Arkansas Business Daily Report

Arkansas Business Daily Reporthttp://www.arkansasbusiness.com/news.aspStories from Arkansasbusiness.com's popular daily e-newsletter and Today's Top Stories section. Includes the latest breaking business news.Copyright 2012 Arkansas Business Limited Partnership. All rights reserved.St. Vincent, Heart Clinic Arkansas Pushed Out of Saline Memorial http://www.arkansasbusiness.com/article.aspx?aid=130112.54928.142241http://www.arkansasbusiness.com/article.aspx?aid=130112.54928.142241St. Vincent Health System of Little Rock and Heart Clinic Arkansas started the cardiac program for Saline Memorial Hospital in 2008 and unwillingly left the hospital in December. By now you’ve heard that Saline Memorial Hospital in Benton has continued the recent trend of hospitals joining forces with cardiology groups by partnering with Arkansas Heart Hospital of Little Rock. What you might not know is that St. Vincent Health System of Little Rock and Heart Clinic Arkansas started the cardiac program for Saline Memorial in 2008 and unwillingly left the hospital in December. St. Vincent had trained Saline Memorial’s staff and managed the cardiac program while Heart Clinic doctors handled the patients. But then, in December, the hospital’s board pulled the plug on the arrangement with St. Vincent and the Heart Clinic. In January, Saline Memorial announced its partnership with the Heart Hospital, but didn’t mention St. Vincent or the Heart Clinic in its announcement. “Contracting with Arkansas Heart Hospital was just a part of the normal business process of contract review and we are confident that the agreement is in the community’s best interest,” Carla Robertson, Saline Memorial Hospital’s interim CEO, said in a statement to Whispers last week. After being booted from Saline Memorial, St. Vincent announced in January that it had bought Heart Clinic Arkansas. The clinic’s new name is St. Vincent Heart Clinic Arkansas.     Mon, 6 Feb 2012 00:00:00 CSTGene Cauley Hit With $2.4 Million Tax Lien http://www.arkansasbusiness.com/article.aspx?aid=130113.54928.142242http://www.arkansasbusiness.com/article.aspx?aid=130113.54928.142242We can now add tax troubles to the list of problems that have befallen former Little Rock attorney Gene Cauley.We can now add tax troubles to the list of problems that have befallen former Little Rock attorney Gene Cauley. The IRS recently slapped a lien on Cauley for not paying his small business taxes in 2007. The amount? $2,366,725.89. We are projecting that the tax bill won’t be paid soon — if at all. The 43-year-old was sentenced in November 2009 to 86 months in the federal pen for swiping $9.3 million from his client trust account. He was ordered to repay the money, but he hasn’t made a dent in restitution. At last count, he still owed $8.7 million. The once-celebrated attorney specializing in class-action securities cases is scheduled to be released from prison in April 2016. He is serving his time at the federal lockup in Pollock, La.   Mon, 6 Feb 2012 00:00:00 CSTBank Forecloses on Bruce Burrow Property http://www.arkansasbusiness.com/article.aspx?aid=130114.54928.142243http://www.arkansasbusiness.com/article.aspx?aid=130114.54928.142243On Thursday, a Missouri bank recovered nearly 30 acres of undeveloped land in Jonesboro from developer Bruce Burrow, who defaulted on a $2.7 million loan.On Thursday, a Missouri bank recovered nearly 30 acres of undeveloped land in Jonesboro from developer Bruce Burrow, who defaulted on a $2.7 million loan. Burrow, through his company WHB LLC, which is also known as Burrow Halsey Holdings LLC, borrowed the money from Focus Bank of Charleston, Mo., in June 2008, according to a lawsuit filed in Craighead County Circuit Court. The loan was secured by a personal guarantee of Burrow and the land. The lawsuit didn’t say when Burrow defaulted on the loan. But as of Jan. 3, 2011, he owed $2.79 million in principal and interest. The commercial land on the western side of Jonesboro had been listed for sale for $4.5 million through NAI Halsey of Jonesboro. That price works out to be $3.50 per SF. “Great opportunity for retail/restaurant/novelty or retail center,” NAI Halsey said on its website about the property. The property is next to a Wal-Mart Supercenter, Pizza Hut and Dollar Tree. Burrow declined to comment last week becuase the issued was in the process of being worked out.   Mon, 6 Feb 2012 00:00:00 CSTFormer Little Rock Business Owner Sent to Prison for Medicare Fraudhttp://www.arkansasbusiness.com/article.aspx?aid=130110.54928.142239http://www.arkansasbusiness.com/article.aspx?aid=130110.54928.142239Archibong Edem-Effiong, 58, now of Houston, who owned Joshua Medical Link Corp. in Little Rock, had pleaded guilty in October.A former Little Rock medical equipment business owner was sentenced on Friday to 27 months in federal prison and ordered to pay nearly $1 million in restitution for Medicare fraud. Archibong Edem-Effiong, 58, now of Houston, who owned Joshua Medical Link Corp. in Little Rock, had pleaded guilty in October in U.S. District Court in Little Rock. At the plea hearing, Edem-Effiong admitted that, between December 2007 and March 2009, he stole the identity of a Nigerian woman he knew from church and used the information to apply for a Medicare Durable Medical Equipment supplier number, according to a news release from the U.S. Attorney's Office in Little Rock. After receiving the DME number, he billed Medicare for arthritis kits and power wheelchairs that were either not ordered by physicians or never delivered to patients. The total amount billed to Medicare was $1.94 million and the total amount paid to the defendant through the DME company was $983,273, the news release said. Edem-Effiong was ordered to repay the amount he received. He is to report to federal prison on March 29.Fri, 3 Feb 2012 17:08:49 CSTJobs Report Lifts Dow to Highest Mark Since 2008 http://www.arkansasbusiness.com/article.aspx?aid=130105.54928.142234http://www.arkansasbusiness.com/article.aspx?aid=130105.54928.142234A drop in the unemployment rate to its lowest in three years propelled the Dow Jones industrial average Friday to its highest close since before the 2008 financial crisis. The Nasdaq composite index hit an 11-year high. NEW YORK - A drop in the unemployment rate to its lowest in three years propelled the Dow Jones industrial average Friday to its highest close since before the 2008 financial crisis. The Nasdaq composite index hit an 11-year high.The Dow jumped 156.82 points to 12,862.23, its highest mark since May 19, 2008, about four months before Lehman Brothers investment bank collapsed.Before the market opened, the Labor Department said the economy added 243,000 jobs in January. It was the strongest job growth in nine months. The increase in hiring pushed the unemployment rate down to 8.3 percent, the lowest since February 2009.The surprising data gave financial markets a morning jolt that lasted throughout the trading day. The Nasdaq index closed 45.98 points higher at 2,905.66, its highest since December 2000, during the steep decline that followed the dot-com stock bubble.The price of ultra-safe Treasury notes dropped, sending yields higher, and the price of oil rose for the first time in a week."In this economy, only one variable matters right now, and that variable is employment," said Lawrence Creatura, an equity portfolio manager at Federated Investors. "This report was great news. It was beyond all expectations, literally. The number was higher than even the highest forecast."The Standard & Poor's 500 index added 19.36 points, or 1.3 percent, to 1,344.90, its highest close since last July. The S&P 500 surged 2.2 percent for the week, its fifth straight week of gains. That's the longest weekly winning stretch since January of 2011.More evidence that the economy is gaining strength followed the jobs report. A trade group said the service industry expanded at the fastest pace since last February. The government also said factory orders rose 1.1 percent in December, supported by a rebound in orders for heavy machinery.Bank of America led the 30 stocks in the Dow, rising 5.2 percent. Only two stocks were lower: Merck and Procter & Gamble.Treasury prices fell, lifting the yield on the 10-year note Treasury to 1.93 percent. When bond prices fall, yields rise. The benchmark 10-year rate had traded below 1.79 percent earlier this week as traders bought U.S. Treasurys on renewed concern over Europe's ongoing debt crisis.The U.S. jobs figures helped markets in Europe rally on Friday despite further evidence that the 17-country eurozone is heading for recession. Germany's DAX closed 1.7 percent higher, and France's CAC-40 gained 1.5 percent.Among companies whose stocks made large moves:- Genworth Financial soared 14 percent, the best gain in the S&P 500. The insurance company reported late Thursday that it swung to a profit in the most recent quarter, helped by gains in sales of life insurance.- Weyerhaeuser gained 5.7 percent after reporting better quarterly earnings than analysts' forecasts. The timber and real estate company's earnings still sank 62 percent.- Video game maker Take-Two Interactive Software Inc. rose 3 percent. The company reported a 65 percent drop in quarterly profits after the market closed Thursday, but Wall Street's analysts expected much worse.(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, rewritten, broadcast or distributed.) Fri, 3 Feb 2012 15:54:07 CSTKFSM: Air Force to Cut 20 A-10 Aircraft from Fort Smithhttp://www.arkansasbusiness.com/article.aspx?aid=130104.54928.142233http://www.arkansasbusiness.com/article.aspx?aid=130104.54928.142233U.S. Air Force officials announce plans to retire 20 A-10 Thunderbolt II fighter planes from the 188th Fighter Wing at Fort Chaffee in Fort Smith. U.S. Air Force officials announced Friday plans to retire 20 A-10 Thunderbolt II fighter planes from the 188th Fighter Wing at Fort Chaffee in Fort Smith, according to Arkansas Business news partner <a href="http://www.5newsonline.com/news/kfsm-flying-razorbacks-on-the-chopping-block-20120203,0,1275176.story" target="_blank">KFSM-TV, Channel 5, in Fort Smith</a>.Officials at the 188th plan to hold a news conference at 4 p.m. to discuss their new mission. KFSM is carrying the announcement live <a href="http://www.5newsonline.com/news/5live/" target="_blank">here</a>.The Arkansas National Guard said the 188th will transition from the A-10 Thunderbolt II to a remotely piloted aircraft mission in fiscal year 2013, <a href="http://www.5newsonline.com/news/kfsm-flying-razorbacks-on-the-chopping-block-20120203,0,1275176.story" target="_blank">KFSM reported</a>.KFSM said the 189th Airlift Wing in Little Rock is also included in the proposal, with the retirement of one of its nine C-130H aircraft in fiscal year 2017.KFSM has more <a href="http://www.5newsonline.com/news/kfsm-flying-razorbacks-on-the-chopping-block-20120203,0,1275176.story" target="_blank">here</a>.In a statement, U.S. Sen. Mark Pryor, D-Ark., said that even though the 188th survived Base Realignment and Closure in 2005, he is concerned about plans for the future. "I, along with the Fort Smith community and the Arkansas Congressional delegation, will fight tooth and nail to ensure the Air Force maintains a viable mission to our national defense in Fort Smith," Pryor said in a news release. "I also have concerns about cutting the C-130 AMP program. The Air Force needs to explain why this decision makes economic and strategic sense."The Air Force outlines the cuts in a document <a href="http://www.af.mil/news/story.asp?id=123288620" target="_blank">here</a>. The cuts are part of $487 billion in defense cuts over the coming decade <a href="http://www.arkansasbusiness.com/article.aspx?aID=129778&view=all">the Pentagon outlined last week</a>. The cuts would come from shrinking U.S. ground forces, slowing the purchase of a next-generation stealth fighter and retiring older planes and ships.In a bid to pre-empt election-year Republican criticism, Defense Secretary Leon Panetta said the plan shifts the Pentagon's focus from the wars in Iraq and Afghanistan to future challenges in Asia, the Mideast and in cyberspace. More special operations forces like the Navy SEALs who killed Osama bin Laden will be available around the world, he said.Arkansas miliary personnel at Fort Chaffee in Fort Smith have long believed their operations might be cut as part of Panetta's plan. Last week, members of the 188th Fighter Wing Steering Committee, an arm of the 188th Fighter Wing/Fort Chaffee Community Council, <a href="http://www.arkansasbusiness.com/article.aspx?aID=129778&view=all">watched Pannetta unveil the broad strokes</a> of cost cutting plan online. "We believe we are at risk to lose the A-10s in Fort Smith," community council chairman Retired Col. Kevin Wear said in a news release, referring to the A-10 Thunderbolt II fighter planes stationed there."While it is understood that cuts must be made in many areas to reduce our nation's deficit spending trend, those cuts need to be made for the right reasons. The facts support that if there is only one A-10 base in the world, it should be in Fort Smith, Arkansas if the decision makers are doing the right things for the right reasons. "If the decision is based on cost-effectiveness and combat efficiencies, on saving money, on 'bang-for-buck,' on the most firepower available when needed, A-10s need to be on the ramp in Fort Smith, Arkansas," he said.   Fri, 3 Feb 2012 15:42:37 CSTUPDATE: Southwest Power Pool to Spend $1.7 Billion to Grow Networkhttp://www.arkansasbusiness.com/article.aspx?aid=130091.54928.142220http://www.arkansasbusiness.com/article.aspx?aid=130091.54928.142220The board of directors of Southwest Power Pool Inc. of Little Rock approved a transmission expansion plan, with projects estimated at about $1.7 billion in engineering and construction costs. The board of directors of Southwest Power Pool Inc. of Little Rock on Friday approved a multi-year transmission expansion plan, with projects estimated at about $1.7 billion in engineering and construction costs.The bulk of the plan, to take place over 10 years, calls for more than 900 miles of new transmission lines and 15 transformers. It is expected to generate $834 million in net regional savings over 40 years.The projects, which cost a total of about $1.5 billion, are designed to resolve reliability issues, enable states to meet renewable goals or targets and cut CO2 emissions, and provide regional energy savings.A map detailing the 10-year expansion shows Arkansas getting most of plan's allotment of 500kv lines in northwest and southwest Arkansas, along with 345kv lines in northwest Arkansas. Some rebuild and conversion work is also taking place in the region near Farmington.The plan puts 15 transformers in Texas, New Mexico, Oklahoma, Kansas and Nebraska. Click <a href="http://www.arkansasbusiness.com/news/print_editions/SPP-2012-expansion-map.pdf" target="_blank">here</a> (PDF) to view the map. "A well-planned, robust transmission grid gives us the flexibility to move energy from diverse generating resources to where it's needed across the region and beyond," said Lanny Nickell, SPP's vice president of engineering. "Adding more lanes to the transmission highway will improve our ability to provide the least-cost power to consumers and strengthen grid reliability so power is always there when we need it."Another part of the plan includes construction of $251 million in new transmission projects over the next five years.SPP, a nonprofit regional transmission organization, provides services to 65 members in the electricity utility industry in nine states. Earlier this month, SPP said it would add 50 new positions this year at its three sites in Little Rock and Maumelle. Meanwhile, construction is scheduled to be complete this spring on its new $62 million corporate office center in west Little Rock, bringing all SPP's employees to one location. Fri, 3 Feb 2012 15:28:36 CSTVideo: On CNBC, Beebe Says Arkansas Ready for Another Caterpillar Planthttp://www.arkansasbusiness.com/article.aspx?aid=130103.54928.142232http://www.arkansasbusiness.com/article.aspx?aid=130103.54928.142232Heavy-equipment maker Caterpillar Inc. of Peoria, Ill., is moving a manufacturing plant to North America from Japan, and Arkansas wants to be its new home.Heavy-equipment maker Caterpillar Inc. of Peoria, Ill., is moving a manufacturing plant to North America from Japan, and Arkansas wants to be its new home.CNBC reported Friday that Arkansas is one of two dozen states that want to be considered for the plant, which would make the <a href="http://www.cat.com/equipment/hydraulic-excavators/mini-hydraulic-exavators" target="_blank">mini hydraulic excavators</a> that are in increasing demand in North America.Caterpillar <a href="http://www.thestreet.com/story/11308260/1/caterpillar-to-open-mini-hydraulic-excavator-and-small-track-type-tractor-manufacturing-facility-creating-more-than-1000-new-jobs-in-north-america.html" target="_blank">announced in November</a> its intention to shift production from Sagami, Japan, as demand for the equipment wanes in Asia. Excavators made in the United States would be sold to customers in North and South America and Europe, the company said.The plant would employ more than 1,000 people, Caterpillar said. The company expects to make a decision by April 1.Caterpillar already has a two-year-old motor grader manufacturing plant in North Little Rock. The $140 million plant employs 550 people.Appearing live from the North Little Rock plant on CNBC Friday, Gov. Mike Beebe said Arkansas would be an ideal spot for the new plant, citing the site's central location and river access, as well as Arkansas' tax structure and incentives.Beebe also cited Arkansas' workforce."Arkansas has been committed to tying education and workforce training to the specific needs of business and industry, and particularly manufacturing," Beebe said. "Nobody in the country is going to do a better job of trying to provide the quality workforce than Arkansas."CNBC's report said the University of Arkansas' engineering school has geared its training toward the skills Caterpillar requires and has already provided the North Little Rock plant with six employees.Speaking at an Arkansas Economic Development Foundation luncheon in Little Rock in October, <a href="http://www.arkansasbusiness.com/article.aspx?aID=128710&view=all">Caterpillar CEO Doug Oberhelman praised Arkansas' economic development efforts</a>, calling them "at or near the top" of those he's seen in other states."I think Arkansas gets it," he said. "I'm not sure many other states do." Oberhelman also hinted at expansion possibilities in North Little Rock, but provided no details at the time.Luring Caterpillar to Arkansas was part of an effort <a href="http://www.arkansasbusiness.com/article.aspx?aID=111146&view=all">years in the making</a>. The state and city of North Little Rock also committed to a list of incentives. To supplement the $3 million Beebe offered up out of the Governor's Quick Action Closing Fund, North Little Rock:  <ul><li>Spent about $8 million to build a new power substation</li><li>Spent $800,000 for a wastewater treatment facility at the site</li><li>Committed more than $2 million in electricity subsidies over five years</li><li>Provided carbon offset <a href="http://www.arkansasbusiness.com/article.aspx?aID=111147">"green tags"</a></li><li><a href="http://www.arkansasbusiness.com/article.aspx?aID=111147"></a>Waived all building fees. </li></ul> The company also received standard state incentives based on job creation and pay.Click below to watch CNBC's segments live from North Little Rock's Caterpillar plant, which include an interview with Beebe. <object classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=9,0,0,0" width="400" height="380"> <param name="type" value="application/x-shockwave-flash"></param> <param name="allowfullscreen" value="true"></param> <param name="allowscriptaccess" value="always"></param> <param name="quality" value="best"></param> <param name="scale" value="noscale"></param> <param name="wmode" value="transparent"></param> <param name="bgcolor" value="#000000"></param> <param name="salign" value="lt"></param> <param name="flashVars" value="startTime=000"></param> <param name="flashVars" value="endTime=000"></param> <param name="movie" value="http://plus.cnbc.com/rssvideosearch/action/player/id/3000070111/code/cnbcplayershare"></param> <embed pluginspage="http://www.macromedia.com/go/getflashplayer" name="cnbcplayer" bgcolor="#000000" src="http://plus.cnbc.com/rssvideosearch/action/player/id/3000070111/code/cnbcplayershare" type="application/x-shockwave-flash" height="380" width="400"></embed></object><object classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=9,0,0,0" width="400" height="380"> <param name="type" value="application/x-shockwave-flash"></param> <param name="allowfullscreen" value="true"></param> <param name="allowscriptaccess" value="always"></param> <param name="quality" value="best"></param> <param name="scale" value="noscale"></param> <param name="wmode" value="transparent"></param> <param name="bgcolor" value="#000000"></param> <param name="salign" value="lt"></param> <param name="flashVars" value="startTime=000"></param> <param name="flashVars" value="endTime=000"></param> <param name="movie" value="http://plus.cnbc.com/rssvideosearch/action/player/id/3000071344/code/cnbcplayershare"></param> <embed pluginspage="http://www.macromedia.com/go/getflashplayer" name="cnbcplayer" bgcolor="#000000" src="http://plus.cnbc.com/rssvideosearch/action/player/id/3000071344/code/cnbcplayershare" type="application/x-shockwave-flash" height="380" width="400"></embed></object>Fri, 3 Feb 2012 14:13:37 CSTLog Cabin Democrat to Make Move to Downtown Conwayhttp://www.arkansasbusiness.com/article.aspx?aid=130100.54928.142229http://www.arkansasbusiness.com/article.aspx?aid=130100.54928.142229Rick Fahr, publisher of the Log Cabin Democrat, says the newspaper's move to a new office in downtown Conway is part of a plan to reinvest in the paper's content. Rick Fahr, publisher of the Log Cabin Democrat, said the newspaper's move to a new office in downtown Conway is part of a plan to reinvest in the paper's content.On Thursday, Fahr announced plans for the daily newspaper to move from its current 20,000-SF building at 1058 Front St. to a smaller, newly renovated office at 1111 Main St.The newspaper plans to complete the move to Federal Plaza, formerly called the Federal Building, in April.Morris Publishing Group of Augusta, Ga., owner of the 132-year-old Log Cabin Democrat, in December <a href="article.aspx?aID=129791">sold its current building, which has housed the newspaper's offices and printing press since 1980</a>, for $665,000 to Covington Properties of Conway. Covington had offered to continue leasing space in the facility to the newspaper. But Morris chose to lease smaller offices in Federal Plaza from Nabholz Construction and outsource printing to Paxton Media Group's The Courier in Russellville.Morris is still in negotiations with Paxton over terms of the deal. But the agreement would include The Courier staff printing the Log Cabin Democrat and its related publications. Once the Log Cabin stops its 10-person printing operation, up to six related jobs will be eliminated from the company, Fahr said. The Courier might hire some staffers whose positions are eliminated, he said. But Fahr said the move should allow hiring in other parts of the newspaper.  "This is part of an overall reinvestment plan so that as the months go by we can hire more people on the content side," Fahr said.According to the Arkansas Press Association, the Log Cabin has an average daily circulation of 7,052 and an average Sunday circulation of 13,429.Morris Publishing Group owns 13 daily newspapers in Arkansas, Texas, Georgia, South Carolina, Minnesota, Florida, Alaska and Kansas. Fri, 3 Feb 2012 12:43:48 CSTBill Stobaugh Promoted to Executive Vice President at Murphy Oilhttp://www.arkansasbusiness.com/article.aspx?aid=130099.54928.142228http://www.arkansasbusiness.com/article.aspx?aid=130099.54928.142228Bill Stobaugh has been promoted to executive vice president, corporate planning and business development at El Dorado's Murphy Oil Corp. Bill Stobaugh has been promoted to executive vice president, corporate planning and business development at El Dorado's Murphy Oil Corp. of El Dorado, the company said Thursday.Stobaugh has been senior vice president, corporate planning since 2005. He joined Murphy in 1995 as vice president, corporate planning.Stobaugh received a bachelor's degree in chemical engineering from the Georgia Institute of Technology of Atlanta and also holds an MBA from Harvard Business School.Murphy Oil also announced Tom Mireles was promoted to vice president, corporate planning and business development. Mireles has worked at Murphy since 2005 and previously served as general manager, planning and analysis.Fri, 3 Feb 2012 12:41:49 CST