Whirlpool closing news the Top 2011 story

Announced plant closings, deaths, election drama, new political lines and a muddled economy were the top stories for the Fort Smith region during 2011, based on a review of the year by The City Wire staff.

The City Wire reviewed the past year of top business, political and cultural news to develop the standard top 10 stories list. Our primary criteria for a top story is that the event, issue or project have a broad impact on the community, with the impact being felt for years to come. Such criteria allows us to avoid the crime news that most other media outlets can’t resist placing in their top stories lists.

With that simple criteria, we submit the following as the top stories for the Fort Smith region in 2011. (For historical perspective, link here for the top regional stories of 2010.)

1. Whirlpool closing
Company officials announced Oct. 27 a plan to close the large refrigerator manufacturing operation by mid-2012, a move that will cut 1,000 jobs. The closing will mark the end of more than 45 years of Whirlpool operations in Fort Smith. The Norge Company opened in 1961 a factory for the manufacture of refrigerators, freezers, and air conditioners. It was purchased by Whirlpool in 1966 and expanded.

According to the Whirlpool statement, production of trash compactors now at Fort Smith will move to Ottawa, Ohio, and production of built-in refrigerators will move to Amana, Iowa. Production of the side-by-side refrigerators, once the bread-and-butter of Whirlpool’s Fort Smith plant, will move to Ramos Arizpe, Mexico.

The loss of the about 1,000 Whirlpool jobs in Fort Smith will result in the overall loss of 1,550 jobs and a labor income reduction of $56.9 million, according to an economic impact model prepared by Gregory Hamilton, senior research economist at the University of Arkansas at Little Rock, for The City Wire.

Of the 1,550 estimated jobs lost, 472 are indirect — Whirlpool vendors, companies that do business with Whirlpool vendors, etc. — job losses and 80 are Arkansas jobs lost outside of the Fort Smith region.

2. 1% prepared food tax election
Fort Smith voters on Nov. 8 overwhelmingly rejected the use of a 1% prepared food tax to help support the marketing and operations of the Fort Smith Convention Center.

The highly charged election saw 62.7% of voters (5,619) against the tax. Of the 64,165 eligible voters, only 10,245, or 15.97%, voted.

The vote capped about three years of study on how best to fund the center that was expanded in the late 1990s. A 1% prepared food tax is estimated to raise about $1.8 million annually.

A 1% prepared food tax was originally enacted by the board in February as a solution to an annual deficit with Fort Smith Convention Center operations predicted to occur when $1.8 million in annual state turnback money dried up. The state turnback program —which supported expansion or construction of tourism facilities — ended for Fort Smith in June 2010. The center has since operated on a reserve fund.

The board changed direction on the tax after months of public uproar, which included a petition drive to force the tax to an election and a court hearing that essentially overturned the city’s rejection of the petition drive. In a July 28 special meeting, the board unanimously voted to repeal the original food tax ordinance, re-enact the tax, and send the measure to voters in the Nov. 8 special election.

3. Deaths among business, political leaders
Unfortunately, 2011 brought the deaths of numerous area business leaders, to include Sam M. Sicard, Collier Wenderoth Jr., H.L. Hembree and Fred Baker Sr.

Sicard, president of First National Bank of Fort Smith, died Aug. 7 following a heart attack. He was 70.

Sicard was elected president of the large regional bank holding company in 1977 and eventually added the title of bank board chairman. During his tenure, the bank saw remarkable growth. In 1989, the bank was formed into a holding company — First Bank Corp. — and acquired National Bank of Sallisaw, Citizens Bank & Trust of Van Buren, Bank of Rogers and Brown-Hiller-Clark & Associates.

Wenderoth, the chairman of Fort Smith-based OK Industries and a legend in the Arkansas and national poultry industry, passed away in early June. He was 87.

The regional poultry processing company was began by Wenderoth’s father, and Collier joined the small family operation selling feed for O.K. Feed Mills, and in 1955 became president of the company. Wenderoth began a path of growth that would see the company post revenue of $928.3 million in 2010.

H.L. Hembree III, a prominent Fort Smith businessman who was involved in trucking, banking, farming and many other pursuits, died in late January. He was 79. Hembree was a top executive with Arkansas Best when the company’s trucking business began to emerge as a national player.

Fred Baker Sr., World War II veteran and notable Fort Smith businessman, passed away suddenly on Jan. 10, according to his family. He was 89. Baker is best known as being a co-owner — with his son Fred Baker Jr. — in several Fort Smith radio stations, to include KFSA, KREU and KISR 93.7.

The year also brought the death of longtime Fort Smith Mayor Ray Baker. Baker died March 4. He was 71.

Baker was mayor of Fort Smith between 1991 and 2010, and served on the Fort Smith Board of Directors for almost 10 years. Ending almost every speech with “Life’s worth living in Fort Smith, Arkansas,” Mayor Baker was considered by many as the city’s best cheerleader.

He also taught American History at Southside High School for 44 years, and taught English and geography at Ramsey Junior High School two years prior to moving to Southside. Baker was named the Arkansas Teacher of the Year, Arkansas PTA Teacher of the year, and in 1995 won the nationally prestigious Milken Family National Educator award.

Other deaths that made local news included former Tyson Foods CEO and Chairman Don Tyson, Arkansas Economic Development Commission Executive Director Maria Haley, and Arkansas’ “Fifth Congressman” Ray Reid.

4. Regional economy
The economic recovery anticipated for 2011 never fully materialized, but marginal improvements did happen. For example, the year began with a 9.2% metro jobless rate in January, and the number of unemployed at 12,209. It was February 1992 when the metro jobless rate was at or above 9.2%.

But by November, the metro jobless rate was down to 7.8%, with 10,241 unemployed.

Also, regional sales tax and hospitality tax collections posted gains compared to 2010.

"Despite the much anticipated announcement that Whirlpool would shutter its Fort Smith manufacturing facility, the Fort Smith regional economy continues to show surprising resilience,” Economist Jeff Collins said in the third quarter The Compass Report. “Sales tax and employment data will bear scrutiny over the next four to six quarters given continued erosion of the manufacturing sector and the forecast for slow growth nationally."

In addition to Whirlpool, major job moves announced during the year included new jobs with Sykes and Golden Living. However, Fortis Plastics, a supplier to Whirlpool, announced it will close.

5. Congressional, local redistricting
Congressional and local redistricting moved the political lines in dramatic ways during 2011.

Crawford County is split almost evenly down the middle with the western half in the 3rd District and the eastern half in the 4th. The city of Alma — about 5,000 people — will be split down the middle, with 2 city precincts voting in the 3rd District and 2 precincts voting in the 4th District.

Franklin County is moved entirely out of the 3rd District and into the 4th District.
Lavaca and environs in the northeastern corner of Sebastian County are pulled into the 4th District. Roughly one-third of Sebastian County below Greenwood and below Fort Chaffee and Chaffee Crossing will be in the 4th District.

Essentially, the Fort Smith metro area will soon have two Congressman — 3rd District Congressman Steve Womack, R-Rogers, and 4th District Congressman Mike Ross, D-Prescott.

Arkansas House and Senate districts were also redrawn. The lines created several interesting new districts. Senate District 9 now includes an eastern portion of Crawford County, the eastern and southern portion of Sebastian County, the southwestern edge of Franklin County and all of Scott County.

Senate seats attempted to include a target of 83,312 voters, while House seats aimed for a population base of 29,159.

“Redistricting is a very complex process that by its very nature will be partisan to some and non-partisan to others," said Sen. Jake Files, R-Fort Smith, in this report. "I can tell you that I had input into the district I represent, and although it didn’t come out exactly like I had hoped, it is fair to me and to our communities.”

6. Postal Service moves
On April 28, the U.S. Postal Service announced it would close the Fort Smith mail processing operation and move the work to Fayetteville.

And then everything changed.

The USPS on Sept. 15 announced a national plan that would include the study of about 250 processing facilities for possible consolidation or closure, reducing mail processing equipment by as much as 50%, decreasing the nationwide transportation network, cutting up to 35,000 jobs, and revising service standards for first-class mail and periodicals.

The USPS proposal announced Sept. 15 it would essentially move all mail processing in Arkansas to Little Rock and create lengthier mail delivery times and the loss of more than 200 jobs in Northwest Arkansas and Fort Smith.

The new study has also halted the transfer of mail processing from Fort Smith to Fayetteville. Leisa Tolliver-Gay, the USPS spokeswoman in Little Rock, confirmed that the Labor Day weekend plans to begin shifting sorting machines from Fort Smith to Fayetteville has been put on hold pending the outcome of the new national plan.

The USPS also on March 26 closed the 3400 Rogers Ave. station in Fort Smith. The station, near Creekmore Park, has been on the possible closure list for more than two years, with local postal union members as far back as picketing the to oppose the closure as far back as September 2009.

7. OK Industries sells to Mexico-based company
Celaya-Mexico-based Industrias Bachoco paid $93.4 million when on Nov. 1 it acquired Fort Smith-based OK Industries. Bachoco acquired OK Industries less than six months after the passing of Collier Wenderoth Jr., a U.S. poultry industry icon who assumed control of the family business in 1955 and grew it to a large regional poultry operation.

Philadelphia-based SSG, the company hired by OK officials to investigate various options for its business, recently reported the details of the transaction on its website.

“Starting in the summer of 2010, the poultry processing industry faced a sharp increase in the cost of inputs such as corn and soybean,” SSG noted. “Furthermore, as a result of overcapacity, the poultry processing industry has been unable to pass on the increased cost of inputs to customers. This dynamic has negatively impacted the profitability of O.K. and the entire poultry industry.”

Bachoco’s is the largest poultry company based in Mexico and its products include chicken, table eggs, feed and swine. The company was founded in 1952 and has 60 distribution centers and reported $2 billion in sales for 2010.

Prior to the transaction, OK Industries employed about 5,000 in western Arkansas and eastern Oklahoma. The company was one of the largest privately held operations based in Arkansas. The company operates large processing plants in Fort Smith and Heavener, Okla.

8. Actions against Sebastian County Circuit Clerk Ken Blevins
The drama during 2011 in the office of Sebastian County Circuit Clerk became so intense ii made national news when Blevins was named one of the top 100 Worst Bosses in America.

Blevins recently faced a contempt of court charge and possible arrest, but finally agreed to allow employees Tyanna Caldwell and Cassie Vega to return to work in the clerk’s office. He fired Caldwell and Vega on Nov. 16, but a grievance committee ruled Dec. 7 that he did not have cause to fire them. A subsequent order from Sebastian County Judge David Hudson required Blevins to allow the two employees to return to their jobs. Blevins refused had a Sebastian County Sheriff’s deputy escort the women out of the office.

In April. Caldwell was among six Circuit Clerk employees who complained to the county’s human resources department that Blevins created a “hostile work environment.”

Caldwell was part of a group of women who earlier this year alleged that Blevins sexually harassed them. On May 12, a three-member Sebastian County grievance committee ruled that Blevins sexually harassed office employees and created a hostile work environment.

9. Forward movement on Ben Geren, ballfield development
After on-again, off-again discussions through 2011, the Sebastian County Quorum Court on Dec. 12 voted 8-1 in favor of moving forward with the larger $8 million facility to be added to Ben Geren Regional Park in conjunction with the City of Fort Smith. Four court members were absent at Monday night’s (Dec. 12) joint meeting.

The Fort Smith Board of Directors had given tentative agreement to fund two separate softball complexes totaling approximately $2.8 million. Along with the city’s $4 million share of the aquatics facility, that’s around $6.8 million in new recreational projects contingent on a bond refinance vote set for the March 13, 2012, election. The Fort Smith Board voted Jan. 3 to set a March 13 election on the sales tax extension.

Both softball facilities will be city-funded with the county’s only commitment at this time for $4 million to the large-scale aquatics facility. Both city and county officials estimate operation of the aquatics facility will project a total loss of $125,000 each year, to be divided equally by the two entities.

10. Opening of Crystal Bridges
It’s not located in the Fort Smith region, but it’s not every day a world-class art museum opens within an hour drive of the region.

Located in Bentonville, the Crystal Bridges Museum of American Art officially opened its doors to the public on Nov. 11. The 201,000-square-foot museum is situated in a deep ravine within a 120-acre forested campus and was designed by world-renowned architect Moshe Safdie. Eight pavilions provide 12 distinct gallery spaces.

The museum is dedicated to American art and provides a perspective spanning five centuries from the colonial to the contemporary. For the most part, the museum configuration sets up a counter clockwise progression that chronicles the style, focus and direction of American art from colonial settlement until now.

The impressive museum, with an estimated price tag to-date of $1.4 billion, is still but in its planning infancy with respect to the art. During the last decade, the creation of the world-class museum has been kept secret as anonymous art auctions buys and purchases through special donor relationships have helped amass a collection of more than 1,000 pieces. Adding to the collection are several of the most important pieces from the lifetime personal collections of Alice Walton.