The Friday Wire: Water money and worried consumers

by The City Wire staff ([email protected]) 123 views 

A water park project over budget, a ‘pipeline’ for females to be elected governor, and the continued fight over Obamacare are part of the Fort Smith area Friday Wire for Nov. 15.

• The worried consumer
Wal-Mart Stores on Thursday reported quarterly income of $3.738 billion, up 2.8% overall, but same store comps in the U.S. were down 0.3%.

Wal-Mart President and CEO Mike Duke said consumers remain wary about the economic outlook and concerned about their job. Wal-Mart results are typically seen a barometer for the overall national economy given the retailer’s size and geographic reach across the U.S.

Duke’s not an economist, but it’s not unreasonable to think he has as good a grasp on economic conditions a a gathering of Federal Reserve governors. If he says consumers are worried, they are.

• Service center uncertainty
The relatively new Board of Directors of Health Management Associates – the parent company of Sparks and Summit – announced Nov. 13 that it supports the $7.6 billion acquisition offer from Community Health Systems. Barring any regulatory checks, the deal is expected to close in the first quarter of 2014.

The deal, like it or not, does inject some measure of uncertainty into the future of a newly opened HMA regional service center in Fort Smith. HMA officials announced in April that the center would be housed in what was once a portion of Phoenix Village Mall. HMA said at least 500 will be employed at the center, and estimated the annual payroll at $21.5 million, with the center at full employment within 12 months. The facility began operations in mid September.

• Water money
Construction of a long discussed, voter-approved water park in Sebastian County is now uncertain.

Concerns raised earlier this year by members of the Sebastian County Quorum Court that the planned Ben Geren Aquatics Center could come in over budget have been realized after County Judge David Hudson revealed during a Nov. 12 Quorum Court meeting that designers have estimated the water park to cost almost $11 million should all features requested in public meetings be in included in the design.

The county and city of Fort Smith were to share costs on the project. It will be interesting to watch elected officials with both governments wrestle with this dilemma. Stay tuned.

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

• 'Pipeline' needed for female Arkansas Governor
Having a female name on the door of the Arkansas Governor’s office in the State Capitol is just a matter of finding the right candidate, says Gov. Mike Beebe. But two women who watch Arkansas politics say women face culture obstacles and a “pipeline problem” with respect to being elected to the state’s top office.

• Changing retail trends
Retail’s landscape over the next five years, powered by such trends as smart phones, sweeping demographic shifts, and radically transformed consumer expectation, could be Kryptonite for brick-and-mortar stores, creating more painful change than in the last century.

• Here we go again
The fight over the Affordable Care Act is not over. At least according to U.S. Rep. Tom Cotton, R-Dardanelle.

$11 million: The estimated cost of building Ben Geren Aquatics Center up to conceptual designs previously shown to the public.

$162,000: Amount approved by the Fort Smith Board of Directors for funding of outside agencies.

20,000+: Number of veterans hired by Wal-Mart Stores following a Memorial Day announcement that the company would hire at least 100,000 veterans in the next five years.

564: Number of homes in Arkansas in a foreclosure process during October. The number was up 4.5% compared to October 2012.

• Small Business and ObamaCare
One of President Obama's proudest boasts about the Affordable Care Act is that it helps small business. The White House website says the health law "makes it easier for businesses to find better coverage options" and "stops insurance companies from taking advantage of you, giving the consumer and business owner more control and making health-care coverage more affordable." Small businesses aren't buying it.

• The Wal-Mart fight in Kenya
In Africa, foreign investors beware: business is often a family affair. Just ask Wal-Mart, the world's largest retailer. When it sought a foothold in east Africa, it sparked a family feud in one of its acquisition targets, Kenya's Naivas supermarket chain.

• Good growth in Arkansas?
Meredith Whitney, the Wall Street analyst who forecast a flood of U.S. municipal-bond defaults in 2010 that hasn’t materialized, predicts that growth in states such as Arkansas and South Dakota will be twice the national average, according to the presentation. Those states have one-third less consumer leverage, lower taxes, right-to-work laws and high commodity exposure, the presentation shows.

"It's typically a longer term process. It's a frustrating process. I can tell you I do these for sites all across the state and it typically takes a significant among of time to get to this point to select an ultimate remedy. Because what you want to do is when you select your ultimate remedy, you want to know that you have all the information."
– Ryan Benefield, deputy director of the Arkansas Department of Environmental Quality, responding to a question about why it has taken so long for the agency to clean up TCE pollution caused by a chemical spill at the former Whirlpool manufacturing facility in south Fort Smith.

“The best we’ve been able to determine looking at this program and similar programs across the country, somewhere between 25% and 30% of the value of the tax credits make it to the end-project company. That means 70% of the value of the tax credit is going someplace else. Where? I’m not sure anyone is completely sure."
– Grant Tennille, executive director of the Arkansas Economic Development Commission, addressing concerns about the New Markets Tax Credits passed by the Arkansas General Assembly during the 2013 legislative session

“Arkansas has never elected a female to hold a Constitutional office that the office is not considered a traditional female role, such as Attorney General or Lieutenant Governor. Such an office could vault them into the office of Governor during a non-incumbent year. Such was the case in Texas, Oklahoma and Louisiana.”
– Megan Tollett, executive director of the Republican Party of Arkansas, when asked why Arkansas has not yet had a woman elected governor

“I received a note from a fifth-grade student from Fort Smith, (Ark.), named Stephanie, who wrote after her visit to the Museum, ‘Before, I looked at art as just something someone painted on a canvas. But now I look at it as something someone put their feelings into and made it from their heart,’ I want everyone to see contemporary art through the eyes of the artists. That’s why we’re doing this.” 
– Alice Walton, about a new exhibit planned for the Crystal Bridges Museum of American Art