2014-02 Faulkner County Business Journal

FEBRUARY 2014

First Security Ranks First in Market Share in Faulkner County

2D — Sunday, February 16, 2014

Faulkner County Business Journal

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Chamber announces Annual Meeting award recipients An awards ceremony recognizing individuals and businesses that have made a difference in Conway over the past year is one of the highlights of the Conway Area Chamber of Commerce’s Annual Meeting. The following award recipients will be recognized at the 2014 event, which is scheduled for March 20 at the Conway Expo Center and Fairgrounds. Tickets and sponsorships are available now at ConwayChamber.org.

Bunny Adcock, Centennial Bank

Bunny Adcock, Distinguished Service Award

Bunny Adcock, vice chairman of the board for Centennial Bank, is the 2014 recipient of the Distinguished Service Award, the Chamber’s highest form of recognition. Throughout his career in the banking and finance sector, Mr. Adcock has devoted himself to improving the overall business climate of Conway and the state of Arkansas. He has headed two state agencies — the Arkansas Development Finance Authority and the Arkansas State

Bank Department — and has served in various capacities at the University of Central Arkansas. Mr. Adcock is a current member of the UCA Board of Trustees and has served as vice president for advancement as well as vice president for finance and administration at the institution.

Established in 1957, the Distinguished Service Award is presented annually to an individual or group who has rendered special service for the benefit of the community. Candidates have demonstrated an active leadership role for the betterment of the community through their involvement in business, civic and social service organizations.

endeavors range from landscaping, painting and cleaning 12 schools in the Conway School District as part of the Big Event Volunteer Day, to delivering a Thanksgiving meal provided by Centennial Bank to 1,150 people in Conway. Mr. Washispack serves on the boards for Conway Public Schools, Ministry Center and Human Services Coalition.

He is also a member of the Ministerial Alliance, a graduate and curriculum member of the Faulkner County Leadership Institute, and part of the Toad Suck Continuum of Care.

Established in 1973, the Good Neighbor Award is presented annually to an individual who has given of his or her time and talents. Candidates are known for going beyond the call of duty to help others. The nominee shall exemplify outstanding public service to the Conway area.

Business of the Year

The Business of the Year Award recognizes businesses for continued growth, innovation and community involvement.

It is the premier honor to Quentin Washispack, New Life the best overall businessChurch es in Conway and is preQuentin Washispack, sented in five categories Good Neighbor Award based on industry and Quentin Washis- number of employees. pack is the 2014 recipient of the Good Neighbor Outstanding Nonprofit Award. As mission and — Independent Living outreach pastor for New Services Life Church, Mr. WashisIndependent Living pack organizes hundreds Services (ILS) is the 2014 of volunteers to tackle recipient of the Business a number of community of the Year: Outstanding projects. His most recent Nonprofit Award. The or-

ing — offers live music in a trendy environment.

Co-owners Dustin Botsford and Marcus Bobbitt wanted to provide a “cool, classy escape” for Conway residents and breathe life into an underutilized part of downtown. In addition to providing highquality musical entertainment from local artists, Kings Live Music supports the community in other ways. The venue has hosted numerous charity and community events for organizations such as the Boys and Girls Club of Faulkner County, United Way, Conway Cares, Faulkner Jackie Fliss, Lum Kramer, Jerome Riley and Bart McCuin, Independent County Women’s Shelter, The Blue Crew Police Living Services Fund and Conway Instiganization provides ser- al budget of $7.5 million, tute of Music. vices for more than 250 making it one of the largdevelopmental and intel- est nonprofit organiza- Outstanding Retailer — lectual disabled individ- tions in central Arkansas. The Kitchen Store uals in Faulkner County.

The Kitchen Store is These services — which Outstanding Hospitality the 2014 recipient of the include therapy, transpor- — Kings Live Music Business of the Year: Outtation, residential servicKings Live Music is standing Retailer Award. es, health and wellness, the 2014 recipient of the Since Jeanne and the late and an adult develop- Business of the Year: Mike Smyers purchased ment day program — of- Outstanding Hospitali- the store in 1999, its volfer ILS consumers a more ty Award. The entertain- ume has quadrupled, and fulfilling life that may not ment venue — located the staff has grown from have been possible oth- in a beautifully restored, three part-time employerwise. ILS was incorpo- historic, downtown build- ees to 12 who work up rated in 1970 as a group home for eight men from the Conway Human Development Center. It has since grown to operate three group homes, two residential homes, three apartment complexes and one intermediate care facility. Along with increasing services and the number of people receiving services, ILS employs 375 people in Faulkner County and has an annu- Marcus Bobbitt and Dustin Botsford, Kings Live Music

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Jeanne Smyers, The Kitchen Store

to full-time. The Kitchen Store is known throughout Conway and central Arkansas for its highquality kitchen, gift and home décor merchandise and excellent customer service. In addition to operating a favorite Conway retailer, the Smyers family made the first donation to establish the Conway Regional Perinatal Bereavement Program to help families, like theirs, who have experienced the loss of a pregnancy. They pledged continued support of the program through The Kitchen Store by hosting the Annual Holiday Preview event. Since 2009, the event has donated 100 percent of its gross proceeds to the program, totaling more than $72,500.

Outstanding Large Employer — CenterPoint Energy

than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and Texas. CenterPoint Energy and its predecessor companies have been in business for more than 135 years. The company focuses on safety and education, community development, and health and human services in the places where its 8,700 employees live and work.

CenterPoint Energy invests hundreds of millions of dollars each year on system modernization and safety-related infrastructure and technology to ensure its system is safe and reliable.

Faulkner County Business Journal

is the 2014 recipient of the Business of the Year: Outstanding Small Business Award. Since 1991, the business has provided quality instruction in gymnastics, dance, cheer, tumbling and related physical activities to children. Sonshine Academy’s recently expanded, 52,000-square-foot training facility features the latest equipment and training tools and is designed to maximize training in a fun and safe environment. Certified judges in gymnastics, dance, all-star cheerleading, tumbling and trampoline along with awardwinning cheer and dance faculty are on staff. Not only do children enhance their athletic ability at Outstanding Small Sonshine Academy, they Business — Sonshine also develop desirable Academy Sonshine Academy character traits such as

CenterPoint Energy Inc., a domestic energy delivery company, is the 2014 recipient of the Business of the Year: Large Employer Award.

CenterPoint Energy is the largest natural gas distribution company in Arkansas. It serves more Scott and Elsie Rose Wright, Sonshine Academy

Sunday, February 16, 2014 — 3D

confidence, discipline and sportsmanship. In addition to its day-to-day operations, Sonshine Academy hosts regional boys’ and girls’ gymnastics meets and cheer competitions each year.

way Corporation board of directors; president of the Little Rock Air Force Base Community Council; and is a member of the board of directors for the Air Force Chief of Staff Civic Leader Group, ARVets and Conway Development Corporation.

The Business Executive of the Year Award recognizes the owner, executive or president of a business who has displayed outstanding performance in either an individual or collaborative endeavor.

The nominee is a driving force behind the company and works to Brad Hegeman, Nabholz Con- maintain an enriched struction business climate and an enhanced quality of life in Conway.

Business Executive

of the Year — Brad Hegeman

Brad Hegeman, president of south-central operations for Nabholz Construction, is the 2014 recipient of the Business Executive of the Year Award. As an executive for the accomplished, multi-service construction company, Mr. Hegeman has demonstrated leadership in the building industry and the community as a whole since he began working for Nabholz in 1996.

His community service ranges from the public sector to nonprofits to industry-specific organizations. Mr. Hegeman served on the Conway City Council for two terms and was chairman of the finance committee and the parks and recreation committee. He currently serves as secretary of the Con-

comprise Conway Management Inc. Mr. Patel will soon add restaurant proprietor to his list of accomplishments.

He plans to open a new establishment in the Village at Hendrix, where he will also relocate his corporate office.

Mr. Patel has been involved in the community since he was a child; his family owned and managed hotels in Conway for several years.

Now that he has taken on the main role in the family business, he continues to invest time and money into the local economy.

The Young Business Leader Award recognizes a community business leader, age 40 or younger, who has helped create a more vibrant business and social environment for all of Conway’s residents.

About Annual Meeting

Umang Patel, Conway Management Inc.

Young Business Leader of the Year — Umang Patel

Umang Patel, owner of Conway Management Inc., is the 2014 recipient of the Young Business Leader of the Year Award. Four local hotels — Holiday Inn Express & Suites, Comfort Suites, Candlewood Suites, and Comfort Inn & Suites —

In addition to the awards, Annual Meeting features a CEO-level speaker. This year’s speaker is Steve Mueller, president and CEO of Southwestern Energy Company.

Mueller serves on the boards of America’s Natural Gas Alliance, the American Exploration and Production Council, and the Independent Petroleum Association of America.

Individual tickets are $75, and tables and sponsorships begin at $600.

Reserve a space by contacting Mary Margaret Satterfield at Mary@ ConwayArkansas.org or 501-932-5412.

4D — Sunday, February 16, 2014

Faulkner County Business Journal

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First Security Bank ranks first in market share in Faulkner County First Security Bank recently moved to first place in market share in Faulkner County. Market share data is collected by the Federal Deposit Insurance Corporation (FDIC) and measured by deposits an FDIC-insured institution has within a defined geographic market. The most recent data collected was from June 30, 2013 and reported by the FDIC nationally in October.

This is not the first No. 1 ranking the First Security –Conway has received. First Security Mortgage has been ranked first in Faulkner County, filing more mortgages than any other financial institution in the county for 13 years.

First Security’s commitment to their customers and community is evident, earning the bank recognition as “Faulkner County’s Best Bank” by the Log Cabin Democrat “Reader’s Poll” consistently for the past 5 years.

With approximately 27,000 personal and business customers, the Conway market has continually grown in assets since its charter in 1991 as First Community Bank, which joined First Security Bancorp in 1997. Today, the bank locally has more than $645 million in assets and $550 million in total deposits.

“We believe this data is a result of our emphasis on relationships and a better banking experience,” said Johnny Adams, president and CEO of First Security Bank Conway. “Also, while other Arkansas-based lenders are investing outside

Lenders Mark Lollar and Mike Randy at the Faulkner County Justice Building.

Linda Linn, Johnny Adams, Debra Robinson at the Conway Senior Citizens Center. the state, First Security Bank remains committed to investing in growing in Arkansas to meet the needs of fellow Arkansans. We have a local advisory board of director’s, an experienced local based lending team and the financial and capital backing to really be a partner in growth for Conway and Faulkner County. We understand the community its businesses and people and strive to make the best

decisions always with Conway’s and Arkansas’s best interest in mind. It’s our main focus here.”

Some of a number of recent Conway projects the bank is proud to provide local community based financing for include the new Faulkner County Justice Building and the new Conway Senior Citizens Center.

The $10.6 million Faulkner County Justice Building will house pre-

viously scattered circuit courts and related offices under one roof and replace the 1936 courthouse. The 17,500 SF building will include seven courtrooms, offices for judges, prosecuting attorneys, county clerks and circuit clerks, as well as victim services offices. The construction plan includes improved security features, such as a secure entrance for the public and secure parking for judges.

First Security – Conway is a partner in providing financing for the new $2 million Conway Senior Citizens Center. The program has operated out of their current locations for 34 years. In 2013 they provided over 92,000 meals to homebound seniors; 39,000 meals and activities at the center; 20,000 transportation trips for medical & dental, and assisted needs trips.

“Both of these projects have been particularly meaningful, as we’ve been able to play a part in meeting a need in Faulkner County, said Adams. “When we have the opportunity to partner with groups that are impacting lives and ultimately making Conway a better place to live, we want to help them succeed.”

First Security Bank Advisory Board Member Linda Linn served as co-chair of an impressive fund raising drive that helped this dream for the Conway Senior Citizens Center become a reality. Joe White, who also serves on the bank’s advisory board and at the center helped greatly in the planning for the new

building.

Other members of the bank’s Advisory Board of Directors include: Richie Arnold, CEO of Conway Corporation, Jack Bell, Assistant to the Mayor – City of Conway, George Covington, Covington Companies, Hal Crafton, Rush-Hal Companies, Bill Hannah, Chairman of Nabholz Corporation, Dr. Bob Rook, Physician, Mike Baldwin, Mark Ferguson and Reynie Rutledge with First Security Bancorp.

Adams who is on the board leads First SecurityConway’s senior management team, which collectively has over 160 years of banking experience. These seasoned banking professionals also share a commitment to the community they call home.

“It’s always a privilege when business projects bring about community improvements, but our team doesn’t stop there,” said Adams. “We are committed to giving back to Conway, and our bank’s community focus fosters our desire to do so.”

First Security has proudly sponsored the First Security Conway Kids Triathlon, one of the country’s premier youth triathlons, for 10 years and the Conway Symphony Orchestra Children’s Concert, an annual performance supporting the Orchestra’s Feeding America program through donations to local food banks for the past 10 years.

The company has also served up thousands of hot dogs and hamburgers on its signature Teal Grill at local events, ranging from fund-

raisers to groundbreaking ceremonies.

This community-centric outlook translates naturally into taking care of their customers. While offering traditional personal and business banking products and services, the bank also supports local schools by offering mascot debit cards. Mobile and on-line banking allows customers convenient access to their accounts. The bank’s new SecurityPlus product features identity theft protection and includes credit file monitoring, identity theft resolution services, discounts on gas and gifts cards, free custom checks and more. “Offering our customers the opportunity to BANK BETTER is not only a First Security promise, it’s a service culture our employees have adopted and live everyday”, says Margaret Smith, marketing officer for the Conway market.

First Security has also connected with customers and the community through the social media, something that is innovative for the banking industry. The First Security Facebook page has over 14,000 fans, is 38th most liked bank in the United States and in the top 100 most liked banks in the world. The bank also even has followers on Twitter and Pinterest.

First Security Bank – Conway is a part of First Security Bancorp, an Arkansas-based financial services holding company with more than 900 employees and 70 locations across the state.

6D — Sunday, February 16, 2014

Conway Economy at a Glance

Faulkner County Business Journal

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Going out to eat in Conway

By Roger Lewis

Unemployment Rate* December US 6.7% Arkansas 7.4% Faulkner County 7.0% Conway 7.2% *Faulkner County & Conway not Seasonally Adjusted Sales Tax Collections Conway* November 2013 $1,868,063 2012 $1,853,144 Percent Change 0.81% Year to date (November) 2013 $20,940,295 2012 $20,779,269 Percent Change 0.77 Annual 2012 $22,944,163 2011 $22,366,464 Percent Change 2.6% *Tax Rate 1.75% Faulkner County* November 2013 $687,686 2012 $660,842 Percent Change 4.06% Year to Date (November) 2013 $7,770,243 2012 $7,700,145 Percent Change 0.91% Annual* 2012 $8,465,686 2011 $8,279,301 Percent Change 2.3% *Tax Rate 0.5% Restaurant Sales* December 2013 $13,867,524 2012 $13,497,777 Percent Change 2.4% Annual Sales 2013 $165,124,807 2012 $161,318,563 2011 $147,820,786 Percent Change 2013-2012 2.6% *Including mixed drink sales Hotel Sales December 2013 $1,056,692 2012 $1,156,995 Percent Change -8.7%% Annual Sales 2013 $18,559,308 2012 $18,683,676 2011 $18,662,136 Percent Change 2013-2012 0.7% Conway Building Permits Single Family Homes January 2013 4

2012 7 Percent Change -43% Annual 2013 147 Permits 2012 186 Permits 2011 153 Permits Percent Change 2012-13 -21.0% Average Construction Cost* Annual 2013 $228,275 2012 $207,537 2011 $204,387 Percent Change 2012-13 10.0% *Not including land or lot improvements Average Square Footage* Annual 2013 3,002 2012 2,910 2011 2,814 Percent Change 2012-13 3.2% Average Construction Cost Per Square Foot* Annual 2013 $76.04 2012 $71.33 2011 $72.64 Percent Change 8i2012-13 6.6%% * Total under roof Lottery Sales Faulkner County Annual 2013 $17,038,277 2012 $16,943,909 2011 $16,768,678 Percent Change 2012-13 .06% Total State Annual 2013 $432,932,799 2012 $452,245,215 2011 $474,879,701 Percent Change 2012-13 -4.3% Natural Gas Severance Tax Distribution Conway Annual 2013 $276,523 2012 $162,457 2011 $254,822 Percent Change 2012-13 70.2% Faulkner County Annual 2013 $224,455 2012 $131,418 2011 $204,052 Percent Change 2012-13 70.8%

Information provided by pulseofconway.com

Even in the beginning Conway had places where you could go out to eat. Although Gatewood’s 1880 map shows no cafés or restaurants among about 35 businesses, there are two hotels and one rooming house. Today’s very longtime residents might recall Mrs. Ross’s (where Dayer Jewelry is now) or Goads Café at the corner of Oak Street and Parkway (which was Railroad Avenue then). And just plain long-time residents will remember places to eat on Harkrider Street; American Grill, Southern Café, Frank Brannan’s Drive Inn and Tommy’s. Many college students of the 70’s and 80’s remember Ma Tucker’s on Hariston street for a good, plentiful, cheap meal – no selection, only what Ma cooked that day. Today’s choices, however, can be described as a different kettle of fish: In 2013 the number of establishments selling food to eat at the point of sale was 235.

Any establishment that sells prepared food ready to eat at the point of sale is required to collect a two percent Advertising and Promotion tax (A&P), which is often referred to as “the hamburger tax.” Accordingly, the term restaurant includes coffee shops, grocery store delis, gas stations’ “convenience” sections, and specialty shops such as those selling frozen yogurt, donuts and bakery items.

The tax falls on locals and travelers alike.

Of the 235 businesses that paid A&P taxes last

year, some were seasonal businesses (think shaved ice and Toad Suck Daze concessions). For others, food sales were ancillary (gas stations, grocery store delis, and movie theatres).

However, using as a criterion that an establishment mainly sells prepared food– whether it’s ice cream, pizza, donuts, or a full meal, the number of restaurants and cafes in Conway is about 150. Using this criterion, Cinemark Theatre is not counted as a restaurant, even though their concession sales rank them at 23rd for 2013.

The top 20 restaurants in Conway for 2013 are shown in the table. Rankings are based on annual revenue (in millions of dollars) and do not include alcohol sales.

Several interesting items about these 20 restaurants: • Only Mike’s Place and Stoby’s are independent restaurants (not part of a national chain or franchise) • The oldest restaurant is McDonald’s on Oak Street, which opened in 1975; second is Stoby’s (1980) • Only seven of the top 20 and two of the top 10 sell alcoholic beverages • Chick-fil-A, the top grossing restaurant, does

not sell alcoholic beverages and is not open on Sundays The most remarkable restaurant of these 20, in my opinion, is Stoby’s. Stoby’s is an independent restaurant that has been continuously operated by its founder and sole owner since 1980. It is not open on Sunday, does not serve alcoholic beverages, and has a small seating capacity but ranks eleventh in sales. No wonder the Conway Chamber of Commerce honored Stoby’s in 2013 as its outstanding small business of the year.

The food sales for these 20 restaurants total $57 million a little over a third of all prepared food sales.

Looking at these figures of gross revenue might lead to a conclusion that the restaurant business is booming. Also, 2013 saw eleven new establishments open including Brick Oven Pizza (Oak Street Bistro location) Dunkin Donuts, Kobe, Table Mesa and Toppers Pizza.

Except for Kobe’s these restaurants replaced restaurants at existing locations.

The Kum & Go station and the Walmart neighborhood market are among the new restaurants.

On the other hand, fifteen restaurants closed during 2013. We bid goodbye to Agora, Beef

O’Grady’s, Michelangelo’s, Oak Street Bistro, Stromboli’s, Something Brewing, and Wimpy’s among others.

To get a better picture of this industry we need a broader sweep of time. Although restaurant sales for 2013 were up $3.8 million over last year, a 2.4 percent increase, the previous three years had an average annual growth rate of 7.3 percent.

The total restaurant revenue for Conway for 2013 was $165 million, which includes mixed drink sales.

At almost $14 million a month, this represents approximately 11 percent of the total retail sales in the city.

So what does this all mean for 2014? Although our local economy is stagnant in many areas, there are several restaurants under construction including, Chick-fil-A (Prince St.) Purple Cow, Taco’s for Life and How Do You Roll. There are others in the planning stage and rumors of more.

Most likely we will have ten to fifteen new restaurants open and about a dozen will close. This has been the trend the past several years and is likely to continue. With the economy in slow recovery, total restaurant sales will likely increase by five or more percent and set a new sales record of approximately $175 million in 2014.

I thank my friend Chris Spatz for editing and helping me with this article.

You can obtain more information on the economy of Conway and Faulkner County by going to the Pulse of Conway website (www. pulseofconway.com).

Log Cabin Democrat • Find our online edition at www.thecabin.net

Sunday, February 16, 2014 — 7D

Faulkner County Business Journal

Lunch & Learn focuses on small business financing On Wednesday, Feb. 26, representatives from Advantage Capital Partners will give a presentation about Arkansas’s New Markets Jobs Act. The seminar is part of the Conway Area Chamber of Commerce’s Small Business Lunch & Learn series and is free to employees of Chambermember businesses. It will take place from 11:30

a.m. until 1 p.m. at the Chamber building, located at 900 Oak Street.

Arkansas became the 12th state to enact a state-level, new markets policy after the Arkansas legislature overwhelming passed the New Markets Job Act. This legislation — modeled after the successful, federal New Markets Tax Credit program — is an economic devel-

opment program that encourages private sector investments in promising small businesses located in distressed communities throughout the state.

The legislation provides small businesses with new and flexible financing for growth, capital expenditures and jobs. A number of areas in Conway and Faulkner

County are eligible for this incentive.

Seating is limited to the first 40 participants so reservations are required. To reserve a seat at the Small Business Lunch & Learn, visit ConwayChamber.org/ events or contact the Chamber at 501-3277788 or GetSmart@ConwayArkansas.org.

Advantage Capi-

Chamber adds attorney, graphic designer To meet growing organizational needs, the Conway Area Chamber of Commerce has added a part-time graphic designer and a full-time attorney to its staff.

Kara Darling, Graphic Designer

Kara Darling began her new position as graphic designer on Jan. 21. A Florida native, Darling is a graduate of Full Sail University and has more than 10 years of advertising-agency experience. She has also served as creative director for the Winthrop Rockefeller Institute.

Throughout her career, Darling has designed projects for local and national clients from various industries, particularly nonprofit organizations and small businesses. She has received five ADDY® Awards from the Central Arkansas chapter of the American Advertising Federation and a Service Industry Advertising Award.

“Kara’s creativity, ex-

perience and attention to detail have already made her an asset to our Darling team,” said Jamie Gates, senior vice president. “Having a skilled graphic designer on staff will ensure that materials from the Chamber and our partner organizations are high-quality and professional.”

Darling is the owner of Kara Darling Creative, a virtual, marketing services firm. She resides in Little Rock with her husband, Justin, and daughter, Bowen.

Luke Ferguson, Senior Vice President/ General Counsel

Luke Ferguson joined the Chamber and Conway Development Corporation on Feb. 3 as senior vice president/general counsel. The Faulkner County native attended high school in Greenbri-

er and obtained a bachelor’s degree in Spanish and history Ferguson from the University of Central Arkansas.

Ferguson went on to earn his Juris Doctor from the William H. Bowen School of Law in May 2008 and became licensed to practice law in Arkansas later that year.

He worked at a private law practice in Conway and most recently served as a Deputy Prosecuting Attorney in the Twentieth Judicial District, which includes Faulkner County.

Ferguson will be responsible for contract review and negotiation, risk management, and human resources. He will also assist with economic development activities, including the development of Central Landing. Brad Lacy, president and CEO of the Chamber and Con-

way Development Corporation, said having an attorney on staff will be beneficial as the organizations continue to grow.

“Luke is a strategic addition to our team. As events like Toad Suck Daze continue to grow and as we become involved in complex projects like Central Landing, it is helpful to have legal knowledge on staff,” Lacy said. “We also have the opportunity to gain efficiencies as we move all human resource responsibilities to him. We are excited to have Luke on board.”

Ferguson resides in Springhill with his wife, Jessica. He said it has been exciting to witness the economic growth and increased opportunities in Conway and the surrounding area.

“I’m honored to be working with the Chamber and CDC and hope to personally contribute to the progress these organizations will continue to foster in Conway,” he said.

tal Partners is a leading venture capital and small business finance firm focused on providing growth capital and other investments supporting state and local economic development efforts. The firm’s typical forms of investment include venture, expansion equity, mezzanine financing, senior and subordinated loans, and government-

guaranteed lending. With offices and partners in New Orleans, St. Louis, Chicago and other U.S. cities, Advantage Capital has invested more than $1.4 billion since 1992. The firm invests in small businesses located in geographic areas underserved by traditional capital and in companies in a wide range of industries.

EDITORIAL

At what cost?

The Arkansas Legislature is back in session.

As in all even-numbered years, they are convening for a “fiscal session.” These sessions are reserved for appropriation matters and the usual “political” issues will wait until 2015. This year, however, Arkansas’s largest political issue is an appropriation matter.

The issue is whether or not to renew the one-year-old “Private Option” method of Medicaid expansion.

Without going into too much detail, the Private Option extends subsidized private insurance to Arkansans making between 100 and 138 percent of the federal poverty level. The federal government will pay 100 percent of the increase in costs for the first three years of the program.

Eventually, the federal portion will drop down to 90 percent.

That brings us squarely to the politics of this appropriation. In Arkansas, a full three quarters of the legislature must vote to continue this program. Currently, there are a handful of legislators who think this program is too close to “Obamacare” for their comfort.

Sadly, that handful of legislators is using Faulkner County employers, employees and families as cannon fodder in a “proxy war” on Obamacare.

Three of Faulkner County’s four largest employers, representing 4,100 employees, will be directly impacted if the Private Option isn’t renewed.

Conway Regional stands to lose $750,000 per year in reimbursements for uncompensated care.

UCA and the Conway Human Development Center will be fighting to avoid the inevitable cuts that come from a state budget with an $89 million dollar hole in it. And it would be awfully hard-hearted to not mention the more than 3,000 Faulkner County households (mainly the working poor) who would lose their newly gained insurance.

The question at hand is not whether or not you agree or disagree with health care reform at the federal level. The only question is whether or not Arkansas is better off with the extension of the Private Option. It certainly is.

Faulkner County too.