est:www.ascc-aia.org Website: [email protected] Bowen, Kelly Administrative Assistant [email protected] Deb Mathis, Communications andEvents Coordinator [email protected] Linda Curtis, Financial Coordinator [email protected] Thatcher, Jeff Marketing Events and Communications, of Director [email protected] DeLille, Angela Trade International of Director [email protected] J.D., Hall, Kenneth R. Affairs Governmental Vice of President [email protected] Ron Russell, andCEO President Staff Stacy Pittman, Education Committee Woods Denver Peacock, Committee Communications &PublicRelations Economic Advancement Ashvin Vibhaker, Dr. SmallBusinessCouncil Arkansas 2005-2006 Committee Chairs Wood ManufacturingCo./Ranger Boats Hopper Randy theBoard of Past Chairman Albemarle Corporation Joe Bossier Treasurer Freight FedEx Reed Pat Vice President PaperInternational ContainerDivision Benny Baker Second Vice President AT&T Drilling Ed Vice President First Tyson Foods, Inc. Archie Schaffer theBoard of Chairman OF ARKANSAS ASSOCIATED INDUSTRIES Cranford Johnson RobinsonWoods APR Pittman, Stacy B. theBoard of Past Chairman Wal-Mart Inc. Stores Joe Kefauver Vice President ALLTEL Communications, Inc. Randy Wilbourn Second Vice President OG+E Sparks “Kenny” K.W. Vice President First Arkansas Entergy Hugh McDonald theBoard of Chairman COMMERCE ARKANSAS STATE CHAMBEROF 2005-2006 Executive Committee Bill Walmsley, CompensationCommittee Workers’ Woods, Daniel H. Committee Unemployment Compensation Tom Kennedy, Tax Committee Woods Arkansas Walmsley LawFirm Cranford Johnson Robinson Entergy Arkansas Entergy Cranford Johnson Robinson Timex Corporation Annual SummaryUALR Institutefor ai el SouthArkansas Telephone Co. Inc. ALLTEL Communications, BureauFederation Arkansas Farm Regions Bank ProductionCompany Stephens Randy Wilbourn David Wells RheemAirConditioningDivision Ewell Welch William Walker Mitchell WilliamsSeligGates& Vest Jerry Arkansas ElectricCooperatives of Inc. Stephens Doyle Thresher Arkansas Federal First Bank of Nick Thompson Company Energy Southwestern Kirkley Thomas BoatWorld Inc. Arkansas Children'sHospital Frank Thomas Scott Tennyson III Smith, Robert D. OG+E "Sandy"Stroope F. Lawrence County NationalBankof First Alan Stewart Sparks Bank Arvest “Kenny” K.W. Rosi Smith CenterPoint Arkla Energy Road SystemsInc. & Starling Harrelson Robert Ramsay Smith Bridgforth Milton Smith Dennis Smiley CopySystems Spencer Robinson CapriCasino Dover PLLC Dixon Isleof Horne Lynn Reinbolt Cranford Johnson Robinson Woods Ray Reid Mid-South EngineeringCompany MaryJane Rebick APR Pittman, Stacy Friday &Clark Eldredge Charlie'sThriftway Michael Parker Meadows Inc. Enterprises Jose Oakley Trane The Company Roy Murphy Michael Moore FirstSecurityBank Charles Moore Arkansas Entergy Meadows Jack McFerran Union Bank&Trust Company Mike Roddy McCaskillRealty McFarland Mike Washington GroupInternational MazanderEngineeredEquipment Hugh McDonald Jonesboro Zach McClendon SimmonsFirstBankof Koontz ElectricCompanyInc. McCaskill Martha Wal-Mart StoresInc. Charles Mazander P.A. Gilker andJones, Martin Cheryl Razorback ConcreteCompanyInc. Ledbetter Barry Benny Koontz AFayetteville USAbleLife Uof Joe Kefauver Michael Jones CraigheadElectricCooperative Corp.Keith Ingram EastArkansasCommunity College CrossGunterWitherspoon&Galchus P.C.Richard Friday Hudson &Clark Eldredge Merchants andPlantersBank James House Wayne Honeycutt Arlington Resort Hotel&Spa Daniel Herrington Arkansas StateUniversity Russell Gunter GESInc./Food Giant Coy Grace CooperClinicP.A. Jim Gowen CooperCommunities Inc. Corporation CooperManagement Horst Fischer Robert Evans Oral Edwards AcxiomCorporation Walmsley Law Firm. Jack Davidson GreaterHotSpringsChamber John Cooper Arkansas Tech University CityElectricCompany Jim Cooper Tom Cloninger &Company Barton E.C. Bill Walmsley Dave Byerly Conway Corporation Arkansas BlueCrossandShield Robert Brown Acxiom Corporation ElectricPower AEPSouthwestern Dale Briggs Beasley Gary Richard Arnold Sharon Allen David Allen Nick Akins Table of

State Chamber DirectorsState Chamber Contents 11 10 8 6 5 3 2 odad PLLC Woodyard, Hutchinson speech. speech. Beebe Annual Meetingsummary. Metro 2030 Long Range TransportationMetro 2030LongRange Plan. Just fortheKids. activities. Staff Significant accomplishments. National issues. 85th GeneralAssemblylobbying summary. 85th ArkansasGeneralAssemblytoppriorities. 1 letYrelYrelIeCemC.Inc. Yarnell IceCreamCo. Corporation Timex MacLean-ESNA Weldon Williams&Lick Inc. Emerson ElectricCompany Yarnell Albert Daniel Woods Potlatch Corporation GreenBay Pkg./Arkansas KraftDiv. Dean Williams Federal Mogul James Walcott McKee Foods Corporation Ed Tolleson Matt Szymanski Lisa Stocker Inc. Tyson Foods, Metal Recycling Corporation Incorporated Arts Leisure Don Stephan Emerson ElectricCompany Melissa Smith CompanyInc. Remington Arms Tom Siebenmorgen FedEx Freight Archie Schaffer RicelandFoods Inc. AmericanGreetingsCorporation Steve Ronnel Roberts Perry Charles Rink Frank Richardson GreatLakes ChemicalCorporation, Conway Kimberly-Clark Mills Pat Reed ArkansasEastman Bill Reed Paper International Company Co. DemocratPrinting&Lithographing FedEx Freight -East Dan Redmond John Pownall Randy Powell CentralMoloney Inc. Lee Pittman Sand&Gravel Company Unilever BestFoods PineBluff Parke Bert LLC Mountain Valley SpringCompany, Miller Larry CenturyTel LangstonCompaniesInc. ScottMcGeorge W. TrefilARBED ArkansasInc. Patrick Mathieu Lynn Larry Langston Robert Razorback ConcreteCompanyInc. WoodJim Karrh Boats Manufacturing Co/Ranger Jones Jeff ArkansasSteelAssociates Jos Jacque' Post SMISteel-Arkansas/Southern Hiram Walker Kent &Sons Ingram W. Nabholz CompaniesInc. Corporation Timex Randy Hopper Steven Henderson Dan Haygood FirestoneBuildingProductsCo. LLC SGLCarbon, Brian Hastings Sanyo Manufacturing Corp. Bill Hannah Leon Hall AT&T Arkansas Gar-Bro Flexsteel IndustriesInc. Manufacturing Company Gonzalez Arturo Danny Glass Roland Garlinghouse ContractingCompanyInc. McGeorge Russ BoeingCompany Ford The ElectricPower AEPSouthwestern Mark Feldman LionOilCompany Ed Drilling Haskell Dickinson NucorSteel-Arkansas Sarah Dellinger Manufacturing Company B & Sammie Cox V WeyerhaeuserSteve Cousins Company ColemanDairy AlbemarleCorporation Samuel Commella AmericanGreetingsCorporation "Buddy"Coleman C. W. CooperTire&Rubber Company VircoManufacturing Corporation Richard Chapman LeerLimitedPartnership,Dan Caspall Steven Brothers Joe Bossier Paper International ContainerDivision John Bodart Scotty Bell SuperiorGraphiteCompany Ian Beer Allen Canning Company Benny Baker Missiles& Lockheed Martin Scott Anderson Anderson Norman Joshua Allen 17 16 15 14 13 12 Front coverphoto courtesy ofSammieCox FedEx disasterresponses. andEntergy Disaster planningandcrisiscommunication. Chamberupdate. U.S. State trademissiontoJapan. reform. Immigration Utility salestaxexemption presentation. SSTP presentation. Lake Viewcaseupdate. Bond Proposals. AIA Directors hmuaCompany Chemtura a ProductsDiv.Star/Starrett Fire Control-Dallas in-service training for teachers; diluted the urged the repeal of a temporary income new requirement that every school have tax surcharge. The State Chamber/AIA State access to teachers certified in art and also led the effort that blocked an attempt Chamber/AIA music; provided more flexibility to and to pass unitary combined income tax Accomplishes fewer sanctions for school districts that reporting that would have crippled home- Top Priorities In file data and reports late, and watered based corporations. Legislative Affairs down the omnibus Quality Education Act. Unemployment insurance, which years 85th Arkansas Our education reform efforts ago was the source of much legislation General Assembly continued after the session through our with costly impacts on business, remained continued participation in the Lake View under control through the State The State Chamber/AIA’s case. We filed two amicus briefs. One was Chamber/AIA’s participation in the state’s governmental affairs work in 2005 focused filed before hearings were held by specially Unemployment Insurance Advisory on the 85th Arkansas General Assembly, appointed masters, and the second was Council. This group developed agreed which met for 94 days from January 10 filed with the full state Supreme Court that legislation that was refined, approved and until April 13. We had a successful session urged the Court to let the reforms passed successfully pushed to passage by the State overall and accomplished our top priorities by the 84th General Assembly have more Chamber/AIA’s Unemployment Insurance for the session by protecting the education time to develop before requiring more Committee. reform and tort reform legislation passed money to be thrown at the system. The State Chamber/AIA led efforts to in the 84th General Assembly. An expected effort to allow local elections that could authorize weaken tort reform measures additional electronic games of skill at passed by the 84th General horse or greyhound racing parks. We also Assembly never materialized. A helped pass legislation that requires couple of bills were filed, but legislative review of any bill or interim were immediately placed on study that proposes a mandated health hold after State Chamber/AIA insurance benefit or service and sets up an and other pro-tort reform Advisory Commission on Mandated interests suggested additional Health Benefits. Additionally, we pushed reform measures might be filed. the State Department of Economic This success was supported by Development’s legislative package that was diligent work in the 2004 adopted, and helped pass needed election year to block efforts to legislation to prevent raiding of the elect more anti-tort reform Landfill Post-Closure Trust Fund. We also MAKING A POINT – (From left) State Chamber/AIA Vice legislators. helped block dangerous bills dealing with President of Governmental Affairs Kenny Hall makes a point with State Rep. Eric Harris of Lowell during the 85th Arkansas Protecting the Workers deceptive trade, environmental laws and General Assembly. Compensation reform of 1993 minimum wage laws. is a priority for the State In summary, we upheld our mission of Chamber/AIA in every session. Our enhancing the economic climate in Legislators set a new record by filing Workers’ Compensation Committee Arkansas by continuing to be the leading 3,327 bills and resolutions. We tracked provided direction as we successfully advocate for the business community and 698, which was a 75 percent increase in negotiated agreed legislation with the one of the most effective lobbying groups our bill tracking over 1999, the first year AFL-CIO and passed all four bills. Labor in the state. that term limits impacted the House of gained minor changes to the Representatives. definition of hearing loss We view education as economic and neck and back injury development of our State’s most cases, while management got important resource. a needed fix in the use of Consequently, we maintained our role certificates of non-coverage. as the leading advocate for education We also blocked efforts to reform in Arkansas. drastically reduce the salaries This required diligent efforts to protect of Workers’ Compensation the reforms passed by the 84th General Commissioners and to Assembly. The State Chamber/AIA remove the at-will successfully led efforts to defeat bills that employment status of would: have eliminated the requirement administrative law judges. that all school districts must teach a The tax increases passed minimum of four Advanced Placement by the 84th General courses at the high school level; provided a THE LEGISLATIVE PROCESS IN ACTION – (From left) State Assembly created a much back door out of mandatory curriculum Chamber/AIA Vice President of Governmental Affairs Kenny Hall, welcomed anti-tax State Sen. Terry Smith of Hot Springs and State Chamber/AIA requirements that would allow districts to atmosphere for the members President and CEO Ron Russell discuss pending legislation at the teach less than the required 38 minimum State Capitol during a break in the action at the 85th Arkansas of the 85th. We successfully units; cut professional development and General Assembly. 2 85th General Assembly The possibility of this bill being filed improved education laws. created tension between pro-tort reform SB 1130 (now Act 2005) by Sen. Steve Of Arkansas and anti-tort reform groups. Speaker Bryles (D-Blytheville) is a bill the State State Chamber/AIA Stovall assembled a meeting of all Chamber/AIA supported that improves interested parties early in the session in an charter school laws. Lobbying Summary attempt to diffuse a situation that could HB 2530 (now Act 1672) by Rep. Leroy have resulted in a rash of bill filings by pro- Dangeau (D-Wynne) is a bill that State The 85th General Assembly met for 94 tort reform and anti-tort reform groups. Chamber/AIA Education Committee days before adjourning on Wednesday, The tobacco industry eventually filed Chair, Stacy Pittman, testified in support of April 13. Here is a summary of the issues the bill and managed to get the measure and helped pass. It renames the director of that the State Chamber/AIA lobbied passed without support of business the State Department of Education as the during the session. interests and with opposition by those commissioner and reorganizes the State Chamber/AIA Top Priorities against tort reform. Department into four new divisions and a Tort Refor m An interesting by-product was the central administration as of July 1, 2005. It Going into the 85th General Assembly, beginning of a dialogue begun between the also adds the Division of Academic the State Chamber/AIA set as its top Committee to Save Arkansas Jobs/State Facilities and Transportation and the priorities the protection of tort reform and Chamber-AIA and the trial lawyers Division of Accountability to the education reform measures passed during association. This dialogue helped suppress Department effective July 1, 2007. the 84th General Assembly. We are happy action on Rep. Verkamp’s three anti-tort HB 2520 by Rep. Bill Abernathy (D- to report that we were completely reform bills mentioned above. It is possible Mena) was strongly opposed by the State successful on both accounts. this dialogue could continue into future Chamber/AIA. It would have greatly Only a few anti-tort reform measures sessions much like we have between the weakened the recently passed reform were proposed and none were passed. HB State Chamber/AIA and the AFL-CIO on requiring schools to offer 38 units each 2478, HB 2479 and HB 2522 all by Rep. workers’ compensation and unemployment year. It was set for a special order of John Verkamp (R-Greenwood) were filed insurance issues. business in the House Education the last day of filing and were immediately Since the close of the 2003 session, anti- Committee but was never considered. placed on the inactive agenda, where they tort reform groups had been talking about Tax Issues remained until the session ended. the need for insurance reform legislation. SSTP HB 2637 by Rep. Steve Harrelson (D- SB 233 (now Act 1697) by Sen. Bob Another issue that we worked on heavily Texarkana) would have changed survival Johnson (D-Morrilton) was a preemptive in the background was modification to the actions filed by descendants for wrongs attack by the pro-tort reform group that Arkansas Streamlined Sales Tax Project done to person or property. Its impact on moved cleanly out of the Senate. The anti- (SSTP). We started discussions on this issue tort reform was not noticed immediately tort reform group held the bill in the last fall in State Chamber/AIA Tax and the bill slipped out of the House. We House Judiciary Committee while HB 2075 Committee meetings. discovered the bill as it was assigned to the by Rep. Chris Thomason (D-Hope) was Our committee identified two critical Senate Judiciary Committee, where it died crafted. (SB 228 by Sen. Irma Brown was problems with the SSTP law regardless of following excellent opposing testimony by filed the same day as SB 233 but was never its effective date: sourcing and the attorney Nick Thompson representing the acted upon.) Eventually, a compromise was elimination of local sales tax caps. The Committee to Save Arkansas Jobs, the State reached and some of the provisions of HB committee discussed the following potential Chamber/AIA and the Arkansas Medical 2075 were merged into SB 233, which led solutions: 1) Creating a tax credit/rebate Society. to the adoption of SB 233 in the House that would offset the dramatic increase in SB 937 (now Act 1380) by Sen. Jim with only one dissenting vote. sales taxes caused by the loss of local caps; Luker (D-Wynne) changes the effective Except for HB 2637, we made very little 2) Exemptions for the amount of the now date of the $25 million cap on appeal mention, if any at all, of the rest of the uncapped sales taxes; 3) Delay enactment bonds. It was filed by the tobacco industry tort reform bills described above in our of the Arkansas SSTP law. The committee to gain the use of the cap on a pre-existing daily updates. Occasionally issues are so formed a working group to further develop case that could produce a judgment large volatile that grass roots contacts might solutions and attempt implementation. enough to force bankruptcy and endanger actually hurt. Tort reform was certainly an Going into the session, we knew that the state’s continued receipt of Tobacco issue that we managed more effectively the state Department of Finance and Settlement funds. without making our actions Administration (DFA) was interested in an known. Nick Thompson of earlier implementation date and if Arkansas the Mitchell Williams law were one of the first 10 states to pass SSTP firm in Little Rock, and legislation, the state would get a seat at the Morril Harriman, executive national table. director of the Poultry We also knew that getting Sen. Jim Hill Federation, did terrific work (D-Nashville), sponsor of the original for us on this issue. SSTP legislation and the most experienced Education Reform member of the Senate, to support our Thankfully, very few concerns would be vital to resolving this attempts were made to issue. We felt sure that Sen. Hill would weaken the major education listen to the business community’s concerns reforms passed in the 84th as well as to DFA’s concerns. This meant General Assembly. Most of that a grassroots effort could disrupt the this session’s education focus process. Therefore, beginning last was on funding of November and continuing through final LISTENING INTENTLY – (From left) State Rep. Travis Boyd of educational facilities and the passage of SB 1173 (now Act 2008), Mike Piggott provides an explanation to State Chamber/AIA Vice President of Governmental Affairs Kenny Hall and Director of International general education funding for Parker of the Dover Dixon Horne law firm Trade Angela DeLille during a break in the action during the 85th the next biennium. There and Morril Harriman, executive director of General Assembly. were also a few measures that (continued on page 4) 3 85TH GENERAL ASSEMBLY partnerships, S corps., etc.) to withhold (continued from page 3) income taxes of out-of-state owners. This the Arkansas Poultry Federation and a would have required withholdings of taxes former Senator, served as our negotiators that were never due or passive earnings that with DFA. never became cash earnings. In respect for Initially, we thought we could get an our concerns, Hill did not run the bill until agreement on a rebate and definition of a after several business interests directly single transaction. But a national SSTP affected by the bill helped craft an meeting in Atlanta resulted in confusion at amendment. The amendment limits the the national level and it became obvious required withholding to identified out-of- that trying to find solutions for problems state owners who fail to pay taxes owed to that might be different in the future was the state of Arkansas. futile. Therefore, we agreed with DFA to Loss of Deductions and Credits delay implementation of the Arkansas SB 446 by Sen. Paul Miller (D- SSTP laws until July 1, 2007. Melbourne) was a bill that might have Unitary Combined wiped out the state’s primary industrial Income Tax Reporting development deductions and tax credits. During the 2003 legislative session, Rep. The State Chamber/AIA’s opposition Phil Jackson (R-Berryville) ran a bill on helped Miller decide not to run the bill. OUR MAN AT THE STATE CAPITOL – State Attempts To Increase Taxes unitary combined income tax reporting. Chamber/AIA Vice President of Governmental Although it was defeated, everyone Affairs Kenny Hall prepares for another day of Several of the bills filed would have expected him to bring the issue up during lobbying at the State Capitol during the 85th increased taxes. The State Chamber/AIA the 2005 session while he was serving as General Assembly. was on guard to battle any that came up. chairman of the House Revenue and Fortunately, the legislature adjourned Taxation Committee. bill on a voice vote – a culmination of the without passing any of these tax increase Jackson kept the issue active in the State Chamber/AIA-led lobbying effort plans. interim and the State Chamber/AIA that began last fall. HB 1320 (now Act 2022) contains the brought in experts to speak about the issue Income Tax Surcharge Arkansas Department of Environmental at our annual meeting last October. The SB 38 (now Act 63) by Sen. Percy Quality’s budget for the next biennium. State Chamber/AIA Tax Committee Malone (D-Arkadelphia) and Rep. Chris When the revenue stabilization bill came considered the unitary combined corporate Thyer (D-Jonesboro) repealed the three out, it was revealed that ADEQ would lose income tax reporting issue in meetings last percent income tax surcharge, which was a its $3.5 million of state general revenue. fall and adopted the position to oppose priority issue of the State Chamber/AIA An amendment was proposed to allow such a change in Arkansas tax law. Some of Tax Committee. ADEQ to increase user fees to make up the key reasons the committee voted to Food Tax Repeal the lost state revenue. These fee increases oppose the unitary tax issue were: It would For 40 years, the State Chamber/AIA would have resulted in significant increases create corporate tax winners and tax losers; was a key part of groups that successfully to businesses. The State Chamber/AIA there was no guarantee of a revenue gain blocked attempts to repeal the sales tax on joined the Arkansas Environmental for the state; it would put the greatest stress food because it would eventually create a Federation, Arkansas Farm Bureau, the on home-based Arkansas corporations – tax shift to business and those it was Poultry Federation and several other some of which could decide to relocate intended to help – the poor. business interests to oppose the fee their home offices out of Arkansas; it SB 277 (now Act 647) by Sen. Terry increases. would close the door on attracting any Smith (D-Hot Springs) was a scheme that Eventually Governor Huckabee told the business to choose Arkansas as its home quickly became a runaway train. Due to ADEQ director the fee increases were office location, and it would not shift the term limits, few legislators had been tantamount to a tax increase and he would tax burden from small to large businesses through the legislative and ballot battles not allow it to happen. Finally ADEQ was because most small businesses do not pay over this issue. authorized to receive a potential $2.5 C-Corp. income taxes. We went to several leading legislators to million that the state could save through Jackson finally filed his bill, HB 2686, seek their help in blocking this bill only to the merger of the state Health Department on March 7, which was the last day of bill find that they were co-sponsors of the into the state Department of Human filing, but the bill was only a “shell” bill. proposed legislation. The bill will remove Services. On February 28, a professor from New the state (not local) sales tax on food when SB 147 by Sen. Jerry Bookout (D- York City addressed a joint meeting of the the state’s revenue from SSTP exceeds 150 Jonesboro) was an attempt to increase Revenue and Taxation Committees. He percent of the revenue generated by the original corporate registration fees from discussed radical changes in tax philosophy state tax on food for six consecutive $25 to $100 and renewal fees from $10 to with which a vast majority of the Arkansas months. Legislators saw this as a political $100. The State Chamber/AIA blocked this business community disagreed. The State goldmine. We saw it as bad government veiled attempt to increase taxes on business. Chamber/AIA brought in Jim Eads, a committing future legislatures and future HB 2406 by Rep. Preston Scroggin (D- native Arkansan and president of the New revenue without any knowledge of what Vilonia) would have increased corporate Mexico Tax Institute, and Doug Lindholm, the needs of the state might be when this filing fees. The bill was pulled down after president of the Council on State Taxation, measure kicks in. the State Chamber/AIA expressed to speak to a joint meeting of the House Pass Through Entities opposition. and Senate Tax Committees on March 8. SB 509 (now Act 1982) by Sen. Jim Hill HB 1419 by Rep. Johnnie Bolin (D- HB 2686 was brought up in the House (D-Nashville) and Rep. Phil Jackson (R- Crossett) would have applied the gross Revenue and Taxation Committee on April Berryville) is a bill that we provided grass receipts tax to the sale of advertising space 5. It was immediately amended as Jackson roots warnings about from the time the bill and time in newspaper, television, radio and presented the bill. When it was time for was filed until it became law. As originally billboards. The State Chamber/AIA and public debate, the committee limited it to filed, it would have required pass through several business interests opposed the bill one minute per side and then defeated the type entities (LLCs, partnerships, limited and it was never brought up for 4 (continued on page 21) National Issues estate tax. This year was no exception as we amounts to a savings of $5,000. We lobbied Arkansas’ congressional delegation support this bill that would give Americans Remain Major Focus to support The Death Tax Repeal more control over their retirement and For State Permanency Act of 2005. The estate tax, or empower them to maintain their standard Chamber/AIA death tax as it is also known, depletes the of living. estates of taxpayers who have saved We also support another legal reform The State Chamber/AIA’s governmental throughout their entire lives, often forcing measure, the Personal Responsibility in affairs team lobbied members of Arkansas’ successful family businesses to curtail Food Consumption Act, which would congressional delegation on a variety of operations, sell income-producing assets, prevent frivolous obesity-related lawsuits national issues this year. One of our most borrow, or in extreme cases, liquidate to that hold food companies liable for an significant achievements was the passage of pay the tax. The “Economic Growth and individual’s obesity or obesity-related health the Class Action Fairness Act of 2005. This Tax Relief Reconciliation Act of 2001,” ailments. The bill still allows appropriate bill will ensure a simpler, fairer, and faster signed into law by President Bush, litigation against food suppliers if they fail legal system by helping move large, multi- gradually phases out the death tax until it is to comply with applicable statutory and state class action lawsuits from state to completely repealed in 2010. However, if regulatory requirements, including federal court, preventing widespread venue Congress does not act, in 2011 the full prohibitions on contaminated foods. shopping by trial lawyers. It will also limit death tax will again be reinstated. Current law allows claims if food contains settlements in which class members actually This fall, the State Chamber/AIA something that does not belong there, does lose money to pay attorneys’ fees and submitted comments to the Minerals not meet health or safety regulations, or ensure the fair and even distribution of Management Service on the new Five-Year when a food seller makes false promises. damage awards to all plaintiffs. Outer Continental Shelf (OCS) Oil and Another important victory came with Gas Leasing Program for 2007-2012, the passage of the U.S.-Dominican recommending the plan provide for Republic-Central America Free Trade expanded OCS leasing, including providing Agreement (DR-CAFTA) by the U.S. flexibility for future inclusion of areas Congress. The Emergency Committee for where development is currently prohibited. American Trade reports that “for Arkansas’ The U.S. cannot continue to reject manufacturers, the DR-CAFTA opportunities to develop our domestic immediately eliminates tariffs on 80 percent offshore energy resources or American of U.S. exports and eliminates all tariffs consumers and businesses will suffer the within 10 years, including the up-to-15 consequences in terms of slower economic percent tariffs on Arkansas’ exports of growth, higher energy prices, reduced electrical equipment, machinery competitiveness in manufactures, paper products, plastics and comparison with rubber, processed foods and transportation overseas equipment. For Arkansas’ agricultural manufacturers and producers, DR-CAFTA will eliminate tariffs continued job losses. on 50 percent of U.S. exports immediately, Americans are and most remaining duties within 15 living longer and years…” This will benefit Arkansas’ rice, traditional sources beef, poultry, soybeans, cotton and textile of retirement producers. income are no The State Chamber/AIA is committed to longer adequate. finding workable solutions that protect the The Retirement environment, while also encouraging Security for Life Act economic growth. For this reason, we of 2005 creates a tax supported the Clear Skies Act of 2005, incentive that would which would enact the largest power plant encourage people to emissions reduction program ever – a 70 choose retirement percent cut in sulfur dioxide, nitrogen oxide, vehicles, such as life and mercury. In addition, Clear Skies would annuities, that allow the nation to continue to burn coal provide a guaranteed without increasing our reliance on natural return during gas. Because coal is our nation’s most retirement. Under abundant and cheapest energy source, the bill, one-half of manufacturers and businesses depend on its income from life low cost to stay competitive. Unlike other annuity payments is proposals, Clear Skies would not excluded from dramatically reduce coal-based generation or federal taxes. The force an over-reliance on natural gas, which amount of income would dramatically increase demand and excluded is capped result in crippling economic costs for at $20,000 per year; Arkansas’ businesses and consumers. for someone in the For years, the State Chamber/AIA has 25 percent tax supported full and permanent repeal of the bracket, this

5 presentations. Dinner and music followed. and (b) eliminate the decal rules for lifts, State Chamber/AIA Accomplishes cranes, etc. for warehouse or other inside Changes in Proposed DF&A Rule use. As part of the mission of the Arkansas “DF&A has apparently accepted the Significant State Chamber of Commerce/Associated comments, will pull the draft Rule, and & ActivitiesAccomplishments Industries of Arkansas, we are constantly reissue with our proposed changes for Accomplishments on guard against legislative and regulatory consideration by the Rules and Regulations Racked Up By issues that might inhibit the economic Subcommittee in November,” Parker State Chamber/AIA climate in Arkansas. recently noted. “This will substantially A case in point occurred recently when reduce the burden of the new decal law During The Past Year Mike Parker, an attorney for the Dover and rule on manufacturers, and Dixon Horne law firm and legal counsel wholesale/retail businesses.” Back Home Bash-Smashing Success for the State Chamber/AIA’s Tax “This is an excellent example of Mike More than 400 people, including three Committee, used his expertise on behalf of Parker’s great ability, tenacity and passion in members of the Arkansas Congressional the State Chamber/AIA to influence looking out for the health of Arkansas’ delegation and approximately 100 changes in a new rule proposed by the business community,” said State Congressional delegation staff members, Arkansas Department of Finance and Chamber/AIA President & CEO Ron crowded into the Great Hall of the Clinton Administration (DF&A) – Markup of Rule Russell. Presidential Center on Tuesday, August 23, 2005-4 “Sales of Heavy Equipment – It is also a classic example of how the for the State Chamber/AIA’s Back Home Decals” that was filed on September 20, 2005. State Chamber/AIA serves the business Bash. The rules were being developed by community and how vital it is for the State The “Bash” event, presented by Wal- DF&A to implement Act 1693 of 2005, Chamber/AIA to have members who go Mart, was our 46th Annual Salute to the which was originally filed as HB 2972 by above and beyond the call of duty to limit Arkansas Congressional Delegation and Rep. Bill Pritchard of Elkins. The unnecessary compliance costs and penalty their staffs. legislation requires a decal to be placed on exposure for business and industry. The evening began with a VIP tour of each piece of heavy equipment when sales State Chamber/AIA Provides the Clinton Library, followed by a Meet and or use taxes are paid as proof that the taxes Interactive Hurricane Relief Greet Reception and self-guided tours of have been paid. The intent of the law was Bulletin Board Online the Library. At 7 p.m., members of the to level the playing field between taxpayers With the help of Atherton Hiett and Arkansas delegation and staff who purchase equipment in Arkansas and Kelly Reed, two of our DINA partners representatives in attendance – U.S. Sen. pay the sales tax, and those who purchase from UALR’s Institute for Economic Mark Pryor; U.S. Rep. Mike Ross; U.S. Rep. equipment out-of-state and potentially Advancement (IEA), the State John Boozman; Steve Patterson, Chief of avoid paying Arkansas sales taxes. Chamber/AIA website hosts an interactive Staff for U.S. Sen. Blanche Lincoln; Ed Fry, Parker filed two rounds of comments Disaster Relief Bulletin Board. Chief of Staff for U.S. Rep. Vic Snyder; on the proposed Rule designed to: (a) This site was developed in response to and Leigh Fowler, District Director for U.S. eliminate the decal rules for manufacturers the Katrina disaster. It is used for posting Rep. Marion Berry – made short buying heavy equipment for use on site; (continued on page 7)

State Chamber/AIA 85th Arkansas General Assembly legislative have been active participants during the past highlights and 2006 key statewide elections. year in various other conferences as well. Staff Remains Busy In addition, Hall spoke to the Arkansas In Little Rock, Ron Russell attended the With Speeches, Mortgage Bankers, the Arkansas Self- Arkansas Economic Developers Annual Insurers Association Annual Meeting and a Meeting and the Arkansas Governor’s Conferences group of International Paper employees Conference on Waterborne Transportation. and Activities and customers. In each speech, Hall Kenny Hall traveled to Dallas, Texas, to provided a brief description of the State network and gain valuable information at Members of the State Chamber/AIA Chamber/AIA and an overview of the the U.S. Chamber of Commerce Regional staff welcome the opportunity to speak to 2005 legislative session. Governmental Affairs Meeting. Hall also our members and friends about issues Speeches detailing the role of the traveled to Hot Springs on two separate facing the business community and the Arkansas State Chamber of Commerce and occasions, once to attend the Annual state. Some of those opportunities are Associated Industries of Arkansas, Inc. Meeting of the Arkansas Bar Association highlighted below. were given to the Boone County Leadership and again for the Arkansas Society of In Little Rock, Kenny Hall spoke to the Group and the Harrison Leadership Group Association Executives Annual Meeting and Governor’s Conference on Waterborne by Angela DeLille. DeLille also addressed Trade Show. Transportation about the Dominican highlights from the 2005 legislative session Angela DeLille attended the three-day Republic – Central America Free Trade as well as the “hot topics” of elections, Arkansas Worker’s Compensation Agreement (DR-CAFTA). The State education reform and the factual details of Commission Conference in Little Rock. Chamber/AIA took an active role in urging the Highway and Higher Education Bond Russell, Hall and DeLille also Arkansas’ Congressional Delegation to issues addressed during the December 13th participated in “How To Win An Election” support DR-CAFTA’s implementing special election. – a seminar in Little Rock that was legislation, which President Bush signed on Jeff Thatcher spoke to the Arkansas sponsored by the Arkansas Farm Bureau August 2, 2005. Chamber of Commerce Executives at their and the State Chamber/AIA. The seminar Hall was invited to Dallas, Texas, to annual meeting in Hot Springs about his role was geared to candidates, their spouses and speak to the U.S. Chamber of Commerce at the State Chamber AIA, membership plans their campaign managers. Regional Public Affairs Meeting. and upcoming State Chamber/AIA events. Jeff Thatcher traveled to San Destin, Approximately 75 governmental affairs Conferences Florida, to meet with a group of his managers from various major corporations In addition to conferences hosted by the counterparts at the Conference of State listened to his presentation concerning the State Chamber/AIA, members of the staff Manufacturing Associations. (continued on page 7) 6 SIGNIFICANT ACCOMPLISHMENTS First Employment Law (continued from page 6) Roundtable a Hit events and announcements relating to relief Participants learned how or recovery efforts, as well as accessing to avoid unexpected legal other state-wide disaster information. pitfalls with employees Our members have been encouraged to during the State share their activities here as well as read Chamber/AIA’s first about what others are doing. Employment Law http://ascc.weknowarkansas.org/katrina/de Roundtable. Spencer F. fault.html. Robinson, Esq., of Ramsay Education Reform Efforts Paying Off Bridgforth Harrelson & The Arkansas Department of Education Starling in Pine Bluff, led reported an abundance of good news the two-hour discussion, relating to Arkansas public school students’ which was held at The test scores. Alliance in Pine Bluff. Students in grades K-9 took the Iowa “The roundtable was Test of Basic Skills, in which they are beneficial for me. I learned compared with a national sample of several things I did not students in the same age range. All but one know,” one participant set of scores were above the 50th wrote to the State percentile, which is the national average, Chamber/AIA, adding, with a couple of grades scoring as high as “(I’m) looking forward to SMALL BUSINESS PERSONS OF THE YEAR – Andrew G. (A.G.) joining you guys again in Russell III (left) and his wife, Goldie Russell were named Small the 68th percentile. Business Persons of the Year for 2005. Russell is the founder and End-of-course exams in algebra and the future.” Goldie Russell the president of The Knife Company, Inc. doing geometry also showed significant gains and Second Employment Law business as A.G. Russell Knives of Lowell. a slight narrowing of the achievement gap Roundtable a Success between whites and African-Americans and How long do you keep resumes on file? Small Business Awards between whites and Hispanics. What do you write in a letter turning an Given at Luncheon in Participation in Advanced Placement applicant down for a job? Mike Moore with North Little Rock courses doubled last year over the previous Friday Eldredge Clark covered these issues Goldie and Andrew G. (A.G.) Russell one. Participation in AP courses is a and many more as he took participants III received the 2005 Small Business predictor for success in college. through the steps of “hassle-free hiring” at Persons of the Year Award at the 15th These successes can be traced to the the State Chamber/AIA’s second Annual Arkansas Small Business Awards state’s reform efforts of the Second employment law roundtable in Little Rock. Luncheon hosted by the State Extraordinary Session, in which the State Nearly a dozen participants gleaned Chamber/AIA at the Wyndham Riverfront Chamber-AIA took a leading role in the helpful information during the two-hour in North Little Rock. calls for reform and school accountability. session. (continued on page 23)

STATE CHAMBER/AIA STAFF president and current board member of the Angela DeLille (continued from page 6) Arkansas Economic Developers. Angela DeLille is a member of the State Staff Activities/Bios Kenny Hall Chamber/AIA governmental affairs team. Ron Russell Kenny Hall is the vice president for She works on state and national legislative As president and chief executive officer governmental affairs of the State issues, while also working with State of the Arkansas State Chamber of Chamber/AIA. He represents the positions Chamber/AIA President & CEO Ron Commerce and Associated Industries of of the two organizations on issues related Russell to develop a focus on international Arkansas, Ron Russell directs the operation to, and focusing on, the enhancement of a trade. of these organizations that serve as the quality business climate in Arkansas before In addition to her duties at the State foremost advocates for business and various government entities, including the Chamber/AIA, DeLille is a member of the industry in Arkansas. He is recognized as a legislature, the governor’s office and Arkansas Society of Association Executives, leading spokesman for the state’s business assorted state agencies, committees and Arkansas Society of Professional Lobbyists, community. boards. Coalition for Nursing Home Excellence and In addition to his duties at the State Hall helps develop and implement State Little Rock World Trade Club. She also Chamber/AIA, Russell is involved in Chamber/AIA legislative strategies and is serves on the advisory committee of the numerous other organizations including the responsible for enlisting support for these Arkansas Governor’s Family Friendly Arkansas Society of Association Executives, goals. He coordinates the activities of the Initiative and the advisory board of the Arkansas Society of Professional Lobbyists, State Chamber/AIA legislative committees. Salvation Army Central Arkansas Area American Chamber of Commerce He serves as president of the Arkansas Command. Executives, National Association of Society of Professional Lobbyists, vice Jeff Thatcher Manufacturers Grassroots Lobbying, and president of the non-profit scholarship Jeff Thatcher, director of Council of State Manufacturers. organization Kids’ Chance and a board communications, events and marketing, is Russell also serves on the Executive member of the Arkansas Environmental responsible for developing, implementing Committee of The Partnership, the Federation. He is an active member and and overseeing all State Chamber/AIA Employment Security Division Advisory former board member of the Arkansas communications efforts, events, marketing Council, the U.S. Chamber of Commerce Society of Association Executives, as well as and membership. He writes and edits Advisory Committee, and the Lyon College a member of the Arkansas Chamber of Business Monthly, the State Chamber/AIA Business Advisory Council. He is also a past Commerce Executives, the Arkansas Bar newsletter, the State Chamber/AIA Annual president of the Arkansas Chamber of Association and a PAC Committee Officer Summary, and all other organization Commerce Executives and serves as a past for the Committee to Save Arkansas Jobs. publications. (continued on page 24) 7 Building Communities that can help shape the lives of our the national pilot program.” children’s futures,” said Pittman. “When The Just for the Kids website Just for the Kids Day communities become informed, inspired (www.just4kids.org) provides accessible, Held At Venues and work together toward an agenda of transparent data that is designed to build Throughout Arkansas improvement and success, our children high performing schools. It shows how have a much better chance of broadening every Arkansas public school is performing Fifty-seven Arkansas schools served as their future opportunities.” on state tests in relation to five other host locations for their communities in a One of the highlights of the Building Arkansas schools that have a comparable statewide discussion on Tuesday, November Communities Just for the Kids Day was the student population. All the data on the 15, to give parents and citizens more release of the parent consumer guide, website for Arkansas schools is provided by information about student performance entitled “Get Educated About Education: Arkansas Department of Education and is data and discussing academic improvement A Consumer Guide to Public Education,” a presented in an easy-to understand format. strategies in their respective communities. tool for parents and citizens to better The Texas-based Just for the Kids Organizers called the launch for the understand the new laws - both state and organization now has affiliates in 37 states. initiative: Building Communities Just for federal - that determine the laws and The group’s national sponsor is the the Kids Day. Forty-seven school districts regulations now required by school districts National Center for Educational participated in the statewide discussion. in Arkansas. It is available on the website Accountability. “Parents and citizens from around the www.just4kids.org. state gathered in their respective Arkansas Parent Teacher Association communities to learn more about how they president Don Johnson said “the consumer State Chamber/AIA can get involved with the process of guide will give parents a more thorough achieving high performing schools,” said understanding of how recent legislation Weighs In On Metro Stacy Pittman, project director for Just for and public policy initiatives affect their 2030 Long Range community and how they can play a key the Kids, Arkansas and chairman of the Transportation Plan State Chamber/AIA Education Committee. role in helping to build high-performing schools.” The community-based initiative, entitled For over a year, the State Chamber/AIA Building Communities Just for the Kids, is “We hope that with better understanding schools and communities has been involved in the Metro 2030 Long a national pilot program for Arkansas and Range Transportation Plan proposed by the first of its kind in the country. It is a will work more closely to build high METROPLAN, the regional planning partnership between Just for the Kids, performing schools,” said Dan Farley, agency for central Arkansas. Arkansas State Chamber of Executive Director for the Arkansas School METROPLAN is comprised of central Commerce/Associated Industries of Boards Association. “That’s good for kids, Arkansas counties, cities, the Central Arkansas, Arkansas State Parent Teacher for our schools and for all of Arkansas. It Arkansas Transit Authority (CATA) and the Association, Arkansas School Boards is important for all Arkansas communities Arkansas State Highway and Transportation Association, Arkansas Association of to understand the challenges we face and to Department (AHTD). The federal Educational Administrators, Arkansas work together to create an education government mandates the development of Education Association, Arkansas Rural system that is focused on what is best for a long-range plan for federal transportation Education Association, Arkansans for kids.” program funding. Education Reform Foundation and the The national pilot program brings The Metro 2030 plan directs the Arkansas Department of Education. together a variety of key education and spending of transportation tax dollars for “Building Communities Just for The community stakeholders, such as parents, developing and maintaining our freeways, Kids is all about bringing educators, teachers, school board members, arterials, transit system, bike and pedestrian parents, community leaders and lawmakers superintendents and members of the facilities and other travel modes. together to analyze where we are, business community. The State Chamber/AIA was concerned determine where we need to be and “This is a historic partnership for our that aspects of the draft plan would be a develop a plan of community cooperation state,” said Dr. Kellar Noggle, Executive Director of the Arkansas detriment to commercial development and Association of Educational notified local chamber executives, economic Administrators. “The goal of developers and State Chamber/AIA Building Communities Just for the members in Pulaski, Lonoke, Saline and Kids and the consumer guide is to Faulkner counties about the plan. bridge the communications divide Along with local representatives, State between the school community and Chamber/AIA staff members attended those who want to help them public hearings and submitted comments succeed.” during the public comment period. In “Just for the Kids chose addition, we worked with local chamber Arkansas for the national pilot and business representatives to lobby the program because of the synergy METROPLAN board until changes were between the state leadership, made to the Metro 2030 plan that satisfied JUST FOR THE KIDS – Little Rock School District educational groups and the business our economic development concerns. Superintendent Dr. Roy Brooks addresses a news conference in Little Rock to announce Building Communities Just for community,” said Pittman. “Just for The State Chamber/AIA would the Kids Day as (behind Brooks from left to right) Dan the Kids encouraged us to continue especially like to thank Jay Chesshir, Farley, Executive Director of the Arkansas School Boards our progress in improving student Executive Director of the Metro Little Association, Luke Gordy of Arkansans For Education Rock Alliance, who was instrumental in Reform Foundation, Ron Russell, President and CEO of the achievement, and we are excited State Chamber/AIA and Stacy Pittman, Project Director for about Arkansas being chosen for developing the strategies used throughout Just for the Kids, Arkansas look on. the debate. 8 2006 Seminar Arkansas Schedule Hot Springs, Arkansas Beginner’s Basic Tax School March 27, 2006 September 11, 2006

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9 Arkansas confines of the Oaklawn Jockey Club for a recent Trade Visit to Japan. reception sponsored by Cranford Johnson Another panel discussion followed State Robinson Woods and a dinner hosted and covering Disaster Awareness, Preparation Chamber/AIA sponsored by Oaklawn Jockey Club. and Recovery. Moderated by Hugh 77thMeeting Annual Wednesday’s General Session kicked off McDonald, President/CEO of Entergy Annual Meeting with a panel discussion moderated by Arkansas, the panel included presentations Chock Full of Archie Schaffer of Tyson Foods. Steve by McDonald, David Maxwell, Deputy Timely Information Patterson, Chief of Staff to U.S. Senator Director of the Arkansas Department of Blanche Lincoln, provided a presentation Emergency Management, Robert J. Alvey, Speeches by the two most prominent on Immigration Reform. Randel Johnson of FEMA Disaster Assistance Employee and candidates for governor – Attorney General the U.S. Chamber of Commerce addressed Co-Founder of Crisis and Conflict Mike Beebe and former Congressman Asa Labor Issues, and David Boling of the Communication and Management LLC, and Hutchinson – as well as presentations on Little Rock law firm of Mitchell Williams John Weston, Vice President Marketing & school funding, highways, higher education, Selig Gates & Woodyard discussed the Sales for FedEx Freight. taxes, immigration reform, international trade and disaster preparedness highlighted Beebe Makes First “50 Hottest Cities” - the recent 77th Annual Meeting of the Public Speech As based on business Arkansas State Chamber of environment, Commerce/Associated Industries of Democratic workforce quality, Arkansas. Gubernatorial operating costs, incentive programs, The two-day meeting drew well over 100 Candidate During people to the historic Arlington Resort worker-training Hotel and Spa in Hot Springs. Opening Day Luncheon programs and ease of “I think this year was probably one of working with local Mike Beebe the better programs in terms of overall Arkansas Attorney General Mike Beebe officials, Beebe said. content that we have had in quite a while,” used the Arkansas State Chamber of Only four states had more cities on the list. said Ron Russell, president and CEO of the Commerce/Associated Industries of Arkansas is proud of the five State Chamber/AIA. Arkansas Annual Meeting in Hot Springs to homegrown Fortune 500 companies Beebe, the favorite for the Democratic make his first public speech as a headquartered here: ALLTEL, Dillard’s, nomination, kicked off the Tuesday Democratic candidate for governor in 2006 Murphy Oil, Tyson Foods and Wal-Mart, Opening Session. Hutchinson, the lone since he announced his candidacy in June Beebe said. Those companies are among Republican candidate for governor, spoke at 2005. the 112 Fortune 500 parent firms with more the Wednesday Closing Session. In between Beebe told more than 100 State than 310 facilities in Arkansas. those two speeches, a significant amount of Chamber/AIA members, staff and others Many Arkansas companies are also useful information was provided to in the audience during the State making headlines: participants. Chamber/AIA Opening Day Luncheon on Acxiom Corporation was on Fortune’s list The Tuesday afternoon General Session Tuesday, October 25 at the Arlington of 100 Best Companies to Work For in started with an update by Price Marshall, a Resort Hotel and Spa that he wants to: keep 2003. Jonesboro attorney, on the Lake View Arkansas jobs from going overseas; find a ALLTEL, Arkansas Best, J. B. Hunt School Funding case before the state way to aid businesses that provide health Transport, Murphy Oil, Tyson Foods and Supreme Court. insurance for their employees; come up Wal-Mart were on the 2004 Forbes Platinum That was followed by a discussion of the with unique approaches to attract major List of 400 companies, which listed J.B. Dec. 13 ballot issue, a special election called industries; improve education from Hunt first among transportation companies. by Gov. Mike Huckabee to extend a preschool through college; and improve Diversity of industry is evident in statewide highway construction bond Arkansas’ highway system. Arkansas, also, Beebe said. Just a few of the program and authorize the sale of “Promoting the development of recent locations and expansions include: additional bonds to benefit higher business opportunities, while bringing manufacturing: Hino Motors, DENSO, education. Dan Flowers, director of the together public and private business sectors EAKAS, Superior Industries and Arkansas Highway and Transportation is a mission we must fulfill, if our state, Champion; food processing: Nestle (the Department, addressed the proposed road region and country are going to continue to largest location announcement in the nation program, while David Leech, vice chairman grow and prosper,” Beebe said. “It is in 2001), Frito-Lay, Gerber and Pinnacle of the state Higher Education Coordinator essential that we all help this state and Foods; aeronautics: Lockheed Martin and Board, addressed the education program. nation achieve equality and success not just Raytheon; distribution: Scholastic, Infinity Tuesday’s General Session ended with a economically, but socially, educationally and Intermodal and Smith Wholesale Drugs; panel presentation on tax issues. The panel in so many ways.” and information technology: GC Services, was moderated by Tom Kennedy of Arkansas has the Number 1 business ARVEST, and IntelliTrans. Entergy Arkansas and Chairman of the climate in the South, according to Southern Employers give favorable ratings to State Chamber/AIA Tax Committee and Business and Development magazine, Beebe Arkansas workers for their work ethic, skills, featured presentations by Warren Townsend said. And Business Facilities magazine said productivity and low turnover rates, Beebe of Wal-Mart on the Streamlined Sales Tax Arkansas has the lowest cost of doing said. Businesses report great success in Project (SSTP), Dr. Matthew Pelkki of the business of all Southern states: “We are recruiting quality and reliable people. University of Arkansas at Monticello on a among the nation’s top “magnet” states, The average cost of living for all of proposed Utility Sales Tax Exemption, and with new people moving into all parts of Arkansas’ MSAs is consistently below the Mike Parker of the Little Rock law firm of the Natural State.” national average. Businesses also enjoy low Dover Dixon Horne on State Tax In 2003, Expansion Management magazine tax obligations through a variety of Regulatory Issues. listed three Arkansas Metropolitan incentives, exemptions, credits, and refunds. Participants then adjourned to the Statistical Areas (MSAs) among the nation’s Because of its central location, Arkansas 10 (continued on page 11) Hutchinson: Tax taxes,” Hutchinson said. “Today, we must capital in these industries inside of do as Abraham Lincoln challenged the Arkansas,” Hutchinson said. “Too many Reform Will Drive Job American people to do: We must think businesses and entrepreneurs are leaving Growth, Higher Wages anew and we must act anew.” Arkansas, or refusing to locate here, because To illustrate how tax reform could lead our tax burden is too great compared to Job growth and to growth in state revenues, Hutchinson surrounding states. We must make Arkansas higher wages in pointed to the example of New Mexico, an attractive place to do business, and then Arkansas will follow where Democratic Gov. Bill Richardson, we will enjoy more jobs, better jobs and if the state takes a elected in 2002, worked with the higher paying jobs.” fresh approach to tax Democratic-controlled legislature to cut the Hutchinson emphasized two initial goals reform, Asa top marginal tax rate from 8.2 percent to for tax reform related to job creation and Hutchinson, 2006 4.9 percent over a five-year period and higher wages in Arkansas: Republican candidate reduced taxes on capital gains. The 1) Creating a more business friendly reductions resulted in economic growth that and competitive tax structure that would Asa Hutchinson for Governor, said in addressing the closing led to $216 million in new revenues in 2005. allow Arkansas to retain its in-state industries luncheon of the Arkansas State Chamber of Hutchinson also emphasized that the and small business, as well as recruit and Commerce/Associated Industries of state must adapt to the new global economy support new industries. To that end, Arkansas Annual Meeting at the Arlington that is driven by the information, technology Hutchinson said he would support an Resort Hotel and Spa in Hot Springs. and service industries. He pointed out that exemption on sales taxes on utilities for Hutchinson expanded upon themes he the state has lost some 38,000 Arkansas industry in order to reduce the cost has discussed recently, tying tax reform and manufacturing jobs in the last five years. of doing business and to encourage business technology expansion to economic “This isn’t anybody’s fault. It is a result expansion and jobs growth. development, jobs growth and higher wages of the changing nature of the global 2) Encouraging the investment of capital in the state. economy,” Hutchinson said. “And although in Arkansas to support, recruit and retain Instead of focusing on new revenues we in Arkansas have made some great jobs in the state. driven by new tax increases, Hutchinson strides, we must not be passive when it Hutchinson, a native of Gravette, is a said, we must look at reducing the state’s tax comes to moving our economy forward.” former U.S. Attorney for the Western District burden as a way to spur the economy, Hutchinson pointed out that many of Arkansas, Member of Congress attract job-creating industries and boost Arkansas industries already lead in the representing Arkansas' Third District, head of wages. After creating a more economically technology field — from retail to the U.S. Drug Enforcement Administration vibrant environment in Arkansas, the transportation to energy exploration – and and the first-ever Undersecretary of revenue will flow from a broader and more that Arkansas universities have produced Homeland Security. Hutchinson is CEO of economically healthy tax base. some of the nation’s cutting edge Hutchinson Security Strategies, a Little Rock “Historically, when the state needed technology. consulting firm, and oversees the homeland revenue, we had a single answer – we raised “The challenge is to retain investment security division of Venable Law Firm.

BEEBE PUBLIC SPEECH treating osteoporosis through bone News and World Report in 2004. In 2003, (continued from page 10) regeneration. “Doctors at UAMS recently three were named on the magazine’s list of provides a valuable transportation performed the first liver transplant in the the top 12 schools in the South, and two advantage, Beebe noted. Halfway between state and the university’s Arkansas Cancer were named among the top 10 best values. Canada and Mexico, the Carolinas and Research Center is internationally known in Five of the 25 fastest-growing two-year California, Arkansas is only a tank of gas several specialty areas, such as multiple colleges in the country are in Arkansas. away from one-third of the nation’s myeloma. Arkansas Children’s Hospital is Education at all levels is valued in the population. A billion-dollar program to the sixth largest pediatric hospital in the state. Arkansas leads the nation in improve approximately 380 miles of nation.” Environmental and Spatial Technology interstate highways will be completed in The UAMS Biomedical Biotechnology (EAST) Labs, a hands-on, advanced 2005. Center houses the Arkansas BioVentures computer course that prepares students for Many retirees are finding Arkansas a incubator, Beebe added, which has the high-tech workplace while they work on great place to live, and as the baby boomers propelled a dozen new biotech companies important community service projects. grow older, the state will continue to attract into the marketplace - with another six in “So all of this is what’s good about the this population, Beebe said. The state ranks the pipeline and three more anticipated each future of Arkansas’ economic climate,” ninth in the U. S. in both retiree relocation year. The Genesis Incubator at the Beebe said. “I know this state well, and I and retiree income. University of Arkansas in Fayetteville is want to take the shining examples I’ve In the U.S. News and World Report 2005 another platform for successful high-tech talked about that I’ve seen in isolated list of America’s Best Graduate Schools, the companies. regions of Arkansas and replicate these University of Arkansas for Medical Sciences In 2002, the University of Arkansas examples from Batesville to Fayetteville, in Little Rock ranked No. 8, ahead of Yale received $300 million from the Walton from Searcy to El Dorado, from the Delta University. The UAMS geriatric clinical care Family Foundation, the largest gift ever to the Ozarks. Let’s make this truly ‘The program was cited as one of the best in the made to a public university, and in 2005 the Land of Opportunity.’ nation, and the university’s primary care UA will meet its fundraising target of $1 “We have so much talent in this state – program was listed as No. 52. The news billion. In 2004, the UA Walton College of so many smart, innovative, creative minds – magazine has named the UAMS Medical Business was ranked 50th among the Top and we just have to harness their energy Center one of America’s Best Hospitals for 200 economic departments in the world, and provide community partnerships nine consecutive years. according to the Journal of the European between business and industry, between UAMS is also noted for medical Economic Association. public and private projects that provide research, Beebe noted. Arkansas doctors Of Arkansas’ 20 colleges and incentives, that create development, and have announced major discoveries in universities, five drew top honors from U.S. that expand existing industry.” 11 AHTD 47 jobs and generates $4.5 million in Information and Construction Quality. economic activity for the state, Flowers said. Without the continuation of the Director Back in 1999 before the current Interstate Bond Program, Flowers said that Flowers Interstate rehabilitation program was within 10 years, 52 percent of the started, 63 percent of Arkansas’ Interstate Interstates would be in good condition, 11 Details Need highways were considered to be in poor percent in fair condition and 37 percent in 77th Annual MeetingFor Interstate condition, with only 21 percent considered poor condition. By 2026, without the Bond Issues/LakeRehabilitation View Bond to be in good condition and 16 percent in continuation of the program, 53 percent of fair condition. the Interstates would be in fair condition, Proposal Arkansas was the first state to complete 42 percent in poor condition and only 5 original Interstate mileage, Flowers said. percent in good condition. One of the ballot The original Interstate was designed for Without the continuation of Interstate issues on tap for the 56,820 pounds and 10-20 percent trucks. Bonds, funds used to improve other scheduled December The current weight limit is 80,000 highways may have to be redirected to 13, 2005 election was pounds and trucks now account for 60 Interstates and the redirection of funds Arkansas’ Continued percent of total traffic on some sections as could lead to significant deterioration of the Use of Bonds for the result of increases in freight movement. Interstate system, Flowers said. Interstate The old pay-as-you-go system for funding The December 13th Interstate Bond Rehabilitation. Interstate construction and rehabilitation is Proposal, a continuation of the existing Dan Flowers, the not sufficient. bond authority, would require no new taxes Dan Flowers Director of the After the 1999 Interstate Rehabilitation and would allow for cities and counties to Arkansas Highway Program was approved, $575 million in continue to share, Flowers said. The and Transportation Department addressed bonds were issued to improve more than 50 maximum bond debt would remain at $575 the subject at the State Chamber/AIA percent of our Interstate system. The million with short maturity bonds of 10 to Annual Meeting in Hot Springs. program was approved by voters by a four- 12 years being issued. Besides the proposal for Interstate to-one margin. The bonds were to be repaid Flowers summarized his presentation by Bonds, there was a separate proposal for with federal interstate maintenance funds, a noting that Arkansas’ interstates have gone Higher Education bonds on the same state match and a 4-cent state diesel tax. from being among the worst in the nation ballot, Flowers said. However, the proposals Today, six years after passage and to among the best. However, needs still were separate and independent and the implementation of the 1999 Interstate exist and a funding mechanism is needed to AHTD program was for Interstates only. Rehabilitation Program, 72 percent of maintain the current conditions. The The AHTD program would extend Arkansas roads are considered to be in Interstate bond proposal would provide a authority to issue bonds for Interstate good condition, 14 percent are considered mechanism to maintain the progress made rehabilitation with the maximum amount of fair and 14 percent are considered poor. In on our Interstates, make needed bond debt remaining at $575 million. No addition, a significant portion of the let improvements in a timelier manner, create new taxes would be levied; the existing jobs are complete on Interstates 40, 55 and jobs and boost economic activity. revenue stream would be used. 30. The Program racked up numerous Each $1 million in highway work creates awards for Work Zone Safety and Public

Voter Approval of Higher Education Bonds at maturity for technology and facility improvements may be used for college tuition at any for state institutions of higher education; Higher Education Bond college or university or for any other refund certain outstanding bonds; and Program Would Benefit purpose, Leach said. Investors’ income provide for a statewide election of the from the bonds would be exempt from issuance of bonds. Arkansas Colleges and both federal and state income tax whether “This Higher Education Bond Proposal Universities or not the income was used for college would not require any new taxes and would tuition. not require any additional annual debt Passage of the proposed Higher In 2004, Arkansas public institutions of service,” Leech emphasized. Education Bond Program by Arkansas higher education documented needs of As far as the distribution of the voters in the December 13 Special Election more than $110 million in critical proposed Bond Fund, Leech said that a would provide funds for Arkansas’ colleges maintenance, which will escalate by the time total of $250 million in bonds would be and universities, David Leech, President of bond funds are available, Leech said. There authorized. The breakdown for that total Mayflower Foods and Vice Chairman of are critical needs for upgrades in: would be $100 million for the restructuring the Arkansas Higher Education instructional technology; technology of existing bonds, $10 million to connect Coordinating Board, said during a infrastructure and research technology; universities to eCorridor, $90 million to be presentation at the State Chamber/AIA nursing, medical technology, engineering distributed to universities and $50 million to Annual Meeting. and education. be distributed to colleges. The bonds would be used to upgrade Since the last bond issue was passed in The eCorridor is a term coined to technology for research and instruction, the 1990s, higher education institutions have encompass the National LambdaRail finance critical maintenance and renovation experienced a 34 percent increase in (NLR), a high-speed, national computer needs, and build new classrooms and enrollment. network that runs over fiber-optic lines, libraries. Colleges and universities would Act 1282 of 2005, known as the Leech said. It will advance the research, have immediate access to funding if the “Arkansas Higher Education Technology clinical and educational goals of member measure passed, Leech said. and Facility Improvement Act of 2005,” institutions by providing the resources With new technology and adequate was sponsored by Sen. Gilbert Baker and demanded by cutting-edge network facilities, colleges and universities in Rep. Bruce Maloch. The Act authorized the research. Arkansas would be able to attract more Development Finance Authority to: issue The university distribution breakdown federal and private funds, Leech added. higher education general obligation bonds (continued on page 13) 12 Lake View Case Has declaring that Arkansas’ system of funding David Newbern and Brad Jesson – to public schools violated the State examine and evaluate the work of the Attained Almost Constitution’s promise that “the State shall recent General Assembly. Legendary Status ever maintain a general, suitable and The Special Masters raised the following efficient system of free public schools and questions: Has the Legislature retreated Even though the shall adopt all suitable means to secure to from reform? Is there enough money for school district that the people the advantages and opportunities funding per student (foundation funding) spawned the Lake of education.” for the current biennium? Did the View Case is no “The State Chamber/AIA was the only Legislature do right on facilities funding? longer in existence, party that said Kilgore had it right,” The State Chamber/AIA then filed a the case itself has Marshall said. “The system was broken and friend-of-the-Court brief with the Masters become almost needed to be fixed. That was a watershed on some of the compliance issues: legendary – like event in our history.” Arkansas’ obligation to make funding Brown versus Board In 2004, the Arkansas Legislature education the state’s priority, the state’s Price Marshall of Education or Bush provided $400 million in funding to put accountability reforms, and the efficiency/ versus Gore, Price into the public school system and placed a consolidation issue. Marshall, an attorney with the law firm major refocus on accountability and Hearings on the case were held during Barrett & Deacon of Jonesboro, told efficiency in regard to how school districts July, August and September, Marshall said. attendees at the State Chamber/AIA were performing, Marshall said: “The On October 3rd, the Special Masters filed a Annual Meeting in Hot Springs. Supreme Court said that was great,” report finding that the Legislature had Marshall, who has represented the State declined the request of several parties to retreated, foundation funding was not Chamber/AIA in several filings pertaining exercise its continuing jurisdiction over the adequate and facilities were not adequate. to the case before the Supreme Court of case and released its mandate. The deadline to file a response was October Arkansas, noted that the original lawsuit During the 2005 Legislative Session, the 24th. started 13 years ago as the result of the Arkansas Legislature put $20 million in early As friends of the Court and steadfast Lake View School District of Phillips childhood education, adjusted the Teacher supporters of education reform in County not getting enough money from the Crisis Fund and added an additional $400 Arkansas, the State Chamber/AIA filed an state to produce students who were million in general funding for schools, additional brief to assist the Court in prepared for further education and life. Marshall said. The Legislature also added evaluating the Masters’ new report. The The case initially centered on “equity” new accountability measures that included brief urged the Court to reject the Special and “adequacy” issues, Marshall said: “How consolidating some of the school districts Masters’ overall conclusions. Another big is my slice of the pie and how good is that were not complying with the new hearing was held on November 17th. (No the pie?” measures into school districts that were. decision had been rendered in regard to the In 2001, then-Chancery Judge Collins “The Legislature did not abandon any last hearing when this article was being Kilgore took the case a step further by accountability reforms,” Marshall said. written.) Despite those Despite the filing of that brief, Marshall measures and the said he felt that the four votes on the Court EMPTY YOUR WALLET TO FILL THEIR MINDS. initial ruling by the to adopt the Special Masters’ Report will Supreme Court that hold and the Court will retain jurisdiction. the reform measures What that means is that a Special Legislative Did you know that Arkansas’ private colleges and were acceptable, the Session will probably be held to address the universities enroll only 10% of Arkansas Rogers School issues raised by the Special Masters. college students but produce 20% of District and more “The State Chamber and AIA need to all Arkansas degrees - every year? than 40 other districts maintain dialogue,” Marshall said. Article in the state filed suit XIV of the State Constitution mandates a These schools are non-tax-supported. They again soon after the good system of public schools. Efficiency depend on private support. That support 85th General needs to be raised overall in regard to the - your support - is an investment in Assembly adjourned number of superintendents and how the Arkansas’ future growth and Development. in April 2005, asking school districts are being managed. the Supreme Court to Accountability needs to be evaluated as • Harding University reopen the case. well.” • John Brown University “The State • Ouachita Baptist University Chamber/AIA (filed VOTER APPROVAL • Hendrix College a brief and) said no,” (continued from page 12) • Philander Smith College Marshall said. • University of the Ozarks “Reopening the case including for eCorridor would provide: $9 • William Baptist College would be a bad million for Arkansas State University at • Lyon College precedent. What the Jonesboro; $7.5 million for Arkansas Tech • Central Baptist College Legislature did was University at Russellville; $4 million to • Arkansas Baptist College good.” Henderson State University at Arkadelphia; • Crowley’s Ridge College However, by a 4 to $3.5 million to Southern Arkansas 3 vote, the Supreme University; $63 million to the U of A ARKANSAS’ INDEPENDENT Court disagreed with System; and $13 million to the University of COLLEGES & UNIVERSITIES the State Central Arkansas. The college distribution is Chamber/AIA’s broken down among 22 separate colleges in the state. One Riverfront Plaza, Suite 610 • North Little Rock, AR 72114 position and reappointed the two In regard to actual projects to be funded, Phone: 501.378.0843 • Fax: 501.374.1523 Leech said that the Higher Education Email: [email protected] • Web: www.arkindcolleges.org Special Masters – (continued on page 14) 13 SSTP sourcing rules that are destination based; a The 108th Congress introduced H.R. menu of uniform definitions; a simplified 3184 and S. 1736, both federal sales tax Project exemption administration process; rate simplification bills, and the 109th Would simplification with databases, and no caps Congress was expected to introduce and thresholds after December 2005. similar legislation in November 2005, Simplify Additional agreement provisions Townsend said. 77th Annual MeetingSales and Use Tax include limited scope audits and In regard to Arkansas’ future tax issues, Reporting certification standards; hold harmless a deadline of July 1, 2007 has been set to Tax Issues/Immigration provision if using databases; uniform implement no caps and thresholds Nationwide returns; sales tax holiday definitions and (rebates); destination sourcing – a shift in guidelines; one rounding rule; state local taxes, and one tax base per state Streamlining the sales taxes on Internet funding of technology; and amnesty. (Texarkana), Townsend said. sales would simplify sales and use tax reporting nationwide, according to Warren Townsend of Wal-Mart Stores Inc. during Exempting Utility Sales Arkansas Department of Economic a Tax Issues Panel presentation during the Development (ADED). State Chamber/AIA Annual Meeting. Tax For Certain However, when the state’s sales tax rate The Streamlined Sales Tax Project Manufacturers of 6 percent on utilities is added into the (SSTP) actually got its start in March 2000, mix, the situation becomes more Townsend said. A group of Implementing Worth Exploring, complicated, Pelkki said. Currently, States was subsequently organized in 2001. UAM Professor Says Missouri, Oklahoma, Texas and Tennessee In November 2003, a Streamlined Sales have no sales tax on utilities and Use Tax (SSUT) agreement was approved. Exempting the Louisiana’s sales tax on utilities is only 4 That was subsequently amended in sales tax charged by percent. Mississippi, with a sales tax of 7 November 2003, November 2004 and utilities on certain percent on utilities, is the only neighboring April 2005. manufacturers in state with a higher rate. Also in 2003, 2004 and 2005, Arkansas is an issue In 2004, Arkansas’ state sales tax definitions, uniform procedures, issue worth exploring revenue from utilities on manufacturers papers and technology implementation because industrial amounted to $55 million. were all developed, Townsend said. Those electricity rates have If a sales tax waiver on utilities for same years, state conforming legislation increased by 23 manufacturers were implemented, there was enacted. In 2004, Conforming States percent and would be a significant potential for added were organized. Certificates of Dr. Matthew Pelkki industrial natural gas employment, Pelkki said. Such a Compliance were reviewed June 30 rates have increased reinvestment into the current through July 1, 2005. by 128 percent since the first quarter of manufacturing matrix could result in $243 Full members of the Governing Board 2004, according to Dr. Matthew Pelkki of million in increased output for the state, enacted on October 1, 2005 include the the University of Arkansas-Monticello 1,000 new jobs and $40 million in states of Indiana, Iowa, Kansas, Kentucky, School of Forest Resources. employee compensation. However, a loss Michigan, Minnesota, Nebraska, North Pelkki appeared as part of a Tax Issues of state jobs might mean only a minor net Carolina, Oklahoma, South Dakota and Panel at the State Chamber/AIA Annual gain. Yet such a waiver could potentially West Virginia, all effective on July 1, 2005, Meeting in Hot Springs. attract new industries. and New Jersey and North Dakota, “Such spikes are disastrous because Pelkki ended his presentation by urging effective on October 1, 2005. most industry in Arkansas is energy- statewide business planning to consider Associate members enacted by the intensive,” Pelkki said. Such industries such a waiver. Governing Board on October 1, 2005 include food processing, pulp and paper have until the dates noted: Nevada, mills, petrochemicals, petroleum refining, January 1, 2006; Utah, July 1, 2006; transportation equipment, wood VOTER APPROVAL Tennessee, July 1, 2007 and Ohio, January processing, iron and steel forging and farm (continued from page 13) 1, 2008. Arkansas and Wyoming were also equipment. selected as Associate Members, but neither Coordinating Board approved the In the 2005 Legislative Session, House state has implemented an effective date distribution of funds in July. Colleges and Bill 2103: An Act to Provide for the yet. universities determined the projects based Continued Economic Development of the Townsend said that to date, 44 states on available funding. The Coordinating State of Arkansas’ Natural Resource plus the District of Columbia have Board approved specific projects on Manufacturing Base was introduced. established State and Local Advisory November 4. Projects include construction The Act, which would have been Councils and there are currently 39 of classrooms, technology upgrades and phased in over a three-year period, would implementing states plus the District of renovations to existing classroom space. have exempted natural gas, electricity and Columbia. Routine maintenance is ineligible. solid wood waste from sales taxes, Pelkki Additionally, 18 conforming states were “While bond buyers are investing in the said. The exemption would cover sawmills part of the Governing Board on October future of their children and grandchildren, and wood preservation; veneer, plywood 1, 2005 and Nevada is to become a part of they’ll be allowing our colleges and and engineered wood products; pulp, the Governing Board on January 1, 2006. universities to meet critical technology and paper and paperboard mills; converted Other entities involved include local facility needs,” according to Arkansas paper product manufacturing, and lime governments, business communities and Governor Mike Huckabee, who endorsed and gypsum product manufacturing. technology providers. both the Highway Bond and Higher Compared to other neighboring states, Agreement provisions for SSTP include Education Bond issues. “We want all of our Arkansas is 35th in electrical energy costs state level administration of local taxes; institutions of higher learning in Arkansas and 32nd in natural gas energy costs, common state and local tax bases within to have cutting-edge technology. The according to data for 2000 supplied by the states after January 1, 2005; uniform economy of the new century demands it.” 14 Immigration Reform State Trade Mission to The delegation also participated in a tour of the Hino Technical High School, Boling Takes Center Stage Japan Reaps Benefits said. Hino Motors has its own high school At State Chamber/AIA for Participants on the grounds of its Tokyo plant. Mid- Annual Meeting South Community College in West An Arkansas Memphis is seeking to coordinate its curriculum to provide trained workers for In a recent poll, delegation consisting of representatives the Hino plant in Marion, something that three-fourths of Boling called “visionary on the part of Mid- American voters from the Arkansas Department of South Community College.” surveyed supported Additionally, the delegation participated comprehensive Economic immigration reform Development; the (continued on page 16) that combines Arkansas State Chamber of toughness, fairness, a David Boling U.S. Chamber of guest worker program Commerce/ Steve Patterson and an earned path to Associated Industries of Arkansas; the Commerce Supports legal residency for undocumented Arkansas Farm Bureau; the Forrest City, Immigration Reform immigrants who are already here, Steve Marion, Paragould and Wynne Chambers of Patterson, Chief of Staff for U.S. Senator Commerce or Economic Development Offices; Entergy; Isbell Farms, and Mid- The U.S. Chamber Blanche Lincoln, said during a panel of Commerce presentation at the State Chamber/AIA South Community College participated in the Arkansas Trade Mission to Japan on supports legislation Annual Meeting in Hot Springs. proposed by Senators Many studies have shown that September 5-12, 2005, according to David Boling of Mitchell, Williams, Selig, Gates & John McCain and Ted enforcement alone will not work and that Kennedy to establish mass deportation of all undocumented Woodyard, PLLC during a presentation at the State Chamber/AIA Annual Meeting. a six-year path to workers is cost prohibitive, Patterson added. permanent residency Thus, it’s vital to find a fair, practical way Boling said that Japan and Arkansas already had much in common with the for illegal aliens for undocumented workers to earn legal Randel Johnson currently working in status. number of Japanese facilities in the state including Nucor-Yamato in Blytheville; the United States, Randel Johnson, Vice Mexico and all of Central America are President of Labor, Immigration and developing countries. Their citizens migrate Tokusen in Conway; Sanyo in Forrest City; Arkansas Steel Associates of Newport, a Employee Benefits for the Chamber, said northward into the United States because during a panel presentation on Immigration the same opportunities do not exist in their joint venture of Sumitomo and Yamato; Hino Motors in Marion; Denso Corp. in Reform and Labor Issues at the State home countries, according to Patterson. Chamber/AIA Annual Meeting in Hot There are other factors as well. The Osceola, and Sakae Riken (EAKAS) in Wynne. Springs. Mexican economy depends on the “That legislation does not call for remittances of its citizens who are living in During the Arkansas Trade Mission to Japan, one of the events participants took deporting illegal aliens,” Johnson said. the United States. “Rather, they would be required to pay a The Federal Reserve Bank of Dallas in was the Aichi Expo/World’s Fair, which was held in Nagoya, “Japan’s Detroit,” fine. We are in support of permanent reported than in 2003 Mexican workers sent residency.” about $13 billion to family members in Toyota, “whose presence was huge,” and the U.S. Pavilion, which featured an However, Republicans, who hold a Mexico, making remittance Mexico’s second majority in both the U.S. Senate and the most important revenue source, behind only “Arkansas Weekend,” Boling said. The event also included an Arkansas Reception, which House of Representatives, are “very split on petroleum, Patterson said. this,” Johnson said. “House Republicans are The U.S. government has erected families of Japanese companies based in Arkansas or interested in Arkansas behind more enforcement. It’s gearing up to massive fences topped with concertina wire be a nasty fight. We don’t think the Senate and installed motion detectors, ground- attended. Duck calls and Arkansas-grown rice were featured. will take up any Immigration Reform until pressure sensors and night-to-day lighting February.” systems along miles of border near popular Another event was the Sakae Riken Tour, which included a tour of the plant, In regard to labor issues, Johnson urban crossing points. Thousands of new cautioned his audience not to count labor border patrol officers have been added to headquarters and technical center, said Boling. Sakae Riken, a family-owned and unions out as there is more of an effort at the government payroll. organizing – even though there is disarray Despite these efforts, the policy of worldwide business, is based in Nagoya with ties to Toyota. The company is currently on Capitol Hill. “enforcement through deterrence” has been “There are two union movements now an utter failure, Patterson said. There is no constructing an automobile parts facility in Wynne. and Democrats and unions are pushing for evidence that increased technology and the Employee Free Choice Act – collective manpower has substantially reduced the Another event the delegation participated in was a visit to Tokyo and a bargaining without a secret ballot.” flow of migrant crossings. Johnson suggested that those interested Instead, migrants have simply moved to tour of Hino Motors there, Boling said. Tokyo is Japan’s political, economic and in that issue go to the website: more remote crossing areas in the desert secretballotprotection.com. He also noted and on desolate ranches in New Mexico, cultural center. Hino, a subsidiary of Toyota, is currently constructing an that California recently enacted a Paycheck Texas and Arizona. This has increased the Protection Act. death rate among migrants and, according automobile parts facility in Marion and reportedly planning to build a truck Other items that businesses should be to a Princeton study, increased the cost of aware of include FMLA Labor Reform, the border enforcement even more. manufacturing facility nearby. Hino is also a supplier to Toyota’s facility in San Antonio Americans with Disabilities Act, the Harsher enforcement policies may Genetic Discrimination Act and the actually be contributing to illegal and well-known in Japan and Asia for manufacturing heavy-duty trucks. Workplace Freedom in Religion Act, (continued on page 24) Johnson said. 15 done by a business, it’s vital that the plan companies and agencies to better prepare not just sit on a shelf, Maxwell said: “Make for crises: Contingency sure that they work. You need to think 1. Prepare a crisis plan by identifying Planning Vital through everything. Anything you do in your three worst business nightmares. regard to investing in planning is not 2. Identify your external partners. For Disaster wasted.” 3. Know your audience(s). 77th Annual MeetingPreparedness, 4. Develop a crisis communication plan Disaster Preparedness based on comprehensive message mapping ADEM Deputy Crisis Communication techniques. Director Says Planning For Private 5. Select and train at least three spokespersons. All disasters are Industry Makes Sense, 6. Identify and train a crisis communication local, David Maxwell, Reduces Risk team. Deputy Director of 7. Get to know your media. the Arkansas Crisis 8. Ensure coordinated responses. Department of communication isn’t 9. Realize that the quickest path to Emergency exclusive to “business as usual” is through a well- Management, said government agencies thought-out plan executed in a timely during a panel or natural disasters, manner. presentation on attendees at the You can’t prepare for everything, Alvey Disaster Preparedness Annual State admitted. However, you can learn from the David Maxwell at the State Chamber/AIA mistakes of others and avoid some Chamber/AIA Annual Meeting in Hot Meeting were told by common pitfalls. One area that is frequently Springs. Robert Alvey during a overlooked or ignored is the media. The Maxwell, part of a state agency that is Robert Alvey panel discussion on media are not as unpredictable as you would not based in Little Rock but instead is Disaster Preparedness. think. Ignoring them doesn’t work and headquartered in Conway, said the ADEM’s Alvey, co-founder of Crisis & Conflict trying to manage them will complicate role is to support the 84 local emergency Communications and a crisis matters further. management coordinators in Arkansas. communications expert, detailed his “So often you watch as companies “Each county has one,” he said. “They deployment to Baton Rouge immediately accept the fallacy that the media will go coordinate the emergency response. following Hurricane Katrina and the work away if you ignore them,” he said. Another Anything the state or federal government that he did while there for Louisiana State mistake is the attempt to “manage the does supports local governments.” University (LSU) and the largest field media.” Research shows that neither Maxwell said he has seen his share of hospital in U.S. history. approach works frequently enough to take disasters including severe storms, ice “LSU quickly learned some basic crisis such a risk. storms, flooding, etc. communication principles and was able to How you behave in front of the media is “The 2000 ice storm was a $200 million turn the corner on effective crisis a wholly different problem, realized during disaster,” he said. “We have the potential for communication,” Alvey said. “While we and after Hurricane Katrina, Alvey said. earthquakes in the New Madrid Fault Zone. brought them up to speed fairly quickly “Considerable research shows the media We’re also facing other possible problems because of their leadership and team will usually provide a ‘grace period’ at the including an avian flu pandemic, hazardous commitment to the mission, others in south start of any disaster. “The behavior of so material spills and terrorism. Disasters are Louisiana failed on so many levels when many leaders in south Louisiana in front of always in the back of our minds, for communicating with the media, partners the cameras pretty much negated that example, the recent train derailment in and the public.” critical period of time when spokespersons Texarkana.” Much of the bad press and delayed can communicate key information to target ADEM, which consists of 77 employees, response to media requests could have been audiences.” is the state agency that interfaces with the avoided with some investment in a Federal Department of Homeland Security, comprehensive crisis communication plan, STATE TRADE MISSION TO JAPAN Maxwell said. Alvey said. Knowing your partners before (continued from page 15) “Preparedness makes good sense. In the disaster and not airing complaints in an Arkansas Reception at the Tokyo order for continuity of government, through the national media are two basic Imperial Hotel. “It’s a very famous hotel planning is one of the most important tenets. near Tokyo’s business district,” Boling said, things you can do. It’s vital to get all people “You don’t want to be handing out that was designed by Frank Lloyd Wright. involved. business cards during a disaster,” Alvey The reception was for Japanese companies “Since small businesses account for 99 stressed to attendees. “Before a crisis, you based in Arkansas or interested in Arkansas percent of all companies, it’s vital for them need to know who your partners will be, and attended by Hino’s Chairman of the to get to know their local emergency what they are capable of doing, what is Board. management coordinator.” expected of each partner, what they “There is significant momentum with Vital parts of contingency efforts perceive as critical, and how to reach them the siting of the Denso, Hino and Sakae between small businesses and emergency when normal lines of communication fail.” Riken facilities in Northeast Arkansas,” management coordinators include planning Another weakness that was realized Boling said in his concluding remarks. “We for utility problems, insurance and during the recovery effort was crisis have an automobile parts corridor in the emergency planning for employees, Maxwell planning by private industries, Alvey said. making and Hino’s long-term view is to said: “The emergency management Given that 90 percent of a crisis response is manufacture heavy-duty trucks in Marion.” coordinators work with employers to do communicating, even those who had the However, there are some challenges family protection planning as well – so the foresight to develop crisis plans more often facing the state, Boling added, including employees know where their families have than not failed to see the importance of workforce training, maintaining the existing gone in the event of a disaster.” communicating. momentum and taking that momentum to Once contingency planning has been He provided a “grocery list” for the next level. 16 FedEx Freight subsequent landfall impacted the Gulf equipment better, got more customer Coast. In the aftermath of that landfall, shipments out of the storm’s path earlier Provides Certainty FedEx Freight’s people, customers and and pre-positioned our people, customers In An Uncertain World facilities were all impacted. and facilities.” As a result of the lessons learned from Even when people are faced with When you’re a Katrina, the company was better prepared disasters on the magnitudes of hurricanes world class shipping to deal with subsequent hurricanes or terrorist attacks, Weston said it’s the job operation averaging 6 including Rita and Wilma. of FedEx Freight to “provide certainty in million shipments “For Hurricane Rita, we positioned our an uncertain world.” per day, the difference between Entergy Still Standing ads aired, more than 15,000 TV ads aired weathering disasters and an approximate total cost of between like hurricanes and Despite Major $1.1 billion and $1.6 billion.” struggling to get Hurricane Blows On the plus side, “we also started a John Weston through them lies in Project Hope Fund that brought in $3.7 being prepared. Despite seeing hundreds of its million in donations,” he added. Such is the case employees become homeless overnight, Having to deal with the two storms for FedEx Freight, according to John the loss of its corporate headquarters and emphasizes the need for business Weston, Vice President of Sales & the bankruptcy of a subsidiary, Entergy contingency plans, McDonald said. Marketing for the Memphis-based “What company. Weston appeared as part of a happens panel presentation on Disaster when your Preparedness at the State Chamber/AIA employees Annual Meeting. cannot return Standard operating procedures (SOPs) to their at FedEx Freight provide consistency and homes? What reliability, Weston said. But SOPs can work happens to in both normal and abnormal conditions if your you’re prepared. customers? Normal for FedEx Freight is 6 million What shipments per day, Weston said. The happens to company maintains that level of your credit consistency via highly engineered systems, rating?” communications, information systems and McDonald contingency plans. “Information is as asked. important as shipment delivery.” KATRINA’S DESTRUCTIVE SWATH – This Lakeshore, Mississippi beachfront home At the Contingency planning covers such was destroyed by Hurricane Katrina. time of his items as local events, appearance, technology/communication disruptions, came through the Hurricane Katrina and 120,000 Entergy customers were still changes in the competitive landscape, Rita disasters in fairly good shape, Hugh without power. But he noted it would be inclement weather, natural disasters and McDonald, President and CEO of extremely difficult to restore power in terrorist attacks, Weston said. Entergy Arkansas, said during a many instances since many homes were no For FedEx, a corporate approach to presentation on Disaster Preparedness at longer standing or had been inundated dealing with disasters or potential disasters the State Chamber/AIA Annual Meeting with so much water damage. is very important. The company utilizes in Hot Springs. “It’s a house-by-house situation,” he various approaches including flex capacity “We had thousands of inquiries from said. “We’re also dealing with a backflow and proactive measures to overcome the media plus all types of human of billing issues.” problems. And they rarely make the same resources related issues,” McDonald said. mistake twice; they learn from experience. “There were “In 2004, we responded to 37 tropical over 9,000 storms worldwide,” Weston said. “This megawatts of year, we have already responded to more damage, than 30.” 72,000 miles FedEx has the world’s second largest of lines of airline: “We shipped tons of emergency distribution supplies prior to Katrina,” Weston said. out of A major lesson learned after Katrina service in the was not to rely on cell phone or land lines two storms, for phones. 29,000 poles “You need satellite phones,” Weston damaged or said. “Land lines and cell phones go out. destroyed, We also set up temporary housing in 19,000 advance for our workers.” employees When Hurricane Katrina hit, its initial evacuated, impact was on Florida, Weston said. Its REMNANTS OF HURRICANE KATRINA – St. John’s Baptist Church in Lakeshore, 48,200 radio Mississippi was reduced to rubble by Hurricane Katrina’s winds and tidal surge.

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19 Not a State Chamber/AIA Member? Join Today!

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The State Chamber/AIA is working to make Arkansas a better place to do business. We do that through our presence in the halls of the state Capitol as business-related bills are being debated, where we serve as both a voice and ears for our members. We do that through training opportunities for businesses large and small. And we do that through providing networking opportunities among business men and women and local and state policy players.

We want to help you help your business. Of course, we need the financial support of our membership dues, but even more we need our members to voice their concerns, serve on our policy-guiding committees and lead the way to a better business climate in Arkansas.

Here’s how to join. Fill our the application below and mail it to State Chamber/AIA (Membership), P.O. Box 3645, Little Rock, AR 72203-3645, or go to the Membership Center on our website: www.ascc-aia.org.

STATE CHAMBER/AIA MEMBERSHIP APPLICATION Company Name ______Contact Name ______Title ______Mailing Address ______City ______State______Zip ______Phone ______Fax ______E-Mail ______Type of Business ______SIC ______Number of Arkansas Employees ______

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20 85TH GENERAL ASSEMBLY Arkansas AFL-CIO have negotiated bill was filed and he cooperated by holding (continued from page 4) changes to the workers’ compensation laws the bill until an agreement was reached. consideration. since 1995, following the reforms passed by Later he formally withdrew the bill from HB 2392 by Rep. Jay Bradford (D-Pine a State Chamber/AIA led coalition in 1993. further consideration. Bluff) would have reinstated a state estate These negotiations have resulted in agreed HB 1174 by Rep. John Verkamp (R- tax. The State Chamber/AIA kept bill(s) each session. Time and term limits Greenwood) would have done away with grassroots pressure on this bill from the have eroded the memory of just how commission hearings on joint petitions for time it was filed until it was defeated in the difficult legislative sessions were before the final settlement when all parties are House Revenue and Taxation Committee. State Chamber/AIA took control of these represented by counsel. It received a “do Several tax and fee increase measures two issues. pass” recommendation from the House were filed the last day of bill filing. The Workers’ Compensation: Insurance and Commerce Committee but State Chamber/AIA was prepared to fight An agreement was reached between the was defeated on the House floor by a 53 to all of them, but fortunately none of these State Chamber/AIA and AFL-CIO on 35 vote (all workers’ comp bills require a measures were ever considered. March 7, which was the bill filing deadline. supermajority to pass because the original The bills included: SB 1064 by Sen. Paul Before the agreement was completed, law was an initiated act). Miller (D-Melbourne) to create a beverage several workers’ compensation bills were SB 1144 by Sen. Steve Higginbothom container fee; HB 2602 by Rep. Ken introduced, three of which eventually (D-Marianna) was filed on the last day of Cowling (D-Foreman) to increase the liquor became part of the agreement. bill filings. It would have exempted a tax and create a retail beer tax; HB 2638 by The three bills that became part of the certain group from filing initial Rep. Steve Harrelson (D-Texarkana) to agreement were HB 1011 by Rep. Lindsley membership financial reports. Members of authorize a local beer, liquor and wine tax; Smith (D-Fayetteville) SB 489 and SB 941 the group were directed to the commission HB 2649 by Rep. Phil Jackson (R- both by Sen. Dave Bisbee (R-Rogers). The for assistance with their problem and Berryville) to create a tax on bottled water; final bill, HB 2917 by Rep. Mike Burris (D- Higginbothom agreed to honor the HB 2669 by Rep. Phil Jackson (R- Malvern), was filed as a shell on the final agreement and pulled the bill from Berryville) to reinstate the 3 percent day of bill filing and amended to represent consideration. income tax surcharge; HB 2683 by Rep. the agreement. SB 159 by Sen. Ed Wilkinson (D- Sam Ledbetter (D-Little Rock) to increase HB 1011 (now Act 1250) made changes Greenwood) would have allowed the state sales tax by 1/8 cent; HB 2692 by in compensable neck and back injuries not reinstatement of an expired certificate of Rep. Lindsley Smith (D-Fayetteville) to caused by specific accidents. We originally non-coverage without payment of raise the bottle tax; HB 2711 by Rep. opposed this bill, but through negotiations premium. Wilkinson held the bill and Johnnie Bolin (D-Crossett) to increase got it amended and agreed to it as one of eventually formally withdrew it from motor vehicle registration fees; HB 2829 by the two bills that labor wanted. further consideration after the agreement Rep. Denny Sumpter (D-West Memphis) to HB 2917 (now Act 1692) was the other was reached. tax mortgages, deeds of trust and other request from labor that made changes to HB 1688 (now Act 1436) by Rep. Chris instruments; HB 2838 by Rep. Phil Jackson the definition for objective evidence Thyer (D-Jonesboro) was not a workers’ (R-Berryville) to levy a 5 cent fee each time necessary to prove permanent hearing loss compensation bill, but we had concerns a customer used a debit, credit or gift card disability. The estimated cost factor of both that its impact might apply to workers’ to purchase fuel at the pump; HB 2882 by bills combined is a one percent or less comp cases. Thyer honored the State Rep. Jodie Mahony (D-El Dorado) and increase. Management needed help in Chamber/AIA’s request to amend the bill House Speaker Bill Stovall (D-Quitman) to fixing a problem in certain construction in a way to remove all doubt about its levy a new severance tax on natural gas; HB cases related to the use of certificates of impact on workers’ comp. The bill changed 2902 by Rep. Preston Scroggin (D-Vilonia) non-coverage. SB 489 (now Act 1711) the law regarding exchange of medical to levy a sales tax on mobile and modular requires contractors to show proof of information in civil cases. home sales; HB 2924 by Rep. John coverage when applying for a new or We also got involved in a couple of Verkamp (R-Greenwood) to eliminate the renewal contractors’ license. SB 941 (now attempts to hamper the commission’s “come to rest” provision or “become Act 1917) prohibits the issuance of a operation. SB 82 by the Joint Budget commingled with property in the state” certificate of non-coverage to a Committee was the commission’s budget provision in order to be subject to use tax; subcontractor who does not have workers’ for the next two years. There were two and HB 2934 by Rep. Randy Rankin (D- compensation coverage. attempts to place substantive amendments Eudora) to tax direct satellite broadcast There were six bills filed that the on this budget bill. providers. agreement stopped without a fight. First, Rep. Charles Ormond (D- Workers Compensation & HB 1101 by Rep. Robert Thompson (D- Morrilton) tried to reduce the salary of Unemployment Insurance Paragould) was one of two bills we were workers’ compensation commissioners The State Chamber/AIA continued its most concerned about. It would have made from just over $100,000 to $24,000. The role as the “guard dog” of workers’ significant changes in the “going and State Chamber/AIA went after this compensation and unemployment coming” rule. Thompson notified us of “ludicrous” proposal hard and it was insurance issues, which are extremely plans to run the bill in committee before defeated. important bottom line issues for business. the agreement and we brought in several The other attempt was by Rep. Sam Until several years ago, approximately 50 people to testify against the measure. But Ledbetter (D-Little Rock), who wanted to unemployment insurance bills were filed another issue took up all the time that day change the status of administrative law each session by representatives on both and Thompson eventually pulled the bill judges from employees-at-will to the same sides of the issue. Now, the State down after management and labor reached standard as commissioners. The State Chamber/AIA and labor leaders participate an agreement. Chamber/AIA encouraged strong in an advisory council to the state SB 47 by Sen. Jimmy Jeffress (D- grassroots opposition to this proposal and Employment Security Department. This Crossett) was the other bill we were most following testimony from two effort produces a department bill each concerned about. It would have applied commissioners, the language was rejected session. attorneys’ fees to medical treatment awards. by the joint budget committee. Likewise the State Chamber/AIA and Jeffress was contacted immediately after the SB 368 (now Act 505) by Sen. Denny (continued on page 23) 21

85TH GENERAL ASSEMBLY require legislative review of any bill or Others being honored at the luncheon (continued from page 21) interim study proposing a mandated health were: Altes (R-Fort Smith) was a joint effort by insurance benefit or service. It also sets up William R. Hogg Jr. of Metropolitan the Insurance Department and Workers’ an Advisory Commission on Mandated National Bank in Little Rock – 2005 Compensation Commission to shift Health Benefits and proscribes review Minority Small Business Champion of the workers’ comp premium tax collections guidelines. Year from the department to the commission. Miscellaneous Bills Games Boris A. Dover of First Community Unemployment Insurance Of Skill At Existing Locations Bank in Batesville – 2005 Financial Services The benefit of “agreed upon” legislation SB 999 (now Act 1151) by Sen. Bob Champion of the Year was even more apparent in the area of Johnson (D-Morrilton) will authorize cities Samuel L. Holmes of SCORE in Little unemployment insurance. SB 512 by Sen. or counties, by local option election, to Rock – 2005 Veteran Small Business Percy Malone (D-Arkadelphia) and Rep. authorize additional forms of electronic Champion of the Year Doug Matayo (R-Springdale) was the bill games of skill at horse racing or greyhound Bryan Martin of Martins Department developed by the department with the racing parks in their communities. The Store in Warren – 2005 Family-Owned assistance of the Advisory Council. It was State Chamber/AIA backed this plan. Business of the Year one of only two substantive unemployment Deceptive Trade Practices Mildred Holley of the Arkansas Small insurance bills filed and it was easily HB 1105 by Rep. Will Bond (D- Business Development Center in Little adopted. The State Chamber/AIA Jacksonville) would have made transactions Rock – 2005 District Director Award Unemployment Insurance Committee about which the Federal Trade Commission Lonnie Jackson of the Arkansas Small reviewed and agreed to the bill’s text prior or state regulatory agency rules are silent Business Development Center in to the session. subject to Arkansas deceptive trade practice Arkadelphia – 2005 District Director Health Care Issues law. The State Chamber/AIA was very Award Any Willing Provider (AWP) concerned about this bill and led a group State Chamber/AIA’s Tracking This is one of about three issues in this of business interests to meet with staff Site Up and Running session for which we did not achieve the members in the attorney general’s office If you haven’t already, please check out desired result. Due to the diverse opinions that were backing the bill. Following our our web site – www.ascc-aia.org – where we among our membership on AWP, we did meeting, the bill became inactive. offer you one of the best places to keep up not change our position from “neutral” to Environmental Issues with bills important to you and your “opposed” until about a week before the SB 12 (now Act 25) by Sen. Denny business. Under our Governmental Affairs issue was considered in the Senate Public Altes (R-Fort Smith) was designed to section, you can link to the Legislative Health, Welfare and Labor Committee. guarantee that the Landfill Post-Closure Tracking site. At that point, click on “Bills Extreme concerns about increasing the Trust Fund be spent only on the Being Tracked” to get to the regularly cost of healthcare eventually required us to environmental projects for which that fund updated, fully searchable site. take an “opposed” position to the measure was created. It will stop legislative raiding The direct link to the tracking site, if that would allow patients to see any of the fund and secure the fund for future you’d like to bookmark it, is medical provider they choose. The two environmental obligations. The State http://tracking.weknowarkansas.org/defaul companion bills, SB 43 (now Act 490) and Chamber/AIA assisted the Arkansas t.php. SB 44 (now Act 491) by Sen. Steve Faris Environmental Federation in getting this Once at the site, you can search for any (D-Malvern) flew out of the Senate important measure passed. bill being tracked by the State committee and the Senate floor with little SB 599 (now Act 1166) by Sen. Shawn Chamber/AIA by category, bill number or opposition. Womack (R-Mountain Home) was a sponsor. You will be able to easily connect It was assumed that the measure’s business-backed solution to a problem to a summary of the bill, the entire text of popularity would allow success on the created by a lawsuit that threatened to shift the bill, its history as it progresses through House floor, so the real battleground was the Arkansas Department of the legislative system and any comments the House Public Health, Welfare and Environmental Quality’s (ADEQ) authority the State Chamber/AIA has made about it. Labor Committee. We went to bed the in the federal Resource Conservation & New Program Addresses night before the hearing thinking we had Recovery Act back to the federal Education of Arkansas’ Children the measure beat but votes changed during Environmental Protection Agency (EPA). The State Chamber/AIA is proud to the hearing. The legislature never paid any The State Chamber/AIA helped the serve as the state affiliate for an exciting attention to our concerns about increasing Arkansas Environmental Federation pass national program designed to help the cost of healthcare while the medical this legislation that was much preferred communities improve educational society ridiculed our arguments. Very little over competing legislation. opportunities for children. concern was ever discussed about the Just for the Kids is a free web site that potential destruction of rural hospitals. SIGNIFICANT ACCOMPLISHMENTS allows educators, parents and the public to Pharmacy Benefits (continued from page 7) see how their schools are doing on key Management (PBM) A.G. Russell III is founder and Goldie performance indicators, and to see how HB 2845 by Rep. Johnny Key (R- Russell is president of the Knife Company, their schools stack up with schools that Mountain Home) would have restricted the Inc., in Lowell. The company boasts three have similar or more challenging use of PBMs in a way that concerned marketing catalogs, 46 employees and $16 populations. You can find it at employers that use PBMs to reduce the million in annual sales. www.just4kids.org. cost of pharmacy benefits. The State Roby Brock, host of the weekly But the web site goes further than just Chamber/AIA provided grass roots television show, Talk Business, offered the providing a report card. Experts in information to employers about this bill, keynote address. Ron Russell, president and education will visit high-performing schools which was defeated in the House Public CEO of the State Chamber/AIA, and to determine their “best practices.” These Health, Welfare and Labor Committee. Linda Nelson, district director of the Small are placed on the web site so other schools Legislative Review Of Mandates Business Administration in Arkansas, also can integrate them into their own HB 1877 (now Act 1926) by Rep. made remarks congratulating the 2005 educational programs. Johnny Key (R-Mountain Home) is a bill winners. (continued on page 24) the State Chamber/AIA supported that will 23 SIGNIFICANT ACCOMPLISHMENTS Red Cross volunteer, serving as a disaster Earned legalization is not automatic (continued from page 23) team leader and a disaster public affairs citizenship. A path to permanent residency Related to this service is Arkansas volunteer. must force undocumented workers to first Communities for the Kids – a two-year register with the government and pay a national pilot program to encourage and IMMIGRATION REFORM substantial fine, then go to the back of the empower parents and community leaders to (continued from page 15) line behind those immigrants who played by advocate for improved academic immigration into the United States, the rules to get here. performance and to support schools and Patterson said. By making it more difficult Some legislation in Washington proposes educators in realizing student improvement to come into the country, we are also a fee of as much as $2,000 per immigrant by providing access to current school data. making it more difficult for illegal workers visa, Patterson said. If just one million visas State Chamber/AIA and Just for the Kids to return home – so they stay here longer. were issued, that would generate $2 billion staff will be working with local chambers, Contrary to popular belief, most aliens in revenue to help pay for the system. New PTAs and legislators to encourage do not cross the border illegally, but enter taxpayers would also make significant communities to incorporate these two legally and remain after their visa expires, contributions to our Social Security needs. services into their communities. Patterson said. Thus, building a wall at the With an earned path to residency for State Chamber/AIA is committed to border, no matter how high, will not solve undocumented workers who are already Just for the Kids and Communities for the the problem. living here, employers can be assured that Kids because, as we all know, implications The Center for American Progress their workers have passed a criminal for the state’s economy are enormously estimates the cost of mass deportation to investigation. Employers prefer to promote positive whenever education is improved. be at least $206 billion over five years. This from within so they prefer a system where These programs come along at a time when takes into account the cost of workers have the choice to remain in the Arkansas is making great strides to provide apprehension, detention, legal processing U.S. an equitable and adequate education to all and transportation – amounting to a total A time limit on work in the U.S. will be children. cost of $41.2 billion per year. That amount difficult to enforce and discourages “The State Chamber/AIA played a key exceeds the cost of the entire Homeland undocumented workers from registering. By role in advocating for education reform Security budget — $34.2 billion — and creating a path to permanent residency, we during the past special session, and we more than doubles the annual cost of can separate the wheat from the chaff and strongly believe that this effort will further military operations in Afghanistan — $16.8 distinguish those who want to work from enhance what the state has started,” said billion. those who don’t. Ron Russell, State Chamber/AIA President While it may appeal to some, mass Because he believes that American and CEO. deportation of undocumented workers is employers are “addicted to cheap labor,” not a practical solution. It also threatens to Colorado Congressman Tom Tancredo undermine existing American industries. wants to toughen enforcement on STATE CHAMBER/AIA STAFF employers and inflict substantial fines when (continued from page 7) One executive recently stated that if all undocumented workers were suddenly they hire undocumented workers, Patterson In addition to his responsibilities at the removed from the country, the American said. Tancredo and his supporters in State Chamber/AIA, he is a former board economy would suffer a dramatic Congress believe that frequent raids in member and active member of the downturn. Industries such as agriculture, plants are an efficient way to keep our Arkansas Chapter of the International construction, landscaping, janitorial, nation safe, without consideration of the Association of Business Communicators. restaurant and tourism, depend on these labor impact on those businesses. He is also an active member of the undocumented workers. Finally, mass Many bills in Congress, including Arkansas Chapter of the Public Relations deportation would destabilize a Mexican Tancredo’s, require employers to conduct Society of America and the Arkansas economy that cannot absorb 11 million employment eligibility verification even Society of Association Executives. workers immediately to our south. though there is no federal system in place. Deb Mathis Legal employees are more likely to buy How America deals with the Deb Mathis, communications and events homes, create local savings accounts, undocumented worker issue largely depends coordinator, is responsible for registration consume goods and buy items such as on who prevails in Congress, Patterson said. of participants and assisting the director of insurance, cars, etc., Patterson said. There are the Tom Tancredos who advocate communications and events with all aspects Numerous studies have shown that increased border enforcement, repatriation of planning and implementation of State immigrants actually create more jobs than of undocumented immigrants and punitive Chamber/AIA events and communications. they fill. fines for employers who have She also serves as treasurer for the Arkansas Most jobs for immigrants will be open in undocumented workers in the U.S. On the Chapter of the International Association of agriculture, construction, warehousing, opposite side, there is a coalition of Business Communicators. transportation, sales, customer service, food moderate Republicans and Democrats who Linda Curtis preparation/processing, cashiers, janitors support an earned path to residency for Linda Curtis is the State Chamber/AIA and cleaners, nurse aides, orderlies and those undocumented workers who are financial coordinator with the responsibility attendants. Estimates are that more than 6 already living here, reinvigorated guest for billing, payroll, accounts receivable, million newly trained nurses and nurses worker programs and increased border accounts payable and monitoring the aides will be needed to care for the baby enforcement. budget. She also serves as human resource boomer population as it advances into We have to dispel the myths such as manager, keeping up with payroll records, elderly status. immigrants only come to the U.S. to get insurance, pension, vacations, sick leave, etc. President Bush recently urged Congress public benefits, Patterson said. Immigrants Kelly Bowen to adopt a temporary-worker program as he contribute more than what they get. Sixty- Kelly Bowen, administrative assistant, acknowledged the economic forces that six percent of undocumented workers pay covers the phones and the front office area drive immigration, Patterson said. American social security taxes and 62 percent pay and lends administrative support to the employers need more workers and our income taxes. They receive nothing in State Chamber/AIA staff. Bowen is also a demographics show that the situation is return. part-time student and an active American only going to get worse. Most immigrants would return to their country if the economy were improved. 24

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