May/June 2016
John Brummett On the Trump Trail Anita Davis Downtown Visionary The Millennial Banking Challenge The Economy & the Election
John James Puts His Money Where His Mouth Is
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Contents May/June 2016 5 Publisher’s Letter Commentary
7 Sarah Huckabee Sanders The Year of the Outsider
8 Jessica DeLoach Sabin
28
Don’t Fear the Victims Of Manufactured Rage
31 Martin Thoma
Branding Is an Inside Job
33 Frank D. Scott, Jr.
A History of Bank Diversity Profiles
16 The Libertarians
10 54
The “Less Government” Party Grows
20 The Supply Side
UA Students Create Clothing For Walmart Dolls
24 Anita Davis
A Downtown Visionary
28 Insights Industry
38 Startup
Hoisting the Governor’s Cup
42 Tourism
24
The Good Times Continue to Roll
44 Manufacturing
NanoMech Takes a Quantum Leap
48 Energy
Still Low Prices at the Pump
10 Cover Story: John James Is on a Mission The CEO of Fayetteville-based Hayseed Ventures is preaching the evangelism
50 Jobs
of entrepreneurship and backing up his efforts with cold, hard cash.
Unemployment in a Free-Fall
52 Health Care
A Roundabout Way Of Passing Arkansas Works
62 Leadership
Sixth Sense: The Economy and the Election
64 Executive Q&A
Centennial Bank’s Deana Osment
66 Back Talk 4
TALK BUSINESS & POLITICS | MAY/JUNE 2016
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Features In Search of Donald Trump John Brummett travels Arkansas to dive deeper into the psyche of the legions of Donald Trump supporters.
34 The Millennial Banking Challenge Younger financial customers are looking for non-traditional services from the state’s traditional banks. COVER PHOTO: KAT WILSON
eptember/October 2014
Marlon
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ECTURE & LIFE
focused on rm is the result ire. With a e areas, the newly t respected and
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From the Publisher September/October 2014
Was moving primaries a success?
Normally as we enter the month of May, primary election is in the highest gear. The weather is warm, votTalk Business & Politics is owned by Marlon ers are being bombarded by last-minute ads and mailers Blackwell Natural State Media and is published six OUR and candidates are barnstorming the state. times a year.VOICE For additional copies, to be Talk Business & Politics is a multi-media news organization focused on includedbusiness in our mailing list, or for information This year, we did all of this by March 1, and lawand politics in Arkansas. Our new statewide platform is the result about advertising, contact Daniels of a merger between Talk BusinessKatherine & Politics and The City Wire. With a makers will revisit the primary calendar move in the at katherine@talkbusiness.net. combined 24 years of being news leaders in their respective areas, the newly legislative session. The measure that moved the merged Talk Business & Politics brand has become the most respected 2017 and May/June 2016 resourced media in the industry. primaries so Arkansas could be more relevant in the & and CEO Content isPublisher driven by Roby Brock Michael Tilley (The City Wire) and their presidential selection process had a caveat that it would Roby Brock team of veterans. The recent merger created the only media company in the be revisited in case it turned out to be a bust. state offering multi-platforms dedicated to business and political news, includroby@talkbusiness.net ing niche regional coverage and insights into Arkansas’ top economic sectors. By all accounts, it was a success. Arkansas saw a Art Director number of high-profile presidential candidates swing Brock isPistole, the host of Talk Business & Politics, which airs Sunday mornings at Bryan DesignMatters LLC 9:30 a.m. on KATV Channel 7, having interviewed more than 3,000 business through the Natural State. Hillary Clinton, Donald bryan@designmattersllc.com OUR AUDIENCE and political leaders. He also moderates a radio program which airs on NPR Ted Cruz andCEOs, Marco allexecutives madeof lastaudience leads with presidentsRubio and primary affiliates statewide. Supporting staff, contributors, and content partnersTrump,Our Executive Editor statewide. In addition, business ownersGOP of $2.5+candidates million in represent the most knowledgeable and experienced in their fields. minutecompanies appearances. Several other Michael Tilley sales revenue, elected officials at all levels, trade association executives michael@talkbusiness.net showed up early in the process. and higher education representatives also receive our publication and Digital platforms such as Talkbusiness.net, daily and weekly E-Newsletters, Facebook, Twitter, LinkedIn, YouTube and iTunes allow news and Sen. products. John Boozman and Congressman French Hill coasted to primary re-election bids. Editor information from around the state to be made accessible as it And the state toalso more money” Billkeeps Paddack Many of our was readers treated and viewers are the news“dark makers driving busi- in its Supreme Court races – a problem that is happening and those most affected in the know. bill@talkbusiness.net ness and political headlines in Arkansas, nationally and internationally. legislators need to address urgently and extensively. The end result is Judge Dan Kemp of The magazine edition reaches affluent decision-makers across the state and is Mountain View will be your new Supreme Court chief justice come January. Contributing Writers an essential resource guide for new entrepreneurs and leaders at all levels of Brawner government.Steve With a dedicated 12,000 copies bi-monthly, readers receive an While the relevance of Arkansas being a contender for presidential attention was a great Brown in-depth lookWesley at business and political profiles, the most current positive, the real note of success to me was voter turnout. Arkansas’ primaries drew a record developments in key regions and industries, plus corporate and policy strategies. John Brummett Kerri Jackson Case number of voters with some interesting takeaways. Todd Jones • Overall turnout for the primaries (639,146) was roughly 76% of what we saw in the Rex Nelson 2014 general election – a huge deluge of voters for a primary and more than double Casey Penn TELEVISION RADIO PRINT ONLINE E-NEWSLETTERS PODCASTS SOCIAL Jamie Smith the turnout in 2012’s presidential primary. Republicans set a new record for turnout Kim Souza at nearly 410,000 voters. Michael Wilkey • Interestingly, after analyzing a big sample of voter data, it appears that 30% of those Photographers that voted in the primaries had not voted in the last three primary cycles. They are Stephanie Dunn dunnmsteph09@yahoo.com “infrequent voters” that are either newly registered or tend to only vote in general elections. Tim Rand • Add to the mix that another 20% of those voters had only voted once in the last three pix@trand.com primary cycles and an astounding 50% of primary voters would be described as Bob Ocken “infrequent. ” bob@ockenphotography.com I suspect all of these positives will make for solid arguments that the primaries should Kat Wilson remain in early March. So enjoy the spring weather sans the political advertising, but stay katographic@gmail.com tuned for the fall. Like Arkansas weather, it can always take a sudden turn. Vice President Sales & Marketing Thanks for reading our magazine and our daily online news at TalkBusiness.net. Enjoy it Katherine Daniels and please share with your friends, family and colleagues. katherine@talkbusiness.net Story Topic Story Topic Story Topic Story Topic Story Topic Story Topic
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
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Commentary
In ‘Year of the Outsider,’ Let the People Decide By Sarah Huckabee Sanders Sarah Huckabee Sanders is a GOP consultant currently serving as senior adviser to Donald Trump for President. She has managed state and national campaigns, including the Huckabee for President campaign.
I
n 1924, Republicans from around the country gathered in Cleveland, Ohio – it was the first time a national convention was held there and it was also the first time women were given equal representation. Nearly 100 years later, Republicans are about to make history in Cleveland again, but for a different reason: they are on the verge of nominating a candidate who has never held political office to be the GOP’s standard-bearer for president. Former Mississippi Gov. Haley Barbour explained the rise of Donald Trump as only Haley Barbour can: Voting for Donald Trump is the “perfect middle finger” to the Washington political class. He’s right. Most Americans have lost confidence in political leaders on both sides in Washington and Donald Trump has given voice to their frustration. But the Washington political class is not going down without a fight.
Americans are sick and tired of a patronizing political class that always knows what’s best for us.
WHAT WILL HAPPEN? Every politician, pundit and political junkie in the country is speculating on what will happen in Cleveland. Will Trump clinch the 1,237 delegates to win on the first ballot at the convention? If not, will John Kasich, Ted Cruz or someone else emerge from a brokered convention? Most important, will the people or the party bosses get their way? Let there be no mistake: Trump leads by millions of votes and hundreds of delegates. If an establishment candidate like George W. Bush, John McCain or Mitt Romney had that big of a lead, the Washington political class and media would be falling all over themselves to declare him the presumptive nominee. Not Trump. Why? Trump is a direct threat to the Washington political class and Wall Street donor class because they don’t fund him and therefore don’t control him. Unlike many Republican and Democrat politicians, he is not their wholly-owned subsidiary.
So how do the GOP elites plan to stop Trump, who continues to win big states and add to his lead in votes and delegates? The latest and most ridiculous ploy is to change the rules at the end of the game and nominate someone who isn’t even running. Speaker of the House Paul Ryan was smart to distance himself from this anti-democratic effort, because even worse than a convention fight between declared candidates would be to nominate someone who didn’t have the courage to run in the first place. IMPOSSIBLE-TO-MEET STANDARDS Making the decision to run for president is a difficult one, but actually running for president is grueling, humbling and, at times, humiliating and painful. Day in and day out the candidate, his family, staff and supporters are viciously attacked by other campaigns and the news media. As a family member and adviser to presidential candidates, I’ve had people question my faith, disparage my fitness to be a wife and mom, and my name has never even been on the ballot. Presidential candidates are held to the highest and most impossible-to-meet standards, not just morally but intellectually and physically. We all know no one is perfect, yet we all want our candidates for president to be the second coming of Jesus Christ. Seventeen Republicans made the sacrifice to run for president. We are down to three. For all the talk about having a “fresh face” come in at a brokered convention to unite the party, the truth is nothing would do more to divide and destroy the party than to disenfranchise the people and nominate someone who has not earned it. Americans are sick and tired of a patronizing political class that always knows what’s best for us. This is “the year of the outsider” and voters in both parties have registered their disgust with the political class at the ballot box. If the party bosses deny the will of the people – including millions who are voting Republican for the first time – then the party bosses will have only themselves to blame for the result: Republicans could very well lose the presidency, their majorities in Congress, and the Supreme Court for a generation. This is America. Sometimes the people get it right and sometimes we get it wrong, but for the good of our party and our country, let the people decide. www.talkbusiness.net
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Commentary
Don’t Fear the Victims Of Manufactured Rage By Jessica DeLoach Sabin Jessica DeLoach Sabin regularly writes opinion columns that appear on talkbusiness.net. She can be reached by email at jessicadeloachsabin@gmail.com. Follow her on Twitter: @jessicaxan
F
or the better part of a decade, American politics has been transformed by the efforts of an incredibly strong but small and ultra-wealthy band of dissidents. These people – who are best known by the label “Koch brothers and friends” – began to earn more recognition in the mainstream as wealthy rabble-rousers shortly after the start of the Obama administration. But that occasion actually only marks the start of their success in raising an army of folks who would happily commit themselves to standing against all things government while claiming to be “taxed enough already” even though taxes on Americans were nowhere near as severe as they had been in the past. What many don’t know is that the people responsible for the rise of the Tea Party have had their sights set on limited government for a few decades. Even then they were putting their money behind the effort – but perhaps not in the most sophisticated or thoughtful manner. In 1980, David Koch ran for vice president of the United States as a libertarian, but his ticket only received 1% of the vote and his views were dismissed as “Anarcho-Totalitarianism” by conservative icon William F. Buckley, Jr. My how things have changed. During the midterm elections that followed the inauguration of President Obama, Democrats began to experience a conservative backlash, which would ultimately end up completely decimating Democratic strongholds in every level of government throughout the country.
What no one could have known was that the Tea Party would rise to the level of a legitimate political party – let alone completely upend the modern-day conservative movement.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
FUELED BY WEALTHY DONORS A robust fight over health-care reform quickly became toxic and the right’s quest to make the term “democrat” synonymous with “government overreach” became all too easy. But that’s because the success of the mission was entirely contingent upon the willingness of those with an affinity for anger toward government to take to the streets over their belief that the American people were on the verge of living under a tyrannical government. Wherever could they have gotten such an idea? We know now as we suspected then that this movement was fueled by the actions of a few wealthy donors who were hell bent on combatting the change that was promised by the Obama administration. But what no one could have known was that the Tea Party would rise to the level of a legitimate political party – let alone completely upend the modern-day conservative movement. The irony here being that by severely minimizing the democratic movement in the U.S., the Republican Party had created a tremendous opportunity to reposition itself as a party of moderates, thus creating the image of a safe-haven for the politically homeless. Unfortunately, such an opportunity was never to be grasped, as the party – awareness notwithstanding – had chained itself to the Frankenstein that had cleared a path for it into the future and must now be responsible for the antics of the loud minority that occupies leadership roles in both Congress and legislative bodies across the country. TRUMP AND SANDERS This brings us to Donald Trump and Bernie Sanders. Nothing about the political rise of these two individuals should be confusing. Trump is the beneficiary of the anger that is deeply held by many Americans. He presently reaps the benefits of the longstanding battle over health care between Democrats and Republicans that has completely weakened public opinion of government and politics altogether in this nation. The only thing he has brought to the table is a form of audaciousness that has, until now, been off limits. He’s the guy who is showing us the answer to the question “What if
someone just said what they thought?” Too bad that question doesn’t imply an application of thoughtfulness and intellect. He’s also employed his talent for playing off what he believes his audience wants to hear and, to many, he hasn’t been a disappointment. Donald Trump has been masterful at knowing his moment among a particular type of voter and has managed to capture the enthusiasm of those who have been sitting on the sidelines for years. On the other end of this rubber band lies Sen. Bernie Sanders who is similarly bombastic and his supporters mirror this. They, too, have had enough of the government and the political machines they have come to know. So much so that they are convinced that a self-proclaimed socialist who has chosen to run for the presidency as a Democrat would actually stand a chance at winning this particular upcoming election – the election that literally falls on the heels of the revitalization of the term “socialist” as a scare tactic. They believe that Sanders is capable of defeating a man who understands more clearly than anyone presently running how to utilize fear as a means of mobilization for his own purposes. OUR COUNTRY’S HYPER-PARTISANSHIP Somewhere in the middle of these extreme ends lies an answer we can all live with, I believe. But regardless of the outcome of the upcoming presidential election, there is a much larger problem that we must face. Make no mistake about it – whoever wins in November will cause a political backlash – but certain people will elicit more severe reactions
than others. If it’s Trump, we can expect greater unrest with the GOP and an identity crisis that will continue to play out in elected bodies all across the country. If it’s Sanders, we can expect the powers that be to go full-tilt on the “reclaim your country from the imminent destruction of socialism that’s headed this way” narrative. The results of which will be played out in governing bodies all across the country. We’re already seeing shades of this in Arkansas and every other state in the nation. When people get elected on the promise that they will always be against a major piece of policy as it is related to a president or political party, you get what we’re living right now. You get people, who out of pressure to maintain their elected positions, will go above and beyond to live up to their promise despite the fact that circumstances evolve and that reality is what must dictate leadership – not the fear of a response from a body of people who are the victims of manufactured rage. Until we get a grasp on the hyper-partisanship that is destroying our country and the expectations that people can reasonably possess of our elected officials, we will never get out from under the cloud that makes our future so uncertain. Never in my life have I ever wanted to get out from under everything I’ve ever known as politics and just start over. With a little faith and vision and a willingness to support new bold and innovate young leaders, we can do this – and there will even be a place for ideology. But collectively we should agree that no disagreement is worth the ruin that presently hovers over our current political atmosphere.
Winthrop Rockefeller came to a mountain and changed the world around him. We invite others to do the same. Learn more at www.rockefellerinstitute.org.
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Cover Story
ADVENTURE S
in Venture Capital John James, founder of both Hayseed Ventures and Acumen Brands, thrives in the world of entrepreneurship and innovation. By Michael Tilley PHOTOS: KAT WILSON
J
ohn James is passionate about the myriad challenges and limited opportunities of turning an idea into a multi-million dollar enterprise in Arkansas. He’s done it before, is doing it now, and says more should be done by governments and the business community to foster startup success.
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Cover Story: John James James, a self-described 40-year-old Millennial, was one of a group of Northwest Arkansas geniuses who turned the idea of selling medical scrubs online into Acumen Brands – which would eventually capture more than $100 million in venture capital and make its name as one of the nation’s largest online retailers of cowboy boots. That’s right. They moved from uniforms for the operating room, to selling kickers for the dance floor at Gilley’s. It’s simple. You start out selling medical scrubs, tinker with the concept, figure out how to maximize visibility through Facebook, get the family behind Little Rock-based Dillard’s to throw some fuel (cash) on the fire, and boom, Country Outfitter emerges. The story is certainly more complicated than that, but to James, the lesson from Acumen is in the recipe. “You put a bunch of smart people in [a room] who have cash flow and funding and then who knows what spins out of the ideas. The byproducts of the work are often more AHCA ad half page horizontal.pdf 1 valuable than the work itself,” James said.
What’s more, in the pre-Acumen days, the smart folks in venture capital board rooms around the U.S. didn’t believe a tech success could germinate in Arkansas.
“I’m the same idiot I was five years ago, but now I know more people.” – John James
“It proved it could be done and it proved it could be done in Fayetteville,” James said, but admitting that the Acumen success was 08/20/15 9:55 AM “exceptional and surreal.”
Arkansas nursing homes provide round-the-clock quality care for 35,000 patients and residents in over 229 skilled nursing facilities throughout our state. What’s more, nursing home organizations create and support 22,929 jobs statewide, providing a direct
While innovation labs, maker spaces and entrepreneurship events are growing in number, the rubber-meets-the-road work is in sifting through hundreds of ideas and then connecting viable ideas with money, management and marketing. The best bets for startup successes are in the areas of data, retail, logistics and possibly agri-tech, according to James. That’s where Hayseed Ventures, a company James founded about 11 months ago, is placing its focus. THE FRUSTRATION The recipe for startup success excites and frustrates James. The frustration is in what he calls “the gap,” which is capital support between $250,000 and $1 million. That level of funding is critical for a startup with a viable business model but needs an infusion of cash to scale it up. Roughly, the model works like this: a startup gets funded by friends and family. If it has legs, it will then need a Series A round ($1 million to $5 million) to keep growing. That is followed by a Series B (around $10
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economic impact in the communities they serve. Over $1.7 billion of value from nursing
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homes, their employees and their suppliers will be added this year to the Arkansas economy.
Members of the Arkansas Health Care Association strive everyday to continue
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The Arkansas Health Care Association’s affiliate organization, the Arkansas Assisted Living Association (AALA), is dedicated to the professional development of quality care through educational resources, effective communication and financial stability of the assisted living profession.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
million) to scale up. “Series B is where the jobs are created. ... When Dillard’s invested in us, we were a pretty valuable company and it was really fuel on the fire at that point,” James said. Then the Series C venture funding hits. It can be around $100 million, and was $93 million for Acumen Brands. Series C preps a company for acquisition or to go public. There are numerous venture capital funds that help with funding up to $250,000, but getting the growth capital cash is tough. How tough? James, who with Acumen had proved his ability to spin up a multi-million-dollar retail success, was only able in 2015 to raise $3 million for his Hayseed Ventures. Hayseed, based in the Old Post Office on the Fayetteville Square, is a “venture capital production studio” geared to birth valuable byproducts. He admitted that trying to raise $6 million for Hayseed was a “high goal,” but is pleased with the $3 million. It’s a sign of progress in Arkansas’ venture capital ecosystem.
“It’s a small step, but it proves that it can be done and it would have been impossible five years ago,” James said, adding that he is confident other venture capital groups based in Northwest Arkansas will grow their investment access. (Just a few days after the interview with James, it was announced that Bentonville-based NewRoads Capital Partners had partnered with Los Angeles-based Kayne Anderson Capital Advisors to form Kayne NewRoad Ventures II that will help provide some of the growth capital of which James said was needed.) Companies now in the Hayseed portfolio include Scrub Shopper, Smack and Feather. Smack helps consumer packaged goods (CPG) companies – a big market in the supplier community that surrounds Bentonville-based Wal-Mart stores – better sell new and existing products. The work includes customer acquisition. Feather is a unique operation that directly connects those who need home health help with home health providers. Feather founders moved their business from Memphis to Fayetteville.
Scrub Shopper is a medical uniform company Hayseed bought from Acumen. It’s the company James is the most excited about because it has the byproduct potential he says is key to be another Country Outfitter-type success. THE EXCITEMENT Excitement for James from the recipe is in how the deck is stacked against success. Seriously. The incredible odds against success that would frustrate 99% of people is what keeps James in the hunt. All he needs is a whiff of possibility. If he ever took time to visit Crater of Diamonds State Park in Arkansas, he’d want to know why only 37 acres are plowed for searching, and why he has to leave at 5 p.m. when the park closes. Only one out of 10 friends and family funding companies makes it, according to James. And of those, less than 30% will ever see a Series A round, and far fewer will ever get to the big leagues. “You can kind of do the math. ... So maybe we need to seed 100 companies as a
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Cover Story: John James state in order to get that one good IPO – I mean 100 good companies, not 100 that are mediocre,” James said. “But in 2014 I don’t think we seeded more than five or six companies as a state. I mean, what are we going to do, take 20 years to get lucky?” Which brings us back to Hayseed. James and Hayseed Chief Operating Officer Scott Andrews met with 106 startups in 10 months. They settled on working with just six of those. However, James was impressed with the number of applicants, and said it is a good sign for the state. “I really had no idea there would be that many for us to meet with. ... There were a few duds, but for the most part, most of those were great people with good ideas,” James said. James admitted that he and Andrews are “dreamcrushers.” “We’re brutally honest. Because sometimes you see some really brilliant people working on some really bad ideas,” James explained. But the honesty comes with pointers. James said they always try to provide tips on how to tweak the model. Piltdown Outdoor Co., one of the Hayseed companies, was initially rejected. Piltdown CEO Trey Anson returned with a fix for all of the reasons he was initially rejected. Anson was persistent. His blog details the first backpack he created: “That first pack took me two-thirds of forever to finish, and looked like something you’d take home from the bar at 2 a.m. It had all the right stuff on it but the seams were a little busted up, the straps were crosseyed, the zippers were missing teeth. I wasn’t going to show it to my friends but it made me happy and I had no regrets.” To minimize their regrets, James and Andrews look for a business idea with the potential to gear up quick and be a $10 million company with a relatively small amount of capital. Once found, they might join the management team, create or refine a business model, or help get initial traction with customer acquisition and marketing. As James says, he gets amped up moving a company “from zero to 30 miles an hour.” “I feel like my place in life ... truthfully it’s from that half-million to $1 million revenue to $10 million. That’s my sweet spot.
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I love it. I’m kind of like a marketing plan in search of a product,” James said. To that point, James said it is necessary
“You have to be able to ask for help when you need it. ... You have to ask, ‘Am I in my sweet spot?’”
TALK BUSINESS & POLITICS | MAY/JUNE 2016
– John James
for himself and others in startup leadership to know their limitations. “You have to be able to ask for help when you need it. ... You have to ask, ‘Am I in my sweet spot?’” James said, adding that “the people who build the bridge are not always the people needed to operate the bridge.” THE SUCCESS EXAMPLE Menguin, an online tuxedo rental company, is a good example of a company nurtured by James and Hayseed. A Silicon Valley Bank rep called James about a company with roots in Atlanta and Dallas that had a good idea but needed help to reach its potential. James called the Menguin partners and invited them to Fayetteville for a day to “whiteboard” ideas. The company was then doing about $5,000 a month, and James liked what he saw and what he was hearing during the Fayetteville meeting. “I told them, ‘It’s a shame you guys aren’t here in Fayetteville because I could really sink my teeth into this problem and help you, help you scale,’” James said. About two hours after the whiteboard session the Menguin partners called to inform James they were moving the entire operation to Fayetteville. James worried aloud to his wife that maybe he was the dog that had caught the van. But within a few months and with marketing and customer acquisition help from Hayseed, Menguin grew from a handful of people to about 20 employees. They outgrew the second floor space at the Old Post Office. Sales were closer to $5,000 a day. The company is “in the process of raising a very nice round of capital,” James said in the early April interview. The Menguin story also speaks to the value of relationships James and other venture capital leaders in Northwest Arkansas are building. Without his profile through Acumen, the Silicon Valley banker may not have known to connect James with Menguin. Those relationships are building connections and trust with the investment community around the country. “It makes the job easier. I’m the same idiot I was five years ago, but now I know more people,” James said.
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Libertarians Rising? Third party in Arkansas is trying to be more than a third wheel. By Steve Brawner
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
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n the last two election cycles, one political party in Arkansas has fielded a full slate of candidates to challenge the Republicans for state and federal offices, and it’s not the Democrats. Members of the Libertarian Party of Arkansas competed for all state constitutional offices and in all congressional races in 2014 and are on the ballot in all congressional races this year. In the First, Third and Fourth Congressional Districts, Republican incumbents are challenged only by Libertarian opponents. This will be the third straight election cycle where the party will be fielding candidates below the presidential level. It ran 28 candidates in 2014 and is running 23 this year. Of course, fielding candidates is a lot different than winning elections. The best any Libertarian could manage in a threeway statewide or congressional race in 2014 was the 6.36% won by Chris Hayes in the treasurer’s race, and in a two-way race in the Third District, Grant Brand won less than 21% facing incumbent Congressman Steve Womack. The party counts about a hundred dues-paying members at the state level and perhaps another hundred or so who are registered Libertarians but not active in the state party. SEEKING THREE PERCENT So no one is expecting a Libertarian landslide. However, another number seems within reach: 3%. If the party’s presidential candidate can hit that percentage in November, the Libertarians, founded nationally in 1971, will not be considered a “new” party under state law during the 2018 election cycle. That would save the party from having to collect 10,000 valid signatures to qualify for the ballot, an exercise that cost $34,000 for this year’s cycle as well as a lot of energy and legwork. That percentage seems attainable this year, particularly if the two major parties nominate polarizing candidates like Donald Trump and Hillary Clinton. In 2012, the Libertarians’ candidate, Gary Johnson, the former Republican governor of New Mexico, won only 1.5% of the vote in Arkansas. But a recent national poll showed him at 11% this year. “If you can detach yourself from it and
just look at it, it’s really interesting, but since there’s so much at stake, it’s also a little terrifying,” said Frank Gilbert, this year’s Libertarian Senate candidate and the party’s nominee for governor in 2014. What do Libertarians want to achieve? The party’s chair, Dr. Michael Pakko, UALR Institute for Economic Advancement chief economist and state economic forecaster, describes the Libertarian philosophy as “fiscally responsible and socially tolerant.” Libertarians are the party of minimal government – to the right of Republicans on fiscal issues and to the left of Democrats socially. Pakko describes the party’s coalition as being composed of three groups: small
“I believe that we should have the power to run our own lives, to make our own choices, and the only way to get there is to begin peeling away all these layers of federal government that are taking those rights away.” – First District Congressional Candidate
Mark West government constitutionalists, minanarchists who want minimal government and anarchists who want no government. Fundamentally, they agree on the “nonaggression principle,” meaning force should not be initiated to achieve social goals. So Libertarians as a party would stay out of personal decisions, shrink the military, support gun rights, end the drug war and abolish social
programs such as Social Security and Medicare. “It’s not because we don’t think that those are valid objectives for society,” Pakko said of the latter. “On an awful lot of issues, we can concede, yeah, that’s a great idea. If it’s such a good idea, maybe we should have someone more efficient than government implementing it.” Libertarians are running candidates in all four House races: Mark West in the First District; Chris Hayes in the Second; Steve Isaacson in the Third; and Kerry Hicks in the Fourth. Two Libertarians are running in state Senate races: in District 26, Elvis Presley (yes, that’s his real name); and in District 32, Jacob Mosier. Nine candidates are running for state House races, while seven are running for local offices. SUING THE STATE Meanwhile, the party is suing the state to get eight more candidates on the ballot. A state law requires the party to nominate its full slate by the end of the filing period. That law forced the party to hold its nominating convention for the November 2016 election in October 2015, while Republicans and Democrats didn’t choose their candidates until March 1. On Feb. 25, U.S. District Judge James Moody denied the party’s request for a preliminary injunction allowing it to add or substitute nominees. He ruled that candidates had not been harmed by their early nominating date and that the state “has a strong interest in preventing voter confusion by limiting ballot access to serious candidates.” A trial date has not been set. Moody in 2015 rejected a similar lawsuit by independent candidates. But Pakko thinks the cases are different enough that the party has a shot of winning. To improve its chances and increase its legal standing, the party nominated eight additional candidates in February who are waiting to see if they will be allowed on the ballot. Gilbert is running a grassroots campaign for Senate. As of early April, he had made about 20 campaign stops. Unlike many Libertarians, he’s not philosophically opposed to raising money; it’s just hard for third-party candidates to do so. In the 2014 governor’s race, he raised about $5,000. He plans to be more active this year than he was www.talkbusiness.net
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Profile: Libertarians Rising then, and he was pretty active then. “That campaign to me was missionary work,” he said. “It was an effort to find and build some local support. … I’m not going to be doing missionary work this time. I want as many votes as I can get.” FEELING HOPEFUL Pakko sees reason for optimism. He sees more interest in the party this year, especially at the presidential level. Fox Business already has hosted two debates featuring the Libertarian candidates. Gilbert is optimistic, too. He says members of the Tea Party traditionally have seen Libertarians as a distraction from their goal of changing the Republican Party from within. But the Republicans have made too many unkept promises, such as repealing Obamacare. At the state level, he notes that Republicans changed abortion law because they wanted to, but other things haven’t yet changed, such as the private option, the program that uses federal Medicaid dollars to purchase private insurance for lower
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income Arkansans. As of this writing, Gov. Asa Hutchinson has been trying to extend the program with changes and a new name, Arkansas Works. “That part of the Republican Party that believed that Asa Hutchinson was going
Dr. Michael Pakko, Libertarian party chair
TALK BUSINESS & POLITICS | MAY/JUNE 2016
to end the private option, those folks are talking,” Gilbert said. In the First District, Mark West, an office manager and bi-vocational pastor, said he ran as a Libertarian because the party has the “most constitutional viewpoint.” West said his father worked hard to give him a better life, and he’s afraid his own children are inheriting too much debt and not enough individual liberty. “I believe that we should have the power to run our own lives, to make our own choices, and the only way to get there is to begin peeling away all these layers of federal government that are taking those rights away,” he said. Given the difficulties of running as a Libertarian, and the party’s lack of historical success, why not run as a Republican or Democrat and try to move one of those parties in a more libertarian direction? West doesn’t see much hope in that strategy. “Both parties aren’t moving,” he said. “If they were going to move, they would have moved decades ago. They have had oppor-
tunities. They’ve had candidates that have tried to move them that direction, and both of those parties continue to drift toward a more authoritarian viewpoint of government, and neither one of them show any desire to want to do anything different.” In the Third District, Isaacson is a newcomer to the party. A Vietnam veteran who retired after 20 years in the military, he said he was run over by a tank in 1985 and spent more than 23 years fighting the Veterans Administration for his benefits. Veterans advocacy is his top concern, and he also promises a self-imposed limit of three terms. He said he was approached about challenging Congressman Steve Womack for the Third District seat as a Republican but ran out of time raising money to pay the filing fee. He then started collecting signatures for an independent run but fell short of that number as well. When the Libertarians’ Third District candidate, Nathan LaFrance, moved to another state, Gov. Asa Hutchinson allowed the party to nominate another
candidate in his place. At a special caucus in Fayetteville, Isaacson was questioned about his views to see if they matched the party’s. They were close enough. He says he wants to “get the government out of our pockets and out of our backyard.” “There’s some things in the Libertarians I do agree with, but like I told them, basically I’m going to be myself,” he said. LOOKING TO BE COMPETITIVE Pakko is hardly expecting a Libertarian landslide this year, but he’s hoping the party can be more competitive than in the past. In a number of races, the Libertarian is the only opponent facing a major party candidate. “In some cases, depending on the circumstances and the ability of our candidates to marshal some resources and mount effective campaigns, I don’t think it’s inconceivable that we might win a race here or there,” he said. So what then? What if the dog catches the car, and the party starts growing and
winning elections? Both Gilbert and Pakko said that would create some challenges. Pakko said that the party has always been concerned that someone who’s really not a Libertarian – a disaffected Republican or Democrat – would use the party as his or her own vehicle, or that outsiders would seize the party’s reins. Even if those don’t happen, success would require a lot of newcomers. “When the time comes that the Libertarian Party is ready to break through and be competitive in the electoral process, it’s going to feel to an awful lot of insiders that it’s an outside takeover,” he said. Gilbert says that he has long been concerned about the party’s purists, or “this percentage in the Libertarian Party who really don’t want to get involved in electoral politics.” After decades of working for the cause, he wants the party to be more than a club or debating society. He’s ready to win, and then deal with the consequences. “I’m in the camp for, ‘Wade out into it neck deep,’” he said, ‘“and see what happens.’”
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Profiles Service
India Callahan, apparel merchandising student at the University of Arkansas, displays a My Life fishing activewear garment the team pitched to Walmart toy buyers last year.
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PHOTO COURTESY OF UNIVERSITY OF ARKANSAS
THE SUPPLY SIDE:
All Dolled Up Apparel merchandising students at the University of Arkansas create fashionable outfits for Walmart dolls. By Kim Souza Editor’s note: The Supply Side focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. This feature, which can also be found at TalkBusiness.net, is managed by Talk Business & Politics and sponsored by Propak Logistics.
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t’s not every day a college sophomore majoring in apparel merchandising creates a garment, pitches the design to Walmart and then a few months later sees the product on a Walmart shelf. That’s exactly what 40 students from the Apparel Merchandising and Product Development School of Human Environmental Sciences at the University of Arkansas were doing on April 14 at the retail giant’s home office in Bentonville. It’s the third year Walmart has worked with UA students on product designs for the retailer’s My Life doll clothes, which are sold nationwide in its retail stores. Dr. Kathy Smith, clinical associate professor in the School of Human Environmental Sciences’ apparel program, was contacted by Walmart toy buyer Haley Kochen about getting students involved in the project in 2014. Kochen graduated from the UA program in 2010. The clothes designed by the participating UA students are featured on Walmart’s My Life doll, an 18-inch doll that wears various styles of activewear, and was created for young girls ages 8 to 12. Each outfit comes with a tag featuring the UA logo and noting that the outfit was “designed by an apparel student.” The partnership Walmart has with the UA design students makes the students service suppliers in a sense for the retail giant. ACTUAL EXPERIENCE India Callahan, an apparel merchandising and product development major and one of the designers, described the experience as almost surreal. Her My Life fishing activewear garment set was selected by Walmart last year and hit stores this spring.
“It is very seldom that you find this kind of opportunity, especially at a collegiate level, where you get the chance to work with the No. 1 retailer in the world,” Callahan said. “It builds skills on a corporate level and gives you first-hand experience of how it is to work on the product development side.”
“Students can proudly build their resumes and portfolios with hands-on experiences which will set them apart from their peers as they begin their careers.” – Dr. Kathy Smith, University of Arkansas Other winning designs by last year’s class include a watermelon dress, garden clothes, hip hop dancer ensemble, red polka dot swimsuit and pink wetsuit and various dresses for multiple occasions. “Projects such as the My Life doll designs allow students to interact directly with professionals in the apparel industry,” Smith said. “Students can proudly build their resumes and portfolios with hands-on experiences which will set them apart from their
peers as they begin their careers. Walmart and the UA have allowed our apparel students to showcase their work in a national retail arena.” She said 2014 was the first year the sophomore class took part in the design program for My Life doll clothes. She said 24 students presented to the Walmart buyer team that was supposed to choose one design, “but they took six instead, because the designs were that good.” The students’ spring designs were ready a full year ahead of distribution, which is the typical schedule for the apparel supply chain, Smith said. The winning 2014 designs first debuted in Walmart stores last spring. She said the students spent several months researching style and color trends before creating their garments and accessories. The students design the doll clothes using computer-aided drafting software for apparel, which is typically taught to sophomores. The designs are then reviewed by the Walmart team as the students make their presentations. The winning designs move to the next phase of manufacturing, which is handled by one of Walmart’s garment suppliers in Vietnam. Walmart spokeswoman Danit Marquardt said students receive class credit for the project, but no money is paid for chosen designs because it is part of their curriculum. Smith and Kochen said the experience is invaluable as it gives these students an inside look at how the fashion retail business works and it provides opportunities for them to network with professionals a full two years before they graduate. ‘FRESH IDEAS’ “This is a great learning experience, www.talkbusiness.net
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Industry: THE SUPPLY SIDE understanding the cost implications of all of the design decisions that you make and designing a garment that would hit a certain cost threshold,” said Kochen, who has been with Walmart since 2010. “A lot of beautiful things I love can’t be executed because of cost, but I’m learning that you can make beautiful designs that still fit within our ‘Every Day Low Price’ model. I’m excited to be able to give back to the program that has been so good to my career. I didn’t envision doll clothing, but it’s a really fun program to develop.” There were 24 students who presented designs to Walmart last spring and merchants chose designs by 14 of them that hit stores earlier this year, Smith said. “It’s great that Walmart is working with students today because they are the future of this industry. They have fresh ideas which companies can help cultivate so students can be more productive employees when they graduate. This is a fun project and we are excited to be able to incorporate industry and real-life perspectives in the curriculum,”
Smith said. Smith said the exercise in garment design is especially helpful in that the final product will be used by children. She said this adds another layer of scrutiny for the designers who have to be sure the products and accessories are safe and age appropriate. Smith said the students must also keep the company they are designing for in mind and use the consumer as the ultimate guiding force in the product development and retail merchandising process. JUNIORS, SENIORS STUDY OTHER PHASES While the garment design project is typically handled by sophomores, Smith said it is not the end of students’ outreach with the retail fashion and manufacturing industry. She said juniors and seniors learn the rest of the supply chain in creating a prototype for manufacturing and mass production and then merchandising and retail distribution is the final phase. The seniors were preparing for a runway fashion show in late April at the Fayetteville
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Town Center, Smith said. Metal and Shine was the theme for this spring show where all the fashions were designed and produced by the students in the Apparel Merchandising and Product Development School at the UA. “We are blessed to be able to work with Walmart and other industry leaders in the apparel industry with our students and each year we see our graduates find jobs in New York, Dallas and other fashion hotspots,” Smith said. “Several of them have also landed corporate jobs at Walmart.” The doll clothes industry is making a comeback thanks in part to the popularity of American Girl, My Life and other 18inch dolls in recent years. Upstart Business Journal reports that many toy manufacturers pay as much as six figures, which is more than the typical $60,000 to $70,000 regular fashion designers can earn. The caveat to landing a doll clothes design job is that there aren’t that many, fewer than 500, according to Coroflot, a design-job website. Mattel has about 25 garment designers for its Barbie line.
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Giving LoveTo an Area That Needed It Downtown visionary Anita Davis finds her calling in old buildings, placemaking, purses and cornbread. By Rex Nelson
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nita Davis never set out to rehabilitate part of downtown Little Rock. She wasn’t a historic preservation activist or one of those people who write letters to the local newspaper. She describes herself as shy. She simply likes walkable neighborhoods and felt it was time to give back to the city she has called home since the late 1980s. “I started thinking one day about the fact that I had never really been involved in the community or given anything back,” Davis says during breakfast at the Capital Hotel. “I had a bunch of stuff that I needed to store and began looking for a place to put everything. What I found was a building on South Main Street.” A love affair with the neighborhood ensued. Davis, a Murfreesboro native, purchased the Bernice Building at 1417 South Main St. in 2004. A year later, she bought an empty lot at 1401 South Main. She admits now that she viewed the neighborhood as dangerous at the time and ran back to her car following her first visit there. But she was captivated by the Bernice Building, constructed in 1923, and soon was reading everything she could get her hands on about the concept of “placemaking.” She found herself attending conferences from Boston on the East Coast to Seattle on the West Coast in an effort to learn more about building walkable neighborhoods. BRINGING IT TO MAIN STREET One of Davis’ daughters lived in New York City in the Chelsea neighborhood. She could easily walk to restaurants, grocery stores, boutiques and entertainment venues. Davis wanted to see if she could bring a touch of Chelsea to South Main Street. She also wanted to bring a touch of Murfreesboro. Yes, Murfreesboro. “When I was growing up in Murfreesboro in the 1950s, we had three drugstores downtown, a hardware store, a movie theater and a lot more,” Davis says. “We could walk to all of those places. You didn’t have to get in the car and drive from place to place. Anyone who grew up in a thriving Arkansas town in the 1950s and 1960s knows what I’m talking about. I had seen it work in a town as small as Murfreesboro, and I had seen it work in a city as big as New York.”
Davis’ parents, Clarence and Bennie Sue Anthony, were well-known in their corner of Southwest Arkansas. Davis had a maternal grandmother named Bernice (who once had worked at Franke’s, the venerable Little Rock cafeteria), which was another part of the attraction of the Bernice Building on South Main. The empty lot adjacent to the building once had been the site of a Captain D’s fast-food restaurant, which had burned. The restaurant’s owners decided not to rebuild in a neighborhood that was becoming increas-
“I fell in love with the area, and I’m constantly looking for ways to bring more people here.” – Anita Davis ingly downtrodden. There were still crepe myrtles on the lot. Davis began bringing in other plants and benches. A sculpture competition was held. In 2011, a wooden structure was built to serve as a shelter. The Bernice Garden was born, a place that’s now the home to everything from Mardi Gras celebrations to beard-growing contests to farmers’ markets to the annual Arkansas Cornbread Festival each fall. Prior to Captain D’s opening in January 1981, the lot long had been the home of a tiny restaurant known as the Little Rock Inn. Suddenly, there was life again at 1401 South Main St. THRIVING BUSINESSES By 2006, Davis was ready to make another purchase. This time it was the Lincoln Building at 1423 South Main St., which had been built in 1906. In 2007 on the other side of Main Street, she bought the property that once had housed a popular dairy bar known as the Sweden Crème. Now, the Bernice Building
houses the downtown location of Boulevard Bread Co. The Lincoln building houses the Green Corner Store and the soda fountain that has helped make Loblolly Creamery’s products well known across Arkansas. The old Sweden Crème is now an innovative restaurant known as The Root Café, which has received national attention. All of these businesses attract people from throughout Central Arkansas and even out-of-state visitors to South Main Street on a daily basis. Between Boulevard Bread and the Green Corner Store is the home of studioMAIN, a nonprofit organization that brings architects and others in the design community together to introduce urban design concepts for Little Rock. Exhibitions sponsored by studioMAIN have included everything from the work of students to professional designers. An architectural film was produced for the Little Rock Film Festival, and pop-up events are held throughout the city to show what neighborhoods can become. Design awards are given and partnerships have been established with organizations such as the Arkansas Arts Center. Boulevard Bread began serving Little Rock customers in 2000 at its flagship location at the corner of Kavanaugh Boulevard and Grant Street in the Heights neighborhood. Attracted by the South Main vibe, Boulevard’s owners decided to open a downtown location with an expanded bakery that’s open Monday through Saturday from 7 a.m. until 3 p.m. The nearby Green Corner Store describes itself as “Arkansas’ first eco lifestyle store” since products sold there are made from natural, organic, recycled or reclaimed materials. Many of the products – ranging from bath and beauty items to apparel to packaged food – are made in Arkansas. Owner Shelley Green calls it a chance to “showcase the array of green products that are both beautiful and functional.” The soda fountain portion of the building, which had housed the C.H. Dawson Drugstore from 1905-67, became the home in 2012 to Loblolly Creamery, founded by Sally Mengel and Rachel Moore. They debuted their ice cream samples at the 2011 Arkansas Cornbread Festival. Loblolly ice cream initially was sold only at the Green Corner Store. Now, Loblolly products, which often are seasonal in nature and www.talkbusiness.net
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Profiles: Anita Davis use local ingredients as much as possible, can been found in numerous locations, from restaurants such as Big Orange and Graffiti’s to retailers such as Whole Foods and Stratton’s Market. With the success of its ice cream, Loblolly diversified into drinks and syrups. The ice creams have names such as Rock Town Bourbon Pecan, Little Rocky Road and Earl Grey Lemon. On the other side of Main Street, Jack and Corri Sundell opened The Root in June 2011 after three years of planning. They featured everything from burgers to homemade bratwurst to vegetarian dishes and soon gained a dedicated following of diners. In December 2014, The Root won an award from the HLN cable television network’s program “Growing America: A Journey to Success.” The honor came with a $25,000 check. Soon afterward, it was announced that The Root had been awarded a $150,000 Mission Main Street Grant from JPMorgan Chase Bank. The Root was among just 20 small businesses nationally to get a grant. Using shipping containers, the
Sundells are expanding the restaurant. Three containers are being used for additional dining space, three containers are being used to expand the kitchen and one is being used as a walk-in cooler. The premise of the HLN program won by The Root was that teams of MBA graduates and students from top business schools across the country would help three small businesses become more efficient. Also featured were a disaster-relief company in Denver and a barbershop in Detroit. The team in Little Rock helped the Sundells improve their website and their social media efforts. PURSE MUSEUM While the Green Corner Store, Loblolly Creamery, Boulevard Bread and The Root Café were achieving acclaim in the neighborhood she had adopted, Davis had her own expansion plans. She has always enjoyed collecting items, and purses became a specialty. Davis was intrigued as a child by her mother’s and grandmother’s purses, con-
“If you grew up in Arkansas, you grew up eating cornbread. I see it as a link to our shared history and our grandmothers who would make the cornbread.” – Anita Davis
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sidering them a reflection of the individuals. She was part of a group that put together a traveling exhibit titled “The Purse and the Person: A Century of Women’s Purses” that stopped in cities across the country, including the Historic Arkansas Museum in Little Rock in 2006. Among the cities where the purses were exhibited were Dallas, Seattle, Sacramento and Pasadena, Calif. Davis eventually decided to create the Esse Purse Museum at 1510 South Main St. in a building that had been constructed in 1946. The museum opened in June 2013. Davis says she started collecting purses more than three decades ago but having one of the premier collections in the country was “not intentional. It was kind of my way of honoring women. There just aren’t a lot of things in this country that honor women,” she says. Davis believes the museum complements her vision for the rest of South Main Street, which she likes to describe as the “feminine side of Little Rock,” not because men aren’t welcome but because she sees it as an area
that’s open to new ideas. The purses on display – more than 250 of them – are arranged by decade beginning in 1900. Davis views the collection as not only a look at the history of fashion but also as something that gives insight into the history of women. Photos and accessories accompany the purses. Davis’ collection grew to more than 3,000 handbags, most of which were stored in her attic before the traveling exhibition, which toured the country for three years. Davis is hopeful that the museum will lead to additional restaurants and shops along South Main Street. Though she’s a collector, Davis has a more muted personal style. She admits that she carried the same shoulder bag for a decade prior to opening Esse. In 2014, The Huffington Post included Esse on its list of the “World’s Hottest Museums.” It wrote: “Set in an emerging neighborhood filled with boutiques and trendy eateries, Esse Purse Museum celebrates the art and history of women’s handbags. And the best part is that it sells purses too.” Also on the list were the Crystal Bridges Museum of American Art and the 21c Museum Hotel in Bentonville. Among other museums on the list were the Dali Museum in St. Petersburg, Fla., and the Astrup Fearnley Museet in Oslo, Norway. Anita Davis was in very good company. MAKING GOOD THINGS HAPPEN “When I first got involved with this neighborhood, I asked myself, ‘What do you want it to be?’” Davis says. “I fell in love with the area, and I’m constantly looking for ways to bring more people here. I also feed off the energy and ideas of people like Corri and Jack Sundell. I like people who make things happen, and they know how to make things happen.” Davis is quick to give credit to other people and entities who have helped spur development along South Main Street. They include: • Joe Fox and his Community Bakery at 12th and Main. The bakery began in the Rose City area of North Little Rock in 1947 but moved to its current location when Fox purchased it in 1983.
Fox moved to Little Rock from Boston in the 1970s and says he yearned for a place where he could read The New York Times and get a bagel and a good cup of coffee early in the morning. Fox became the Little Rock distributor for The New York Times. Fox has more than a dozen bakers who work through the night.
• The nationally award-winning literary quarterly Oxford American, which moved its offices to South Main Street several years ago and then teamed up with Matt and Amy Bell for a restaurant and entertainment venue known as South on Main, which is in the building once occupied by the popular Tex-Mex restaurant Juanita’s. South on Main has received acclaim for its food and the quality of its concert series. • Midtown Billiards, which made Esquire magazine’s 2007 list of Best Bars in America. Midtown holds a private club license so it can stay open until 5 a.m. and is a favorite haunt of musicians, restaurant workers, newspaper reporters and others who work late. The South Main Street scene received another boost in February 2015 when Bart Barlogie Jr., Eric Nelson and Jason Neidhardt opened what’s now Raduno Brick Oven & Barroom, which features Neapoli-
tan pizzas from a double-deck, brick-lined gas oven that can reach temperatures of 650 degrees. To keep things in the South Main family, the owners announced from the first that they would use products from Loblolly and Boulevard. ‘GO FOR IT’ Davis calls her involvement along South Main Street “the best thing that has ever happened to me.” She said it was “an area that needed some love, and I love it. What’s funny is that I had once been warned by my dad to never buy a building with a flat roof. All the buildings I’ve bought down here have flat roofs. What would he think?” Davis says she has learned through the years to “figure out what you like and go for it.” So what does the future hold for Davis? “I don’t really have firm plans right now,” she says. “I’ve found that running a museum is a full-time job.” Davis would like to see the Southside Main Street organization, a nonprofit entity that promotes economic development on Main Street between Interstate 630 and Roosevelt Road, continue to grow. Southside Main Street is affiliated with Main Street Arkansas and the National Main Street Center. She also wants the Arkansas Cornbread Festival to grow. This year’s event will be held Oct. 29 with the Arkansas Hunger Relief Alliance and Our House as beneficiaries. The stated goal of the festival, which began in 2011, is to raise awareness and funds for worthy nonprofit organizations while celebrating Southern culture and heritage through food, crafts and music. “If you grew up in Arkansas, you grew up eating cornbread,” Davis says. “I see it as a link to our shared history and our grandmothers who would make the cornbread. What better way to pull in a diverse audience is there than food? I know I grew up on cornbread. We had it about every day with our vegetables.” These days, there are plenty of food, shopping and entertainment options along South Main Street in Little Rock, thanks in large part to a lady who remembers what it was like to grow up in Murfreesboro. www.talkbusiness.net
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Insights PHOTO COURTESY OF THE STATE CHAMBER/AIA
PHOTO COURTESY OF UNIVERSITY OF ARKANSAS
Corey Thompson, founder and CTO of WattGlass, shows solar panels that have a prototype for the anti-reflective, self-cleaning glass coating that he invented.
Standing in front of the State Chamber/ AIA’s new mobile unit, Chris Masingill of the Delta Regional Authority addresses those in attendance at the announcement as Gov. Asa Hutchinson and Randy Zook look on.
State Chamber/AIA Seeks to Boost Skilled Workforce The State Chamber/AIA has a new vehicle to help get its message out about shrinking the “skills gap” that exists between Arkansas’ growing labor pool and industry and economic development prospects. The “Be Pro Be Proud” initiative is using a high-tech mobile unit to travel the state and visit companies, schools and events to showcase skilled trade professions and broaden awareness of their impact on the state’s workforce. The vehicle is designed to be an engaging tool that will provide information about training resources, currently available positions and descriptions, skills needed, and how to start the process of beginning a skilled professional career. In March, Randy Zook, president of the Arkansas State Chamber of Commerce and the Associated Industries of Arkansas, introduced the campaign and notes that the state’s “skills gap” – especially in manufacturing – has widened in the past decade and the pipeline of workers in Arkansas and across the U.S. is not adequate to fill the pressing need. “This important and extraordinary effort will pave the way to help Arkansas’ young people make better decisions about career opportunities available to them and how to better prepare for those opportunities,” Zook said. Chris Masingill, federal co-chairman of the Delta Regional Authority, said the launch of the new program will aid economic development efforts and help to attract better-paying jobs to depressed areas of the state. “As we are seeing more and more companies come back to America and locate in the Mid-South, our communities must have a skilled and abundant workforce to attract jobs and support businesses as they grow in our region,” Masingill said. “This initiative will provide students, families, and community leaders in Arkansas’ Delta region with the information and inspiration to obtain technical skills and career training that meets the needs of businesses and industries to attract good-paying jobs to Delta Communities.” Gov. Asa Hutchinson and Walmart Vice President of U.S. Manufacturing Cindi Marsiglio were also on hand at the Statehouse Convention Center in Little Rock for the announcement of the public-private partnership.
UA Startup Gets $ 746,366 Grant The National Science Foundation has awarded a $746,366 grant to WattGlass LLC to further develop the University of Arkansas’ patent-pending coating technology that makes glass anti-reflective, self-cleaning and highly transparent. The nanoparticle-based coating will increase the efficiency of solar panels and reduce their cleaning and maintenance costs, said Corey Thompson, chief technology officer for WattGlass, a Genesis Technology Incubator client at the Arkansas Research and Technology Park. “Solar panels collect dust, dirt and grime, which reduces output and increases the cost per watt,” said Thompson, who founded the start-up company while a graduate student at the university in 2014. “With our anti-reflective and self-cleaning coating, more light penetrates the glass to be turned into electricity by the solar cells.” The coating’s nanostructure causes a self-cleaning effect on the glass by changing the way water reacts to its surface, Thompson said. “When you put a drop of water on a normal piece of glass, the drop forms a bead and doesn’t generally move,” he said. “With our coating, that drop of water spreads rapidly and when it does that it picks up dirt and other contaminants from the surface and literally pushes them to the edge of the glass. A light rain that would normally create mud on the surface of the panels suddenly is able to clean off the majority of the dirt.”
FMH Conveyors Expanding Operations in Jonesboro FMH Conveyors, a global leader in material handling equipment for fluid truck loading and unloading applications, has announced it is expanding its operations in Jonesboro and will begin construction on a new 195,000-square-foot manufacturing facility at the corner of Barnhill Road and Highland Drive. The $12.5 million investment will create 110 new jobs. “FMH Conveyors is a world-class company that has had a presence in Arkansas for many years,” Gov. Asa Hutchinson said. “The fact they chose to expand their operations in Jonesboro is testament to the quality of the local, existing workforce.”
Insights is compiled by Talk Business & Politics Editor Bill Paddack. Possible items for inclusion can be sent to him at wbp17@comcast.net.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
PHOTO COURTESY OF UNIVERSITY OF ARKANSAS
The winning design focuses on redeveloping Mayflower with a new type of walkable town center.
Nabholz Construction Gets Red Cross Honor Nabholz Construction Services received the 2016 Clara Barton Distinguished Humanitarian of the Year award from the American Red Cross serving Greater Arkansas at the organization’s Arkansas Heroes Celebration Luncheon on March 4 in Little Rock. The Red Cross recognized Nabholz for its “generous support of the mission of the American Red Cross across a variety of platforms from generous financial support for the daily disaster responses in Arkansas like residential fires that occur around the clock as well as large scale disasters, like the Vilonia tornado that hit close to Nabholz’s corporate home of Conway.”
‘Slow Street’ Wins Urban Design Award
McKee Foods, Gentry Develop Trail System
The University of Arkansas Community Design Center’s project Slow Street: A New Town Center for Mayflower has won the 2015 World Architecture News’ Future Project Urban Design Award. This project was chosen as the winner from six shortlisted projects that expressed a diverse range of scale and intervention. A second project by the center, Texarkana Art Park and Perot Theatre Revitalization, was one of the remaining shortlisted projects along with entries located in Washington, D.C., Turkey, France and the United Kingdom. The center’s project is based in the Central Arkansas town of Mayflower, which was struck by an EF4 tornado in April 2014. The tornado, which also struck nearby Vilonia, was the nation’s deadliest in 2014, killing 16 people and destroying more than 400 homes. The center’s design for Mayflower is focused on redeveloping the area with a new type of walkable town center with mixed residential, recreational, commercial and municipal functions, which would also incorporate an isolated city park and floodplain. The center partnered on the project with the Central Arkansas Planning and Development District and the U.S. Economic Development Administration. “I am thrilled that our school, university and state can set the bar for urban futures internationally, and so, it is incumbent upon us in Arkansas to work a little harder to implement such city plans,” Steve Luoni, director of the Community Design Center, said. “I also look forward to seeing our participating graduates realize this new thinking on housing and urbanism soon in their own professional work.” The plan was adopted unanimously by Mayflower’s city council, following a year of work between the tornado recovery planning team and the community. Mayflower is currently working on parcel aggregation to implement Phase 1 around the city park.
McKee Foods has partnered with the city of Gentry to develop outdoor trails in the Flint Creek Nature Area that will also include a stocked lake for fishing, fishing dock and other outdoor activities. The development at Flint Creek also will join the Razorback Greenway, a 37-mile shared-use trail that connects Bella Vista with Fayetteville. The effort is part of McKee Foods’ corporate Outdoor Happiness Movement that is designed to help families stay healthy and spend quality time outdoors. “McKee Foods has always placed a priority on the health, safety and well-being of employees and their families,” said Tim Broughton, vice president of McKee Foods’ Gentry operations. “Our work family is excited about experiencing and sharing our Outdoor Happiness in Northwestern Arkansas.”
AG Names Top 10 Complaints In conjunction with National Consumer Protection Week in March, Arkansas Attorney General Leslie Rutledge listed the most common complaints her office’s Consumer Protection Division received in 2015. Here is a list of the top 10: 1. Automobile sales, service, financing and repair. 2. Health care. 3. Wireless and landline telephone service. 4. Satellite, cable and Internet service providers. 5. Credit services, credit repair and other financial services. 6. Home improvement, repair and construction. 7. Landlord/tenant. 8. Utilities. 9. Debt collection. 10. Mortgages, foreclosures and home financing. www.talkbusiness.net
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THANK YOU FOR YOUR SUPPORT OF THE ARKANSAS SCHOLARSHIP LOTTERY! Since it began in 2009, the Arkansas Scholarship Lottery has benefited people from all across the state.
DID YOU KNOW? • 92¢ of every dollar in revenue goes to in-state scholarships, prizes and commissions • More than 200,000 scholarships worth over half a billion dollars have been awarded to Arkansas students • Lottery players throughout the state have won almost $2 billion in prizes • More than $162 million in sales commissions have been paid to retailers in every Arkansas county • College graduates who earned Lottery scholarships are now entering our state’s workforce
These are opportunities worth celebrating!
For more information on games or odds, visit any lottery retailer, MyArkansasLottery.com, or call 501-683-2000. Call 1-800-522-4700 for problem gambling helpline.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Commentary
Successful Branding: It’s an Inside Job By Martin Thoma Martin Thoma writes about branding on talkbusiness.net and a longer version of this article appears there. Email him at martin@thomathoma.com or follow him on Twitter: @MartinThoma
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o often people think “branding” means creating a name, logo or tagline. All the outside stuff. Some recognize that great brands actually start inside. Starbucks revolutionized coffee in the U.S. by elevating the experience. Apple created the world’s most valuable company by obsessing on elegance. Southwest Airlines disrupted an entire industry by democratizing the skies. On the foundation of their crystal-clear business purposes, winning companies build powerful internal brands – the culture and ethos that drives product development, service delivery and marketing. Branding is an inside job. Leaders mobilize their entire employee base to talk up, live out and propagate their brands. Today, we see that without employees driving it forward, a brand doesn’t go very far. In fact, recent data from Customer Think show that up to 70% of your company’s brand perception is the result of customers’ interactions with your employees. How does one go about mobilizing an entire employee population to understand, champion and live the brand? Make it real. Your people sniff out BS in a heartbeat. The stories, the facts and the rationale of your brand strategy must be real and must resonate. If your internal brand development program is simply masking the imperative to “make more money” with some altruistic smokescreen, employees will be on it in a moment. Connect your internal brand story to the underlying mission of your organization. Find and tap natural leaders. Inside, you need brand culture leaders. Leaders are those others want to follow; find them and plug them into the initiative in meaningful ways. How? Establish an internal brand council – 10 to 15 such native influencers, who serve as “roundtable advisers” to the CEO as well as activists and ambassadors to the employee base. These brand councils are extraordinary founts of creativity and innovation – drawing out and elaborating the meaning of a brand in unexpected ways.
Inside, you need brand culture leaders.
Put some skin in the game. Some may think a paycheck is sufficient recompense for an employee’s contribution. The internal brand leader is not so naïve. Money might get the bodies to work, but it will not engage hearts and minds; pay ranks down around five or six in the rewards people ascribe to their work. So, it’s helpful to add some tangible incentive to your internal branding program; it helps grease the skids and get people off the fence. A well-publicized effort by KPMG offered two bonus days vacation if the entire team submitted 10,000 stories to an internal program; the 200,000-plus employees overachieved with more than 40,000. Southern Bancorp doubles the value of its core value awards when employees sock the money away – encouraging development of personal net worth, core to the bank’s mission. Be accountable. Gallup’s decades of employee data underscore that employee engagement and alignment correlate directly with financial performance. CEOs and CFOs don’t sign onto internal branding programs just because they’re good for morale. They want and need to know it will deliver tangible, bottom-line results to the organization. The KPMG program measured employee engagement, satisfaction and retention to demonstrate return. (It also put up record revenues in the year it launched the program.) Being accountable means bringing relevant and concrete success metrics to your program. Use metrics as simple as “can our employees repeat our brand purpose, brand principle and brand promise” statements to more bottom-line measures such as “how many new opportunities did we open based on employee referrals?” Work top-down AND bottom-up. Clearly, brand strategy is an executive-suite discipline. But once you turn it loose into the wild, you want your internal branding effort to harness the wisdom of the crowd. Distributed, bottom-up approaches are congruent with today’s social-media-saturated culture. Designing your internal brand activation program with these tools and temperaments in mind gives it the chance to catch fire and spread virally within the organization, which after all is the objective: a defined, productive culture that feeds off its own momentum and continually strengthens, improves and accelerates your brand.
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Entergy Arkansas’ rates are lower than the state and national averages. And here’s our plan to keep them low.
At Entergy Arkansas, we work not only to ensure reliable power, but also to make sure that power remains affordable. That’s why Entergy Arkansas customers have rates below the average for Arkansas and the nation – and why we are committed to keeping costs down while creating value for customers now and for years to come.
1. Providing reliable power. Our plan includes strengthening the electric grid from transmission lines to substations to transformers – to prevent storm outages by planning and maintaining a more robust network.
2. Lowering costs. Keeping a balanced mix of energy resources is an important ingredient to providing customers with clean, reliable, and affordable electricity. Entergy Arkansas also joined the Midcontinent Independent System Operator (MISO) several months ago. And we’re already seeing monthly savings by having access to a large power market that allows us to further reduce costs.
3. Generating jobs. Entergy Arkansas is reaching out to major companies around the world to put Arkansas on the top of their lists for new facilities. Then we work with them to make sure we have the infrastructure they need to power their business – adding more customers to share costs and putting more Arkansans to work.
4. Investing in sustainable communities. The health of our local communities drives our quality of life as a state. Training, education and infrastructure are vital not only for economic development, but also for building a stable society for generations to come. We’re committed to helping our state grow, strengthening communities, supporting non-profits and improving education.
To learn more, visit EntergyArkansas.com.
A message from Entergy Arkansas, Inc. ©2014 Entergy Services, Inc. All Rights Reserved.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Commentary
Frederick Douglass, Freedman’s And the Importance of Diversity By Frank D. Scott, Jr. Frank D. Scott, Jr., regularly writes opinion columns that appear on talkbusiness.net. He can be reached by email at fdscottjr@gmail.com. Follow him on Twitter @FrankDScottJr Editor’s note: This column first appeared on OnlyInArk.com.
F
rederick Douglass is one of the central figures often profiled during Black History Month. Born a slave, Douglass became one of the foremost black leaders of his time. His work as a writer, orator and abolitionist played a pivotal role in the movement to emancipate enslaved African-Americans in the U.S. He has long since been acknowledged for his skill as an orator, author and abolitionist. However, what many may not realize is that Frederick Douglass was also a banker. As part of the emancipation of enslaved African-Americans, President Abraham Lincoln and the U.S. Congress established Freedman’s Savings & Trust Co. in 1865 in an effort to incorporate African-Americans into the U.S. economy. The bank amassed more than $57 million in deposits from around 70,000 African-Americans over the course of a decade. It operated branches in 17 states, including one in Little Rock, started in June 1870. After a period of poor management, Frederick Douglass became CEO as part of an attempt to save the bank. Despite investing $10,000 of his own money to aid the effort, Frederick Douglass eventually petitioned Congress to close the bank and return the remaining deposits to the bank’s customers.
The kind of diversity that creates opportunities for individuals to collaborate with others different from themselves is indeed a key competitive advantage.
SIGNIFICANCE OF ECONOMIC INCLUSION Though now defunct, the historic institution has since been immortalized as part of a U.S. Treasury building in our nation’s capital. Though the bank did not survive, the effort to create Freedman’s Savings & Trust Co. showed how critical economic inclusion is to the
PHOTO: SHUTTERSTOCK
fabric of our nation. Frederick Douglass Founded on the heels of emancipation, the bank also showed the potential African-Americans had to pool their resources and improve their collective position in society. Today, minority communities have made tremendous strides in their participation in the economy. Yet there is still a long way to go considering the levels of unemployment, underemployment and the need for wealth-building within minority communities. Despite this need, the number of black-owned banks in the U.S. continues to decline. In 1986, when Black History Month was established, there were 47 black-owned banks. Today, there are only 24 black-owned banks in operation. While there may not be a resurgence of black-owned banks, there is great value in ensuring banks across our nation’s communities are led by women and men from a variety of backgrounds. I have written previously about the important role of diversity and an intentional focus on increasing interaction between diverse groups within an organization.
REPRESENTING AN ARRAY OF BACKGROUNDS The kind of diversity that creates opportunities for individuals to collaborate with others different from themselves is indeed a key competitive advantage. Banks have long been foundational to the vitality of communities. They have been critical in everything from encouraging saving to financing the launch of small businesses to helping families buy their first home. Having bank leaders who represent the array of backgrounds present in their local communities is important for banks to truly meet the needs of those they serve both today and in years to come.
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Feature PHOTO: SHUTTERSTOCK
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
MORE FINA NCIAL LY RESPONSIBL E THAN THEIR PARE N TS ,
Millennials ARE
Reshaping the Banking World By Kim Souza
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orget the notion that Millennials are still living in their parents’ basements. A vast number of the 83.1 million people born between 1982 and 2000 are working professionals, and the majority see banking relations as an important part of their financial future. But they are not like their parents and grandparents and status quo services will not be enough to woo their business, according to industry research. “It’s mandatory that banks reach out to Millennial customers and that the services they provide both in physical and digital formats be top notch in terms of experience, convenience and ease of use,” said Mike Sells, CEO of the Sells Agency in Little Rock. Research conducted by the Sells Agency in 2014 found that 77% of this millennial cohort earning at least $25,000 annually have a savings account, are already socking away funds for retirement and they’re using credit more responsibly than their parents – all of which is good news for banks. He said these digital natives likely prefer mobile banking options to online and in-branch, but research shows they use all three.
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Feature: Millennials Sells said 82% of the young professionals in the survey said the number of branches a bank has is important to them because they want convenience, even though the majority of them (56%) said they went into a bank branch less than once a month. Roughly a third said they used bank branches from one to a few times monthly, and 11% never use a branch. FINANCIAL ACUMEN While the majority of banking activity, deposits, withdrawals and bill paying are done online or through mobile banking options, he said Millennials use bank branches as resources for professional advice and services such as retirement planning or budgeting for a home purchase. “This demographic has the financial acumen that their parents’ often lacked,” Sells said. “They do value a bank branch as a place where they get professional advice and
MILLENNIAL BANKING
FAST FACTS
49 % 6 % 15 % 46 %
use PayPal to purchase goods versus 40% of the rest of U.S. online population.
have used Apple Pay compared to 2% of other demographics. use checks, compared to 30% of other age groups. use credit cards, compared to 60% of Gen X and older generations.
4 times as likely to use smartphone to withdraw cash from ATM, rather than using a card. Source: Forrester Research 36
they are using branches for this purpose. This has banks reconsidering what they do with their branches in the future. For instance, Regions Bank’s recent ad campaign doesn’t focus on product, but it spotlights advisory services from budgeting to starting a business with personal stories shared with viewers. This personalization of services and experiences play right into the hands of Millennials.” Millennials are savvy consumers and don’t mind asking for banking perks such as free checking, identity theft protection, free ATM usage and user friendly mobile apps, the survey found. Sells said it’s imperative that banks recruit Millennials while they are still in college, because 63% of those surveyed still bank where they did in college. Slightly more than half of them bank where their parents do. “We have found that many of our Millennial customers have fond memories of coming to the bank as children, whether it was getting a lollipop as they went through the drive-thru or some other story. The old notion that bank branches will eventually become extinct isn’t what we are seeing today as this group of consumers have told us that nothing takes the place of having someone to talk to for advice on financial matters,” said Donna Kimes, senior vice president of Farmers & Merchants Bank of Stuttgart, parent company of the Bank of Fayetteville. Jim Cargill, president and sales manager for Arvest Bank’s central region, said there is also an expectation of simplicity from Millennial customers. “They want their products and services to work well, be easy to use and they expect it to be easy to find help if needed. Millennials are also very resourceful when it comes to technology. They need less instruction and support than other age groups and tend to ‘figure it out’ for themselves by experimenting or playing with a mobile app or a website,” Cargill said. “We’ve also seen that while their preferences and methods of doing things may be different, they are ultimately like most customers – they expect value, fair pricing and great personal service.” Scott Brady, Marketing Senior Vice-president with First Security Bank, said his outfit
TALK BUSINESS & POLITICS | MAY/JUNE 2016
took a different path to pursue Millennials. “This generation has come of age in an era searching, skipping, sharing, and deleting the media they ‘choose’ to consume, so capturing their attention via traditional media is not really achievable, unless the content is delivered ‘live’ via reality TV or sports,” he said. “We began focusing our efforts on new media channels over three years ago in order to appeal to a wider, and younger audience, and we’re not only sharing content on our own onlyinark.com website, but creating and publishing original content as well.” USE OF CREDIT Millennials are the most educated among all the age demographics today, but that higher education comes at a cost as the average Millennial consumer in Arkansas owed $25,433 in student loans as of 2014, according to CollegeInSight. Bankrate.com research found that Millennials are not averse to using credit, but they are doing so more wisely than previous generations. Millennials “grew up in a world where the economy was tanking,” said David Pommerehn, senior counsel with the Consumer Bankers Association and contributor at Bankrate.com. ”There was great concern about jobs and debts and paying off bills.” As the economy is improving, Millennials are using credit more so than in the past. In 2014, Bankrate.com found 63% of Millennials between the ages of 18 and 29 didn’t have a credit card, compared to 35% of adults 30 and older. The study also found that just 6% of Millennials had two credit cards, but nearly all of them use debit cards tied to checking accounts and have quickly adopted mobile payment options. A 2015 report from Mercator Advisory Group suggests that this credit freeze is now beginning to thaw as 57% of Millennials were using credit cards, up from 48% in 2013. Karen Augustine of the Mercator Advisory Group said credit card issuers are doing a better job of introducing new credit card products that appeal to Millennials with tools such as budgeting guidelines that help young consumers spend more responsibly. Credit experts at Bankrate.com said with
up to 18% of Millennials’ net income going to pay student loans this cohort’s limited use of credit cards could make it harder for them to make home purchases in the future because they will have thinner credit history results, which makes having established banking relationships even more essential for this consumer demographic. Kimes said tighter regulation on how credit card companies could recruit new customers on college campuses in recent years has helped reduce credit card usage among young adults. She said the days of high school graduates getting $2,000 credit lines before they had a dime of income are over, thanks to tighter regulations. “This was bound to have helped curb credit card usage among some Millennials, simply because they didn’t have as much access to credit cards,” Kimes added. Cargill said Millennials want to be financially responsible and they want to understand all of their options before making a decision on a financial product. “Our research is showing that Millennials intend to save more and are indeed starting to save sooner than previous generations. This is partially shaped by their experience during the Great Recession and seeing how older friends and relatives who were not prepared with adequate savings were adversely affected,” he said. CARETAKER IMAGE Trust and personal service are two important factors Millennials use to evaluate banks, according to analysts with CCG Catalyst research firm. “They want the institution to act as an “overall financial caretaker” for them, said Paul Schaus, CEO of CCG Catalyst. “Millennials set a high bar and they want their banks to advise them on financial matters.” He said while technology is also essential to Millennials, it would be a mistake to think they don’t care about human connections with their banker. The challenge is being able to balance the two, Schaus said. Millennials still very much rely on the personal touch of banking, but will judge a bank on the basis of its digital capabilities. Banking experts agree that Millennials are not typically scouring the Internet to
find the coolest free checking account, but they are looking for things that they identify with, such as service perks and convenient access. The Center for Generational Kinetics and Global Cash Card reports that “Millennials don’t want a bank. They want an experience.” “This generation is looking for help running their lives, not just their finances. We want an interactive experience to learn about investing. We want step-by-step instructions on paying back our student loans. We want virtual advisers to guide us through making big purchases,” according to Gabrielle Jackson Bosche, a Millennial strategist and author of “5 Millennial Myths: The Handbook for Managing and Motivating Millennials.” “Simply offering mobile banking today is cost of entry and in order to compete our mobile offering must be feature-rich and have an appealing and efficient user interface. Even though technology is the development focus in the banking industry today, we believe there is still value in the ability to speak to a real person, either on the phone or face-to-face, which we will always be able to deliver,” said Brady. DIGITAL MUSTS Cargill said Arvest is working with Millennials by acknowledging what they want and then providing the solutions. He said banks are continuing to evolve more new technology services while also still keeping the standard services used by older generations. Mobile banking is used more by Millennials, which is why Arvest will continue to invest in user-friendly mobile apps as well as offer a rewards program on debit cards as Millennials have a strong preference for a convenient ATM network and they also appreciate loyalty rewards. The most recent J.D. Power Retail Banking Satisfaction survey found that large banks had a higher satisfaction rating than community banks and credit unions for the first time ever. Jim Marous, co-publisher of The Financial Brand, attributes the turnaround of the once-hated “big banks” to higher satisfaction levels with digital banking service offerings. The newest trend in the banking sector
is cardless cash where consumers use their smartphone instead of a debit card to get cash from an ATM. The technology has been offered in larger metro areas like Los Angeles for at least two years, and Bank of America, Wells Fargo and JPMorgan have announced plans to roll out cardless ATMs in the coming months. Kimes doesn’t expect to soon see cardless ATMs in Arkansas, but she did reference a growing trend in peer-to-peer lending that uses a mobile phone to transfer money from one person to another with services like Pop Money or Venmo, which is a payment transfer system app that uses PayPal. “We are finding more digital consumers are using Popmoney (www.popmoney.com) transfers which are available at many banks, even in rural towns like Stuttgart. Say we go to lunch and decide to split the bill but you don’t have any cash. I pay the bill and then you can send me a payment via a text message which is linked through the app to your bank account. Then I get a text when payment has been sent directly to my bank account. It can also work for someone trying to collect money. They send out a request for payment through a text, the one owing money simply responds ‘Pay,’ and the money is transferred,” Kimes said. From Apple Pay to various other mobile payment systems already in use, Kimes predicts payment options will continue to expand. She said the days of having just a few payment providers are over, as there will continue to be more payment processors cutting up the pie into smaller pieces. Brady suggests the banking equation may look different on paper, but it still comes back to fundamentals. “It’s true they behave differently, in part because they have grown up in a world more connected than we could imagine and all of those data points create a different type consumer of information. But their basic financial needs are not that different from a young adult from the Gen X or Baby Boomer generations,” he said. “We believe if we can create tangible reasons for this generation to have a positive attitude about, or emotional connection with, our brand and who we are, we’ll develop a relationship with them too.” www.talkbusiness.net
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Industry PHOTOS: KELLY QUINN
Mike and Anne Preston served as emcees for the event.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Governor’s Cup
VivImmune, Drone Surveying Solutions take the top prizes at annual business plan competition. By Todd Jones
T
he University of Arkansas has been successful in the Donald W. Reynolds Governor’s Cup competition, winning $2.3 million in cash prizes at the state, regional, national and international business plan competitions in recent years. That success continues in 2016. The 2016 Donald W. Reynolds Governor’s Cup held its award ceremony and luncheon at the Statehouse Convention Center on April 19. Graduate and undergraduate finalists competed in a pitch contest while overall winners were awarded in the areas of innovation and agriculture. The business plan competition, now in its 17th year, is sponsored by the Arkansas Economic Acceleration Foundation, an affiliate of Little Rock-based Arkansas Capital Corporation. In the undergraduate division, Drone Surveying Solutions of the University of Arkansas at Little Rock took home the $25,000 top prize. Drone Surveying Solutions proposes to help farmers save money using drones to identify crop losses, expenses and negative environmental effects. Other winners in the undergraduate division included Natural State Bedding from John Brown University (second) and Short Bow from the University of Central Arkansas (third). Drone Surveying Solutions and Natural State Bedding will compete in the Donald W. Reynolds Tri-State Awards May 25-26 in Las Vegas. The teams will compete against the top undergraduate winners from Oklahoma and Nevada. In the graduate division, VivImmune from the University of Arkansas won the top prize. VivImmune is a start-up biotechnology company specializing in immunotherapy for bladder cancer. “They have a technology that can really change the way cancer is being treated for millions of people,” Dr. Carol Reeves, UA faculty adviser, said after the luncheon.
“They’ve had incredible mouse data. It not only destroys the tumor, but keeps them from coming back in other areas. It’s really exciting.” The UA swept the top three places in the graduate division. Joining VivImmune was Actio Systems (second place) and deciLvl (third place). VivImmune and Actio Systems will compete against the top Oklahoma and Nevada graduate winners at the Tri-State Awards event.
“This is so huge. You have a way to get this generation of college and graduate students involved in business plans and preparing for the future.” – AEDC Executive Director
Mike Preston The wins continued the dominance shown by the UA in recent years. Asked if it ever gets old, Reeves said, “It does not get old because the students work so hard to get here. It’s not me, it’s them.” ECONOMIC DEVELOPMENT TOOL Mike Preston, executive director of the Arkansas Economic Development Commission, emceed the event. He was impressed with the presentations during the pitch competition. “They are really good. Some of these
students, I would take an appointment with, just because they have a great idea, a good concept and they sell it well,” he said. “I would love to sit down with them and look at the business plan to see if it makes sense.” Preston sees the Governor’s Cup as a great tool for economic development. “This is so huge,” he said. “You have a way to get this generation of college and graduate students involved in business plans and preparing for the future. We can help them understand, ‘Hey, this is something I can do for the rest of my life. I can find something I love to do, and I can do it right here in Arkansas.’” It seems that the students may have. A chorus of positive reaction came from the VivImmune team students after the ceremony. “Very, very excited,” they said when asked how they felt about winning the competition. “There was a lot of good competition here, so we are definitely pleased.” The company picked up prizes for the Delta Plastics Innovation Award, the Graduate Division Overall and the AT&T Elevator Pitch Contest Graduate Division. In all, VivImmune won $32,000 in prizes. Asked what they learned during the process, team members said working together in collaboration, the hard work needed to get a business off the ground and the impact of technology. VivImmune plans on moving forward with the business and seeking investment capital. The team has been successful at other competitions throughout the country, coming in third place in Oregon and winning a competition in Louisville. In addition, it made some crucial private equity connections while competing in Houston at Rice University. ‘THINK LIKE ENTREPRENEURS’ The Governor’s Cup has become www.talkbusiness.net
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Industry: Governor’s Cup ultra-competitive over the years. “The Governor’s Cup program is ultimately an academic competition, teaching Arkansas’ collegians to think like entrepreneurs,” Arkansas Capital CEO Rush Deacon said. “What is amazing in watching the evolution of the program since its start in 2001 is how the plans entered now are dominated by actual development-stage enterprises, with the real potential for commercial deployment.” The Agriculture Award was presented by Arkansas Farm Bureau for the top agricultural business. AGCorp of Ouachita Baptist University won first and Natural State Bedding of JBU took second. Erick Chang of Arkansas State University and April Hearne of Pulaski Technical College in North Little Rock received the third annual C. Sam Walls Entrepreneur Educator Award. The award is to honor retired Arkansas Capital CEO Sam Walls, Jr., who was CEO of Arkansas Capital from 1989 to 2013 and who advocated entrepre-
neur education in Arkansas. Each teacher received $2,500 prize and their institutions received a matching prize.
“The Governor’s Cup program is ultimately an academic competition, teaching Arkansas’ collegians to think like entrepreneurs.” – Arkansas Capital Corporation CEO
Rush Deacon
VivImmune, University of Arkansas
Natural State Bedding, John Brown University
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Elevator Pitch, Drone Surveying Solutions, UALR
TALK BUSINESS & POLITICS | MAY/JUNE 2016
AGCorp, Ouachita Baptist University
Drone Surveying Solutions, UALR
Elevator Pitch, VivImmune, University of Arkansas
WINNERS
Undergraduate Division Winner – Drone Surveying Solutions, University of Arkansas at Little Rock, $25,000. Second Place – Natural State Bedding, John Brown University, $15,000. Third Place – Short Bow, University of Central Arkansas, $10,000.
Graduate Division Winner – VivImmune, University of Arkansas, $25,000. Second Place – Actio Systems, University of Arkansas, $15,000. Third Place – deciLvl, University of Arkansas, $10,000.
Agriculture Award (presented by Arkansas Farm Bureau) First Place – AGCorp, Ouachita Baptist University, $5,000. Second Place – Natural State Bedding, John Brown University, $3,000.
Innovation Award (presented by Delta Plastics) Undergraduate Winner – Natural State Bedding, John Brown University, $5,000. Graduate Winner – VivImmune, University of Arkansas, $5,000.
AT&T Elevator Pitch Drone Surveying Solutions, UALR – Undergraduate Division, $2,000. VivImmune, University of Arkansas – Graduate Division, $2,000.
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PHOTOS COURTESY OF ARKANSAS PARKS & TOURISM
Whitaker Point
Thorncrown Chapel
Old Mill Spring
Editor’s note: The Arkansas Tourism Ticker is sponsored by the Arkansas Hospitality Association. Big Piney Arlington Hotel
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
State’s Travel and Tourism Industry Growth Continues By Talk Business & Politics Staff Editor’s Note: Featuring trends and data impacting one of the state’s most important industry sectors and top economic engines, this preview of the Arkansas Tourism Ticker report by the Talk Business & Politics staff is presented through sponsorship by the Arkansas Hospitality Association. The full report will be posted online in the near future at talkbusiness.net.
A
rkansas’ tourism industry ended the first two months of 2016 with a more than 4% growth in tourism taxes among 17 cities and a more than 5% growth in tourism jobs. The pace continues that posted by the industry in 2015. In 2015, the Arkansas Tourism Ticker reported a 7.41% increase in hospitality tax revenue among 17 Arkansas cities reviewed for the report, an 8.31% increase in collections of the state’s 2% tourism tax, and a 5.04% increase in Arkansas tourism industry jobs compared to 2014. A preview of the January-February report finds that $6.722 million in hospitality taxes were collected by the 17 cities, up 4.34% compared to the same period in 2015. Collections in Little Rock, the largest city in the report, totaled $2.204 million in the two months, up 5.4% compared to the same period in 2015. LIttle Rock collects a lodging tax and a prepared food tax. Bentonville, a city that has in recent years seen a surge in travel and tourism venues, had $316,440 in hospitality tax revenue in the January-February period, up 8.5% compared to the same months in 2015. The city, home to global retail giant Wal-Mart Stores, also collects a lodging tax and a prepared food tax. Statewide monthly employment in the sector averaged 116,000 in January and February, up 5.6% compared to 109,850 in JanuaryFebruary 2015. The average is also 18.67% higher than the JanuaryFebruary 2010 period, which provides some perspective on travel and tourism industry growth in the past six years. “The significant growth in tax revenue, which reflects the spending of visitors to Arkansas, has been phenomenal to see,” said Montine McNulty, executive director of the Arkansas Hospitality Association, which represents hotels and restaurants across the state. “The Hospitality and Tourism industry is ever-evolving and adapting to fit the needs of both Arkansans and visitors. We are proud to see these numbers.” The Arkansas Tourism Ticker is managed by Talk Business & Politics, and sponsored by the Arkansas Hospitality Association. It is published every two months, or six times a year. The ticker uses the following three measurements to review the health of the state’s tourism industry. • Hospitality tax collections – prepared food tax and lodging tax – of 17 Arkansas cities (cities listed below along with collections for each city); • Tourism sector employment numbers as reported by the U.S. Bureau of Labor Statistics; and • Collections of Arkansas’ 2% statewide tourism tax.
2015 vs. 2014
7.41
% Gain in combined 2015 hospitality tax collections in 17 Arkansas cities compared to 2014;
8.31
% 2015 gain in Arkansas’ 2% tourism tax compared to 2014; and
5.04
%
Increase in average monthly Arkansas tourism industry jobs during 2015 compared to 2014.
www.talkbusiness.net
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Industry PHOTO: SHUTTERSTOCK
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
World’s Largest Oil Firm Takes Big Stake in Springdale Startup By Wesley Brown
I
n mid-April, Northwest Arkansas startup NanoMech announced that it had secured $10 million in capital from the investment arm of Saudi Aramco, the deep-pocket, state-owned national oil company of Saudi Arabia and the world’s most valuable company. NanoMech said the $10 million in capital and new relationship with Saudi Aramco Energy Ventures (SAEV) will jumpstart its Series C Financing round, which will help accelerate NanoMech’s manufacturing, sales and product development. Nanotechnology is a research field that manipulates matter in a microscopic way allowing for applications. The scale of nanotechnology is extremely small – a billionth of a meter – or the equivalent of one ten-thousandth the size of a human hair. Applications may include hardening of tools so they last much longer, suspension in lubricants that improve performance up to 40% and use in sprays to enhance protection from bacteria and other microorganisms. NanoMech Chairman and CEO Jim Phillips said the strategic funding will allow his company to further use nanotechnology to develop advanced products for industrial and mechanical applications, such as lubricants, coatings and specialty chemicals. “NanoMech is honored to achieve this recognition and investment by the world’s largest energy company,” Phillips said. “Building on current momentum, NanoMech will use this financing and relationship to expand our global reach, invest in additional sales and marketing resources, and increase investment in our market leading nanotechnology platforms, nGlide, GuardX, TuffTek and nGuard.” Phillips said the deal with Saudi Aramco, which has conducted due diligence of the Arkansas startup for the past six months, validates the Arkansas company’s intellectual property and confidential patented
technology as “one of a kind.” “This is first time we’ve had a true strategic investor who will also be one of our largest customers,” Phillips said of the national oil company of Saudi Arabia that is more than 20 times larger than a U.S. oil giant. “This ties us into the ecosystem of the oil and gas industry at the highest level.” Cory Steffek, managing director in North America for SAEV, said the response to
“This is first time we’ve had a true strategic investor who will also be one of our largest customers.” – NanoMech Chairman and CEO
Jim Phillips
NanoMech at Saudi Aramco and several of the global oil giant’s major suppliers has been positive. “A platform technology like NanoMech’s has significant potential to bring innovation not only to the energy sector, but also to many other critical industries,” said Steffek, who is based in Houston. PUSHING NANOMECH GROWTH In the startup world, Series C financing is
the third financing phase for successful early stage companies before “scaling up.” Generally speaking, a startup’s third injection of capital from outside sources is a signal to venture capitalists and institutional investors that a young company is maturing and has a viable business model. After exiting this round of financing, many startups look toward more robust growth through acquisitions, mergers or even an initial public stock offering (IPO). “Aramco’s strategic investment in NanoMech will transform the productivity paradigm for sustainable global energy production and accelerate NanoMech’s position as the global leader in advanced nanotechnology delivering products and solutions for enhanced business performance and competitive advantage,” said NanoMech board member Deborah Wince-Smith, CEO of the U.S. Council on Competitiveness. The Springdale-based startup also said it validated and commercialized its innovations to top U.S. companies and has completed scale up of its smart factory and labs. “Several Fortune 100 and emerging companies have incorporated NanoMech’s nano-engineered solutions, to create disruptive and higher-performance products,” the company said. “Today’s announcement represents NanoMech’s most significant milestone in the continued validation and authentication of its unique technology.” PLANS TO BOOST WORKFORCE Phillips said earlier Series A and B rounds of financing raised $1.6 million and $14.6 million, respectively. The talkative NanoMech CEO also said the Northwest Arkansas startup has been awarded several federal government grants and awards to further develop its “technology of the small.” www.talkbusiness.net
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Industry: NanoMech In late 2014, NanoMech celebrated the opening of its global headquarters and its 29,000-square-foot manufacturing facility in Springdale. At the time, NanoMech said it had raised almost $15 million in venture capital, including a 5% equity stake in the company by the Arkansas Development Financial Authority (AFDA) and other state incentives from the Arkansas Economic Development Commission. ADFA spokesman Derrick Rose said the state’s total equity investment in the
Springdale nanotechnology firm was $1.1 million at the end of 2014. He could not confirm if the state had plans to increase that investment. Phillips said that since Saudi Aramco is the lead investor for the Series C round of funding, the Northwest Arkansas company is looking to close on other venture capital deals in the pipeline. He said additional capital will allow the company to expand its Springdale location and possibly open up another office in Houston, near Saudi
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Aramco and at the center of the nation’s oil industry. “This is really a tribute to a company that started with two or three guys,” he said. Phillips said the company is also looking to double the size of its 50-person workforce within the next year to “somewhere in the hundreds.” He said most of the company’s employees are University of Arkansas at Fayetteville graduates who have two or three scientific degrees. “We don’t hire a lot of blue collars workers to do what we do,” he said. “We believe what we are doing, especially in its application to the energy, transportation and manufacturing industry, will one day dwarf Silicon Valley.” LESS OF A DEPENDENCE ON OIL For its part, Saudi Aramco has been upping its investments in U.S. and other global companies tied to the energy industry. On April 1, amid the global slump in oil prices, Saudi Arabia’s Deputy Crown Prince Mohammed bin Salman made public plans to create a $2 trillion investment fund to seek global investment opportunities for the Middle East country, wean the oil-rich kingdom from its dependence on crude oil and partly privatize the national oil company within two years. Saudi Aramco, based in Dhahran, Saudi Arabia, has an estimated market value of more than $10 billion and possesses nearly one-fifth of the world’s crude oil reserves. As the world’s largest crude oil and natural gas exporter, Saudi Arabia is also the most influential member of the Organization of the Petroleum Exporting Countries (OPEC). Aramco Services Co., the kingdom’s U.S.based subsidiary, is based in Houston and employs more than 500 workers. NanoMech’s new partner, Saudi Aramco Energy Ventures, is also based in Houston and invests in technologies in upstream and downstream oil and gas, petrochemicals, water, energy efficiency and renewable startups with application to the Saudi Arabian market. Its portfolio of U.S. startup companies includes Siluria, Wearable Intelligence, ConxTech, 908Devices, Braemer Energy Ventures and Utilidata.
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Industry PHOTO: SHUTTERSTOCK
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Lower Prices at the Pump Forecast expects gasoline costs to remain less expensive than in 2015, with Arkansas averages remaining below $2 per gallon. By Wesley Brown
D
uring the 2016 April-through-September summer driving season, U.S. regular gasoline retail prices are forecast to average $2.04 per gallon, compared with $2.63 per gallon last summer, according to the U.S. Energy Information Administration’s short-term energy forecast and summer fuels outlook. For all of 2016, the forecast average price is $1.94 for a gallon of regular unleaded, which if realized, would save the average U.S. household about $350 on gasoline in 2016 compared with 2015, with annual average motor fuel expenditures at the lowest level in 12 years. Lower international crude oil spot prices and narrower refining margins contribute to gasoline and diesel fuel retail prices that average about 60 cents per gallon lower than last summer, the monthly EIA report says. Compared with last summer, gasoline consumption is up 1.3% as retail prices are 23% lower and continuing employment and income growth contribute to increasing highway travel. FLUCTUATING PRICES Pump prices are likely to fluctuate as the supply of summer-blend gasoline continues to make its way to terminals nationwide. Refineries are increasing their utilization rates, following the spring maintenance season, and as a result there is an increase in domestic gasoline inventories, the EIA reports. California ($2.77) and Hawaii ($2.61) are the only two states with averages above the $2.50 per gallon benchmark. Motorists in the neighboring states of Nevada ($2.44), Washington ($2.29), and Alaska ($2.27) are paying some of the nation’s highest prices at the pump and round out the current top five most expensive markets for retail gasoline.
On the other end of the spectrum, retail averages in a total of 21 states are below $2 per gallon and consumers in Missouri ($1.80) and Oklahoma ($1.82) are paying the nation’s lowest prices for gas. In Arkansas, motorists are paying on average about $1.84 per gallon in the latest report, which is 7 cents higher than in a
Pump prices in the Natural State are well below a year ago, when drivers were paying $2.19 per gasoline for regular unleaded, AAA data shows. month earlier. Still, that’s less that the cost in 2015. Pump prices in the Natural State are well below a year ago, when drivers were paying $2.19 per gasoline for regular unleaded, AAA data shows. Pump prices in the state’s metropolitan areas range from a low of $1.75 and $1.77 per gallon in the Fort Smith area and Northwest Arkansas, to prices in the Little Rock and Pine Bluff areas that are much higher at $1.85 and $1.89 per gallon, respectively. Drivers in the Texarkana area on both sides
of the state line are seeing prices at $1.84 per gallon, on average. PRODUCTION NOTES Other highlights of the EIA short-term energy report included: • North Sea Brent crude oil prices averaged $38 per barrel (b) in March, a $6 per barrel spike from February. Both Brent crude prices and the U.S. premium grade, West Texas Intermediate (WTI), are forecasted to average $35 per barrel in 2016 and $41 per barrel in 2017. However, the values of futures and options contracts suggest high uncertainty in the price outlook, the EIA said. • U.S. crude oil production averaged an estimated 9.4 million barrels per day in 2015. It is forecast to average 8.6 million barrels per day in 2016 and 8 million in 2017, which are both 100,000 barrels per day lower than forecast in the previous monthly report. EIA estimates that crude oil production in March 2016 averaged 9 million per day, 90,000 barrels per day below the February 2016 level. • Natural gas inventories ended the winter heating season (March 31) at 2.478 billion cubic feet (Bcf), slightly above the previous end-of-March record high, set in 2012. End-of-March inventories were 67% above the level at the same time last year and 53% above the five-year average for that date. Henry Hub spot prices are forecast to average $2.18 per million British thermal units (MMBtu) in 2016 and $3.02 per MMBtu in 2017, compared with an average of $2.63 per MMBtu in 2015. www.talkbusiness.net
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Arkansas’ March Jobless Rate % Hits Lowest Level Ever at 4 By Wesley Brown
A
rkansas’ jobless rate fell to its lowest level in the state’s history in March, declining two percentage points from last month’s previous hallmark while adding more than 7,000 new workers to the state’s brimming labor pool. Labor force data, produced by the U.S. Bureau of Labor Statistics and released April 15 by the state Department of Workforce Services, shows Arkansas’ seasonally adjusted unemployment rate now at a tidy 4% compared to 4.2% in February and 5.5% a year ago. Arkansas’ civilian labor force rose by 7,262 in March, a result of 9,569 more employed and 2,307 fewer unemployed Arkansans. By comparison, the U.S. jobless rate increased one-tenth of a percentage point to 5% in March. “Arkansas’ unemployment rate decreased in March, as employment gains increased the size of the civilian labor force,” said Arkansas BLS Program Operations Manager Susan Price. “The number of employed rose 9,569, reaching employment levels not seen since 2008.” With 1,358,908 in Arkansas now receiving paychecks, the state’s civilian labor force has added nearly 26,000 workers to employer payrolls in 2016 and nearly 34,396 from a year ago, up 2.6% from 1.324 million in March 2015. The peak for Arkansas’ labor force was 1.376 million in August 2008. ECONOMY REMAINS STABLE Earlier this month, the nation’s economy remained steady as 215,000 new jobs were added to payrolls. Total nonfarm payroll employment rose by 151,000 and 242,000 in January and February, respectively, and the unemployment rate fell one percentage point as the nation’s labor force saw gains primarily in retail, health care and construction, BLS data shows. The mining and
manufacturing sectors continued to decline, losing a total of nearly 40,000 jobs in March. In February, Arkansas’ touched its lowest-ever seasonally adjusted unemployment rate at 4.2%, which was reached for several consecutive months in the 2000. The last time the state’s jobless rate fell to this level was in December 2000, DWS officials said. The preliminary average monthly jobless rate in Arkansas during 2015 is 5.4%. Arkansas’ average jobless rate for 2014 was 6.1%, down 1.3% percentage points from the 7.4% average in 2013. The closely-watched nonfarm employment in Arkansas increased 4,600 in March to total 1,223,900. Employment gains were posted in six major industry sectors, while declines occurred in four sectors. The nonfarm category does not include farm workers, private household employees, nonprofit employees and “general government” employees. Investopedia estimates that the nonfarm category represents about 80% of the total workforce that contributes to national GDP. The missing data on farm workers in Arkansas is significant, given that Federal Reserve data for the Eighth District shows that much of the region’s agriculture and farming sector is in a downturn because of falling commodity prices. Arkansas sectors leading the year-overyear gains were professional business services with 3,300 new jobs and leisure and hospitality, which added 1,200 positions due to seasonal hiring. Government and education and health sectors, which are now the third and fourth-largest nonfarm sectors, also saw positive gains between months. MANUFACTURING JOBS DECLINE In the losing column, manufacturing jobs dropped by 2,500 as more than 3,200 workers in the durable goods sector went to the unemployment line. The factory job losses were partially offset by 700 new posi-
tions in nondurable goods manufacturing, which typically produce consumable “soft goods” like food, clothing, toothpaste and washing powder. In the Trade, Transportation and Utilities sector – Arkansas’ largest job sector – employment fell to an estimated 254,800 workers in the labor pool, compared to 255,100 in February, but well ahead of 246,700 a year ago. The state’s fast-growing Education and Health Services sector climbed by 800 to 179,900 in March. That compares with 179,100 in February and a strong 6,400 better than a year ago. This sector has seen steady growth in the past decade, with employment in the sector up nearly more than 23% since November 2005. Manufacturing jobs in Arkansas declined for the third consecutive month after a surprising rebound in December as the number of blue-collar workers fell to 152,700, down 3.2% from year ago levels of 155,200. Peak employment in the sector was 247,300 in February 1995. Government hiring continued to climb as 700 new workers were hired as local, state or federal employees in March. There are 217,000 government workers on state payrolls, now the second-largest nonfarm sector behind Trade, Transportation and Utilities. A year ago, there were 216,400 government jobs in Arkansas. The construction sector employed an estimated 47,500 in March, down slightly from 47,700 in February and well above the 46,000 level in the same period of 2015. The sector is well off the employment high of 57,600 reached in March 2007. Arkansas’ growing tourism sector (leisure & hospitality) employed 115,100 in March, up 7.2% from a year ago as the national summer driving season gets under way. Last year, there were 107,900 workers in the state’s tourism industry. www.talkbusiness.net
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Arkansas Works Survives Circuitous Route to Funding By Talk Business Staff
T
here was never any doubt the major-
little-used line-item veto, thus allowing the
happening. That’s not trickery. That is
ity would prevail, but it took a rare
funding to continue.
simply saying, ‘I will utilize my line-item
legislative maneuver for the supermajority
“The key thing was transparency,”
veto strategy in order to accomplish some-
to get its way.
Hutchinson said in his press conference
thing that is important for our state.’”
Over the course of the month of April,
following the veto on April 22. “There hasn’t
A legal challenge is likely to test the effort.
Gov. Asa Hutchinson, Republican leadership
Hutchinson said the line-item veto
and the Democratic minorities in the state
strategy puts his administration “in a very
Legislature passed the legislation revising Arkansas’ Medicaid expansion program and found a way to fund it. Arkansas Works is Hutchinson’s version of the private option, which uses federal Medicaid dollars to purchase private health insurance for Arkansans with incomes up to 138% of the federal poverty level. As of the end of January, 267,590 Arkansans were eligible for coverage. The controversial program was easily approved by healthy majorities in a recent special session – 70-30 in the House and 25-10 in the Senate. But it lacked the threefourths majority that is required to fund all state appropriations, falling five votes short in the House and two in the Senate. So in the fiscal session, the governor and legislative leaders devised a plan to circumvent a minority of 10 senators who seemed concrete in their opposition. SPECIAL LANGUAGE
“That’s not trickery. That is simply saying, ‘I will utilize my line-item veto strategy in order to accomplish something that is important for our state.’” – Gov. Asa Hutchinson
The funding for Arkansas Works was
strong legal position. We’re exactly where we should be. It’s as strong as any other appropriation bill that will be signed all year long.” DATE CHANGE POSSIBLE Still, Sen. Jonathan Dismang, R-Searcy, the Senate president pro tempore, suggested that lawmakers may consider changing the 2016 end date back to 2021 when the Legislature meets in a special session after the current fiscal session. Such a move would require only a majority vote. “That’s a legislative call. … It’s sort of like double-tying your shoelaces,” Hutchinson said. “If they want to double-tie the shoelace, then I’m glad to have that conversation with them. I think we’re in a strong position.” Hutchinson said he hoped Arkansas Works would not face as difficult a road next year as it did this year. He said the upcoming state and national elections will help. “I think we resolved a lot of issues in this
part of the Department of Human Services’
been any hiding the ball. Everybody today
debate in the support that we have gener-
comprehensive Medicaid funding bill.
knew exactly what they were voting on,
ated for the funding of this program, and I
Language was inserted to terminate the
why they were voting on it, what they were
don’t think anybody wants to retrace those
funding at the end of this year. Lawmakers
trying to accomplish. The opposition knew
steps next year. … I expect this to go much
agreed to let the measure pass through both
that. They scored it. They said this will count
more routinely in the future in terms of next
chambers so the governor could exercise a
against you. So everybody knew what was
January. www.talkbusiness.net
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Feature
ILLUSTRATION BY SHAFALI ANAND
ALL TRUMPED UP
HUNTING SUPPORTERS OF THE OUTSIDER WHO WOULD BE PRESIDENT
By John Brummett The author of this article is a regular columnist for the Arkansas Democrat-Gazette.
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
www.talkbusiness.net www.talkbusiness.net 55
55
Feature: All Trumped Up
T
he magazine writer put an open solicitation on Twitter. Would Arkansas supporters of Donald Trump please get in touch with him at his email address? He wanted to try to understand them. It would help him in his work. Soon came this response: “This sounds like a trap.” The reply came from Bud Cummins, the narrowly losing Republican candidate for
we
Congress from the Second District in 1996, a few years ahead of the great Arkansas reddening. Later Cummins was the U.S. attorney in Little Rock from 2001 to 2006, until Tim Griffin, the Karl Rove apprentice and future congressman in the seat Cummins had sought, decided he wanted the politically appointed job. Cummins and the magazine writer had
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a bit of contentious history from the 1996 race in the context of the writer’s main job as a left-of-center opinion columnist for the statewide daily newspaper. It’s no trap, said the magazine writer. Opinion writing is one thing. But this request came in a different forum for a different venue. It transcended opinion. It was more akin to trend reporting: Trump had won the Arkansas Republican presidential primary and appeared possibly headed to the GOP nomination. He’d done it by seizing on to something – but what? – that had roused millions across the country. Conventional punditry had missed this big story altogether. A conventional pundit needed help. Oh, all right, I’ll play, replied Cummins, the establishmentarian turned Trumpian, a man whose political journey had taken him from examining hanging chads in Florida for George W. Bush in 2000 to embracing, in Trump, the Bush family’s quintessential menace and very antithesis. Cummins soon found himself sitting across from the magazine writer over a tall latte at a midtown Little Rock bakery. First things first: Cummins actually is Arkansas chairman of the Trump campaign, a position that he said means nothing except that he was willing to have his name used. He said he met Trump only for a couple of minutes and introduced the New Yorker at a rally in Bentonville. He stressed he was speaking as Bud, not officially or unofficially for Trump, who, clearly, speaks for himself, sometimes effectively, sometimes not quite. What Cummins proceeded to relate was a reformed insider’s more informed version of what other Trump supporters have sought to express. What’s happened to Cummins, specifically, is that he seems 20 years after his personal campaign foray, and a decade after being forced out as U.S. attorney by the George W. Bush White House, to have lowered his BS threshold very nearly to the ground. Cummins said the country is in big trouble, “close to . . .,” and then stopped himself, explaining that he didn’t want to finish the phrase and risk overstating a condition of entrenched polarization between distant
ideologies that reminds him of what he has read about irreconcilable Civil War-producing attitudes about slavery and abolition. UNAPOLOGETICALLY UNCONVENTIONAL Cummins believes the usual politicians simply can’t turn things around doing their usual things. So he thinks maybe Trump could do some good, because he’s different, because he has changed the rules, and because people say that he, in private and in business, is a rational man – unlike how he often behaves publicly – who knows how to mobilize people and get a deal made and a project done. He said it’s fair when a man who has lost his life’s work to another country comes to resent undocumented immigrants dragging down the value of whatever we have left domestically for him to do. But Cummins said there might never actually be a wall at the Mexican border or the deportation of 11 million people. He said Trump is a negotiator and that one starts his negotiation at the outer limit and then works his way back. To what? To where? Cummins doesn’t know. “I didn’t come here to tell you I know what he’s going to do,” Cummins said. “Some of the stuff he says makes me very uncomfortable. I guess I’m just weary of some of the things we represent as Republicans that I’m not sure mean much anymore. All we do as Republicans is say ‘no’ all the time.” He said that Ted Cruz and Marco Rubio “artfully articulate” conservative principles, but that neither has ever actually done anything to impose any of those principles toward workable solutions. Take Obamacare, he said, the intent of which Cummins actually respects. But he said it’s unsustainable financially for the taxpayers and for consumers. That doesn’t mean, he said, that the answer is simply to “repeal every word” of it, as Cruz incessantly promises. He said the answer is to accept that we already largely socialize our health care – Medicare, Medicaid, veteran’s health, uncompensated care – and then to find a way to achieve universal coverage that is less onerous in regulation, less generous in
benefits and less exploding in costs. When Trump said in a debate that he wouldn’t let people die in the streets, Cummins heard him “speaking in code” and saying “I get it,” meaning that he sees the health-care issue as Cummins sees it. “But it’s code, and unclear code, so I can’t be sure,” he says. What Cummins likes most about Trump is that he upturns the conventional political
and media world. He said that as a congressional candidate in 1996 he tended to “cower and say I’m sorry” whenever the editorialists took him to task. He thought that was what he had to do. But he said he since has come to realize – with some degree of resentment, it seems – that he should have stood up for his himself and his supposed gaffes. What Trump has done, Cummins said,
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Feature: All Trumped Up by “not walking back” his several statements that the media proclaimed fatal missteps, is expose that the media “were making up the rules and there was no enforcement mechanism.” Cummins is ready to engage in what he acknowledges is a calculated and calibrated roll of the dice. A DISDAIN FOR POLITICAL ELITES Stephen McIntyre, 60, is from Pine Bluff, where his family operated the now-closed Eden Park Country Club. He is unmarried, a former Walmart store manager, and lives in Maumelle with his 89-year-old aunt, Del Tyson, who was a clerical aide to Orval Faubus 60 years ago. He is her full-time caregiver. McIntyre spends a lot of time online and reading books and periodicals about politics and government. He brought a bound packet of reading material to give to the inquiring magazine writer at their meeting at the International House of Pancakes on Maumelle Boulevard – a meeting sought by the magazine writer, the conventional
pundit, as part of this effort to get himself educated, albeit late, on whatever it is that Trump’s powerfully insurgent presidential candidacy represents. The most interesting reading in McIntyre’s gift packet was an essay from 1996 saying Patrick Buchanan’s presidential candidacy was a harbinger that reflected the real looming polarization in America – the political elites in Washington on one remote side and Middle America on the other. McIntyre said Trump represents the inevitable arrival of that harbinger. “If not Trump this year, it would have been somebody else maybe in four years,” he said. McIntyre said we’ve seen in his lifetime a rise of “the so-called professional politician,” representing a supposed elite and giving us an inadequate presidential candidate like young Rubio, who asserted that he had foreign policy experience based only on a partial Senate term’s committee membership and a few junkets. McIntyre said these supposed political elites have accomplished nothing. A long-
OUTDOOR ADVENTURES WITH A
SOUTHERN ACCENT.
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time Republican, he seems to harbor his greatest disdain for those of his own party who have promised much and accomplished zilch. He cited the irony that the most substantive single policy accomplishment of Gingrich’s “Contract with America” in 1994 was welfare reform, which Bill Clinton got done. That welfare reform proves the point that reform can only be achieved in a bipartisan spirit of compromise, and that a big problem in recent years has been that conservative Republican officeholders promise too much to the right-wing base and then concede not at all out of fear of that base … if McIntyre got that, or bought it, it was not clear. He did concede, like Cummins, that modern-day Republicans offer only opposition and no solutions. Because of debt and troubled entitlements and crumbled infrastructure and mismanaged foreign policy, McIntyre believes the state of the nation is so dire that we must shake things up big-time, which means with Trump.
Like our ride along the Arkansas River Trail, our trip to Little Rock was a delight. Touring its downtown by Segway, and its neighborhoods, barbecue joints and breweries by bike. Riding the METRO Streetcar from our hotel to explore the shops, restaurants and clubs in the River Market. Being mesmerized by the city’s beautiful illuminated bridges at night. We had a wonderful time, and can’t wait to return to Little Rock.
Riverfront Park > To see more visit LittleRock.com
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
He initially seemed to like the general idea of Trump or a version of Trump – or of anyone – mounting an angry and contemptuous outsider’s raid on the failed state of politics. But as he continued to talk, it became clear that he specifically likes and admires Trump. He read “The Art of the Deal,” and liked it. While he sometimes wishes that Trump would “tone it down,” he has read that Trump is different in private – charming and persuasive. He likes that the conventional political money barons – the Kochs, the Club for Growth – have spent tens of millions of dollars attacking Trump conventionally, only to meet the same futility that conventional pundits have encountered in trying to explain Trump. McIntyre said his hope is that “the office of president will mold him,” and that the rest of the political class will accede to the mandate for a shakeup that the voters will give Trump, and produce results – not just a repeal of Obamacare, for example, but a workable alternative to address rising health-care costs. He disdains Obamacare although he freely concedes that he found his own health insurance on its exchange, and that it costs him only $133 a month after Obamacare’s subsidies cover the other $600 or so. His point is that health insurance shouldn’t cost anybody any $700 a month, and that the price is that unsustainably high precisely because of Obamacare’s regulation and mandates. There was a time, he said, when you could go to the hospital or doctor and pay out of pocket without third-party intervention. It was a time to which a 60-year-old child of a more thriving Pine Bluff longs to see our nation restored, at least in some ways. That is to say that what McIntyre wants is precisely the Trump refrain – for America to be again what he remembers as great. ANOTHER SEES ‘TOTAL BETRAYAL’ In early April the Arkansas DemocratGazette, a conservative and usually Republican newspaper that editorially deplores Trump, published on its Voices page a fiery and splendidly literate letter in support of Trump. It came from Quincy Jackson of
“I guess I’m just weary of some of the things we represent as Republicans that I’m not sure mean much anymore. All we do as Republicans is say ‘no’ all the time.” – Bud Cummins
PHOTO: SHUTTERSTOCK
“I don’t trust Ted Cruz, for reasons I can’t explain fully. It’s the same instinct I have that has me believing Donald Trump.” – Quincy Jackson
Rogers. Jackson wrote: “Pro-Trump people, and I am one of them, support him with enthusiasm but don’t insist that others do. Anti-Trumpsters seem to exist for the sole purpose of derisively berating Trump and his supporters, with little regard for other candidates except as foils to Donald Trump. “You’ve heard it: Trump is a smoothtalking con-artist carnival barker and we his supporters are stupid, gape-mouthed, drooling onlookers waiting breathlessly to see the Tattooed Woman with Three Bosoms.” On the phone the day of the letter’s publication, Jackson declared himself unworthy of having his views sought by an interviewer for publication. (A letter to the editor was a different matter altogether, apparently.) But then Jackson warmed to the opportunity. He is 76 years old, retired for more than 15 years from a rice and soybean farm in Northeast Arkansas, where, he said, he grew weary of the “game” of increasing acreage and leveraging government subsidies. So he took what money he had and moved to Rogers, where he still works full-time as a courier for an automotive parts company. He still holds a job, he said, because he needs to preserve his savings, pay for Medicare-supplemental health insurance and stay alive and vigorous. “I think if I ever just sat down in that rocking chair, that’d be the end,” he said. Like other Trump supporters, Jackson observed the state of his nation and saw . . . guess what? You guessed it: doom. He explained his support for Trump this way: “It’s a matter of belief among so many of us after being so betrayed by the Republican Party, which has as much as said they don’t care what we think. Those kinds of things sent us looking for somebody willing to do what it takes to take this country back from the brink.” The brink? Cummins also hinted that the nation was there. So did McIntyre. What in heaven’s name had the Republican establishment in Washington done to so betray a conservative mandate – beyond, that is, yield grudgingly to the political, mathematical and procedural realities in Congress that kept Obamacare from being repealed, and kept the budget from being www.talkbusiness.net
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Feature: All Trumped Up cut deeply, and kept the debt from being reduced, and kept illegal immigration from being stopped? Jackson replied: “When Barack Obama verified our worst fears, we saw that this thing had to be stopped. And the GOP establishment essentially told us to shove it. It’s total betrayal, not only on Obamacare and the deficit and immigration, but on this political correctness madness and Black Lives Matter and all the rest. We gave these Republicans specific instructions as to what we want. And they said, ‘To hell with it. We’ll just give in to him,’” meaning Obama. Did Jackson seriously believe that Trump, if elected, would get a border wall built and that Mexico would pay for it and that 11 million illegal immigrants would be rounded up and deported? “I can’t say I know that for sure,” Jackson said. “I believe he will make an effort in that regard. The effort has to be made and made seriously. Trump has made too much of it. He can’t just go in there and then blow it off.”
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Jackson said he has to trust his instincts and that he has had some success in his life doing so. He said his instinct is that Trump, “by his wealth and nature,” will prove independent enough to do his level best to accomplish what he promises to seek to accomplish, unlike, in Jackson’s view, Ted Cruz. “I don’t trust Ted Cruz, for reasons I can’t explain fully,” Jackson said. “It’s the same PHOTO: SHUTTERSTOCK
TALK BUSINESS & POLITICS | MAY/JUNE 2016
instinct I have that has me believing Donald Trump.” Yes, even Cruz’s colleagues in Washington eschew him, calling him a grandstander not to be trusted. “That’s not my basis for not trusting him. I actually like that about him,” Jackson said. “It’s just something else.” ADMIRING WHAT TRUMP SAYS Lest you think Trump is supported only by disaffected and aging conservative males, consider 81-year-old Dorothy Crockett of Osceola, who is neither male nor all that disaffected. She is a longtime Republican activist, a mother of six who is retired from managing a medical office, and the current chairman of the Mississippi County Republican Committee. She is running to be a Trump delegate to the national convention, at which time she intends to vote for him on every ballot, presuming, as perhaps she safely can, that he will lead with a plurality if not majority of
delegates. She calls herself an “uncloseted” and “unabashed” Trump supporter. “I like that he says we need to restore American industry,” she said. “I like that he says we need to keep out the Syrian refugees, at least without vetting, because ISIS is too smart not to try to infiltrate.” She likes that Trump has never asked her for money while her email box has been filled with solicitations from everyone else running on the Republican side. She is not deterred by any of Trump’s supposed missteps. “I’m a woman,” she said, “and I raised four boys. So I don’t take offense at anything he has said about women.” She said she takes greater offense – invoking one of the Trump-backer themes – at political correctness. She had nothing bad to say about any Republican – except one, Mitt Romney, who offended her with his anti-Trump speech and his indication he could not support Trump as the nominee. If Romney had given such a vigorous speech against Obama in 2012, she said, “we might have an incumbent Republican president today.” A YOUNGER SUPPORTER And lest you surmise that Trump supporters are older adults of either gender longing for an America they remember, consider the case of Richard Caster of Mountain Home. At the age of 18 in 2009, Caster spearheaded the creation of the Ozark Tea Party and then got elected to the Baxter County Quorum Court at the age of 19. Now 25, he graduates this spring from Hillsdale College in Michigan and will return to Mountain Home, and he backs Trump for president. “The problem is that I think Republicans haven’t known how to act as a majority party, at least since Newt Gingrich,” Caster said. “With John Boehner and Mitch McConnell, we haven’t known how to negotiate from a position of strength – to say this is what we insist on, and then go from there. I have every faith Donald Trump is and will be that kind of negotiator. “If not, then I fear we are going to find ourselves in a very bad place,” Caster said,
“The problem is that I think Republicans haven’t known how to act as a majority party, at least since Newt Gingrich.” – Richard Caster
continuing the doomsday theme. He said he believed Trump would get a border wall built, and that it ought to be built. He said that any study of the leading thinkers and essayists of western civilization will show that there is ample historical precedent for the rightness and logic of a nation’s restricting citizenship. As for making Mexico pay for the wall, Caster said his theory was that Trump was saying he effectively would get the cost of the fence defrayed by making better trade deals with Mexico. COMMON THEMES Most of these conversations occurred before a dustup of Trump setbacks – his
“I like that he says we need to keep out the Syrian refugees, at least without vetting, because ISIS is too smart not to try to infiltrate.” – Dorothy Crockett
comment to Chris Matthews about punishing women who get abortions, the misdemeanor charge against his campaign manager, Corey Lewandowski, for grabbing a woman reporter, and the trouncing Trump endured from Cruz in Wisconsin. Here is what Trump admirer McIntyre had to say about all of that in a follow-up conversation: “The Corey Lewandowski thing was so off the charts and, in my opinion, was blown totally out of proportion. I watched that video several times and did not see any evidence of anything close to what [the reporter] claimed in her police filing. I fully expect in the course of things for this to be thrown out.” McIntyre said Trump’s abortion comments “were a mess.” But he said maybe Trump can learn from that debacle and “reset and focus on the basics” and rally in the stretch to salvage the nomination. By the way, McIntyre mentioned, the news of that day was that United Healthcare was pulling out of the Obamcare exchange for Arkansas. His point was that evidence mounted that things were in a holy mess and getting ever-messier, which, as we have seen, is the very foundation of Trump support. So to summarize: Trump supporters cite common themes – that the nation is at the brink of calamity; that the Republican establishment promised to pull the country back from that brink but didn’t; that Trump sometimes says things they wouldn’t, but at least speaks his mind without concern for the political correctness that they consider a scourge on free expression; that Trump’s public bluster belies what they trust to be his conventional competence and vital negotiating skill; that it’s high time to upturn American politics, which has become a refuge for the glib talk and inaction of political careerists; and that Trump’s personal style along with his ability and willingness to fund his own campaign liberate him from conventional obligations and permit the bold independence necessary for these desperate times. Trump supporters would tell you they’re not looking for a tattooed woman with three bosoms. They would tell you they’re only looking for a backbone. www.talkbusiness.net
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Leadership
Sixth Sense:
The Economy and the Election The economy is often front and center in U.S. elections – particularly voters’ perceptions of the economy. With that in mind as we head toward the election of a new president in November, we asked six business leaders from across the state to share their thoughts on the current state of the American economy and how it will affect the race for the White House. By Bill Paddack
Stanley Hill
Sam T. Sicard
Chris Stewart
The public’s perception of the economy will play a significant role in the presidential election. Americans spend an average of 10% of disposable income on food. That’s one of the lowest percentages in the world. Agriculture is one of America’s greatest strengths as we provide a significant amount of food for ourselves and a world population that will reach 9 billion by 2050. In Arkansas, ag production and its associated jobs is the state’s biggest economic driver totaling $20 billion annually. Nationally, ag exports are one of the few areas where the U.S. shows a positive dollar figure on its balance sheet. Those are great strengths to the country and our state’s economic well-being. Ag policy at the state level and nationally should focus on strengthening our ability to efficiently and reliably produce food, fiber and shelter for people here and abroad. And this will require the next administration to advocate and negotiate ag friendly international trade agreements for Congress’ consideration.
The American economy is once again one of the healthiest in the developed world, but I don’t believe Congress or the president should be given credit for it. Even with the political dysfunction and fiscal irresponsibility in D.C., what still drives the economy are dynamic entrepreneurialism, free enterprise and the rule of law. As long as we have those three things in America, I am optimistic on our future. However, we would have stronger economic growth if Congress and the president would reform our convoluted tax code, reform our broken immigration policies, lighten the excessive regulations on small businesses and actually implement a realistic plan to get our federal government back to a balanced budget. It is hard to know how all of this will affect the race for the White House. I believe most Americans sense we could have a stronger economy if there were less dysfunction and stronger leadership in D.C. But the country remains very divided on who would be best to provide that leadership.
There has been some growth in the economy this year and unemployment is lower. However, cost of goods continues to go up and wages have remained stagnant. Although the economy typically is one of the foremost issues driving a presidential race, the election of 2016 signifies a shift. The threat of terrorism and immigration are equally important to voters. This is largely due to Donald Trump’s popularity and rhetoric. The perception is the only candidate focusing on the economy is Bernie Sanders and his message of economic equality. As the race tightens, the economy will be important, but, it will not be the sole issue driving voters to the polls come November.
VP, Public Affairs & Government Relations Arkansas Farm Bureau Federation Little Rock
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President & CEO First National Bank of Fort Smith Fort Smith
TALK BUSINESS & POLITICS | MAY/JUNE 2016
Founder and CEO RaiseTheMoney.com Little Rock
Michael Bahn
Beth Coulson
David Hudson
Our company regularly looks at the state of the economy as it is related to transportation, logistics and storage, particularly at the retail level in Northwest Arkansas. This year, the presidential election will have an effect on businesses, regardless of individual political opinion. Because the transportation industry is a leading indicator for the economy, we have observed certain key operational indicators that suggest a recession is not likely to happen. Even though some indicators point out that we will see more positive data moving forward, candidates have repeatedly focused on the current state of a poor economy and strategies to save it, which has a prominent effect on voters. In addition to the national outlook, stateby-state economic outlet is also a significant factor, as exemplified by the state primaries. With unemployment, health-care costs and median incomes as factors, states with more economic challenges are looking to focus on tax plans and re-shoring efforts. We hope to see a candidate focusing on these kinds of initiatives that encourage economic growth and jobs in the USA and in Arkansas.
Over the last seven years, I’ve seen our economy come back from the brink. Today, our stock market is twice the value it was during the Bush presidency. Yet, too many working families in Arkansas are still struggling. Some are even living in homeless shelters. Take, as an example, my friend who lives at Our House now with her family. She is just one of the many Arkansans who are forced to work two or three jobs just to get by. We’ve also seen college tuitions continue to rise and our retirements threatened. I’m incredibly proud that the family business my husband’s father started has invested in the technology and training needed to create and maintain good-paying, skilled jobs here in Arkansas. Frankly, I think now is the time for another President Clinton to help us boost family household income, ensure equal pay for women, secure retirement for hardworking Americans and keep our economy moving in the right direction.
I’ll start by saying that I am not political. While I take my right and duty to vote very seriously, I consider myself to be in a party of one, as Thomas Jefferson once said. From my own perspective, the current state of the economy is positive. My business continues to operate, and my beautiful city of Little Rock is growing. Most importantly I can care for my family and afford the little extras that put a smile on my daughter’s face. However, I have a very serious concern about the stability of the economy after this presidential election. Many countries look to the United States to be a stable influence in an unstable world. If we elect a mentally unstable president, I think it could seriously affect the perception of the value of the dollar. We need to elect a president that will protect our country’s integrity and honor. This might just be the most important election in the last century.
President, RR Logistics, LLC Sr. VP of Sales & Supply Chain Holistic Product Group, LLC Bentonville
Board Secretary Coulson Oil Company Little Rock
CEO Few Little Rock
www.talkbusiness.net
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Executive Q&A PHOTO COURTESY OF CENTENNIAL BANK
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TALK BUSINESS & POLITICS | MAY/JUNE 2016
Deana Osment
Centennial Bank’s Northeast Arkansas division president puts her knowledge and leadership skills to work while always embracing the advice she received from her father. By Roby Brock
D
eana Osment is the Northeast Arkansas division president for Centennial Bank, a subsidiary of Conwaybased Home Bancshares. A resident of Jonesboro, Osment has made her mark in the banking community as one of the go-to sources for a status of the regional market. Centennial Bank has the largest market share in the Jonesboro market, an outgrowth of the financial group’s $280 million acquisition of Liberty Bancshares in 2013. Osment sat down with Talk Business & Politics at the bank’s regional office in Jonesboro and talked banking, of course, along with economic data, education, the AEDC and business advice. TB&P: Give our readers a lay of the land in Northeast Arkansas. What’s on the horizon and what has you occupied in the banking arena currently? Osment: Banking in Northeast Arkansas has always been very competitive. We’ve always had lots of really good players in the market and a lot of them have been here a really long time as far as experts. It’s been very competitive for the last several years – as long as I’ve been in it – and I think that’s good overall for consumers and businesses. On the immediate horizon, regulatory changes affect us and those are a concern in making sure we can remain competitive and comply with the rules. TB&P: What kind of deals are you seeing in the market currently? Osment: One of the things we’re blessed with here in Northeast Arkansas is we’re so diverse. We get to see a little bit of everything. As of late, we’ve seen a lot bigger development deals that we weren’t seeing after the downturn of ’08 and ’09. Then, we were doing more of the smaller business, smaller retail-type deals, but I really think
AT A GLANCE Arkansas Economic Development Commission Jonesboro City Water & Light Board United Way of Jonesboro, board treasurer Jonesboro Unlimited Jonesboro Economic Development Commission First United Methodist Church, finance committee Married to Ray Osment Three children: Mallory, 27, Gray, 14, and Lindsey, 11. larger development has been on the forefront the last year to 18 months. It’s exploded in Jonesboro. Agriculture has always been out there, but we’re a little more cautious because we’re not sure what the future holds there. We’ve still got some great customers, great borrowers, some good people that have been in the ag business a long time and we’re really strong there. Medical and retail are good, too. We’ve got a lot of diversity. TB&P: Education is strong also, especially with the anchor of Arkansas State University and its activity. Osment: Thank goodness for ASU. They’re a huge benefit for Jonesboro and without them, I don’t think Jonesboro would be what it is or Northeast Arkansas for that matter. They’re a huge economic impact for this area and community with all of the things they’ve got going on right now. TB&P: When you look at some economic data in the region, you see a growing sales tax base, a strong housing market for several years, falling unemployment. These are all great positives. What gives you pause for caution?
Osment: When you get so competitive on the banking forefront, bankers might tend to loosen underwriting criteria, might try to be a little more aggressive. We’ve seen things loosen up in the last couple of years. If we’re not careful, we’ll reap the consequences of those looser underwriting standards. I would be a little bit concerned about that. Hopefully, where we’re headed, we’re all doing the best we can on the underwriting and keeping things tight. TB&P: Dot the i’s and cross the t’s ... Osment: Right. TB&P: You’ve recently been named to the Arkansas Economic Development Commission. I’m curious, what are your goals and expectations for this appointment? Osment: First of all, I was extremely honored to be named to that. There are two other individuals from Jonesboro – Al Heringer and Doug Falls – that are on the commission. I think having three of us from Northeast Arkansas is a huge benefit for this area. I’m excited, I’m brand new and I have a lot to learn and pick up from it, but I think us staying involved from a statewide perspective for Northeast Arkansas is a benefit. We’re always trying to put forward what we have to offer, the great things that are in Northeast Arkansas and how we can benefit – not only from our region – but how we can help the state. TB&P: What’s some of the best business advice you’ve ever given or received? Osment: I still think Ed Way and Wallace Fowler were excellent mentors to me, and I certainly owe a lot to Davy Carter and Johnny Allison, but my dad told me once that 90% of success is showing up every day and giving it your best. I think over the years that has served me well. www.talkbusiness.net
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A collection of recent quotes by Arkansas newsmakers.
“Folks in the field
– State Sen. Jeremy Hutchinson, R-Little Rock,
and they shouldn’t be trapped within the silos or within the programs.”
“I think banks will increase their balance sheets and book more loans this year than last.
should be able to deal with the people that they’re helping as a holistic person,
– Cindy Gillespie, new director of the Department of Human Services.
– State Rep. Clarke Tucker,
defending drug testing for recipients of jobless benefits.
D-Little Rock, who argued drug testing is not cost-efficient for the state.
Those higher loans should drive continued profits.” – Tim Yeager,
banking and finance professor at the University of Arkansas, on improving bank profits in Arkansas.
At the same time, we are pleased to see that optimism tempered by careful consideration of the needs of the market. Everyone is letting the experience of the last 10 years wisely govern their decision-making processes.”
$ $$ $
It’s time to cut this item from the budget and sell the War Memorial Stadium. Then Pulaski County can collect the property taxes that the Little Rock School District needs so desperately.” – State Sen. Bart Hester, R-Cave Springs.
– Tammy Engle, senior vice president and loan
manager with Arvest Bank in Siloam Springs, on recent commercial trends in Northwest Arkansas.
What’s worse, a dope dealer on the corner or a dirty judge? A dirty judge is far more harmful to society than a dope dealer.”
“I have not met anyone in business “I’m very much in who hasn’t said they need talented favor of normalizing sales people.”
– Federal Judge Brian Miller in sentencing
former Judge Mike Maggio of Conway to a maximum 10 years in prison for bribery.
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“
We are spending $849,500 managing a football stadium in Little Rock. This is not a joke.
TALK BUSINESS & POLITICS | MAY/JUNE 2016
– Dr. Shane Hunt,
dean of the ASU College of Business.
relations with Cuba.” – Sen. John Boozman, R-Arkansas.
Your daily allowance of greens. Dining out in Chenal Valley, even the atmosphere is palatable. Not only is the West filled with one-of-a-kind restaurants, outdoor patios and a wide range of menu options, but you’ll find a healthy balance of greenbelts and scenic charm, as well. Voted Arkansas’ #1 Shopping & Dining Destination for the last three years, Chenal is truly the perfect balance of spoiled and unspoiled. In fact, the neighborhoods of Chenal Valley bring to life everything you could dream of in a community. Visit Chenal.com and see how life happens here.
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