoose said. “We’ve got a huge job in front of us. It’s probably going to take seven or eight years to build [the three east-west streets] out. It’ll probably take 10 years to pay off the bonds.”

Van Hoose said a project manager was hired Dec. 9, and work should begin on the $105 million road project in 2005.

Siloam Springs

Mayor M.L. “Moose” Van Poucke of Siloam Springs said his city’s 33 percent population growth between 1990 and 2000 is a much more manageable rate than 75 percent in Bentonville.

“We have an extremely positive situation,” he said. “That is, we have been able to take care of the infrastructure to give service to the community during a period of positive growth.”

Within the next five years, Siloam Springs plans to spend $8 million to $10 million to improve streets. Money for that project is being raised through a 1 percent sales tax.

In 2003, Siloam Springs began a $5.5 million project to improve water and sewer infrastructure.

“Everything we’re doing is in correlation with a population growth that would stagger some of the other folks out there in other parts of the state,” Van Poucke said.

Van Poucke said Siloam Springs recently purchased 72 acres that will be used for ball fields. The city also will spend $2 million to build a four- to 10-acre lake to hold flood waters and discharge water at a normal rate over a dam.

“We’ve got about 5,500 industrial jobs in Siloam Springs,” he said. “About 45 percent of the folks who fill those jobs come across the state line every day. We have a tremendous draw from all the way 30 miles out of Siloam Springs. Four of the [area’s] top 10 industries, as far as labor force is concerned, are in Siloam Springs.”

The city’s major employers include Simmons Foods Inc., Allen Canning Co., Franklin Electric and Gates Rubber Co.

In addition to infrastructure and employment, Siloam Springs has much to offer in the way of quality of life, Van Poucke said. The city has excellent libraries, a museum, an arts center, an excellent public school system and John Brown University.

“JBU is a tremendous school,” Van Poucke said. “It adds an awful lot to the community, not only through the staff who live here, but it is a very strong Christian influence to the community, and our businesses reflect that.”

Van Poucke lauded his city’s crime report statistics.

“Our crime rate per capita is extremely good, far less than any of these, even if you break it down that we’re one-fifth as large as Fayetteville,” he said.

Category — Fayetteville — Springdale — Rogers — Bentonville — Siloam Springs

Population

1990 Population — 42,099 — 29,941 — 24,692 — 11,257 — 8,151

2000 Population — 58,047 — 45,798 — 38,829 — 19,730 — 10,843

10-year population percent change — 37.9 — 53.0 — 57.3 — 75.3 — 33.0

2010 Population (projected) — 75,579 — 63,419 — 51,709 — 33,686 — 14,983

Economy

1990 Per capita income — $12,184 — $11,837 — $12,779 — $12,073 — $10,657

2000 Per capita income — $18,311 — $16,855 — $19,761 — $20,831 — $16,047

1990 Median family income — $30,353 — $29,317 — $31,007 — $30,150 — $26,577

2000 Median family income — $45,074 — $42,170 — $45,876 — $46,558 — $41,153

2000 Labor force — 33,942 — 22,364 — 18,862 — 10,241 — 5,580

2000 Labor force unemployed — 4,719 — 938 — 562 — 367 — 283

% of residents over 16 unemployed — 9.9 — 2.8 — 2.0 — 2.5 — 3.4

2002 Sales* — $1,243,421,926 — $908,403,089 — $643,976,722 — $475,882,839 — $199,186,179

2003 Sales (through October)* — $1,064,630,864 — $791,197,937 — $584,000,647 — $421,327,363 — $175,634,805

Education

Percent of residents with high school degree — 86.9 — 73.6 — 76.1 — 83.5 — 76.7

Percent of residents with college degree — 41.2 — 17.7 — 21.1 — 26.1 — 19.9

Average daily attendance of students in public schools (2001-2002) — 7,380 — 11,215 — 10,788 — 6,832 — 2,723

Number of public K-12 classroom school teachers (2001-2002) — 541 — 685 — 721 — 498 — 195

Number of public school teachers per ADA (2001-2002) — 13.6 — 16.4 — 15 — 13.7 — 14

Average ACT score of graduating seniors — 22.7 — 18.8 — 21.3 — 19.4 — 21.4

School millage tax — 44 — 38.6 — 33.5 — 32.6 — 32.7

Annual expenditure per public student (2001-2002) — $7,044 — $5,628 — $5,576 — $5,937 — $5,228

Average annual pay for public teachers (200-2002) — $40,435 — $43,959 — $39,331 — $37,924 — $35,318

Housing

Median home value (2000) — $100,300 — $87,500 — $91,700 — $91,200 — $78,800

Median price for new home construction (2Q 2003) — $136,367 — $121,726 — $171,099 — $149,985 — $91,994

Average home price per SF — $51.53 — $50.92 — $68.02 — $59.47 — $41.04

Average selling price for homes in 2003 — $162,223 — $135,179 — $157,882 — $158,753 — $108,000

Number of residential building permits in 2002 — 327 — 518 — 342 — 644 — 171

Total value of residential building permits in 2002 — $73,886,835 — $67,365,826 — $57,059,328 — $103,562,497 — $20,910,945

Average value of residential building permits in 2002 — $225,953 — $130,050 — $166,840 — $160,811 — $122,286

Crime (2002)

Murder — 0 — 1 — 0 — 0 — 0

Forcible rape — 42 — 24 — 28 — 15 — 1

Robberies — 31 — 28 — 9 — 2 — 1

Aggravated assault — 149 — 116 — 50 — 25 — 21

Burglaries — 355 — 362 — 157 — 272 — 41

Theft — 2,352 — 1,447 — 1,349 — 542 — 377

Motor vehicle theft — 98 — 72 — 52 — 25 — 14

Arson — 15 — 16 — 0 — 2 — 1

Crime index — 3,042 — 2,066 — 1,645 — 883 — 456

Crime index per 100,000 population — 5,170 — 4,450 — 4,179 — 4,415 — 4,149

Quality of Life

Acres of city parks — 3,300 — 250 — 470 — 120 — 260

Number of restaurants — 255 — 108 — 99 — 103 — 30

Number of private clubs that serve liquor — 28 — 11 — 30 — 19 — 1

Number of mixed-drink permits (serving the public) — 52 — 12 — 0 — 0 — 0

Number of restaurant wine permits (includes beer) — 33 — 15 — 0 — 0 — 0

Total number of businesses that serve liquor, beer or wine — 113 — 38 — 30 — 19 — 1

Number of movie screens — 24 — 9 — 12 — 0 — 0

Number of stadium-seating movie screens — 0 — 0 — 12 — 0 — 0

Number of hospital beds — 367 — 285 — 165 — 125 — 73

Miscellaneous

% of population age 15+ who are married — 49.1 — 60.3 — 61.3 — 59.6 — 56.7

% of residents born outside United States — 6.4 — 15.7 — 13 — 5.7 — 9.4

% of residents who speak Spanish at home — 4.7 — 17.6 — 18.4 — 5 — 13

Primary ancestry claimed by residents — German (13.3%) — German (11.2%) — German (14.9%) — German (17.2%) — German (13.8%)

*Based on state sales tax collection figures.

Sources: U.S. Bureau of the Census, Northwest Arkansas Regional Planning Commission, Arkansas State Treasury, Northwest Arkansas Multiple Listing Service, Arkansas Alcoholic Beverage Control, Arkansas Department of Education, Arkansas Crime Information Center, and city administrators.

Research by Bill Bowden