Phase I SWOT Analysis

Transcription

1 Fayetteville, Arkansas Economic Development Strategy Phase I SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) December 2008

2 Fayetteville, Arkansas Economic Development Strategy Phase I The Framework SWOT Analysis Fayetteville and Northwest Arkansas (Strengths, Weaknesses, Opportunities, and Threats) TABLE OF CONTENTS Introduction Objectives and Scope of Work... 1 Consultant Team... 1 This Document... 1 Defining Economic Development in the 21 st Century... 2 Defining Functions of Economic Development... 2 Defining Roles for Economic Development... 2 Part 1 Demographic and Economic Profile City and Regional Demographics... 3 Population and Households... 3 Mobility and Growth Patterns... 4 Household Incomes and Labor Force Indicators... 6 Industry and Employment Trends... 7 Resident Employment... 7 Metropolitan Area Employment Trends... 8 Businesses by Size... 9 Job Growth by Business Size Comparison with Other Benchmark Regions An Informally Selected Benchmark Group Benchmark Comparisons Part 2 Competitiveness Assessment Education and Knowledge Workforce National and International Context The Arkansas Context Educational Attainment in Fayetteville and its Metro Area Area School Students by Age, Ethnicity, and Reduced or Free Lunch Eligibility Necessary Skills, Growing Occupations NorthWest Arkansas Community College (NWACC) Northwest Technical Institute Local Workforce Investment Board (LWIB) Quality of Place and Other Competitive Factors Connectivity Infrastructure Business Climate Entrepreneurial Support Quality of Life Quality of Place Image and Marketing Part 3 Strategies of Entities Engaged in Economic Development

3 State Government The Milken Analysis of the Arkansas Economy Building a Knowledge-based Economy in Arkansas: Strategic Recommendations by Accelerate Arkansas, September Building a 21st Century Economy in Arkansas, Findings and Recommendations of the Task Force for the 21st Century Economy, October 31, Innovate Arkansas, Innovation.arkansasbusiness.com Governor s New Strategic Plan / Arkansas Economic Development Commission, Regional Entities in Asset-Building Northwest Arkansas Council, Economic Development Strategy, June 7, Green Valley Network, 32 Higher Education University of Arkansas at Fayetteville NorthWest Arkansas Community College Local Fayetteville Metro Area Fayetteville Economic Development Council, Strategic Plan and Priorities Part 4 Stakeholder Interviews and SWOT Conclusions Stakeholder Interviews City of Fayetteville Northwest Arkansas Region Higher Education SWOT Conclusions Strengths Weaknesses Opportunities Threats Summary Appendix A Appendix Tables...42 Appendix B Summaries of Additional Plan Documents...49 State Government Regional Entities in Asset-Building Local Fayetteville Metro Area Appendix C Interview Protocol...70 Appendix D Interviewees and Planning Participants...72 City of Fayetteville Other Communities / Local Governments Regional Business / Economic Development Organizations Regional Businesses Arts and Cultural Education and Higher Education Media Planning Workshop Round Table Participants (October 17) Round Table: Niches of Competence Round Table: Infrastructure for Innovation Round Table: Human Capital Round Table: Regional Promotion Round Table: Smart Community Places... 76

4 Round Table: City Development and Finance Appendix E: Stakeholder Views of Present and Future...77 Strengths and Opportunities Weaknesses and Threats Current Fayetteville Economic Development Strategies Regional Economic Development Collaboration Role of the State Role of the University Special Topics Appendix F Documents and Data...122

5 Fayetteville, Arkansas Economic Development Strategy Phase I The Framework SWOT Analysis Fayetteville and Northwest Arkansas (Strengths, Weaknesses, Opportunities, and Threats) INTRODUCTION Located in Northwest Arkansas, Fayetteville is a progressive community of approximately 70,000 residents. The City long has been the economic, political and cultural center of a diverse and now rapidly-growing region. The City of Fayetteville (City), in partnership with the University of Arkansas at Fayetteville (University), undertook a process to define an Economic Development Strategy for the metro area including attention to regional dynamics where/as appropriate. The project was co-funded by the City and the University. The City and University worked hard to engage as many stakeholders in the community and throughout the region as possible including leaders from all sectors of the regional economy. Objectives and Scope of Work This planning initiative was designed to be carried out in two phases: Phase I Economic Development Strategy The Framework Phase I was to be a visioning process, to create the outlines of an Economic Development Strategy. It included data collection and analyses of strengths, weaknesses, opportunities and threats (SWOT); stakeholder interviews; and workshop sessions with stakeholders to define the Economic Development Strategy Framework. Phase II Economic Development Strategy The Roadmap Phase II is intended to be the development of an Action Plan for implementation including refinement of the strategies; selection of priority strategies and related tactics; determination of roles of various organizations, and estimation of investment requirements. Consultant Team As a result of a national competitive process led by a joint City-University committee, Eva Klein & Associates, Ltd. (EKA) was selected to facilitate Phase I of this planning effort. EKA is not under contract for Phase II. The EKA team was composed of four consultants with varied and extensive backgrounds in economic development. This Document This document is one of two Phase I deliverables preliminary Analysis of Strengths, Weaknesses, Opportunities, and Threats (SWOT). The other is the Economic Development Strategy Framework. This SWOT Analysis was designed as preparation material for the Plan Framework, to: Establish a baseline of current data about Fayetteville and the region Organize in one place a snapshot of existing plans and strategies of major local, regional, and state stakeholders Provide other context information that would inform creation of a new economic development vision Incorporate (after the consultant team visit in October) the views of stakeholders from interviews. Because this was an interim, work paper document, the consultants did not undertake to verify all local data and information. The consultant team apologizes for unintended errors that may survive in this text. Page 1 of 127 Introduction

6 Defining Economic Development in the 21 st Century Defining Functions of Economic Development For purposes of this project, economic development is not defined narrowly as business recruitment and retention. It is defined, in 21 st century context, as strategies to make a place, in this case Fayetteville (and the region), competitive in the Global Knowledge Economy with the outcomes being not only jobs but creation of opportunities, wealth, and prosperity. Economic development focuses on three main functions: Asset-Building. Building competitive assets (knowledge competencies, people, places, institutions, quality of place, etc.) Promotion. Promoting those assets (on a significant, globally competitive scale) for enhancing economic activity Transactions/Deals. As asset-building and promotion efforts succeed in bringing prospects to light or creating new companies locally, the third element of economic development is the transactionoriented process of securing company location decisions or growth in place of local entrepreneurial companies ( deals ). Defining Roles for Economic Development If the above definition of functions is correct, economic development no longer is the province of economic developers only. Economic development involves everyone in a community or region, more or less as follows: Asset-Building: City, county, and state governments, education and training institutions and systems, regional entities that develop infrastructure; health care institutions; arts/cultural organizations, etc. Promotion: Best and most cost-effective if a single regional entity has overall coordination and direction responsibilities for regional promotion working closely with municipalities and counties and special-focus entities (e.g., university, museums, tourism bureau, etc.) Deals. In the ideal, managed by a regionbased economic development entity LEADERSHIP & STRATEGY working closely with local governments and chambers. If this is not achievable, Common Vision then some other manner of coordination Good Governance or collaboration about prospect Regional Alliance cultivation is desirable. Leadership and Strategy. To put together the many activities involved in the three main sets of functions requires a focused strategy. Achievement of a common vision, purpose, and strategy that helps unify the efforts of many organizations requires a regional leadership function. This can be supplied by a single organization, occasionally by one highly influential individual, or, in most cases, by a process to create unified commitment to vision that involves multiple organizations. Asset-Building (Global Scale) Deals Metrics for Ongoing Evaluation Evaluation. A regional entity needs to organize the metrics and baseline data, and then report periodically. In some communities, this is called a report card or scorecard. Promotion (Global Scale) Page 2 of 127 Introduction

7 PART 1 DEMOGRAPHIC AND ECONOMIC PROFILE City and Regional Demographics Following is a profile of the demographic characteristics of Fayetteville and the Fayetteville-Springdale- Rogers metropolitan area 1, providing comparisons to Arkansas and the United States (US) as a whole. Population and Households Fayetteville and the region have sustained a long period of rapid population growth, averaging 3 to 4 percent growth annually since 1990 more than two to three times faster than the State and the Nation. As Table 1 shows, although Fayetteville grew somewhat more slowly than the region as a whole, it has added 27,000+ residents since 1990, an increase of almost two-thirds, in part due to University enrollment growth. The city residents average age of 27.8 reflects the high number of college students living in the City, as compared with an average age of 33.2 in the metro area and 37.0 in Arkansas. Fayetteville s households are significantly smaller than those in the larger region, with an average of 2.1 persons per household, and more than one-third of the residents living alone. This compares with an average household size of 2.64 persons in the metro area, where less than one-quarter of residents live alone. Table 1. Population, Age Distribution, Households by Type and Mobility, 2007 Fayetteville Metro Area Arkansas US Number Percent Number Percent Number Percent Number Percent Population Trends , ,464 2,350, ,709, , ,045 2,673, ,421, , ,484 2,834, ,621, Change 27, % 210, % 484, % 52,911, % Change 15, % 102, % 322, % 32,712, % Change 11, % 108, % 161, % 20,199, % Population by Age 69, % 433, % 2,834, % 301,621, % Under 20 Years 19, % 129, % 785, % 82,783, % 20 to 24 Years 10, % 33, % 187, % 20,945, % 25 to 34 Years 12, % 64, % 366, % 39,987, % 35 to 44 Years 8, % 58, % 381, % 43,410, % 45 to 54 Years 7, % 58, % 395, % 43,925, % 55 to 64 Years 5, % 41, % 320, % 32,729, % 65 to 74 Years 2, % 24, % 209, % 19,397, % 75 to 84 Years 1, % 16, % 135, % 13,309, % 85 Years and Over 1, % 6, % 52, % 5,133, % Median Age Households 29, ,013 1,102, ,377,977 With Own Children Under 18 8, % 56, % 377, % 38,639, % With One or More Seniors 65+ 3, % 32, % 276, % 26,256, % Single-Person Households 10, % 38, % 297, % 30,645, % Average Household Size Residence One Year Ago 67, % 427, % 2,794, % 297,545, % Same House 46, % 339, % 2,270, % 250,025, % Different House in the US 21, % 85, % 514, % 45,705, % Same County 12, % 50, % 315, % 28,005, % Different County in Same State 4, % 14, % 110, % 10,193, % Different State 3, % 20, % 89, % 7,506, % Abroad % 2, % 9, % 1,813, % Note: Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: American Community Survey, 2007; Partners for Economic Solutions, The metropolitan area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Page 3 of 124 Part 1 Demographic and Economic Profile

8 Mobility and Growth Patterns The City s and the region s high growth rates are reflected in mobility patterns. The 31 percent of city households that moved to a different house in 2006 was double the national rate and half again higher than the metro area rate, again reflecting the large number of college students living in the City (14,285 in 2007). Looking at regional growth by City and County (Table 2 and Figure 2) shows that growth is occurring more rapidly in Springdale and Benton County than in Fayetteville. Although the City s population grew, its share of metropolitan area population declined from 17.6 percent in 1990 to 15.9 percent in At the same time, Bentonville and Rogers increased their share by 5.3 percentage points. Page 4 of 124 Part 1 Demographic and Economic Profile

9 Table 2. Population Trends by Jurisdiction, Average Annual Total Population Change Share of Metro Area July, July, 2007 Metropolitan Area 239, , , % 3.2% 100.0% 100.0% 100.0% Washington County 113, , , % 2.9% 47.4% 45.4% 44.6% Fayetteville 42,099 58,047 69, % 2.4% 17.6% 16.7% 15.9% Springdale 29,941 45,798 66, % 5.4% 12.5% 13.2% 15.3% Benton County 97, , , % 3.9% 40.7% 44.2% 46.6% Rogers 24,692 38,829 54, % 4.9% 10.3% 11.2% 12.6% Bentonville 11,257 19,730 33, % 7.7% 4.7% 5.7% 7.7% Madison County 11,618 14,243 15, % 1.1% 4.9% 4.1% 3.5% McDonald County, MO 16,938 21,681 22, % 0.8% 7.1% 6.2% 5.3% Note: 2007 Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: American Community Survey, 2007; Partners for Economic Solutions, Shown in Table 3, commuting is relatively extensive. However, more than four of five persons employed in Washington County also live in the County, and 86 percent of those workers living in Washington County have found jobs within the County. Benton County draws its workforce from a somewhat larger area with 76 percent of its workers living in the County, 11.0 percent living in Washington County, 5.6 percent living in Oklahoma and 4.7 percent living in Missouri. Table 3. Washington and Benton County Commuting Patterns, 2000 Washington County Benton County Number Percent Number Percent Persons Working in the County and Living in: 81, % 76, % Washington County 65, % 8, % Benton County 10, % 58, % Crawford County % % Madison County 2, % % Sebastian County % % Other Arkansas Counties % % McDonald County, MO % 2, % Other Missouri Counties % 1, % Oklahoma % 4, % Other States % 1, % Persons Living in the County and Working in: 76, % 70, % Washington County 65, % 10, % Benton County 8, % 58, % Crawford County % % Madison County % % Sebastian County % % Other Arkansas Counties % % McDonald County, MO % % Other Missouri Counties % % Oklahoma % % Other States % % Source: US Census of Population, 2000; Partners for Economic Solutions, Page 5 of 124 Part 1 Demographic and Economic Profile

10 Household Incomes and Labor Force Indicators Incomes in the City, region and State still significantly lag those of the Nation. In 2007, Fayetteville households had a median income of $35,725, which is 70 percent of the national average and 80 percent of the metro area average. (See Table 4.) Table 4. Household Incomes and Employment Status, 2007 Fayetteville Metro Area Arkansas US Number Percent Number Percent Percent Percent Household Income, Total Households 29, % 160, % 100.0% 100.0% Less than $10,000 4, % 12, % 10.6% 7.3% $10,000 to $14,999 2, % 9, % 8.3% 5.6% $15,000 to $24,999 3, % 18, % 14.3% 11.0% $25,000 to $34,999 4, % 19, % 13.0% 10.7% $35,000 to $49,999 4, % 27, % 16.1% 14.5% $50,000 to $74,999 3, % 31, % 17.5% 18.9% $75,000 to $99,999 2, % 17, % 9.2% 12.2% $100,000 to $149,999 2, % 14, % 7.3% 11.7% $150,000 to $199,999 1, % 4, % 1.8% 4.0% $200,000 or More % 4, % 1.9% 4.0% Median Household Income $35,725 $44,552 $38,134 $50,740 Mean Household Income $55,227 $60,508 $51,748 $69,193 Percent Under the Poverty Line Families 15.1% 10.2% 13.7% 9.5% Persons 24.0% 14.1% 17.9% 13.0% Employment Status, Population Aged , ,185 In Labor Force 36, % 212, % 60.6% 64.8% Civilian Labor Force 36, % 212, % 60.3% 64.4% Employed 35, % 200, % 92.8% 93.7% Unemployed 1, % 12, % 7.2% 6.3% Armed Forces - 0.0% % 0.2% 0.4% Not in Labor Force 19, % 116, % 39.4% 35.2% Note: 2007 Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: American Community Survey, 2007; Partners for Economic Solutions, The metro area median income was 88 percent of the US median. In terms of distribution, only 35.5 percent of city households made $50,000 or more in 2007 as compared with 45.2 percent of metro area households and 50.8 percent of US households. More than one-third of Fayetteville households, including a number of student households, had incomes of less than $25,000. This income disparity exists in spite of the fact that unemployment is significantly lower in the city than in the US. Page 6 of 124 Part 1 Demographic and Economic Profile

11 Among Fayetteville residents aged 16 or over in the civilian labor force, only 2.9 percent were unemployed in 2007, as compared with the national rate of 6.3 percent (Table 4 and Figure 4). Industry and Employment Trends The region s industry mix and employment trends reveal a good deal about the region s economy. Resident Employment Table 5 shows the employment distribution of metropolitan area residents (regardless of where their jobs are based) with comparisons for the City, State and the US. Metro area residents are more likely to be employed in retail trade or manufacturing than are those of the US as a whole. Retail trade employs 18.9 percent of area residents as compared with 11.4 percent nationally. Manufacturing still employs 15.7 percent of metro residents as compared with 11.3 percent in the US. Table 5. Employment of Civilian Residents by Industry and Occupation, 2007 Fayetteville Metro Area Arkansas US Number Percent Number Percent Percent Percent Civilian Employed Population Aged 16+ by Industry 35, % 200, % 100.0% 100.0% Agriculture, Forestry, Fishing, Hunting, Mining % 3, % 3.4% 1.8% Construction 1, % 18, % 7.5% 7.7% Manufacturing 4, % 31, % 15.1% 11.3% Wholesale Trade % 5, % 2.6% 3.2% Retail Trade 5, % 37, % 13.3% 11.4% Transportation, Warehousing, Utilities 1, % 8, % 5.6% 5.2% Information % 3, % 1.9% 2.5% Finance, Insurance, Real Estate, Rental and Leasing 2, % 9, % 5.2% 7.2% Professional, Scientific and Management, Administrative, Waste Management 3, % 15, % 6.6% 10.3% Educational Services, Health Care, Social Assistance 11, % 40, % 22.0% 21.2% Arts, Entertainment, Recreation, Accommodation, Food Services 3, % 13, % 7.6% 8.8% Other Services, Except Public Administration 1, % 7, % 4.8% 4.8% Public Administration % 4, % 4.3% 4.7% Civilian Employed Population Aged 16+ by Occupation 35, % 200, % 100.0% 100.0% Management, Professional and Related 15, % 67, % 30.0% 34.6% Service Occupations 5, % 29, % 16.3% 16.7% Sales and Office Occupations 10, % 48, % 24.2% 25.6% Farming, Fishing and Forestry Occupations - 0.0% 1, % 1.1% 0.7% Construction, Extraction, Maintenance, Repair Occupations 1, % 21, % 10.6% 9.7% Production, Transportation and Material Moving Occupations 3, % 31, % 17.9% 12.7% Note: 2007 Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: American Community Survey, 2007; Partners for Economic Solutions, Page 7 of 124 Part 1 Demographic and Economic Profile

12 Only 1.9 percent of the region s residents are employed in information industries as compared with 2.5 percent nationally. Finance, insurance, real estate, rental and leasing also employ a smaller share of metro residents at 7.8 percent rather than the 10.3 percent nationally. The employment profile of city residents is dominated by educational services, health care and social assistance industries with 31.4 percent of residents, reflecting the major institutions based in the City. Also important are arts, entertainment, recreation, accommodations and food service industries with 10.1 percent of city residents. The occupational distribution of residents shows that Fayetteville has a much higher percentage of residents employed in management, professional and related jobs 42.8 percent versus 34.6 percent in the US. Jobs in construction, extraction, maintenance, repair, production, transportation and material moving occupations are significantly less represented among Fayetteville residents than elsewhere in the metro area. Metropolitan Area Employment Trends Looking at employment based on where the jobs are located provides the trends in Table 6 and Figure 5. As is happening around the country, the share of metro area jobs in industries that produce goods has declined from 27.4 percent in 1998 to 21.2 percent in 2007 with the loss of 3,500 manufacturing jobs. The service-producing industries boosted their relative economic importance from 72.6 percent of the 1998 employment base to 78.8 percent in Table 6. Employment at Place of Work, Fayetteville-Springdale-Rogers Metropolitan Area, 2007 Metro Area Employment Change Number Percent Annual Percent Total Employment 150, , , ,800 45, % 3.6% Goods-Producing 41,100 43,300 43,200 44, % 0.2% Percent of Total 27.4% 26.7% 22.9% 21.2% Service-Producing 108, , , ,800 45, % 4.7% Percent of Total 72.6% 73.2% 77.1% 78.8% Total Employment by Industry 150, , , ,800 45, % 3.6% Natural Resources, Mining, Construction 6,300 7,400 9,800 11,600 4, % 6.6% Manufacturing 34,800 35,900 33,400 32,400 (3,500) -9.7% -1.5% Wholesale Trade 4,900 6,000 8,600 9,500 3, % 6.8% Retail Trade 16,000 17,200 19,400 22,200 5, % 3.7% Transportation, Utilities 10,600 11,200 16,800 17,300 6, % 6.4% Information 2,100 2,300 2,500 2, % 2.3% Financial Activities 5,700 6,000 7,000 8,700 2, % 5.5% Professional and Business Services 20,700 24,200 28,800 33,000 8, % 4.5% Education and Health Services 12,800 13,500 16,800 18,800 5, % 4.8% Leisure and Hospitality 11,500 12,300 14,700 17,600 5, % 5.3% Other Services 4,200 4,500 5,900 6,500 2, % 5.4% Government 20,400 21,400 24,600 27,600 6, % 3.7% Note: 2007 Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: U.S. Department of Labor; Partners for Economic Solutions, The regional economy is dominated by professional and business services (33,000 jobs in 2007), manufacturing (32,400 jobs), government (27,600 jobs), retail jobs (22,200 jobs), education and health services (18,800 jobs), leisure and hospital (17,600 jobs) and transportation and utilities (17,300 jobs). Page 8 of 124 Part 1 Demographic and Economic Profile

13 Businesses by Size Table 7 characterizes the Washington County, Benton County, Arkansas and US businesses by their ownership and employment size using data provided by the Edward Lowe Foundation. Table 7. Establishments and Jobs by Type of Establishment, Washington Co. Benton Co. Metro Area Arkansas US Number Percent Number Percent Number Percent Percent Percent Total Establishments by Type 9, % 7, % 17, % 100.0% 100.0% Resident 1 8, % 6, % 15, % 83.5% 87.0% Non-Commercial % % 1, % 10.3% 7.5% Non-Resident % % 1, % 6.2% 5.5% Resident Establishments by Stage, Number of Employees 8, % 6, % 15, % 100.0% 100.0% Stage 1 (1-9 Employees) 7, % 6, % 13, % 87.9% 87.9% Stage 2 (10-99 Employees) 1, % % 1, % 11.4% 11.4% Stage 3 ( Employees) % % % 0.6% 0.7% Stage 4 (500+ Employees) % % % 0.1% 0.1% Total Jobs by Establishment Type 100, % 82, % 182, % 100.0% 99.9% Resident 1 66, % 60, % 126, % 59.8% 62.8% Non-Commercial 2 12, % 7, % 19, % 18.5% 16.2% Non-Resident 3 22, % 14, % 37, % 21.7% 20.9% Total Jobs in Resident Establishments by Stage, Number of Employees 66, % 60, % 126, % 100.0% 100.0% Stage 1 (1-9 Employees) 18, % 14, % 33, % 31.9% 30.8% Stage 2 (10-99 Employees) 24, % 16, % 41, % 36.6% 37.9% Stage 3 ( Employees) 10, % 10, % 20, % 15.9% 16.4% Stage 4 (500+ Employees) 13, % 18, % 31, % 15.6% 14.8% Note: 1 Stand-alone businesses in the area or businesses with headquarters in the same state. 2 Business located in the area but headquartered in a different state. 3 Educational institutions, post offices, government agencies and nonprofit organizations. Data are annual averages for time period. Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: National Establishment Time Series; Edward Lowe Foundation, 2008; Partners for Economic Solutions, Page 9 of 124 Part 1 Demographic and Economic Profile

14 Eighty-five to 86 percent of Washington and Benton County establishments are resident companies that are either stand-alone businesses or branches of a company headquartered in Arkansas; they provide 66 to 73 percent of the jobs. Non-profit organizations represent another 7.2 to 7.3 percent of establishments and 8.6 to 12.1 percent of jobs. Non-resident businesses those commercial businesses headquartered in another state or country account for 6.7 to 7.1 percent of establishments and 18 to 22 percent of the jobs in the two counties. By size, the smallest companies with less than 10 employees represent 85 to 90 percent of the resident establishments and 24 to 28 percent of the jobs. Large companies with 500 or more employees account for only 0.2 percent of all establishments in the two counties but 20 percent of Washington County jobs and 30 percent of Benton County jobs (Figures 6 and 7). This, of course, reflects the importance of large employers such as Walmart, Tyson Foods and J.B. Hunt. Job Growth by Business Size The US Small Business Administration sponsored a special tabulation of changes in the number of establishments and jobs by business size for and The results, shown in Table 8, indicate significant churning in the mix of businesses each year. Table 8. Business Births and Deaths by Employment Size, Fayetteville-Springdale-Rogers Metropolitan Area, Employment Size, Employment Size, Total < Total < Establishments 8,295 5,367 1,185 1,743 8,719 5,627 1,270 1,822 Percent by Employment Size 100.0% 64.7% 14.3% 21.0% 100.0% 64.5% 14.6% 20.9% Establishment Births 1, ,291 1, Percent by Employment Size 100.0% 76.9% 6.3% 16.7% 100.0% 78.6% 6.5% 14.9% Establishment Deaths Percent by Employment Size 100.0% 79.6% 5.7% 14.7% 100.0% 82.4% 8.8% 8.8% Employment Changes 168,475 25,533 39, , ,959 26,675 43, ,546 Percent by Employment Size 100.0% 15.2% 23.2% 61.6% 100.0% 15.2% 25.0% 59.8% From Establishment Births 11,497 3,068 2,518 5,911 11,019 3,435 2,985 4,599 Percent by Employment Size 100.0% 26.7% 21.9% 51.4% 100.0% 31.2% 27.1% 41.7% From Establishment Deaths 6,637 2,188 1,035 3,414 8,956 2,340 3,188 3,428 Percent by Employment Size 100.0% 33.0% 15.6% 51.4% 100.0% 26.1% 35.6% 38.3% Note: Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: National Establishment Time Series; U.S. Small Business Administration; Partners for Economic Solutions, Page 10 of 124 Part 1 Demographic and Economic Profile

15 Among the almost 65 percent of establishments that have fewer than 20 employees, 17 to 18 percent were newly formed that year and 12 to 13 percent had gone out of business. The impact on the number of jobs shows a somewhat different picture. Small companies were responsible for 12 to 13 of the new jobs associated with a newly created or relocated establishment and 8 to 9 percent of the jobs lost due to company closure or relocation. For mid-sized companies with 20 to 499 employees, roughly 6.5 percent were establishments newly opened or relocated to the metropolitan area. Between 4 and 6 percent of the establishments closed in a given year. Regarding employment, 6 to 7 percent of the jobs were created by new companies with 2.6 to 7.3 percent of jobs lost to companies closing or departing the region. Comparison with Other Benchmark Regions An Informally Selected Benchmark Group A full benchmarking exercise requires detailed analyses to determine which other places are appropriate and valid benchmarks. To provide some informal, initial context for understanding the characteristics of the Fayetteville region s population and economy, the following graphs compare data for the Fayetteville metropolitan area to data for seven other metropolitan areas. Not necessarily a definitive benchmark group, these seven were selected because they include major universities and because they have economies with a relatively greater focus on technology industry growth: Austin-Round Rock, Texas Birmingham-Hoover, Alabama Gainesville, Florida Greensboro-High Point, North Carolina Greenville-Maudlin-Easley, South Carolina Raleigh-Cary, North Carolina Richmond, Virginia. The backup data appear in Appendix Tables A-1 through A-4. Benchmark Comparisons These preliminary benchmark comparisons show good news and bad news. (Please see Figures 8, 9, 10, 11, and 12 on the following page.) The Fayetteville-Springdale-Rogers metropolitan area experienced faster employment growth than any of the benchmark cities with a 38.5-percent increase from 1998 to However, the region s employment base includes only 1.3 percent of jobs in information and telecommunications industries. Among the benchmark regions, information industries provide between 1.5 and 3.2 percent of total jobs. In Northwest Arkansas, several of the major employers have large information technology operations that are not included in the 1.3 percent count. Unemployment in the Fayetteville region at 5.9 percent was among the lowest rates among the benchmark cities. By comparison, the unemployment rates ranged from 6.7 to 7.2 percent in the Gainesville, Greensboro and Greenville metro areas. With 25.6 percent of its residents aged 25 or older with a Bachelor s degree or higher, the Fayetteville metro area compares with rates in Birmingham, Greensboro and Greenville. Austin, Gainesville and Raleigh have significantly higher ratios between 38 and 41 percent. At $44,552, the Fayetteville metro area s median household income is similar to that of the Greensboro and Greenville regions but much lower than those of the Austin, Raleigh and Richmond regions. Page 11 of 124 Part 1 Demographic and Economic Profile

16 Page 12 of 124 Part 1 Demographic and Economic Profile

17 PART 2 COMPETITIVENESS ASSESSMENT Education and Knowledge Workforce National and International Context Data have shown for some time that the workforce needed for the jobs being created in the economy of the 21 st century must be more highly skilled. The Partnership for 21 st Century Skills, in its recent policy guide, noted that where economies are becoming technology and knowledge-based, substantial numbers of scientists, engineers, and other innovators are obviously needed. But so is a labor force that has the technological skills to survive in a technologically driven economy. The number of unskilled workers demanded is falling as technology permeates more and more sectors and transforms the content and requirements of nearly all jobs. Even routine jobs require people to exercise judgment and act responsibly or to operate in technically complex environments. The demand for people with advanced degrees is escalating, as innovation based in research and knowledge becomes more pivotal in economic development. Higher education in the US has been the envy of the world and a magnet to students from around the world eager to earn US degrees, particularly in science, mathematics, and engineering. However, data show that the US awards a disproportional number of advanced degrees in these fields to immigrants or resident aliens. Other indicators of a need for renewed emphasis on these fields include: The proportion of bachelor s degrees in physics to total degrees awarded was twice as high the year before Sputnik as in In science, math, and engineering related fields, the United States awarded the lowest percentage of first university degrees of all the G-8 countries. Finally, the US ranks third behind the Russian Federation and Canada in a seven-nation study in the proportion of citizens who have completed higher education. Employers of knowledge workers are attracted to areas that have the amenities desired by highly skilled workers, including good schools, cultural events, and attractive environments. They include in their criteria for location the level of skills in the area workforce and the ready availability of resources to deliver the training that is needed to prepare and constantly upgrade a workforce that can adapt to new technology as it changes. As part of such an environment, even workers in low-skilled service jobs need the communication skills, critical thinking, and problem-solving skills that come with mastery of more than basic education levels as well as responsibility, time management, and ethical understanding. Another factor showing the importance of making advanced education generally accessible is that even as growing economies require the highly skilled professionals in the workforce, they also require the presence of skilled technicians. Lab technicians, programmers, IT maintenance and security specialists, health care support workers in a wide range of occupations, skilled production workers with the skills required for biotechnology, nanotechnology, and other advanced fields require specialized training beyond the high school level but below the baccalaureate. Page 13 of 124 Part 2 Competitiveness Assessment

18 The Arkansas Context skills. Arkansas imbalance is more marked that that in the Nation. The most rapidly growing need is for workers with some training/education beyond high school. Data from Arkansas Department of Workforce Services estimates that 28 percent of the state s jobs require high skill levels, while only 22 percent of workers possess the high skills needed, 55 percent of the State s jobs require more than high school, but less than a four-year degree, while 47 percent of the State s workers possess these skills; and 18 percent of the State s jobs require low skills, while 31 percent of the State s workforce has this level of Educational Attainment in Fayetteville and its Metro Area Fayetteville boasts a well educated citizenry, where 44.7 percent of the population aged 25 or over has a Bachelor s or higher degree and 92.4 percent has at least a high school diploma. This compares with 27.5 percent and 84.5 percent, respectively, in the US as a whole. Shown in Table 9, the regional population has educational levels just slightly below those of the nation. One-half of the region s college students live in the City of Fayetteville. Fayetteville scores well above the nation, Arkansas, and the metro area/region in the numbers of its citizens who have attained some college or above. The percentage who hold a graduate or professional degree (20.6) is more than double the US average (10.1), reflecting the dominance of the University in the city s profile. However, Fayetteville itself is home to only 14.4 percent of the metro area s population over the age of 25 and, at 39,000 plus, is not large enough to offer the employment base that development would require. Page 14 of 124 Part 2 Competitiveness Assessment

19 The metro area s 270,000 plus population over 25 years old is the more relevant population base upon which to plan future development. The educational attainment levels of this population show attainment of the bachelor s degree or higher (25.6 percent) below the national average (27.5 percent), and attainment of a high school diploma or less (47.5 percent) somewhat above the national average of 45.6 percent both figures in the unfavorable direction. The implications of these facts are that the quality of the workforce in the entire region is important both to Fayetteville itself and to the whole region and, to support world-class development, it must be improved. Table 9. Educational Attainment and College Enrollment, 2007 Fayetteville Metro Area Arkansas US Number Percent Number Percent Number Percent Number Percent Educational Attainment, Population Aged , % 270, % 1,861, % 197,892, % Less than 9th Grade % 20, % 134, % 12,575, % 9th to 12th Grade, No Diploma 2, % 25, % 217, % 18,098, % High School Graduate (Includes GED) 7, % 83, % 663, % 59,658, % Some College, No Degree 9, % 56, % 377, % 38,522, % Associate's Degree 1, % 16, % 109, % 14,704, % Bachelor's Degree 9, % 44, % 239, % 34,364, % Graduate or Professional Degree 8, % 24, % 120, % 19,969, % Percent High School Graduate or Higher 92.4% 83.2% 81.1% 84.5% Percent Bachelor's Degree or Higher 44.7% 25.6% 19.3% 27.5% Enrolled in College 14,285 28, ,935 20,793,948 Note: 2007 Fayetteville-Springdale-Rogers Metropolitan Area includes Benton, Madison and Washington counties in Arkansas and McDonald County in Missouri. Source: American Community Survey, 2007; Partners for Economic Solutions, Public Schools Of the county s 16 school districts, four are among the 10 largest in the State: Fayetteville; Bentonville; Springdale; and Rogers. All four have schools that rank well among all Arkansas schools. The quality of the schools in Fayetteville and Bentonville districts has been particularly recognized. Among facts cited on the Fayetteville Public Schools website are these: Fayetteville High School annually leads the state in the number of Advanced Placement Scholars. Fayetteville annually has a greater percentage of its students accepted to the Arkansas Governor s School than does any other school district in the state. Expansion Management magazine awarded the district five gold medals for excellence since (Expansion Management s rating of schools is one of the measures used by Money magazine in determining its annual 10 Best Places to Live in the US. ) Fayetteville High School graduates are annually accepted into the finest universities in the nation, including Harvard, Yale, Stanford, Duke, Vanderbilt, Vassar, Princeton, and all three military academies. Three of the area s high schools received a bronze ranking from US News and World Report in 2007: Decatur and Gentry High Schools in Benton County, and Haas Hall Academy, a private school in Washington County. (US News and World Report rankings are weighted toward schools that improve the performance levels of all the students in the school, including underserved populations.) Scores for the four districts on the eleventh grade literacy test given by the State are shown in Table 10 below. (Data for the 14 districts in Benton and Washington Counties are in Table A-5 In the Appendix.) Page 15 of 124 Part 2 Competitiveness Assessment

20 Table 10. Scores on 11th Grade Literacy Exam, th Grade Enrollment Percent Below Basic District Number Tested Mean Score Percent Basic Percent Proficient Percent Advanced Bentonville % 22% 71% 3% Rogers % 36% 55% 2% Fayetteville % 24% 66% 4% Springdale 1, % 37% 51% 1% Source: Arkansas Department of Education Technical/Occupational Education All four districts offered technical/occupational courses in technical/occupational pathways for high school students in , though other districts in the area offered more programs of study and enrolled more students. Any student may enroll in a course included in a program of study. Concentrators are students who have completed at least two units from a program of study in grades 9-12 and are leaving the secondary system during the reporting year. Completers are students who complete at least three courses in a pathway. Bentonville offered 15 programs of study with 117 completers; Rogers offered 16 programs of study with 80 completers; Fayetteville offered 18 programs of study with 6 completers; and Springdale offered 22 programs of study with 236 completers. Programs of study by districts offering the program are shown in Appendix Table A-6. All students enrolled in a technical/occupational course are tested for proficiency in literacy and geometry. The state target average of all students taking end-of-course tests in a Pathway course is 70 percent: Bentonville tested 750 students resulting in an average score of 73 percent Rogers tested 785 students resulting in an average score of 73 percent Fayetteville tested 380 students resulting in an average score of 70 percent Springdale tested 978 students resulting in an average score of 65 percent. Area School Students by Age, Ethnicity, and Reduced or Free Lunch Eligibility The population of the counties is young, with a median age of 33.5 and an average age of 35.4 compared to a national median of 36.7 and average of Five years from now, the median age is projected to be 34.7 in the two-county area and 37.6 in the nation. The population of this area below the age of fourteen will be higher in the future than at present, though the population of workforce age is expected to be relatively unchanged. The counties are also home to immigrants from a wide variety of nations. The Hispanic population is 14.2 percent, while the non-hispanic African-American population is estimated at 2.1 percent. The number of foreign languages spoken in the homes of students can be used as a proxy for the ethnic diversity of an area. The major school districts have substantial enrollments of students who speak other languages. Spanish, Hmong, Marshallese, and Vietnamese are well represented. The ratios of Spanish-speaking to English-speaking students in the four largest districts are shown below. Statistics for students speaking a language other than English are shown by district in Table 11 and Appendix Table A-7. Page 16 of 124 Part 2 Competitiveness Assessment

21 Table 11. Student Languages Spoken at Home by District, Number of Different Ratio of Spanish Languages Students Number of Students Who Number of Students Who Speakers to English District Speak at Home Speak Spanish at Home Speak English at Home Speakers Bentonville , % Rogers 41 4,591 8, % Fayetteville , % Springdale 36 5,758 9, % Source: Arkansas Department of Education Other districts in the two counties with significant ratios of students speaking Spanish at home to students speaking English at home are: Siloam Springs (25 percent) Decatur (18.4 percent) Gentry (9 percent) Farmington (5.2 percent). The poverty status of students is indicated by the number of children who qualify for free or reduced lunches. A large proportion of poor students usually is inversely related to the test scores of the school and directly related to the difficulty of improving the student learning that occurs there. Of the four largest school districts in the two counties, two have free or reduced lunch eligibility over 50 percent: Springdale (52.33 percent) and Rogers (52 percent). Fayetteville s rate is percent, and Bentonville s is percent. The majority of the remaining districts are above 40 percent. This indicates that the area has substantial numbers of people in poverty. Bentonville and Fayetteville score better on this statistic, so the issues related to learning problems of poor students are likely to be less troublesome in these two districts. Table A-8 in Appendix A shows free/reduced lunch statistics for all school districts in Benton and Washington Counties Necessary Skills, Growing Occupations Skills that can and should be addressed in the elementary and secondary school systems repeatedly dominate lists of employers most desired skills. The Northwest Arkansas Council s list is typical. The Council identified the basic skills that are most important in the quality of the labor force as: Customer focus Good manufacturing practices Communication Teamwork Listening Observation Reading for information Locating information. The survey also identified weak areas in the existing labor force as: Communication skills Technical training Problem-solving ability Work habits Page 17 of 124 Part 2 Competitiveness Assessment

22 Educational level Work ethic. The same Northwest Arkansas employers projected that the jobs to be added between 2003 and 2008 would primarily require a high school diploma (66 percent), while 18 percent would require a baccalaureate, 11 percent technical training, and 5 percent a two-year degree. See Figure 13 above, which shows the mismatch between the skills desired and the skills available in the workforce. Growing Occupations The fastest growing occupations in both Arkansas as a whole and Northwest Arkansas are in Computer Software Engineers, though in the region, Systems Software Engineers are most in demand, while in the state Applications Engineers lead. Table 12, below, shows the occupations in the top five for both the state and the region. The region s leading occupations reflect the retail and distribution industries that dominate the local economy. Highest wage occupations in both the state and region are made up of health care occupations with the single exception of Chief Executives, which ranks third in the Northwest Arkansas region. Health care includes both professional and technical occupations. It is important to note that all of these occupations require skills above the high school level. Table 12. Fast Growing Occupations, State of Arkansas Computer Software Engineers, Applications Database Administrators Service Unit Operators, Oil, Gas, and Mining Engineers, All Other Network Systems and Data Communications Analysts Source: Arkansas Department of Workforce Services. Northwest Arkansas Computer Software Engineers, Systems Software Marketing Managers Logisticians Computer Systems Analysts Market Research Analysts The industries in the region projected to grow fastest between 2004 and 2014 are shown below. Again, the region s fast-growing industries reflect the dominance of education, retail, and distribution and appear to forecast fast growth in entrepreneurial activities. While many occupations may be in demand within an industry, the majority of these industries will require many workers with skills acquired in training and/or education beyond high school. Table 13. Fast Growing Industries, State of Arkansas Oil and Gas Extraction Educational Support Services Other Residential Care Facilities Support Activities for Rail Transport Management of Companies and Enterprises Source: Arkansas Department of Workforce Services. Northwest Arkansas Management of Companies and Enterprises Professional and Business Services Professional and Technical Services Couriers and Messengers Truck Transportation Page 18 of 124 Part 2 Competitiveness Assessment

23 NorthWest Arkansas Community College (NWACC) Overview NorthWest Arkansas Community College (NWACC) is a comprehensive community college institution offering basic skills, GED, English for Speakers of other Languages (ESOL), business and corporate training, 27 Associate in Applied Science degree programs, the Associate in Arts, Associate in Science, Associate in Science in Agriculture and Associate in Arts in Teaching degree areas (all consisting of courses that transfer to four-year institutions and generally comprise the first two years of the baccalaureate), the Associate in General Education, and 15 certificate programs In NWACC s technical specialties include high demand fields such as Nursing and three other health care specialties, Business Administration, and Computer Systems. Its graduates are firefighters, police, emergency personnel, and early childhood educators. The college also offers certificates for shorter-term training in 21 areas including aviation, Computer Aided Design (CAD) for both architecture and engineering, environmental science, and health-related specialists. Enrollment The Associate Degree students numbered 6,470 in fall 2007, up 12.9 percent from the previous fall. Ninetyfour percent of the students reside in Benton and Washington counties; two-thirds attend part-time; half are 21 years old or younger; 80 percent are white; and just over 10 percent are Hispanic. Enrollment of Hispanics grew more than 30 percent from fall 2006 to fall 2007 alone. The community college enrolls 20 percent of Benton County high school graduates and 15.1 percent of Washington County s graduates. Fayetteville High School sends 10.8 percent of its graduating class to NWACC. The college enrolled 3,694 students in basic and secondary level instruction, including ESOL, representing a growth of 80 percent in the past six years, with basic education and EOL experiencing the fastest growth. NWACC granted 380 GED awards in In 2007 Corporate Education enrolled 1,915 students serving 158 businesses in 389 class sections. NWACC enrolled 113 in Allied Health Non-Credit Classes, 924 in Personal and Professional Education, 191 in Early Childhood Education Caregiver Certifications, and 250 in KEEP (Kid s Enrichment) and Kid s College. NWACC partners with local high schools to offer students the opportunity to take college credit courses in their own schools while they are still taking high school classes. In fall 2007, 570 Benton and Washington County students enrolled in the program, called Step Ahead. The program grew 22 percent overall from 2004 to Two high schools accounted for 47 percent of the enrollment in fall 2007: Bentonville (125) and Rogers (143). Fayetteville High School no longer participates in the program; the 34 students in Fayetteville who are dually enrolled at NWACC attend the Regional Technology Center (RTC). Regional Technology Center The college operates the Regional Technology Center with a site in Fayetteville; a Washington County Center located in Springdale; and the Western Benton County Regional Technology Center which opened in Gentry in August, Both regular NWACC credit students (571) and high school students (198) attend the RTC. An additional 34 high school students take both high school and community classes at the RTC. Programs offered include: Aviation Maintenance Automotive Computer information Cosmetology Criminal Justice Culinary Arts Page 19 of 124 Part 2 Competitiveness Assessment

24 Dental and Medical Assisting Pre-Engineering Vet Assisting Welding The Division has two postsecondary technical program areas located at the RTC sites that primarily serve postsecondary students. The Division has five secondary technical programs located at the RTC site that primarily serve high school students. High school students may also enroll in the academic courses offered on site if they meet the college requirements for the courses. For a variety of reasons, NWACC is planning to close the RTC in Fayetteville and distribute its programs to other sites: Automotive will be relocated to NWTI in Springdale. Culinary, Hospitality, and Cosmetology to Benton County; Medical Assisting and Dental Assisting will go to the University Medical School s new location for its teaching hospital, the old Washington Regional Hospital. Pharmacy Technology and Certified Nursing Assistant are also being considered for that location. Student Performance Remediation is required for 70.9 percent of entering students in Math, 40.5 percent in English, and 30.6 percent in Reading. These scores follow a typical pattern but are lower than national community college remediation averages. At NWACC student performance has generally improved over the past five years, particularly in English. These changes indicate that entering students are showing better preparation, but do not reveal whether that is because fewer of the better-prepared students are willing or able to go to four-year institutions, or whether students from NWACC s feeder high schools are improving their preparation overall. NWACC has posted retention of first year students over the last five years between 57.2 percent and 64.3 percent, slightly above all Arkansas Public Two-Year Colleges (5-year range 52.3 to 56.7 percent). NWACC s three-year graduation rate was 7.5 percent in 2003 (most recent available) and the six-year graduation rate was 19.8 percent. These rates are typical of national community college graduation rates. The College has higher transfer rates (14.4 percent after the third year) compared to statewide rates (8.1 percent). Northwest Technical Institute Formed in 1975, Northwest Technical Institute (NWTI) provides job training, adult education and short-term courses to train community members on software and other topics. It offers diploma programs in 17 areas listed in Appendix Table A-9. In cooperation with NWACC, students can go on for an Associate Degree in the same areas. Adult basic education and English for Speakers of Other Languages (ESOL) are also offered at NWTI. Local Workforce Investment Board (LWIB) The Northwest Arkansas Economic Development District, Inc. (NWAEDD) operates programs under the Workforce Investment Act Adult, Dislocated Worker and Youth programs in cooperation with the Local Workforce Investment Board. NWAEDD contracts with Northwest Arkansas Certified Development Services to provide the programs at five Workforce Centers in Northwest Arkansas (Harrison, Fayetteville, Siloam Springs, Rogers, and Mountain Home). The Workforce Centers provide occupational training in a variety of occupations selected from those identified by the Arkansas Department of Workforce Services as high growth or high-demand for the local region. Of the 98 industries identified for the Northwest Arkansas area, the 33 occupations shown in Appendix Table A-10 are authorized for sponsored training. Page 20 of 124 Part 2 Competitiveness Assessment

25 Currently 193 individuals are enrolled in training by specific federally authorized program type: Adult Programs: 88 Dislocated Workers: 75 Youth Programs: 30 The Trade Adjustment Act and the Trade Readjustment Allowances also provide employment and training opportunities and are administered through the Arkansas Department of Workforce Services. Students with these benefits may be attending classes at several of the workforce providers, including NWACC and NWTI. Quality of Place and Other Competitive Factors While labor force skills and availability are critical to successful development of a knowledge economy, other factors also influence a region s ability to develop and compete for high-wage industry. In addition to traditional factors relating to infrastructure, location and operating costs, several relate to the region s ability to attract, retail and support entrepreneurs and skilled workers. Quality of life and quality of place factors are integral to the region s long-term economic health and ability to compete for the labor force critical to knowledge-based industry. Fayetteville and Northwest Arkansas have made significant strides in addressing the full range of location factors, but more is left to be done. Important to the knowledge economy are: Connectivity both communication and transportation Support infrastructure Business climate and the cost of doing business Entrepreneurial climate and support Quality of life Quality of place Community image Connectivity Operating in a global economy requires superior communication, data and transportation connections. High-speed fiber and other telecommunications infrastructure to facilitate instant communications are now a standard requirement for a number of businesses. Highways, rail and airport infrastructure continue to support easy movement of goods and people within regional, national and international markets. Northwest Arkansas has focused much of its attention on improving these physical connections, resulting in construction of I-540 and the Northwest Arkansas Regional Airport. The rapid pace of population and economic growth places a growing pressure on the existing road and highway network. A study of Northwest Arkansas traffic has identified 16 road segments in the region that will face capacity constraints by Continued growth strains the regional network for movement between the region s communities, requiring upgrades to the regional grid system. The Northwest Arkansas Regional Airport provides important air connections to most of the regional hub airports, but service is somewhat limited and expensive. The Northwest Arkansas Council has prioritized attraction of additional carriers, particularly a low-cost carrier such as Southwest. Infrastructure Support infrastructure for business and economic development includes water, sewer, storm water, electric and gas systems. The Two-Ton Reservoir will meet the region s water needs for the next 50 years, eliminating a potential constraint. Going forward, population growth threatens to outstrip wastewater treatment capacity. The City of Fayetteville wastewater treatment facility is planned for expansion to meet that demand, but the investment required for that improvement has not yet been committed. Page 21 of 124 Part 2 Competitiveness Assessment

26 The costs of utility services (electricity, natural gas and telephone) in Northwest Arkansas are relatively low in cost, and capacities are sufficient to meet current demand. Over the long term, continued investment will be needed to keep pace with economic growth and demand. On the individual business scale, the availability of appropriate facilities and sites can be very important in the selection among different locations. Most businesses seek space with a lead time of less than 12 months, placing a premium on available buildings. Even those seeking a built-to-suit facility are typically under time pressure to move ahead quickly. They need to know and rely on the development schedule, which means that few companies are willing to consider properties that are not properly zoned and improved. Fayetteville has a limited supply of industrial and office sites due to zoning and flood plain constraints. Among those sites, very few are serviced with all needed infrastructure and ready for immediate construction. Recognizing the competitive advantage that available industrial facilities and sites offer, several states have programs to certify and then promote industrial sites that are shovel ready. In the interviews, there were many comments about the need for one or more new business sites. It was beyond the scope of this analysis to confirm this need. However, it seems reasonable that this is a topic that merits a specific analysis. Business Climate Essential to economic development is government that works effectively with business, providing essential services efficiently. Leadership must be responsive and decisive, giving businesses timely and predictable decisions and rules that don t change. Stakeholder interviews indicate that this is a major perceived and real weakness of Fayetteville, one that threatens to undermine the city s ability to attract and nurture businesses that will provide the jobs and tax base the city needs to thrive into the future. The length of time required to secure development approvals is a major disincentive. More important is the total lack of predictability and certainty about the likely outcome of that process. Planning decisions made through lengthy citizen input, stakeholder involvement and consensus building have been abandoned in the face of opposition from one or two citizens. The continual injection of politics into the development approval process has given Fayetteville a highly negative image as being anti-business. From the perspective of Fayetteville itself, the above business climate issues are accentuated and made more problematic because interviewees consistently report that the local governments in the neighboring municipalities and counties are more business-friendly causing developers and other interests to veer away from the City of Fayetteville. The tax environment is relatively favorable. The Arkansas corporate tax rate is average and the property tax rates are low. While still quite low compared with other areas, property taxes on Fayetteville land and buildings are among the highest within the region due to the high percentage of its property used by taxexempt institutions. Tax incentives support research and technology development. InvestARK is a sales and use tax credit for investment in plant or equipment, new construction, expansion or modernization. Limited to specific industries and Arkansas companies that invest $5 million or more, the incentive provides a 50-percent offset on State sales and use taxes. For qualifying companies, an Arkansas Advantage tax credit provides a State income tax credit equal to one percent of new payroll for five years; also available is a refund of sales and use taxes for building materials and taxable equipment connected with the qualifying project. Important to technology companies is the 33-percent income tax credit available to eligible businesses that contract with Arkansas colleges or universities. Targeted businesses can earn transferable income tax credits up to 33 percent of approved expenditures for in-house research and a 20-percent income tax credit for inhouse research. Page 22 of 124 Part 2 Competitiveness Assessment

27 Entrepreneurial Support In the Knowledge Economy, in which ideas and innovation are key, much economic and job growth comes from entrepreneurs who push the envelope to adapt existing products, develop new products and apply technology to meet an identified need. Their ability to innovate and respond quickly and nimbly allows entrepreneurs to capitalize on market opportunities at times faster and more effectively than can many large companies. Ideally, a region will offer an environment that encourages and rewards entrepreneurial risk taking. Northwest Arkansas excels in this regard, respecting the contributions that home-grown companies have made to the local economy. The University of Arkansas Technology Development Foundation (UATDF) provides important resources for technology businesses. The Arkansas Research and Technology Park (ARTP) offers not only facilities and sites but also technical assistance and access to University resources. The Genesis Technology Incubator and the Innovation Center within ARTP provide office and laboratory space for small and start-up companies as well as a menu of business and other support services. The University of Arkansas plays a major role in providing access to technical equipment, engineering resources and access to the student workforce. ARTP tenants receive access to University facilities and equipment at fair prices that relieve the companies of the need to buy the equipment themselves. Specialty centers such as the High Density Electronics Center (HiDEC) and the National Center for Reliable Power Transmission (NCREPT) bring together focused research and specialty equipment that benefit both the University and local businesses. Technical assistance also is available through the Arkansas Small Business and Technology Development Center at the Sam M. Walton College of Business. Innovate Arkansas is a statewide entity established to assist technology entrepreneurs in developing and commercializing their technologies. Services offered include product assessments, market feasibility analyses, commercialization strategies, business plan development, and product and concept valuations. A key issue facing local entrepreneurs (and which may inhibit the region s ability to attract early-stage entrepreneurial companies) is access to risk capital. Most venture capital companies are headquartered in San Francisco, New York, Chicago and other major metropolitan areas and invest close to home so as to be closely involved with their investments. Local technology companies report great difficulty in securing risk financing as they move out of the initial research phase funded by Small Business Innovation Research grants. Mezzanine financing of $1 to $2 million has proven to be very hard to secure for an Arkansas company. The Arkansas Science & Technology Authority (ASTA) operates a Seed Capital Investment Program to provide up to $500,000 in working capital for new and expanding technology-based companies. Its Technology Development Program provides up to $100,000 in royalty financing for science and technology projects with economic and employment growth potential. However, funding for these programs has been limited in recent years. Networks of like-minded entrepreneurs can provide mutual support, and access to mentors, specialized legal, accounting and marketing expertise as well as technical resources. The emerging Green Valley Network Initiative is helping to create such a network among sustainable technology companies and creation of a substantial venture capital fund is a stated objective of the Green Valley Network. Quality of Life While each person defines quality of life according to his or her individual likes and interests, quality of life is often defined in terms of education, arts, recreation, sports, the natural environment, entertainment and religious life. Increasingly important is the quality and availability of health care. Shopping opportunities and quality housing at an affordable price are always important as is the overall cost of living (90.4 percent of the national average). Transportation impacts quality of life as people s lives are affected by the Page 23 of 124 Part 2 Competitiveness Assessment

28 availability of public transit, traffic congestion and other factors. Northwest Arkansas success as a major tourism and retirement destination reflects its natural beauty and outdoor recreational opportunities. Most residents value Fayetteville s small town feel. The Walton Arts Center, the University of Arkansas and other entities support a lively arts community with a variety of cultural opportunities, including Fayetteville s renowned library. Dickson Street and Downtown Fayetteville offer a lively entertainment district with pedestrian amenities and a variety of restaurants and shops. Sporting events include the full range of Razorback sports as well as minor league baseball in Springdale. Many stakeholders emphasized Fayetteville s diversity of residents and the community s embracing of that diversity as something valued. In the past, most such amenities were concentrated in Fayetteville. In recent years, the other communities in the region have been acquiring amenities. The new Crystal Bridges Museum of American Art (Alice Walton) will be a new world-class cultural asset. Restaurants and downtowns outside Fayetteville are enhancing lifestyle choices for residents throughout the region. Expanding options for housing are a positive factor. And, the City s and region s low crime rates also contribute to the high quality of life. Quality of Place As we gain more experience in the Knowledge Economy, many are recognizing why some communities are more successful than others in attracting and retaining knowledge workers. For many, it relates to creating physical places for socializing and exchanging ideas. These locations are sometimes referred to as a third place not the workplace or the home but a third environment to meet friends and interact with others. It often blends cultural, recreational, arts, eating and entertainment venues where a community of individuals can come together to meet and interact with each other. These types of community spaces whether public or private encourage creativity and new connections across backgrounds and disciplines. The most successful of these environments are those that encourage pedestrian movements, interactions and socializing. Many are compact so as to reduce the dependence on automobiles and designed with high-quality landscaping to take advantage of the natural environment. They gain their vitality from aggregating people in one place. Dickson Street and Downtown Fayetteville set a quality image for the community, helping to attract knowledge workers. Image and Marketing In this highly competitive time, it is not sufficient to have a high quality of life to attract new companies if it is not recognized by others. Fayetteville enjoys a rising visibility with high positions on several rankings of places to do business, live and retire, including Kiplinger s Best Places, Fortune s 100 Best Places to Live and Launch, Inc. Magazine s Best Cities for Doing Business, and CNN Magazine s Best Places to Live. However, this favorable recognition is tempered somewhat by marketing problems associated with the nation s perceptions of Arkansas. Rankings that show low incomes and low spending for education impact people s perceptions of Northwest Arkansas. This affects both companies ability to recruit staff and their ability to sell their services to customers in other regions. Fayetteville and Northwest Arkansas have limited funding for economic development; most specific projects require an individual fundraising effort. The City of Fayetteville has a $1.2 million reserve fund to support economic development. There is no marketing budget or promotional campaign to boost Northwest Arkansas as a region. Each community and Chamber of Commerce pursues marketing on an individual basis. Page 24 of 124 Part 2 Competitiveness Assessment

29 PART 3 STRATEGIES OF ENTITIES ENGAGED IN ECONOMIC DEVELOPMENT In this section are summaries of the key strategic plan documents that form the foundation and context for a Fayetteville Economic Development Strategy. Although each document results from the work of separate and diverse groups of participants, at the State level and extending to the Northwest Arkansas region, there is significant agreement on issues that need attention and strategies for change. The Arkansas Research and Development Plan: A Strategic Plan to guide Arkansas into the 21 st Century, provides historical references to the origins of research and commercialization activity in Arkansas. Beginning in that document, and following in every subsequent document, several points are common: A belief in the transformative power of pure science research A belief in the need to have within Arkansas superior science and technology education through the PhD level The need to link transformative science research and development to existing economic drivers The need to control the long term location of science and technology assets through access to capital at all stages of business development. Despite these shared ideals, within the economic development community, Fayetteville has largely tended to focus its efforts and resources more traditionally: an emphasis on business attraction; lack of attention to comprehensive science and technology education; a failure to link education and workforce development to existing technology growth sectors; and substantial gaps in available funding for research and business development at all stages of a business s maturity. Fayetteville places a very high value on quality of life. Yet, outside of the economic development community there is very little connection or seemingly understanding of how Fayetteville s quality of life that is so highly valued is linked to its economic success. State Government Substantial research has been conducted at the State level to inform and guide decision making toward the creation of long term development plans and legislative initiatives. Touched upon here, and included in summary in the Appendix, are the following in chronological order: Arkansas Research and Development Plan: A Strategic Plan to Guide Arkansas into the 21 st Century, April 1996 Report of the Task Force for the Creation of Knowledge-Based Jobs, September 2002 Arkansas Position in the Knowledge-based Economy: Prospects and Policy Options, September 2004 Building a Knowledge-based Economy in Arkansas: Strategic Recommendations by Accelerate Arkansas, September 2007 Arkansas Economic Development Commission - Strategic Plan Update, June 24, 2008 State Technology and Science Index, Enduring Lessons for the Intangible Economy, Milken Institute, June 2008 Task Force for the Twenty-First Century Economy Interim Report, July 31, Research and Development Plan, Arkansas Science and Technology Authority, September 21, 2008 Building a 21 st Century Economy in Arkansas, October 31, 2008 Innovate Arkansas, www. innovation.arkansasbusiness.com Arkansas Development Finance Authority, Governor Mike Beebe s Strategic Plan for Economic Development, AEDC, 2009 Page 25 of 124 Part 3 Strategies of Entities Engaged in Economic Development

30 From very early on in Arkansas history research and development activity has been valued. Beginning with the establishment in 1888 of the Agricultural Experiment Station at the University of Arkansas (U of A), the State saw an appropriate role for government in furthering prominence of the State in various industries and bolstering production. However, it was not until the General Assembly in 1983 created the Arkansas Science & Technology Authority (ASTA) and charged it with increasing the R&D activity of the state that the State took an active role in attracting research and development funding from outside the State. During the first decade of its existence, the Authority promoted Arkansas' R&D climate by: Awarding 101 Basic Research Grants, totaling $3,384,664 Awarding 35 Applied Research Grants, totaling $850,701 Placing $1,500,500 in Seed Capital Investments that created 264 jobs Establishing seven business incubators around the State. Despite these efforts by 1990, Arkansas was 43rd among states in the amount of federal R&D funding. The Milken Analysis of the Arkansas Economy The Milken Institute is an independent, publicly supported economic think tank with the mission to improve the lives and economic conditions of diverse populations in the US and around the world by helping business and public policy leaders identify and implement innovative ideas for creating broad-based prosperity. In 2004 the Milken Institute was commissioned by Accelerate Arkansas to analyze the issue of per capita income in Arkansas and to identify the actions necessary to raise Arkansans per capita personal income (PCPI) to the national average by Funding for the study was provided by the Winthrop Rockefeller Foundation. The Milken Institute report, Arkansas Position in the Knowledge-Based Economy: Prospects and Policy Options, was published in September This study was one of the most extensive ever conducted on the Arkansas economy. In it, the authors analyzed the economy of Arkansas relative to Milken s State Technology and Science Index, business and competitive factors, and industry groups in the State. Additionally, Milken compiled a comprehensive list of Arkansas institutions and policy tools that currently benefit the knowledge-based economy, and calculated the economic impact of the successful creation of knowledge-based industries in Arkansas. Finally, the Milken study made recommendations to enhance and expand Arkansas knowledge-based economy. The National State Technology and Science Index was published by the Milken Institute in 2002 and again in 2004 and It provides a set of interrelated but distinct indicators that encompass a comprehensive inventory of technology and science assets important to the development of knowledge-based companies. Arkansas remains in the bottom ranking of most economic indices when compared to other states. Benchmark assessments of Arkansas for technology, research and development, risk capital, and education are relatively the same. Arkansas is 48th in the US on the overall 2008 State Technology and Science Index. With the exception of Mississippi, all of the states surrounding Arkansas ranked higher on the 2008 Index. Arkansas has moved out of the bottom tier of states in just two categories: Risk Capital and Entrepreneurial Infrastructure, moving from 42 nd to 31 st ; and Technology Concentration and Dynamism, moving from 44 th to 38 th. In Research and Development Inputs, a state s ability to attract research and development dollars from all sources, Arkansas is dead last. In Arkansas ability to attract high end human capital and skilled professionals the State has fallen three spots to 49 th. Page 26 of 124 Part 3 Strategies of Entities Engaged in Economic Development

31 Building a Knowledge-based Economy in Arkansas: Strategic Recommendations by Accelerate Arkansas, September 2007 As a result of the Milken study, the following strategic recommendations were made by Accelerate Arkansas to support the building of a knowledge-based economy in its 2007 plan: Core strategy 1: Support job-creating research The action plans associated with this core strategy are all involved in increasing research in Arkansas, using scarce Arkansas dollars to increase research in areas that have more immediate impact in technology job creation. Core strategy 2: Develop risk capital that is available for all stages of the business cycle, especially the funding gap The risk capital action plans are related to areas where technology companies have difficulty raising risk capital, preventing their establishment, growth, and success. Core strategy 3: Encourage entrepreneurship and accelerated new enterprise development The action items for the third core strategy revolve around expanding the culture of entrepreneurship for technology and knowledge-based companies, supporting the entrepreneur starting such a company, and accelerating the company through support of a wide variety of actions via an organization designed for such support. Core strategy 4: Increase the education level of Arkansans in science, technology, engineering, and math (STEM) In order to produce a workforce that possesses inquiring minds, enthusiasm for solving problems and finding new solutions in existing industry; to produce entrepreneurial start-ups; and to produce the recruiting of R&D jobs, Arkansas must significantly improve our students knowledge in the STEM areas. The action plans for this area are as follows: Core strategy 5: Sustain successful existing industry through advancing technology and competitiveness Classical economic development involves providing incentives to businesses for creating jobs or generating high payrolls. Many of these existing programs can be modified to further encourage high paying technology jobs. Building a 21st Century Economy in Arkansas, Findings and Recommendations of the Task Force for the 21st Century Economy, October 31, 2008 The Task Force for the 21st Century Economy was established by the 86th General Assembly of Arkansas to study the role and scope of economic development in the 21st Century in Arkansas, and to identify the programs and services needed for continued development in Arkansas. Additional objectives mandated for the Task Force were to examine the constitutional prohibition on State equity investments and the current structure of the State s economic development agencies in light of the needs of a 21st Century economy. Recommendations K-12 Education Enhance science, technology, engineering, and mathematics (STEM) educator talent by providing salary enhancements for Nationally Board Certified math and science teachers as an economic development investment. Page 27 of 124 Part 3 Strategies of Entities Engaged in Economic Development

32 Phase out the number of students that opt out over the next six years by strongly encouraging school districts to adopt curriculum models that will eventually make opting out unnecessary. Post-Secondary Education Enhance incentives to encourage students to go into STEM four-year degree programs, including secondary math and science education. Workforce Education Review and coordinate the existing workforce training programs to support the Arkansas Economic Development Commission s (AEDC s) targeted industries with an emphasis on best practices and support of the State s strategic economic development initiatives. Education Adopt the recommendations of the Task Force on Higher Education Remediation, Retention, and Graduation. Pass a constitutional amendment to Amendments 60 and 65 of the Arkansas Constitution that would eliminate the interest rate caps for the Arkansas Student Loan Authority (ASLA). Research and Development Expand the job-creating research and development capabilities of our universities through sustained State investment in research infrastructure and science and engineering talent. Entrepreneurship Develop an economics and entrepreneurship curriculum appropriate for grades K-16, including classes in personal finance. Risk Capital Increase the availability of risk capital for State supported investment in early stage technology start-ups. Existing Business Innovation Expand research and development (R&D) incentives for industry; financially support business retention and expansion activities through AEDC s existing Business Retention and Expansion program, the Arkansas Science and Technology Authority s (ASTA s) Arkansas Manufacturing Solutions, and a variety of Arkansas Development Finance Authority (ADFA) programs; and increase incentives for existing businesses to modernize their processes through R&D and modernization of their equipment. Infrastructure Create a 21st Century cyber-infrastructure. Economic Development Activities Make Arkansas globally competitive in business and industry recruitment. Innovate Arkansas, Innovation.arkansasbusiness.com Innovate Arkansas works with new, technology- based entrepreneurs to turn inventions and high-tech concepts into viable businesses. Its primary purpose is to create high-paying Arkansas jobs in the knowledge, technology, and information-based industries. The intended result is a rise in Arkansas' per capita personal income. Innovate Arkansas works with new technology-based entrepreneurs as they move new inventions and high-tech service concepts toward viable commercial enterprises. The intended outcome is that Arkansas will benefit from an increase in higher-paying jobs and better opportunities for its college-educated youth, as well as entice young professionals from outside the state to relocate to Arkansas. Page 28 of 124 Part 3 Strategies of Entities Engaged in Economic Development

33 Objectives To recruit and assist technology entrepreneurs by conducting product assessments, market feasibility analysis, commercialization strategies, business plan development and product and concept valuation To work with university research centers to assist those technology innovations already identified in the university settings, and help provide the necessary business and financial support services Identify existing technology employers who have unused or "on-the-shelf" intellectual property to negotiate control of the intellectual property, match intellectual property with serial entrepreneurs and develop intellectual property Governor s New Strategic Plan / Arkansas Economic Development Commission, 2009 Just as the last editing was being done on this SWOT Analysis document, AEDC released the Governor s new Plan for Economic Development. Goals Governor Beebe s five goals are: 1. Increase the incomes of Arkansans at a growth pace greater than the national average. 2. Expand entrepreneurship, focusing on knowledge-based enterprises. 3. Compete more effectively in the global marketplace for new business and jobs, and create a business retention strategy to reduce closures. 4. Economic development will meet the special needs and take advantage of the extraordinary assets of various areas of the state. It will not be a one size fits all. 5. Increase the number of workers with post-secondary training so they are prepared when they enter the workforce and equipped for new jobs in the future. Guiding Principles 1. To generate wealth for Arkansans, the AEDC requires a systematic plan causing a transition to an economy supported by knowledge-based jobs. 2. All internal and external AEDC business practices and processes must be evaluated to guarantee efficiencies of operation and mission focus. Inefficient processes should be corrected immediately, while others must be evaluated over a period of time to determine if they are properly focused. 3. 3Scarce and diffused economic resources mandate a coordination of efforts led by the AEDC to transition the Arkansas economy to an economy supported by knowledge-based jobs. 4. The AEDC must help provide the needed tools to allow regions to control their own economic development. 5. A new approach to state and regional economic development funding must be employed to ensure resources are predictable and flexible. This approach will allow funds to be committed efficiently and equitably. Implementation of these guiding principles will lead to accomplishments in the five key sectors of: Workforce Development Infrastructure Business Development Competitive Business Climate Collaborative Partnerships. It would appear that the State s new economic development focus will: Support regionally developed and adopted strategies Give greater recognition to the role that NW Arkansas plays in the State s future. Page 29 of 124 Part 3 Strategies of Entities Engaged in Economic Development

34 Regional Entities in Asset-Building In addition to the University of Arkansas and NW Arkansas Community College, which are included in a separate section below, there are two primary entities working in economic development asset building within a regional context and a host of others working independently within the region or only working on a project by project basis as a region. Those working within a regional context are as follows: Northwest Arkansas Council Green Valley Network Those working independently are as follows: Benton County Washington County City of Fayetteville City of Bentonville City of Rogers City of Springdale The Northwest Arkansas Council is a private regional organization of business leaders with the primary purpose of marketing and promoting the region. Its mission has evolved to lead economic research, thinking, and major initiatives, such as the airport. The Green Valley Network is a non-profit coalition that fosters collaboration and commercialization of sustainability technology, particularly in making, shipping, and retailing. The Green Valley Network connects the Northwest Arkansas region to the world through its initiatives in sustainability and green technology. Summaries of the plans of the two regional entities follow. Northwest Arkansas Council, Economic Development Strategy, June 7, 2001 As stated in the introduction to the Northwest Arkansas Council plan of 2001, the past 20 years in Northwest Arkansas have been nothing short of phenomenal with respect to economic growth. Job growth averaged between 3 and 4 percent annually for nearly 20 years, one of the highest sustained growth rates in the country, leading to one of the lowest unemployment rates in the United States. The region exceeded the United States Census rates of population growth among most competitor locations and the State of Arkansas with the region, ending the 1990 s as the 6 th fastest growing MSA in the country. The region planned and increased its connection to the outside world focusing on critical road, airport, and water expansions. While recognizing past successes, specific concerns have emerged: Workforce skills are not keeping up with employer needs and market demands Continued growth is stretching and straining the area s infrastructure The area is not sharing in the growth of industries that create wealth and value through the use of technology Outside existing firms, the region does not have image as a place to build a challenging career with an exceptional quality of life. Economic Performance Best The region s major companies were excellent competitors in regional and national markets and expanded their market share over the last 20 years. Page 30 of 124 Part 3 Strategies of Entities Engaged in Economic Development

35 Compared to its nine benchmarked competitors, the regions overall economic performance trailed only the extremely high growth rates of Austin and Raleigh/Durham. Since 1990, the region s unemployment rate has been consistently almost two full percentage points below the corresponding figures for Arkansas and the US. Worst The region s growth in high technology employment has lagged behind the US and other comparable MSAs. When measured in terms of gross product per worker, the region s economy is less productive than those of the benchmarked competitors. The region s economy is forecasted to slow down in the next decade, and while its rate of growth is expected to still exceed the US average, the difference will shrink perhaps dramatically. NWAC Conclusions Northwest Arkansas is extremely reliant for growth on its existing anchor industries including Walmart, Tyson Foods, and J.B. Hunt comprising more than 50 percent of the region s growth. There is evidence that despite efforts to keep up with infrastructure planning, significant near- and mid-term challenges remain 16 road segments face growth constraints by 2020 requiring ongoing expenditures of $270-$450 million per five-year period over the next 20 years. The region has generally not benefited from the national trend that ties productivity and performance to technology the region has one of the lowest ratings when looking at concentrations or clusters of technology industries. Foundation Strategies for the Region First, increase the competitiveness of the region s anchor businesses, and Second, identify and attract skilled workers and selected businesses that complement the existing anchors and create opportunities for further growth and innovation in the region. Strategic Initiatives Human Resources: Building Skills & Opportunities The number one issue for the region s business is the ever-increasing shortage of qualified personnel. In the next decade and beyond, Northwest Arkansas must insure that the size, quality and skill levels of its workforce meet the needs of its current and future business customers. Technology: Building a More Competitive Economy There is little doubt that the presence of a technology base in a local economy leads to enhanced economic performance. Unfortunately, Northwest Arkansas ranks near the bottom of high technology rankings of US cities in various studies including the Milken Institute study on America s high-tech economy. Infrastructure: Building and Expanding for the Region Creation of a state of the art infrastructure has been an integral part of the region s economic development strategy for some time. Despite these efforts, continued attention is required to capitalize on investments and meet future market demands. Marketing Northwest Arkansas: Telling the Story Well Image is the perception that the marketplace has of an area s attributes as a business location. The quality of an area s image is fundamental to its ability to retain and grow existing businesses and attract new ones. Page 31 of 124 Part 3 Strategies of Entities Engaged in Economic Development

36 Green Valley Network, Sustainability is a technology platform like semiconductors, the Internet or nanotechnology. Innovators who apply emerging technology usually cluster together to leverage each other s resources. The Green Valley, extending from northwest Arkansas into sections of Missouri, Kansas, and Oklahoma, has become a business cluster for innovators who are applying tomorrow s sustainability technology today. Green Valley Network helps sustainability s innovators move ideas from mind to market faster. The Green Valley Network was formed by CaseStack founder and CEO, Dan Sanker. Mr. Sanker relocated his business to Fayetteville to conserve energy and other finite resources and more effectively manage the changes necessary in his own business to be more sustainable. The sustainability revolution has deep roots in the foundations of sustainability technology agriculture, energy, industry and frugality. Arkansas Green Valley is home to: The highest concentration of plant scientists in the world Walmart, the largest funnel for global consumer demand and the largest proponent of sustainability on Earth The largest pre-existing supplier cluster with 1,300 consumer goods companies One of America's largest oil and gas energy centers The world's busiest cargo airport One of America's largest agri-business centers with biofuel and eco-tourism opportunities The Technology Transfer Center Innovators with sustainability intellectual property and companies that want to find the latest technology find each other at the Green Valley Network Technology Transfer Center. Innovators can describe their technology, so companies can find what they are looking for. Companies that need specific technology can source their needs at the Technology Transfer Center. The Venture Center The Venture Center is an Investor-Entrepreneur Relationship Service for Green Valley Network Members. Entrepreneurs can submit business plans, and investors can review analytical summaries of investment opportunities. On the last day of each quarter Green Valley Network will submit completed summaries to qualified venture capitalists. The Venture Center is powered by EquityNet which provides innovative software tools and services to the private-equity investment marketplace, including specialized web-based applications that allow investors and entrepreneurs to improve the efficiency and value of the investment process. EquityNet offers a secure and independent platform that enables market participants to make better decisions in less time than with conventional methods. LinkedIn Green Valley Network Linkedin Group LinkedIn is an online network of more than 20 million experienced professionals from around the world, representing 150 industries. Members may find potential business clients, service providers, subject experts, and partners who come recommended. Member may also search for business opportunities, new jobs, post and distribute job listings, find high-quality passive candidates, and get introduced to other professionals through those they know. Green Valley Network has a Linkedin Group. Page 32 of 124 Part 3 Strategies of Entities Engaged in Economic Development

37 Higher Education University of Arkansas at Fayetteville The State of Arkansas supports 35 public colleges and universities. The University of Arkansas at Fayetteville is the State s land-grant and flagship institution. Its programs include nearly all disciplines, except Health Sciences, which is based in Little Rock. In 2001, Chancellor John White appointed a group of 92 leaders in business, education, government, and the professions with the charge: to make the case for the University of Arkansas becoming a nationally competitive, student-centered research university serving Arkansas and the world. This 2010 Commission produced the plan document Making the Case: The Impact of the University of Arkansas on the Future of the State of Arkansas in September, The 2010 Commission also developed three formal updates on progress achieved: Picking Up the Pace, March 2004 Gaining Ground, March 2005 Raising the Bar, February The strategy, as revised in 2007, consists of 40 recommendations: Thirteen for the Governor and General Assembly Five for the Arkansas Congressional delegation Nine for the State s business leaders Thirteen for the University of Arkansas community. Chancellor White retired from that position and it is presumed that Chancellor David Gearhart, who just recently assumed the chancellorship, will determine how he wishes to move forward with overall University strategies, building from the 2010 Commission s base. Graduate Education and Research UA s strategic plan for Graduate Education and Research calls for an increase in graduate enrollment to 5,500 by 2010 and graduation of at least 185 doctoral students per year and at least 1,295 master s and specialist students per year. This plan also emphasizes retention of students through more intentional advising, providing resources for counseling, communication, academic growth, and leadership development. It includes in its goals stimulation of creative activity, research and development of flexible organizational units that encourage collaborative research and can respond rapidly to large-scale funding opportunities. Of particular importance to economic development are plans to offer: M.S. and Ph.D. in Human Nutrition Science, interdepartmental between Food Science and Human Environmental Sciences. Master s in Biostatistics Departments of Biological Sciences and Mathematical Sciences Certificate in Computational Biology And to strengthen: Cross-college interdisciplinary programs (Cell & Molecular Biology, Microelectronics-Photonics, Space and Planetary Sciences, Public Policy) and Environmental Dynamics Master of Science in Biomedical Engineering. Page 33 of 124 Part 3 Strategies of Entities Engaged in Economic Development

38 University of Arkansas Technology Development Foundation and Arkansas Research and Technology Park The mission of the University of Arkansas Technology Development Foundation is to stimulate a knowledge-based economy in the state of Arkansas through partnerships that lead to new opportunities for learning and discovery, that build and retain a knowledge-based workforce and that spawn the development of new technologies that enrich the economic base of Arkansas. UATDF is sponsor and master developer of Arkansas Research and Technology Park, which envisions a build-out of nearly 1 million square feet for university and corporate partner advanced technology activities. The Master Plan contemplates: Carefully organized building clusters, offering a wide array of floor sizes, which can respond to specific project requirements A strong community aspect, both within the research park and its relationship to surrounding property development and the resulting centers of activity Clustered, well-landscaped parking within the property, enhancing the visual character of the project Establishment of a well-designed, landscaped internal road system including a hierarchy of streets that will provide access to the site from several points, as well as between buildings. Use of an abandoned railway line for an internal vehicular route, connecting the ARTP with the supporting public and private development Preservation and enhancement of existing natural features, including streams and wooded areas Inclusion of mixed-use amenities, such as dining facilities, lounge spaces, outdoor spaces and trails, parks and plazas. Facilities already developed include: The University of Arkansas Engineering Research Center The Genesis Technology Incubator The Innovation Center National Center for Reliable Power Transmission (NCREPT) High Density Electronics Center (HiDEC) A new multi-tenant building, the Enterprise Center, which will have 60,000 square feet of office and lab space available for lease, is in planning. Internally, at the University, UATDF works closely with the University s Offices of Research and Technology Transfer and with schools and colleges, to help identify and create R&D partnership relationships between faculty and private sector R&D counterparts. UATDF also is a major locus of the University s outreach and partnership with others in the City, region, and State for overall advancement of economic development. Primary partners include: Arkansas Economic Development Commission City of Fayetteville Page 34 of 124 Part 3 Strategies of Entities Engaged in Economic Development

39 Northwest Arkansas Council Fayetteville Economic Development Council Accelerate Arkansas Green Valley Network Innovate Arkansas NorthWest Arkansas Community College Background NorthWest Arkansas Community College (NWACC) is a comprehensive, learning-centered two-year college dedicated primarily to meeting the educational needs of its service area. NWACC offers a comprehensive educational program including, but without limitation, technical and occupational programs, freshman and sophomore programs for students to transfer to four-year colleges, specialty courses, professional continuing education courses, community enrichment classes, and business and industry training to meet the needs of the emerging and existing businesses in the area. (Statement of Scope, NWACC Fact Book, , p. 6.) The NorthWest Arkansas Community College District was authorized in 1989 by the voters in the Rogers and Bentonville public school districts. The first classes were attended by more than 1,200 students in municipal and leased facilities, high schools, and chambers of commerce. Its first facility was opened in August 1995 on 131 acres of land just off Interstate 540 at the Rogers and Bentonville city limits. A second facility in Bentonville, Shewmaker Center for Workforce Technologies, houses customized programs for area businesses. The College s Adult Education Program, which serves over 3,000 students per year, is located in Rogers. An additional facility, College at the Crossings, opened in Bella Vista in the fall of The Regional Technology Center, an area secondary education center, opened August 2005 in Fayetteville. The Washington County Center is located in Springdale, and the Western Benton County Regional Technology Center opened in Gentry in August Strategic Plan Goals, NWACC plans to become a premier educational provider in northwest Arkansas by developing a responsive educational delivery system customized to the needs of learners and receiving organizations. Its goals state: 1. For the student community we will: provide expanded access to educational opportunities for the population in general, but especially for under-served learners in all age groups who are disconnected from education by choice or circumstance. 2. For the business community we will: enhance partnerships and collaborations with business and industry through innovative approaches to design and delivery of training. 3. For the owner community (taxpayers) we will: a. enhance NWACC s capacity to achieve its initiatives by diversifying its resource base b. develop into a hub and function as a catalyst for comprehensive regional planning and development encompassing all sectors of the community. 4. For the pre-kindergarten through grade 16 community we will forge a systematic linkage with P-16 and University partners to achieve seamlessness in curriculum, technology and student support and service delivery. Page 35 of 124 Part 3 Strategies of Entities Engaged in Economic Development

40 5. For the college community we will: align the organizational infrastructure of NWACC with College growth. Anticipated New Programs to be offered by NWACC AAS Cultural Heritage Management AAS Sustainability AAS in Computer Information: Cyber Security Option Technical Certificate in Dental Assisting AAS in Culinary Arts AAS in Hospitality Management Technical Certificate in Baking Planned Changes/Additions to Existing Programs at NWACC AAS CAD (to be restructured) Technical Certificate in Hospitality Management (changed from Certificate of Proficiency) Technical Certificate in Culinary Arts (restructured) CNA/PCA+ courses (currently non-credit, moving to credit Spring 2009) Arkansas Medication Aid course to be piloted as credit course Spring 2009) Local Fayetteville Metro Area Strategic Plan , Mayor, City Council, and Executive Team, Fayetteville Arkansas, August In 2004, the City of Fayetteville engaged Lyle Sumek Associates, Inc. to guide it through a visioning and strategic planning process to develop a five-year Plan. As stated in the Plan, the Plan is the City s road map for five years on how to reach its vision with achievable goals, measurable benchmarks, and specific actions. Included in the Strategic Plan is a vision statement for the year 2020 defining the view of the participants for Fayetteville in the year Vision 2020 Fayetteville is a Naturally Beautiful City Diverse, Growing Economy Home of a Nationally Recognized University Vibrant Downtown / Dickson Area Revitalized South Fayetteville Safe Community Housing Choices for All Income Levels Ease of Mobility Fun City Fayetteville s Goals for 2009 A Strong, Diverse Economy Planned and Managed Growth Development of Our Crown Jewels: The Square Dickson Street University Improved Mobility and Street Quality Page 36 of 124 Part 3 Strategies of Entities Engaged in Economic Development

41 Strong Partnership with the University of Arkansas A Beautiful City Clean and Green. It is interesting that this consultant team has found such a notable lack of consensus about growth vs. no growth in our 2008 interviews, given that the extant Strategic Plan for Fayetteville articulates planned and managed growth as a goal. The City of Fayetteville, Fayetteville Chamber of Commerce, and the University of Arkansas all have separate economic development interests and staff to support their programming. However, for the purposes of planning and execution of overall economic development activities, the three entities joined together under the banner of the Fayetteville Economic Development Council (FEDC). None of the individual organizations have separate economic development plans. The most recent plan for the FEDC is summarized below. Fayetteville Economic Development Council, Strategic Plan and Priorities 2007 FEDC is a not-for-profit organization founded in 2004 by the Fayetteville Chamber of Commerce, the City of Fayetteville, and the University of Arkansas. FEDC is designed to serve as Fayetteville's single point of contact for economic development. FEDC is funded by private investments from local businesses and receives no tax dollars. Currently there are 80 investors. FEDC s Vision FEDC will create and grow a diverse, vital and sustainable economy that enables Fayetteville, Arkansas to enjoy a superb quality of life and be recognized throughout the world as a research, business, medical and cultural center of excellence. FEDC s Mission Serve as the single point of contact for economic development in Fayetteville, Arkansas. Provide the leadership required to leverage the strengths of the founding organizations and investors into a seamless, world-class economic development team. Bring new wealth and investment into the local economy by helping existing companies grow, creating new companies, and recruiting compatible new businesses. Metrics Successful efforts will create new jobs, increase per capita income and spendable income, and positively impact other economic indicators. This new wealth grows the property tax base for schools and sales tax base for the City. Economic Foundation Issues and Opportunities The University of Arkansas is Fayetteville s largest economic development engine. Leveraging the University s research capability is the single best opportunity for the creation of knowledge-based jobs, new businesses, and wealth in the 21 st Century. The existing tax base must be protected and grown. Businesses or industries that move or go out of business and consumers that shop elsewhere create a tax burden on the remaining taxpayers. FEDC Economic Development Priorities The following priorities were identified by members of the FEDC: Develop and promote a competitive business environment Determine the balance between the high development standards needed to keep Fayetteville a destination and the cost of developing. Evaluate costs and benefits of current and proposed impact fees, hillside ordinance, and other regulations and fees with respect to the tax base. Page 37 of 124 Part 3 Strategies of Entities Engaged in Economic Development

42 Determine if impact fees should be graduated or waived in areas where Fayetteville wants to encourage development. Create a spreadsheet to quickly estimate development costs and benefits. Evaluate the merit of City business incentives. Strongly support annexation with emphasis on those areas that will offer the highest return on investment. Define Fayetteville s image and strengths and then develop an aggressive marketing plan. Strongly support traffic improvements that provide critically needed access for key commercial areas. Improve access from Fulbright Expressway by making it a boulevard with stop lights and/or roundabouts to support mall retail. Improve Cato Spring Road on the south side of the Arkansas Research and Technology Park, South Fayetteville, and Highway 265 South. Identify land for a new business/vendor park. Support growth of the Arkansas Research and Technology Park (ARTP). Work with the University of Arkansas to find money to construct the next building(s) in accordance with the Master Plan for Arkansas Research and Technology Park. Tremendous success over a short period of time has left little or no space for new or growing companies in the park. Evaluate a Public/Private/Academic partnership for constructing new buildings in the ARTP. Explore options for new office space. Page 38 of 124 Part 3 Strategies of Entities Engaged in Economic Development

43 PART 4 STAKEHOLDER INTERVIEWS AND SWOT CONCLUSIONS This section summarizes the key strengths, weaknesses, opportunities and threats identified through the review of background plans and research and extensive discussions with stakeholders. Stakeholder Interviews To engage as many stakeholders as possible, despite the fact that Phase I was an abbreviated process, the City and University sponsors of Phase I organized groups of stakeholders for interviews with the consultants on October 14 and 15, 2008, that included: City of Fayetteville Mayor Dan Coody City Council Chief Financial Officer City Department Heads Group Chamber and Fayetteville Economic Development Council Group Fayetteville Public Schools Neighborhoods Group Bankers and Developers Group Northwest Arkansas Region Mayors, Other Cities Quorum Court, Washington County Chambers of Commerce, Other Cities Group Green Valley Network (D. Sanker) University of Arkansas Technology Development Foundation Superintendents of Schools, Other School Districts Northwest Arkansas Council Big Companies / Utilities Group Independent Business Alliance Group Arts Group Higher Education University of Arkansas (Deans and Vice Chancellors Group) NorthWest Arkansas Community College (President) The interview protocol included some general questions for all groups and some special-focus questions. Appendix C provides the interview protocol. The specific interviewees are listed in Appendix D followed by a compilation of interviewee comments in Appendix E. SWOT Conclusions Of necessity, the analysis and discussion of strengths, weaknesses, opportunities, and threats focus dually on the City of Fayetteville itself and on the larger region Northwest Arkansas. Strengths Fayetteville and Northwest Arkansas have a variety of strengths for achieving long-term future prosperity, many of which are compelling. These strengths offer a strong foundation on which to build a stronger, Page 39 of 127 Part 4 Stakeholder Interviews and SWOT Conclusions

44 more diversified economy and by which the region can make a successful transition to a 21 st century Knowledge Economy. Key among the City s and region s many strengths are: The University of Arkansas at Fayetteville and its faculty, research and students (historically, the 600- pound gorilla ) Globally-prominent corporations, including Walmart (recently emerged as the 800-pound gorilla ) The Green Valley Network initiative (the potential 1,000-pound gorilla ) and evident commitment of many leaders in the region, in all sectors, to sustainability in a variety of forms Quality of place and quality of life tremendous natural beauty, a good-quality built environment, and a small town atmosphere; good public schools; cultural, recreational and entertainment amenities; increasing residential housing options; and a reasonable cost of living Central US location with supportive infrastructure (interstate, airport, water, etc.) Entrepreneurial history and spirit Educated and professional work force; increasingly diverse population/demographics; and a growing retirement cohort (which can become an opportunity). Weaknesses A few important weaknesses are constraining the City s and the region s economic development, growth of advanced technology or knowledge-based businesses, and creation of high-paying jobs, including: Insufficient visibility on the national and international scenes (except as pertains to Walmart) Still relatively small knowledge industry base Educated work force not yet scaled for global competition Insufficient risk capital Limited regional cooperation for economic development; in fact, outright competition among local communities, and some hostility toward Fayetteville presumably arising in part from the region s history Perception of the City of Fayetteville as anti-business, based on realities of unpredictable business and development environment, politicization of development approval process, slow and difficult city decision-making, lack of commitment to implement publicly-approved plans and rules that seem to change in the middle of the process City s over-dependence on sales taxes Limited supply (reportedly) of available buildings and shovel-ready sites within Fayetteville itself That portion of the urban work force which consists of low-skilled workers without the training essential for occupations in today s economy, particularly for well-paying jobs; related problems of low-income population and public school at-risk students Weak technical education (non-baccalaureate post-secondary training) both for high school graduates and for adults already in the work force Limited public transportation, which tends to increase the risk of automobile-driven sprawl. Opportunities Major opportunity lies in featuring and consistently investing resources in various aspects of sustainability, building on important assets in the business and university community both in the City and regionally. Much good progress has occurred organically, as a result of corporate, individual, and public sector leadership. The opportunity lies in the lead that Fayetteville and the region already have (versus other regions) in these competencies that will be so important to the global future. What is needed is the commitment to focus and grow the assets to more systematically support, promote and leverage these accomplishments to achieve undisputed global prominence. Page 40 of 127 Part 4 Stakeholder Interviews and SWOT Conclusions

45 In connection with this, a second opportunity is presented by the potential to connect various leadership and strategy initiatives. There is a new State of Arkansas strategy. The University is on a path to engage more directly in developing the assets and outcomes in economic development. Walmart, other corporations, and the Green Valley Network already have compatible strategies. Thus, there is immense potential to align a more crisply-focused Fayetteville/NW Arkansas strategy with those of the State, University, NWACC, schools systems, NW Arkansas Council, chambers, and major corporate citizens. This is an opportunity of the stars are aligned type. Threats The biggest threat and impediment to success in transition to a 21 st century Knowledge Economy is complacency engendered by the fairly good economy that developed without significant public intervention since the community organized to bring the University of Arkansas to Fayetteville in the 1800s. Within Fayetteville itself, this threat takes the form of a strong division of views about growth. For Fayetteville, the threat is that other communities in the region may promote themselves more successfully for knowledge-based companies and that Fayetteville s prosperity could go into relative decline. The second big threat is that sustainability in all its forms (energy, logistics, transportation, health, regional development, etc.) now is a highly visible field that many other regions around the globe are determined to mine for economic opportunities. If Fayetteville and NW Arkansas do not focus well enough on investments and promotion relating to sustainability, there is the threat that other regions with significant assets will emerge in the coming decades as more prominent global leadership regions. The third threat is that failure to adopt effective regionalism, with respect to a common vision of the region s future, shared investments, and scaled up regional promotion strategies, could lead to suboptimization of the region s considerable potential. It is a risk that too much energy could be devoted to local competition, rather than to the entire region s competitive success vis-à-vis other global regions. Summary As stated in Fayetteville Past, Present and Options for the Future: The City is at a tipping point. Will Fayetteville guide change and chart its own fiscal future or will Fayetteville respond piecemeal confronting one fiscal crisis, only to be confronted by the next? Without the creation and execution of a strategy for fiscal sustainability, funding may no longer be available for the expansion or even continuation of some of those quality of life programs and activities that make and keep Fayetteville unique and continue to separate it from its neighbors. A new Economic Development Strategy for Fayetteville should be constructed of two types of strategies: Some that are specific to the City of Fayetteville Several that must be regionally-focused to be effective, and thus require active participation of Fayetteville s public and private partners throughout Northwest Arkansas in their definition and implementation. (This suggests that Fayetteville may ask its neighbors about a joined effort in future economic development planning.) The new Economic Development Strategy should be designed to connect and help sharpen, and in some cases build upon previous work, (but not replace or set aside) the strategic plans and priorities of the many stakeholder entities in the region including all levels of government, academia, not-for-profit social and cultural institutions, and private sector players. Again quoting Fayetteville Past, Present and Options for the Future: everyone must be involved in the choices. In a sense, it should be a regional meta-plan, including common vision and a commonly accepted set of major goals toward which all parties contribute resources and effort. Within such a regional meta-plan, there is a great deal of room for communityspecific strategies, as each of the communities in the region may define for themselves. Page 41 of 127 Part 4 Stakeholder Interviews and SWOT Conclusions

46 APPENDIX A APPENDIX TABLES Table A-1. Employment Trends, Benchmark Cities, Fayetteville Austin Birmingham Gainesville Greensboro Greenville Raleigh Richmond Total Employment Employment Growth 57, ,600 27,500 17,400 20,500 26, ,300 73,600 Percentage Growth 38.5% 26.1% 5.4% 14.9% 5.8% 9.2% 26.6% 13.1% Information Industry Employment Percent of Total Jobs 1.3% 2.9% 2.2% 1.5% 1.7% 2.0% 3.2% 1.8% Employment Growth 600 3,400 (2,000) (100) (600) 200 (300) (300) Percentage Growth 28.6% 18.4% -14.8% -4.8% -8.7% 3.2% -1.8% -2.6% Source: Bureau of Labor Statistics, U.S. Department of Labor; Partners for Economic Solutions, Table A-2. Unemployment Rate, Benchmark Cities, 2007 Total Employment Fayetteville Austin Birmingham Gainesville Greensboro Greenville Raleigh Richmond Unemployment Rate 5.9% 6.0% 6.4% 6.8% 6.7% 7.2% 4.9% 5.8% Source: American Community Survey; Partners for Economic Solutions, Table A-3. Educational Attainment, Benchmark Cities, 2007 Fayetteville Austin Birmingham Gainesville Greensboro Greenville Raleigh Richmond Total Employment Percent with High School Degree or Higher 83.2% 85.7% 83.7% 89.3% 82.3% 80.8% 88.8% 85.3% Percent with Bachelo's Degree or Higher 25.6% 38.4% 25.4% 38.4% 25.8% 26.5% 41.4% 30.2% Source: American Community Survey; Partners for Economic Solutions, Table A-4. Median Household Income, Benchmark Cities, 2007 Household Income Fayetteville Austin Birmingham Gainesville Greensboro Greenville Raleigh Richmond Median Household Income $44,552 $56,746 $47,196 $38,026 $42,486 $45,210 $58,111 $56,739 Source: American Community Survey; Partners for Economic Solutions, Page 42 of 124 Appendix A Appendix Tables

47 Table A-5. Scores on 11th Grade Literacy Exam by School District, th Grade Percent Enrollment Number Mean Below Percent Percent Percent District Tested Score Basic Basic Proficient Advanced Bentonville % 22% 71% 3% Decatur % 45% 32% 0% Elkins % 41% 51% 3% Farmington % 38% 53% 1% Fayetteville % 24% 66% 4% Gentry % 45% 53% 0% Gravette % 29% 63% 3% Greenland % 51% 38% 2% Lincoln % 42% 43% 0% Pea Ridge % 35% 58% 1% Prairie Grove % 33% 58% 0% Rogers % 36% 55% 2% Siloam Springs % 36% 54% 1% Springdale % 40% 46% 0% West Fork % 37% 52% 0% Source: Arkansas Department of Education, Statewide Information System. Page 43 of 124 Appendix A Appendix Tables

48 Table A-6. Technical Training Programs by School District Program of Study Administration & Information Support: Office Administration Animal Systems Audio & Video Technology and Film: Career Communications Banking and Related Services: Banking Business Financial Management: Finance Construction: Construction Technology Design/Pre-Construction: Drafting and Design Architectural CAD Early Childhood Development and Services: Childcare Guidance, Management and Engineering and Technology: Pre-Engineering Facility and Mobile Equipment Maintenance: Automotive Collision Facility and Mobile Equipment Maintenance: Aviation Mechanics Family and Community Services: Family and Consumer Sciences Education Interactive Media: Desktop Publishing Interactive Media: Multimedia District(s) Offering Rogers, Springdale Bentonville, Fayetteville, Rogers, Springdale Fayetteville, Rogers Rogers Springdale Springdale Bentonville, Rogers, Springdale Bentonville, Springdale Bentonville, Springdale Bentonville, Fayetteville, Rogers Bentonville, Fayetteville Bentonville, Fayetteville, Rogers, Springdale Fayetteville*, Springdale Bentonville, Fayetteville*, Rogers, Springdale Journalism and Broadcasting: Radio/TV Broadcasting Law Enforcement Services: Criminal Justice Management Marketing Information Management and Research: Marketing Technology National Security: JROTC Network Systems: Computer Engineering Personal Care Services: Cosmetology Plant Systems: Horticulture Plant Systems: Biological Power, Structural and Technical Systems: Agricultural Power, Structural & Technical Systems Printing Technology: Graphic Communications Production: Welding Programming/Software Engineering: Programming Springdale Bentonville, Fayetteville, Springdale Bentonville, Rogers Bentonville, Fayetteville, Rogers, Springdale* Springdale Fayetteville* Bentonville, Fayetteville, Rogers, Springdale Bentonville*, Rogers, Springdale Fayetteville* Fayetteville, Rogers Fayetteville, Rogers, Springdale Bentonville, Fayetteville Bentonville, Fayetteville*, Rogers, Springdale Restaurant & Food and Beverage Services: Culinary Arts Therapeutic Services: Medical Professions Education Visual Arts: Advertising Design Visual Arts: Career Communications Note: * indicates Conditionally Approved. Source: Arkansas Department of Education, Statewide Information System. Bentonville*, Fayetteville*, Rogers*, Springdale Bentonville, Fayetteville, Rogers, Springdale Springdale Fayetteville Page 44 of 124 Appendix A Appendix Tables

49 Table A-7. Languages Spoken at Home by Students, by District, District Total Number of Languages Spoken Language with Enrollment of 10 or More Enrollment Bentonville 36 Korean 11 Tamil 11 Vietnamese 51 English 10,224 Hmong 12 Laotian 10 Marshallese 14 Spanish 724 Telugu 19 Decatur 5 Hmong 24 Spanish 81 English 441 Elkins 6 Spanish 23 English 1,077 Eureka Springs 4 English 645 Spanish 20 Farmington 10 Spanish 105 English 2,013 Fayetteville 41 Korean 20 Marshallese 24 Arabic 45 Swahili 10 English 7,335 Chinese 60 Russian 14 Spanish 587 Page 45 of 124 Appendix A Appendix Tables

50 Table A-7. Languages Spoken at Home by Students, by District, (Cont.) District Total Number of Languages Spoken Language with Enrollment of 10 or More Enrollment Gentry 8 Spanish 108 Hmong 111 English 1,204 Gravette 8 Spanish 54 Hmong 25 English 1,501 Greenland 2 English 915 Spanish 10 Lincoln 8 Spanish 81 Hmong 62 English 1,076 Pea Ridge 9 Spanish 78 English 1,386 Prairie Grove 5 Spanish 21 Hmong 10 English 1,634 Rogers 34 Hmong 13 Marshallese 24 Vietnamese 45 English 8,109 Laotian 35 Spanish 4,591 Siloam Springs 14 Spanish 644 English 2,578 Hmong 60 Springdale 36 Spanish 5,758 Marshallese 764 English 9,413 Chinese 13 Vietnamese 10 Laotian 151 West Fork 5 English 121 Source: Arkansas Department of Education, Statewide Information System. Page 46 of 124 Appendix A Appendix Tables

51 Table A-8. Free and Reduced Lunch Student Enrollment, District Enrollment Free/Reduced Lunch Percent Free/ Reduced Lunch Bentonville School District 11,118 2, % Decatur School District % Elkins School District 1, % Farmington School District 2, % Fayetteville School District 8,496 2, % Gentry School District 1, % Gravette School District 1, % Greenland School District % Lincoln School District 1, % Pea Ridge School District % Prairie Grove School District 1, % Rogers School District 13,241 6, % Siloam Springs School District 3,577 1, % Springdale School District 16,476 8, % West Fork School District 1, % Source: Arkansas Department of Education, Statewide Information System. Page 47 of 124 Appendix A Appendix Tables

52 Table A-9. Northwest Training Institute Diploma Programs Program Areas Ammonia Refrigeration Maintenance Technology Architectural Drafting Technology Automotive Service Technology Business Accounting Assistant Administrative Assistant Medical Assistant Computer Information Systems (CIS) Network/Computer Technician Programmer Source: Northwest Training Institute. Diesel & Truck Technology Electronics Technology Industrial Maintenance Technology Automated Industrial Process Technology Mathematics and Communications Practical Nursing Surgical Technology Truck Driving Table A-10. Occupations Authorized for Sponsored Training Occupations Bakers Coating, Painting, and Spraying Machine Setters, Operators, and Tenders Commercial Pilots Compensation, Benefits, and Job Analysis Specialists Mechanical Drafters Meter Readers, Utilities Ophthalmic Laboratory Technicians Opticians, Dispensing Compliance Officers, Except Agriculture, Construction, Health and Safety, and Transportation Computer and Information Scientists, Research Computer Software Engineers, Systems Software Construction and Building Inspectors Demonstrators and Product Promoters Electrical and Electronic Engineering Technicians Engineering Managers Extruding, Forming, Pressing, and Compacting Machine Setters, Operators, and Tenders Farm Equipment Mechanics Food Batchmakers Food Cooking Machine Operators and Tenders Legal Secretaries Procurement Clerks Purchasing Managers Real Estate Brokers Roofers Structural Metal Fabricators and Fitters Surveying and Mapping Technicians Surveyors Switchboard Operators, Including Answering Service Technical Writers Telecommunications Line Installers and Repairers Weighers, Measurers, Checkers, and Samplers, Recordkeeping Wholesale and Retail Buyers, Except Farm Products Massage Therapists Source: Northwest Arkansas Economic Development District, Local Workforce Investment Board Page 48 of 124 Appendix A Appendix Tables

53 APPENDIX B SUMMARIES OF ADDITIONAL PLAN DOCUMENTS The following provides additional detail from several of the key planning documents summarized in Part 3 and summaries of additional historical documents. State Government Arkansas Research and Development Plan: A Strategic Plan to Guide Arkansas into the 21 st Century, April 1996 Background The research history of Arkansas began with the establishment in 1888 of the Agricultural Experiment Station at the University of Arkansas (U of A). The mission of this center was to deal with problems of practical importance to farmers, stock raisers and fruit growers of the state. Basically, the research was designed to bolster the production of existing crops. The mission of the Experiment Station has changed since 1888 and will continue to evolve. Today's agricultural research is very much "science based" with emphasis on cellular and molecular techniques. The UofA also has changed with time. By the 1950s, doctoral degrees were being awarded in several fields, and by 1970, the UofA had developed into the five-campus University of Arkansas System, which includes the: Original land grant site at Fayetteville as the University of Arkansas, Fayetteville University of Arkansas for Medical Sciences (in Little Rock) University of Arkansas at Little Rock University of Arkansas at Pine Bluff University of Arkansas at Monticello. In 1979, the National Science Foundation (NSF) requested that seven states write proposals to compete for funds under a new program called EPSCoR, the Experimental Program to Stimulate Competitive Research. NSF had found that a few states received the majority of NSF funds, while there was a group of states that received an order of magnitude less in NSF funding per capita than the national average. Arkansas was one of those seven states. The basic EPSCoR concept was to fund programs that would overcome the barriers to research in these states. According to NSF, one of those barriers was a lack of state financial commitment. The six barriers most frequently identified in the NSF survey of the states were: Inadequate release time Lack of "state of the art" equipment Lack of technical support personnel for the laboratory Lack of support from department leaders and higher administration Lack of technical services for research (glass blowing, repairs, etc.) Lack of laboratory space. The General Assembly in 1983 created the Arkansas Science & Technology Authority (ASTA) and charged it with increasing the R&D activity of the state. During the first decade of its existence, the Authority promoted Arkansas' R&D climate by: Awarding 101 Basic Research Grants, totaling $3,384,664 Awarding 35 Applied Research Grants, totaling $850,701 Placing $1,500,500 in Seed Capital Investments that created 264 jobs Establishing seven Business Incubators around the State. Page 49 of 124 Appendix B Summaries of Additional Plan Documents

54 ASTA s 2008 plan is included separately later in this appendix. However, the plan document does not provide information to update the above awards through In September 1993, the Arkansas Institute reported that Arkansas still was not receiving its fair share of federal research dollars. In 1990, Arkansas was 43rd in the amount of federal R&D funding. The report further indicated that this was related to the fact that the state had the lowest number of PhD scientists and engineers per capita. In May 1994, Governor Jim Guy Tucker appointed a task force that he charged with developing a research and development (R&D) plan for Arkansas State government. It detailed strategies designed to promote scientific knowledge in the general population and to increase the number of graduates majoring in science, math and engineering. It also provided suggested approaches for improving the R&D climate of the State and identifies six areas in which Arkansas should invest for the future. These areas were as follows: Advanced Materials Agriculture, Food and Life Sciences Biotechnology and Bioengineering Environment Manufacturing Systems Transportation and Logistics This task force was charged with developing a strategic plan for enhancing R&D in Arkansas. The desired plan would emphasize the state's broad R&D needs and complement federal and university research agendas. The Task Force first met on June 15, 1994, with John W. Ahlen as the chair, and decided to divide into four working groups: Human Resources Policy/Infrastructure R&D Capacity Communications. Arkansas companies identified the following obstacles to R&D. These items are listed in order of most reported to least reported: 1. Not enough money for R&D 2. Lack of in-house R&D expertise 3. Cost of R&D would outweigh potential economic benefits 4. Unable to estimate the benefits of R&D 5. Lack of in-house expertise to assimilate or use the results of R&D 6. Unable to identify specific R&D needs 7. Government regulations concerning the environment, health, or safety 8. Could not find competent outside scientists who were willing or able to assist with the necessary R&D 9. No urgency to conduct R&D because it was satisfied with the current situation 10. Would be unable to reap economic benefits because of current patent laws and the inability to prevent dissemination of R&D results 11. Could not complete R&D in the time needed 12. Had bad previous experiences in attempts at R&D 13. Could not catch up with competitors 14. Federal or state anti-trust laws blocking joint industry projects The Task Force articulated its vision for change in a formal Vision Statement and Goals for the Research and Development Plan. Page 50 of 124 Appendix B Summaries of Additional Plan Documents

55 Vision Statement Economic Growth based on Science and Technology with Improved Science and Technology Education Available to All. Goals The two primary goals as formulated by the Task Force were as follows: 1. To insure that Arkansas achieves national recognition in research and development (R&D) 2. To enhance the quality of life for Arkansans through increased R&D activity. These actions were recommended by the Task Force as important steps in the development of R&D in Arkansas: Human resources should be improved by: 1. Strengthening minority participation at all levels of education, including increased recruitment and retention of minority faculty 2. Developing an increased consciousness of human resources development in all R&D activities 3. Developing the National Science Foundation's Rural Systemic Initiative Program with Louisiana and Mississippi 4. Increasing the use of technology in educational programs at all levels (in-service teacher training programs should be implemented to provide educators with a better understanding of science and currently available technology) 5. Increasing research opportunities for high school and undergraduate students and increasing the investment in graduate student research support 6. Encouraging collaborative efforts in research and education among all educational and private institutions in Arkansas 7. Encouraging the recruitment and retention of productive research scientists at all institutions of higher learning in the state 8. Increasing science literacy in the state. The climate for R&D should be improved by: 1. Developing a technology extension service program for Arkansas 2. Strengthening computer networking within the state 3. Developing shared instrumentation resources 4. Developing appropriate focus groups that promote interactions among individuals and institutions involved in the R&D enterprise 5. Providing financial incentives to promote R&D in the private sector (possible incentives include enterprise zones, investment tax credits, loss write-off legislation for R&D, sales tax exemptions on R&D, assessment practices for R&D facilities, and other tax preferences) 6. Providing matching funds for major R&D grants and contracts 7. Increasing the number of doctoral graduates in science and technology by providing incentives and interdisciplinary programs 8. Providing incentives to encourage students, especially women and minorities, to go into math, sciences, and engineering (tuition waivers and forgivable loans could be considered) 9. Providing incentives to promote technology-transfer (suggested incentives include liberal university patent policies, a patent/copyright assistance program, and programs designed to encourage university and college faculty to spin-off research ideas into private business and/or manufacturing) 10. Promoting the development of research parks by: Providing planning assistance to community leadership (perhaps as part of the Arkansas Industrial Development Commission's Arkansas Community of Excellence program) Page 51 of 124 Appendix B Summaries of Additional Plan Documents

56 Assisting in the establishment of partnerships among industry, academic institutions and government labs (for example Arkansas/Marshall Space Flight Center agreement signed in 1993) Identifying low-cost land with adequate utilities and accessibility 11. Improving the climate for R&D in institutions of higher education by: Changing the depreciation schedule for research equipment and computers Allowing the use of provisional positions as needed for grants and contracts Recognizing the different needs of R&D as compared to classroom education Including R&D components as criteria for higher education productivity 12. Creating an infrastructure to assist in grant procurement and administration. Report of the Task Force for the Creation of Knowledge-Based Jobs, September 2002 The Task Force for the Creation of Knowledge-Based Jobs (the Task Force) was formed by the director of the Arkansas Department of Economic Development in June 2001 as an adjunct to Opportunity Arkansas. Opportunity Arkansas was an effort to establish a State economic development strategy based on regional plans that were initiated at five regional Opportunity Arkansas conferences held simultaneously on July 12, The Task Force was asked to contribute to this statewide economic development strategy by focusing specifically on knowledge-based job creation. A knowledge-based company is one that earns revenue in the marketplace through the intellectual activities of its employees who have some form of specialized training and are paid a relatively high average wage compared to the community average (two times the average or greater). This increased wage and spending power ripples through the economy and benefits all citizens of the state. Two-thirds of recent national growth stems from the expansion of knowledge-based businesses. The mission of the Task Force was to recommend ways to expand the number of knowledge-based jobs and companies in Arkansas. This was to be accomplished by: Increasing knowledge-based employment in existing businesses Increasing the number of new knowledge-based start-up businesses Attracting new knowledge-based businesses from outside the state. Page 52 of 124 Appendix B Summaries of Additional Plan Documents

57 Figure B-1. Process for Creating Knowledge-Based Jobs Recommendations The Task Force made recommendations in four areas. Those recommendations are summarized below: Education Elevate math and science education as a whole to the number one public education issue Establish an independent study panel to make recommendations on ways to better allocate, without a significant increase in spending, the state s higher education and supporting infrastructure (K-16) budget Shift resources to degree programs that best address the economic needs of Arkansas. Research Centers of Excellence Support research as a tool for economic growth Page 53 of 124 Appendix B Summaries of Additional Plan Documents

58 Focus research matching funds by establishing no more than six Centers of Excellence Business Formation and Expansion Institute a voucher program to provide flexible grants to qualified Arkansas-based business start-ups to help finance fees for professional services needed during the start-up phase Require state pension funds to invest not less than one percent and not more than three percent of their investment pools in the Fund of Funds for early-stage Arkansas technology companies or in Arkansas venture capital funds investing at least 60 percent of their investments in Arkansas companies Expand the Arkansas Science and Technology Authority s Seed Capital Program Pledge a portion of Arkansas Department of Economic Development s bond guaranty fund to support the Arkansas Development Finance Authority s venture capital fund specifically for Arkansas technology-based companies Provide specific tax incentives for investors in technology start-up and early-stage businesses to invest in Arkansas companies instead of out of state Modify economic development incentives to value people and other intangible assets Policy and Infrastructure Create the Knowledge-Based Industries Partnership of Arkansas to recommend and champion actions that will accelerate the creation of knowledge-based businesses and jobs Propose a constitutional amendment to allow equity investment by qualified state agencies Figure B-2. Recommendations for the Creation of Knowledge-Based Jobs Page 54 of 124 Appendix B Summaries of Additional Plan Documents

59 Positive Trends The Task Force identified the following positive trends: Positive Trends From Arkansas K-12 Recognizing the importance of a strong foundation to enable and support future research activity. The Task Force examined trends in grades Kindergarten through 12. The SmartStart and SmartStep programs were designed to provide Arkansas students with the basic education skills needed to be a successful student. The establishment of the Arkansas School for Math and Sciences has proven to be successful, especially in terms of providing students from smaller school districts an opportunity to participate in math and science curricula and activities that are normally not available in smaller schools. Arkansas leads the nation is in the proliferation of Environmental and Spatial Technology (EAST) labs. There are more than 100 EAST labs in Arkansas high schools. One of the most exciting parts of the EAST lab experience has been the impact this program has had on students who may not have been recognized as academically advanced. They have blossomed when allowed to participate in the EAST environment and utilize the high-end computer and software programs provided in the EAST labs. The Legislature Act 453 enacted in 2001 provides $250,000 in grant funds that will allow 50 to 75 projects to be funded to purchase science equipment in the public schools. Positive Trends from Higher Education Recognizing the impact of the Milken Study s statistics, the Task Force also took time to review the broad scope of positive activities underway in Arkansas technical colleges and universities. Arkansas two-year colleges have taken a leadership role in the establishment of Cisco Academies to train people in the installation, maintenance and service of information systems. The Genesis Incubator, located near the campus of the University of Arkansas at Fayetteville, is the lone survivor of an experiment in the mid-1980s to establish six business incubators in various locations throughout the state. The University of Arkansas at Fayetteville established the Arkansas Research and Technology Park (ARTP), which included the Genesis Incubator. The establishment of the UAMS Biomedical Biotechnology Center in 1994 and more recently Arkansas BioVentures incubator on the campus of the University of Arkansas for Medical Sciences in Little Rock. The establishment of the Donaghey College of Information Sciences and Systems Engineering (the CyberCollege) at the University of Arkansas at Little Rock is seen as another major positive step toward meeting the employment needs of information technology companies in Central Arkansas. More than 700 students are enrolled in degree programs and almost 500 more take classes in the college. Positive Trends from Expanded Research A very important factor in the creation and retention of knowledge-based jobs is the degree to which the State is involved in research that leads to innovations and the creation of new businesses. Although the state is consistently ranked among the lower tier of states in research-oriented indicators, Arkansas has taken some necessary steps to improve that ranking. The Arkansas Science and Technology Authority (ASTA) was established in 1983 to provide a focal point for science and technology issues in the state. ASTA offers assistance in the funding of basic and applied research and also manages a seed capital investment fund. The Seed Capital Program was initially funded at $1.8 million and its worth is now about $4 million. Page 55 of 124 Appendix B Summaries of Additional Plan Documents

60 In 1999, the Arkansas General Assembly established the Arkansas Research Matching Fund through Act For the first time, the State of Arkansas appropriated funds to allow colleges and universities to compete for federal research dollars. The results were dramatic in terms of the percentage of federal research dollars. A permanent source of revenue for this fund is essential if Arkansas colleges and universities are to aggressively participate in efforts to bring federal dollars to the state for research. Positive Trends from Entrepreneurial Activities Another indicator often used to gauge a state s progress in economic development is the extent to which entrepreneurial activities are encouraged and nurtured. The establishment of the Genesis Innovation Incubator program initiated by the University of Arkansas at Fayetteville is one such activity. This program provides access to University research equipment to assist promising startup companies coming out of the University. Arkansas Capital Corporation has initiated an annual business plan competition among Arkansas college students. Other actions included the passage of Act 1791 that authorized the Arkansas Development Finance Authority (ADFA) to establish a fund of funds venture capital investment group that would finance targeted and approved venture capital funds in the state. ADFA is authorized to finance up to $70 million in viable venture capital investments. A complementary act, Act 1584, allows investors who hold their investments in certain technology areas for at least five years to be exempt from the Arkansas capital gains tax on profits realized from these targeted investments. Building a Knowledge-Based Economy in Arkansas: Strategic Recommendations by Accelerate Arkansas, September 2007 Accelerate Arkansas is a statewide group of 60 business and education leaders committed to building a competitive, knowledge-based economy in Arkansas with the goal of achieving parity in per capita income with the US average by Once attained, approximately $2.4 billion in additional tax revenue will be created for the State on an annual basis. Mission The mission of the organization is to foster economic growth in Arkansas by using the essential building blocks of the knowledge-based economy, and to create an environment supporting entrepreneurship and continuous innovation. The Knowledge-Based Economy in Arkansas: Our Current Competitive Position Arkansas remains in the bottom ranking of most economic indices when compared to other states. Benchmark assessments of Arkansas for technology, research and development, risk capital, and education are relatively the same. The National State Technology and Science Index was published by the Milken Institute in 2002 and again in It provides a set of interrelated but distinct indicators that encompass a comprehensive inventory of technology and science assets important to the development of knowledge-based companies. Arkansas is 49th in the US on the overall 2004 State Technology and Science Index. With the exception of Mississippi, all of the states surrounding Arkansas ranked higher on the 2004 Index. Additional analysis of the Index showed that one of Arkansas strengths, although limited, lies in its ability to create and sustain the formation of new high-technology businesses in the state. Arkansas ranked above the national average for the number of fast-growing high-tech industries; the state was ranked 16th in the nation on the 2002 Index and 20th on the 2004 Index. In terms of yearly growth of high-tech industries, Arkansas ranked 18th in 2002, improving its performance to 12th in In net formation of high-tech establishments per 10,000 business establishments, Arkansas substantially increased its rank to 36th in the nation in the 2004 Index, up from 49th in States were again ranked in Information from that Page 56 of 124 Appendix B Summaries of Additional Plan Documents

61 ranking is included later in this appendix under a separate heading State Technology and Science Index The Milken Analysis of the Arkansas Economy The Milken Institute is an independent, publicly supported economic think tank with the mission to improve the lives and economic conditions of diverse populations in the US and around the world by helping business and public policy leaders identify and implement innovative ideas for creating broad-based prosperity. In 2004 the Milken Institute was commissioned by Accelerate Arkansas to analyze the issue of per capita income in Arkansas and to identify the actions necessary to raise Arkansans per capita personal income (PCPI) to the national average by Funding for the study was provided by the Winthrop Rockefeller Foundation. The Milken Institute report, Arkansas Position in the Knowledge-Based Economy: Prospects and Policy Options, was published in September This study was one of the most extensive ever conducted on the Arkansas economy. In it, the authors analyzed the economy of Arkansas relative to Milken s State Technology and Science Index; business and competitive factors; and industry groups in the State. Additionally, Milken compiled a comprehensive list of Arkansas institutions and policy tools that currently benefit the knowledge-based economy, and calculated the economic impact of the successful creation of knowledge-based industries in Arkansas. Finally, the Milken study made recommendations to enhance and expand Arkansas knowledge-based economy. Industry Typologies Based upon the Milken Institute research, with some modifications, Accelerate Arkansas has identified four typologies of high-technology and knowledge-based industries in Arkansas. The typologies are based upon two characteristics of the industries: their location quotient (i.e., the proportion of industry employment in Arkansas relative to the US as a whole) and their employment growth rate in Arkansas relative to the US as a whole. Only industries with positive employment growth rates are included in Accelerate Arkansas analysis. The industry typologies are described below, followed by Table B-1, a list of the four types of hightechnology and knowledge-based industries currently in Arkansas. Diamonds are industries that are growing faster in Arkansas than they are in the US as a whole, and employ a higher percentage of people in Arkansas than in the US. These are industries that could be said to be doing better than average. Rising Stars are industries that in Arkansas are growing faster than their US counterparts, but are less concentrated here than in the US. These industries could be said to be playing catch-up with their national counterparts. Drifters are industries that are more concentrated in Arkansas than in the US, but are growing here more slowly than they are in the US. Arkansas might have had an early advantage with these industries, but it could be slipping away for some reason. Finally, Laggards are industries that are both growing more slowly in Arkansas than in the US, and employ a smaller percentage of the population in Arkansas than they do in the US. These industries might be slowly disappearing from the state. Page 57 of 124 Appendix B Summaries of Additional Plan Documents

62 Table B-1: High Technology and Other Knowledge-based Industries in Arkansas Diamonds Drifters Commercial and Service Industry Machinery Mfg. Hardware Manufacturing Audio and Video Equipment Manufacturing Semiconductor and Other Electronic Component Manufacturers Motor Vehicle Body and Trailer Manufacturing Motor Vehicle Parts Manufacturing Activities Related to Credit Intermediation Lessors of Nonfinancial Intangible Assets Management of Companies and Enterprises Rising Stars Laggards Communications Equipment Manufacturing Software Publishers Aerospace Product and Parts Manufacturing Cable and Other Program Distribution Motion Picture and Video Industries Internet Service Providers and Web Search Portal Wired Telecommunications Carriers Data Processing Hosting and Related Services Wireless Telecommunications Carriers (except Satellite) Computer Systems Design and Related Services Telecommunications Resellers Construction of Buildings Satellite Telecommunications Machine Shops Turned Product and Screw, Nut, and Bolt Architectural Engineering and Related Services Manufacturing Scientific Research and Development Services Professional and Commercial Equipment and Supplies Medical and Diagnostic Laboratories Merchant Wholesalers Motor Vehicle Manufacturing Drugs and Druggists Sundries Merchant Wholesaler Hardware and Plumbing and Heating Equipment Radio and Television Broadcasting Merchant Wholesaler Cable and Other Subscription Programming Chemical and Allied Products Merchant Wholesaler Non-depository Credit Intermediation Deep Sea Coastal and Great Lakes Water Transport Securities and Commodity Exchanges Support Activities for Water Transportation Other Financial Investment Activities Freight Transportation Arrangement Agencies, Brokerages, and Other Insurance Related Internet Publishing and Broadcasting companies Securities and Commodity Contracts Intermediation Other Investment Pools & Funds Insurance Carriers Management, Scientific, and Technical Consulting Legal Services Office Administrative Services Offices of Physicians Facilities Support Services The following strategic recommendations were made by Accelerate Arkansas to support the building of a knowledge-based economy in its 2007 plan: Core strategy 1: Support job-creating research The action plans associated with this core strategy are all involved in increasing research in Arkansas, using scarce Arkansas dollars to increase research in areas that have more immediate impact in technology job creation. Provide research and development tax credits Create an Arkansas Research Alliance Recruit research talent with an Eminent Scholars Program Increase Arkansas research funding Create an Arkansas Research Park Authority Create and focus on programs of excellence in research Establish statewide master agreements for intellectual property sharing. Core strategy 2: Develop risk capital that is available for all stages of the business cycle, especially the funding gap. The risk capital action plans are related to areas where technology companies have difficulty raising risk capital, preventing their establishment, growth, and success. Page 58 of 124 Appendix B Summaries of Additional Plan Documents

63 Create an early Enterprise Development Fund Increase the Seed Capital Investment Program Establish a Risk Capital Matching Fund Facilitate a return to the state for support of private enterprise to be used for further investment. Use state retirement funds to invest in technology companies in Arkansas. Revise the investment tax credit. Provide small grants for support tasks for start-up technology companies. Amend the State Constitution to exempt private investors from usury restrictions for start-up companies. Lower the capital gains tax rate for residents of Arkansas who invest in Arkansas-headquartered targeted businesses and hold the ownership for at least five years. Implement a competitive severance tax for oil and gas extracted from within the state, use some of the funds to expand support of start-up technology companies and reduce other taxes commensurately. Amend the State Constitution to allow State economic development agencies to enhance returns for investments in start-up companies by allowing the agencies to hold equity in those companies that participate in the agencies economic development programs. Core strategy 3: Encourage entrepreneurship and accelerated new enterprise development. The action items for the third core strategy revolve around expanding the culture of entrepreneurship for technology and knowledge-based companies, supporting the entrepreneur starting such a company, and accelerating the company through support of a wide variety of actions via an organization designed for such support. Establish the Arkansas Accelerator Authority Redesign the Arkansas Community of Excellence (ACE) program Develop regional entrepreneurial centers. Core strategy 4: Increase the education level of Arkansans in science, technology, engineering, and math (STEM). In order to produce a workforce that possesses inquiring minds, enthusiasm for solving problems and finding new solutions in existing industry; to produce entrepreneurial start-ups; and to produce the recruiting of R&D jobs, Arkansas must significantly improve our students knowledge in the STEM areas. The action plans for this area are as follows: Provide Arkansas STEM Teacher Grants as salary supplements Expand the Environmental and Spatial Technology (EAST) Initiative Include science, technology, pre-engineering, and math content in curriculum frameworks for all appropriate grades including elementary school Develop a general science education college degree Eliminate the opt-out provision of the Smart Core curriculum Institute 75 regional STEM-specialized high schools in Arkansas Establish a large supplemented internship program for STEM teachers to work in industry and higher education research. Change the alternative certification program for private sector workers to more easily become certified as STEM teachers Establish more content specific credentialing for STEM teachers; e.g. having chemistry teachers certified in chemistry content Improve STEM instructional practices at the colleges of education Page 59 of 124 Appendix B Summaries of Additional Plan Documents

64 Establish more scholarships for STEM college degrees that are hard to get but easy to keep. Core strategy 5: Sustain successful existing industry through advancing technology and competitiveness. Classical economic development involves providing incentives to businesses for creating jobs or generating high payrolls. Many of these existing programs can be modified to further encourage high paying technology jobs. Modify the existing Create Rebate program Modify the existing investment tax credit ArkPlus Amend Arkansas s bond guaranty law to allow for financing of start-up technology companies Create a tax credit program for high-growth, high-salary, small businesses. Arkansas Economic Development Commission, Strategic Plan Update, June 24, 2008 Governor s Economic Development Goals Governor Beebe s Five Goals for Economic Development are: Increase the incomes of Arkansans at a growth pace greater than the national average Expand entrepreneurship focusing on knowledge-based enterprises Compete more effectively in the global marketplace for new businesses, jobs, and create a business retention strategy to reduce closures. Develop economic development policies that meet special needs and take advantage of the extraordinary assets of various areas in the state. Increase the number of workers with post secondary training so they are prepared when they enter the workforce and equipped for new jobs in the future. What has been learned thus far? Arkansas needs a transitional systematic approach to an economy supported by knowledge-based jobs. This will require a coordinated effort by all organizations affecting economic development is necessary to achieve the systematic transition to a knowledge-based economy. A major impediment to successfully overcoming the first two issues is the lack of a Statewide Plan for a recurring and predictable funding source for economic development. New Mission of the AEDC To lead statewide economic development, create targeted strategies which produce better paying jobs, promote communities, and support the training and growth of a 21 st century skilled workforce Proposed Scope of the Final Plan Systematic approach to transition Arkansas to knowledge-based jobs that is both orderly and adheres to a clearly defined timeline Statewide coordination of the Plan for Economic Development including a statewide organization structure with private participation Predictable and recurring funding for economic development including state and local funding coordination, taxes and new ideas (including equity investments by the state), and private sector participation Page 60 of 124 Appendix B Summaries of Additional Plan Documents

65 State Technology and Science Index, Enduring Lessons for the Intangible Economy, Milken Institute, June 2008 The Milken Institute again issued its state ranking for a set of interrelated but distinct indicators of competiveness of a state in science and technology and therefore in its ability to advance its state using a technology based economic development strategy. Arkansas, though remaining near the bottom, has improved its ranking from 2004 to 48 th overall in All of the surrounding states, with the exception of Mississippi, are ranked higher. Arkansas has moved out of the bottom tier of states in just two categories: Risk Capital and Entrepreneurial Infrastructure, moving from 42 nd to 31 st ; and Technology Concentration and Dynamism, moving from 44 th to 38 th. In Research and Development Inputs, a state s ability to attract research and development dollars from all sources, Arkansas is dead last. In Arkansas s ability to attract high end human capital and skilled professionals the State has fallen three spots to 49 th Research and Development Plan, Arkansas Science & Technology Authority, September 21, 2008 The newly released Arkansas Science & Technology Authority (ASTA) plan revised and reaffirmed its vision and mission and identified areas of strategic importance for Vision The Arkansas Science & Technology Authority believes that the economic well-being of Arkansas, its communities, and its citizens is enhanced through the wise and appropriate application of science and technology to security, health, education, government, business opportunities, agriculture, and environmental protection. Mission The mission of the Authority is to bring the benefits of science and advanced technology to the people and state of Arkansas. For the purpose of R&D planning, the Authority made the following assumptions: the context for R&D is economic growth; economic growth is driven by investments in innovation and human capital; the key partners in achieving economic growth are existing and emerging technology (or knowledge-based) firms, research universities, and the educational infrastructure; and the roles of the key partners are to create businesses, high paying jobs, and wealth by commercializing innovations, to produce innovations and knowledge workers; and to focus limited resources on the best research and development opportunities for existing and emerging technology firms State Research and Development Plan Research areas and cross-cutting disciplines of strategic importance to Arkansas in 2008 include: Advanced Materials and Manufacturing Systems Electronics, Nanotechnology, Photonics, and other Advanced Technologies Lean Manufacturing, Quality Management, and Six Sigma Environmental Issues related to Manufacturing Environmental Sciences Advanced Thermal Technologies Energy and Renewable Resources Geosystems and Environmental Impacts Sustainability Page 61 of 124 Appendix B Summaries of Additional Plan Documents

66 Biotechnology, Bioengineering, Agriculture and Life Sciences Genetics, Geriatrics, Medical Devices, Neuroscience, Nutrition, Oncology, and other Medical and Plant Biotechnologies Nanotoxicology Information Technology Data, Knowledge, and Systems Engineering Data and Information Quality Distributed Systems Software Development State-of-the-art applications of Information Technology to Bioinformatics, Healthcare, Logistics, and Transportation Human Resource Development The knowledge-based Career Pipeline, including undergraduate research support for students Linkages between undergraduate and graduate programs Career Pathways and improved workforce connections between employment and lifelong education Building a 21 st Century Economy in Arkansas, Findings and Recommendations of the Task Force for the 21 st Century Economy, October 31, 2008 The Task Force for the21st Century Economy was established by the 86 th General Assembly of Arkansas to study the role and scope of economic development in the 21 st Century in Arkansas, and to identify the programs and services needed for continued development in Arkansas. Additional objectives mandated to the Task Force were to examine the constitutional prohibition on State equity investments and the current structure of the State s economic development agencies in light of the needs of a 21 st Century economy. Mission and Purpose The mission and purpose given to the 21st Century Task Force were to: 1. Define the role and scope of economic development in Arkansas 2. Define the programs and services needed for the state and its communities to be globally competitive within the role and scope of 21st century economic development 3. Determine the advisability of removal of the constitutional prohibition on State equity investments in private enterprise by economic development agencies 4. Study the organizational structure necessary for an efficient and effective 21st century State economic development system. Topics of discussion throughout the meetings included education, defining a 21st century economy and knowledge-based jobs, infrastructure, the constitutional prohibition on State equity investments in private enterprises by economic development agencies, the organization structure and locations of the three state economic development agencies (AEDC, ASTA and ADFA), high-tech manufacturing and knowledge-based jobs, agency budgets, broadband accessibility, regionalism and partnerships, workforce training, globalization, alternative fuels and sustainability, character and soft skills issues businesses face, factors of production, best practices, and challenges communities face. In addition to the recommendations listed in Part 3, the Task Force was asked to consider and speak to the constitutional question of equity investments of State funds in private sector firms. The Task Force recommended removing the constitutional prohibition against equity investments and further recommended that the State share in the growth and profits of such firms through an exchange of stock or other securities for any equity investment made. Page 62 of 124 Appendix B Summaries of Additional Plan Documents

67 There were two items mentioned that were discussed that have bearing on Northwest Arkansas. No recommendations were made regarding the opportunity that exists for the development of policies related to energy production and consumption, and green and sustainable industries. Nor were any recommendations made for current and future infrastructure needs. There is significant room for leadership on these issues that may well come appropriately from Northwest Arkansas. Arkansas Development Finance Authority, Between 1977 and 1985, the Arkansas Housing Development Agency successfully supplemented the housing finance market by providing funds at below market interest rates. Its main goal was to develop safe, decent and affordable housing for low and moderate income Arkansans. Fortunately, the legislators realized that an agency empowered to issue tax-exempt bonds and other debt instruments could have an even greater impact on the lives of Arkansans by focusing not only on affordable housing but also in areas of manufacturing, health care, export finance, infrastructure projects, small business, agricultural business enterprises, and education. The Arkansas Development Finance Authority (ADFA) was created by Act 1062 of 1985, the Arkansas Development Finance Authority Act. This act abolished the former Arkansas Housing Development Agency and transferred all functions, powers and duties to ADFA. A Board of Directors governs ADFA and is composed of the State Treasurer, Director of the Department of Finance and Administration and 11 public members whom the governor appoints. The president of ADFA is an ex-officio non-voting member of the Board. ADFA employs a permanent full-time staff of professionals who, together, provide expertise in all areas of banking, finance, mortgage lending and accounting. ADFA administers funding in the form of tax exempt bonds and other debt instruments, and equity and near equity capital for emerging, expanding, relocating, and restructuring enterprises in Arkansas through its series of program activities. These activities are divided into three main categories: Economic Development; Homeownership; and Affordable Rental Housing. Regional Entities in Asset-Building There are two primary entities working in economic development and asset building within a regional context and a host of others working independently within the region. Those working within a regional context are as follows: Northwest Arkansas Council Green Valley Network Those working independently are as follows: Benton County Washington County City of Fayetteville City of Bentonville City of Rogers City of Springdale Summaries of their organizations and plans, if available, follow. Northwest Arkansas Council, Economic Development Strategy, June 7, 2001 NAC Conclusions Northwest Arkansas is extremely reliant for growth on its existing anchor industries including Walmart, Tyson Foods, and J.B. Hunt---comprising more than 50 percent of the region s growth. Page 63 of 124 Appendix B Summaries of Additional Plan Documents

68 There is evidence that despite efforts to keep up with infrastructure planning, significant near and mid-term challenges remain---16 road segments face growth constraints by 2020 requiring ongoing expenditures of $270-$450 million per five-year period over the next 20 years. The region has generally not benefited from the national trend that ties productivity and performance to technology---the region has one of the lowest ratings when looking at concentrations or clusters of technology industries. Foundation Strategies First, increase the competitiveness of the region s anchor businesses, and Second, identify and attract skilled workers and selected businesses that complement the existing anchors and create opportunities for further growth and innovation in the region. Human Resources: Building Skills & Opportunities The number one issue for the region s business is the ever-increasing shortage of qualified personnel. In the next decade and beyond, Northwest Arkansas must insure that the size, quality and skill levels of its workforce meet the needs of its current and future business customers. Increase the supply of suitable job applicants from outside the regions Develop comprehensive programs for education-to-career excellence Form and fund an Education Foundation to promote education-to-career excellence Support strategic development of the University of Arkansas with special attention to increasing the number of technical graduates, especially in computer-related programs. Technology: Building a More Competitive Economy There is little doubt that the presence of a technology base in a local economy leads to enhanced economic performance. Unfortunately, Northwest Arkansas ranks near the bottom of high technology rankings of US cities in various studies, including the Milken Institute study on America s high-tech economy. Support efforts to stimulate technology and entrepreneurial initiatives, particularly around efforts at the University of Arkansas The region should become a catalyst for the development of venture capital, the lifeblood of the new economy Northwest Arkansas should promote itself aggressively as a preferred destination for certain highgrowth technology oriented industries, especially advanced manufacturing Northwest Arkansas should support planning and eventual development of research/ business parks. Infrastructure: Building and Expanding for the Region Creation of a state of the art infrastructure has been an integral part of the region s economic development strategy for some time. Despite these efforts, continued attention is required to capitalize on investments and meet future market demands. Northwest Arkansas must provide leadership for funding and planning critically needed road and sewage improvements, including the review of new organizational options such as the creation of regional Transportation and Wastewater Authorities. Northwest Arkansas must market and promote the regional airport with the objectives of increasing market connectivity, reducing travel costs, and creating opportunities for air-related businesses. Marketing Northwest Arkansas: Telling the Story Well Image is the perception that the marketplace has of an area s attributes as a business location. The quality of an area s image is fundamental to its ability to retain and grow existing businesses and attract new ones. Page 64 of 124 Appendix B Summaries of Additional Plan Documents

69 Develop effective ways to increase interest in the region among highly skilled workers, tied to both work opportunities and quality of life Begin formulating a marketing strategy that helps deliver the message via the Web to select companies and workers Create a regional marketing strategy through a high-level public private partnership that focuses on identifying and enhancing a brand image for the region. Local Fayetteville Metro Area Fayetteville Economic Development Council, Strategic Plan and Priorities 2007 FEDC is a not-for-profit organization founded in 2004 by the Fayetteville Chamber of Commerce, the City of Fayetteville, and the University of Arkansas. FEDC is designed to serve as Fayetteville's single point of contact for economic development. FEDC is funded by private investments from local businesses and receives no tax dollars. Currently there are 80 investors. FEDC s Vision FEDC will create and grow a diverse, vital and sustainable economy that enables Fayetteville, Arkansas to enjoy a superb quality of life and be recognized throughout the world as a research, business, medical and cultural center of excellence. FEDC s Mission Serve as the single point of contact for economic development in Fayetteville, Arkansas. Provide the leadership required to leverage the strengths of the founding organizations and investors into a seamless, world-class economic development team. Bring new wealth and investment into the local economy by helping existing companies grow, creating new companies, and recruiting compatible new businesses. Metrics Successful efforts will create new jobs, increase per capita income and spendable income, and positively impact other economic indicators. This new wealth grows the property tax base for schools and sales tax base for the City. Economic Foundation Issues and Opportunities The University of Arkansas is Fayetteville s largest economic development engine. Leveraging the University s research capability is the single best opportunity for the creation of knowledge-based jobs, new businesses, and wealth in the 21 st Century. The existing tax base must be protected and grown. Businesses or industries that move or go out of business and consumers that shop elsewhere create a tax burden on the remaining taxpayers. Here following issues and opportunities identified by the City of Fayetteville and the members of the FEDC. 1. Jobs and investment from traditional manufacturing will continue to migrate off shore unless local companies can be infused with new technologies that keep them competitive while operating in the US. 2. The City of Fayetteville s revenue for their operating budget is primarily dependent on sales tax. The City must strike a balance between a business environment that is competitive with the other high amenity communities and quality of life that makes Fayetteville a destination attractive to 21 st Century workers and businesses. 3. Fayetteville s public schools rely primarily on real estate taxes. Continued loss of major taxpayers will result in decreased school funding or increased taxes. Page 65 of 124 Appendix B Summaries of Additional Plan Documents

70 4. For the most part, real property investment benefits the public schools. Business retail sales benefit the City. 5. While strong, high-end commercial and retail business investments help generate the tax base necessary for great schools and quality of life, the service related jobs associated with this sector generally don t pay enough to be a significant economic driver. 6. Leveraging University of Arkansas research and growing knowledge-based jobs and businesses is one of the best ways to generate the wealth that grows tax revenues, without raising taxes. Fayetteville can also recruit technology-concentric business that want to be near a research university and live in a very desirable community. 7. High value Walmart vendor/supplier jobs are already here. Procter & Gamble s regional headquarters with 200 plus jobs at salaries averaging $100,000 (including benefits) brings tremendous wealth and talent to Fayetteville. Nurturing the existing vendor businesses located in Fayetteville and leveraging their presence to attract others is another source of high value businesses and jobs to drive the economy. 8. Benton County is growing faster than Washington County and it has a higher per capita income. Retail moves to money and growth. This has and will continue to drive the development of new retail opportunities in Benton County. 9. The main retail hub is currently in the mall area. Across the nation malls are in a decline or just holding their own. The Northwest Arkansas Mall and Steel Crossing areas are the City s largest retail sales tax generators. 10. Fayetteville must have a diverse economy with a wide array of jobs ranging from a retail sales force to scientists. To this end, affordable housing must be in the mix to accommodate low to medium income families. FEDC Economic Development Priorities The following priorities were identified by members of the FEDC. Develop and Promote a Competitive Business Environment Determine the balance between the high development standards needed to keep Fayetteville a destination and the cost of developing. Evaluate costs and benefits of current and proposed impact fees, hillside ordinance, and other regulations and fees with respect to the tax base. Determine if impact fees should be graduated or waived in areas where Fayetteville wants to encourage development. Create a spreadsheet to quickly estimate development costs and benefits. Evaluate the merit of City business incentives. Strongly support annexation with emphasis on those areas that will offer the highest return on investment. Define Fayetteville s image and strengths and then develop an aggressive marketing plan. Strongly support traffic improvements that provide critically needed access for key commercial areas. Improve access from Fulbright Expressway by making it a boulevard with stop lights and/or roundabouts to support mall retail. Improve Cato Spring Road on the south side of the Arkansas Research and Technology Park, South Fayetteville, and Highway 265 South. Identify land for a new business/vendor park. Support Growth of the Arkansas Research and Technology Park (ARTP). Work with the University of Arkansas to find money to construct the next building(s) in accordance with the Master Plan for Arkansas Research and Technology Park. Tremendous success over a short period of time has left little or no space for new or growing companies in the park. Page 66 of 124 Appendix B Summaries of Additional Plan Documents

71 Evaluate a public/private/academic partnership for constructing new buildings in the ARTP. Explore options for new office space Priorities Retain and grow our existing businesses, industries, and new start-up companies to prevent further erosion of the tax base. Make the Fayetteville based Northwest Arkansas satellite campus of UAMS a reality for all Arkansans by augmenting the previous efforts of Washington Regional, UAMS, the Veterans Hospital, University of Arkansas, the County, and the Governor's Office. Build Fayetteville as the region's "medical city" and preferred choice for all healthcare services. Land a high value industrial project, Information Technology company, a new Proctor &Gamble type Walmart supplier, and/or another company with 400 plus high paying jobs to help jump start the economy. Continue branding Green Valley to build a business and technology cluster focused on sustainability by building on Walmart's sustainability initiative, the strengths of the U of A, and Fayetteville's quality of life. Work with Sweden, Japan, the World Trade Center and other countries to import existing, sustainable technologies and businesses. In turn, use these relationships to open new markets for companies, such as White River Hardwoods, BioBase, BlueInGreen, Duralor, CaseStack, EquityNet and the many others on track for commercialization at the ARTP. Increase the availability of economic development products to be prepared for success. Implement a virtual spec building program in the industrial park and in the new aerospace business complex at Drake Field; secure 200 acres of spade ready industrial property; and work closely with the ARTP to quickly fill the new wet lab capable building so a new building can be constructed. Build enough hotel and conference room space to attract major conventions to the Downtown and Dickson Street area. Build Fayetteville's transportation infrastructure. Improve access to the Mall and place a new exit (Exit 68 on I-540) on the Highway Department's construction program. Secure and build on Fayetteville's quality of life. Do what it takes to retain the Walton Art Center, build a new 3,000 seat performing arts center, and bring the new Science Museum to Fayetteville. Create a stable, predictable, expeditious business environment with world class standards. Market, leverage, and maintain a highly competitive cost of doing business, i.e., housing, transportation, gas, and electricity. Participate in the design of an economic development plan for Fayetteville that secures Fayetteville s economic future, quality of life, and the environment. Create a plan that is compatible with Fayetteville's label of "Green Valley" and one that supports building a business and technology cluster focused on sustainability. Build a Venture Capital Fund and an Angel Investor Group as part of an entrepreneurial eco-system that provides capital to the right companies at the right time. University of Arkansas Raising the Bar: A Report by the University of Arkansas 2010 Commission, The 2010 Commission presented 40 recommendations. For the Governor and General Assembly: 1. Make higher education funding a top priority and ensure the formula for Arkansas higher education is fully funded. Create a capital improvement fund for higher education. 2. Recognize that the University of Arkansas is emerging as a nationally competitive, student-centered research university serving Arkansas and the world. 3. Support the University s five major goals: 1) enhancing the diversity of the faculty, staff, and student body; 2) enhancing academic quality and reputation by excelling in teaching, research, and Page 67 of 124 Appendix B Summaries of Additional Plan Documents

72 outreach; 3) increasing the size and quality of the student body; 4) increasing private support; and 5) increasing federal and state support. Hold the University accountable for achieving these goals. 4. Bolster the State s research capacity, particularly at institutions showing the greatest promise for research and scholarship. Increase the amount of funds available to all university researchers for required matches on competitive research grants. 5. Develop a statewide plan for competing in the knowledge-based economy of the 21 st century. In particular, identify and prioritize key areas and institutions best positioned to strengthen the State s intellectual infrastructure in research, science, technology, education, and medicine. 6. Offer State-sponsored workshops that help prepare high school students to perform well on the ACT assessment. Provide funds to allow financially challenged students to retake the ACT. 7. Leverage private support by creating a dedicated State fund to match private gifts endowing professorial chairs and academic programs and the construction of academic buildings. 8. Enhance incentives for venture capital and for high tech firms to locate in Arkansas, as well as retain and strengthen in-state companies to discourage them from migrating elsewhere. 9. Provide institutional incentives for rapidly increasing the percentage of Arkansans with baccalaureate and advanced degrees (master s, professional, and doctoral). 10. Facilitate the collaboration of two- and four-year institutions by offering degrees on other campuses to reduce duplication and expand opportunities for Arkansans. Implement a transfer scholarship program to ensure that more graduates of two-year colleges pursue four-year degrees. 11. Support efforts to recruit high-ability students from other states and nations to attend college in Arkansas, creating a brain gain and building the technical workforce needed for the 21 st century economy. 12. Upgrade the State s information systems infrastructure and fund a statewide digital library for use by public libraries, as well as public and private colleges and universities. 13. Support the Arkansas World Trade Center. For the Arkansas Congressional Delegation: 14. Coordinate efforts to provide annual funding for the Arkansas World Trade Center. 15. Continue to support University of Arkansas research, particularly in nanotechnology and other leadingedge initiatives that promise to enhance the State s economic development. 16. Support UA research programs, such as the Mack-Blackwell Rural Transportation Center, that make a statewide impact. 17. Continue efforts to secure federal funding for clean up of the SEFOR reactor site in southern Washington County. 18. Ensure that Pell Grants keep pace with higher education inflation to help address the growing demand for increased need-based funding. For Business Leaders: 19. Invest in and become more involved in higher education institutions. Provide increased philanthropic support. Sponsor research projects and contracts that benefit business. Offer more opportunities to college students through internships, externships, and mentoring programs. 20. Actively support the Commission s recommendation for increased funding for Arkansas public higher education. Support full funding of the formula for higher education and the creation of a capital improvement fund for higher education. 21. Support the recommendations in A Test of Leadership: Charting the Future of US Higher Education by the US Department of Education, the recommendations in Rising Above the Gathering Storm by the National Academies, and the recommendations in Next Steps, a joint effort by the leadership of six major US higher education associations. 22. Consider the long-term value of hiring employees with four-year degrees to enhance corporate skill sets. Assist the State in increasing the number of adults having at least a bachelor s degree. Page 68 of 124 Appendix B Summaries of Additional Plan Documents

73 23. Pay nationally competitive salaries for college graduates and provide competitive benefits to attract outstanding new talent to Arkansas and stem the flow of outstanding native talent to other states. 24. Provide incentives for employees to obtain bachelor s and advanced degrees (master s, professional, and doctoral). 25. Define workforce development needs and communicate them to appropriate colleges and universities. 26. Provide more educational opportunities and educational infrastructure for employees on site and/or in the context of their lives. Invest in distance learning on company sites or work with other businesses, local high schools, and colleges and universities to gain access. 27. Support the Arkansas World Trade Center. For the University of Arkansas Community: 28. Continue to strengthen the University of Arkansas standing as a nationally competitive, studentcentered research university serving Arkansas and the world. 29. Continue to pursue the University s institutional goals of 1) enhancing the diversity of the faculty, staff, and student body; 2) enhancing academic quality and reputation by excelling in teaching, research, and outreach; 3) increasing the size and quality of the student body; 4) increasing private support; and 5) increasing federal and state support. 30. Communicate that the University of Arkansas is the best hope for the State to have a nationally competitive research university. 31. Support the increase of purchasing power of the Pell Grant and the Arkansas Academic Challenge grant. 32. Achieve the University s 2010 goals of enrolling 22,500 students, including 4,000 minority students; retaining 88 percent of freshmen; and graduating 66 percent of entering students within six years. 33. Meet 2010 annual research goals, including $100 million in new awards, $150 million in expenditures, and $50 million in Federal expenditures. 34. Sustain annual private giving at a level of $100 million and increase the University s endowment to $1 billion by Continue concerted efforts between the University of Arkansas and the Arkansas Congressional delegation to seek out and support opportunities to bring federal research funds to the state. 36. Support the Arkansas World Trade Center. 37. Support efforts to make the University of Arkansas the model of a sustainable university. 38. Provide leadership for the private and public education systems in the State. 39. Continue efforts to educate students and parents that higher education is an investment, not an expense. 40. Create a communications and marketing plan to ensure that Raising the Bar is seen, heard, and understood by key opinion leaders and constituencies across the State. Page 69 of 124 Appendix B Summaries of Additional Plan Documents

74 APPENDIX C INTERVIEW PROTOCOL Fayetteville, Arkansas Phase 1 Economic Development Strategy The Framework Protocol for Stakeholder Interviews--October 2008 Interviewer Comments What is this interview about? Eva Klein & Associates (EKA) is facilitating a planning process by which Fayetteville will accomplish Phase 1 of Economic Development Planning to define a framework of/for future economic development strategies. (In a Phase 2, an action/implementation plan of strategies, tactics, resources, targets, etc. will be developed.) One of the most important objectives of Phase 1 is to achieve a high level of agreement and buy-in to the main directions of vision and strategy. For whom are we planning? This planning project is jointly sponsored by the City of Fayetteville and The University of Arkansas. It is about Fayetteville, but in today s world, there is very little that can be planned that does not require a regional focus. In fact, defining region often is one of the most difficult challenges in economic development planning. So, for our purposes, with Fayetteville at the center, we can talk about a region of two counties (Benton and Washington) and four towns Bentonville, Rogers, and Springdale, along with Fayetteville. For some issues, a state perspective may be appropriate. What do we mean by economic development? We have entered an age of enormous transformation from the Industrial Economy to the Global Knowledge Economy. In this completely new competitive context, all the old ways of doing things may not necessarily work any longer. That is true also of economic development. Economic development no longer is only about recruitment of primary manufacturing jobs. It has become a highly complex art form with the goal of creating not only jobs but wealth. The main aim is to create a place that is globally competitive especially in certain niches of competence. Economic development now focuses on building assets for competitiveness, then promoting them. By assets, we mean a range of things from highlyskilled people who will attract high-end jobs to traditional and technology infrastructure to highly visible competencies in certain industries or big technologies. Quality of place amenities that knowledgebased companies and their employees require are part of competitiveness. Because of the breadth of factors in creating competitiveness today most of us are economic developers (not just those with that title). Page 70 of 124 Appendix C Interview Protocol

75 Protocol I. SWOT Analysis 1. City and Region. Please tell me what you consider to be the greatest strengths, weaknesses, opportunities, and threats for the City of Fayetteville (metro area and the two county region). What distinguishes the economic role of the City of Fayetteville within the regional economy? II. Economic Development Current Strategies and Ideas for Future Strategies 2. City s Current Strategies. At present, what are the City of Fayetteville s main strategies and priorities for economic development? Do you have ideas about how these strategies might/should be refined, expanded, refocused, or changed altogether? 3. Regional Collaboration. Since it is commonly assumed that economic development strategy in the 21 st century economy must involve regional collaborations, how would you assess the way in which local/regional organizations are (or are not) working together in the Fayetteville / NW Arkansas region? On what things does collaboration occur? On what other things should it occur? 4. State Strategies. Would you please comment on the range and effectiveness of the State of Arkansas strategies for economic development perhaps especially as these state strategies may help Fayetteville and NW Arkansas. 5. University Roles. What roles should the University of Arkansas play in providing resources, assets, specific programs/services, leadership, etc. in building the future economy for NW Arkansas (and the State as a whole) and strengthening the success of its people and communities? III. Specific Topics for Various Groups/Individuals 6. Education and Work Force. We now have experienced 2 to 3 decades of experimentation in Pre-K- 12 models with federal, state, local, philanthropic, and business funding. We have many model programs and lots of data but, in many respects NO REAL CHANGE. If you could wave a magic wand to solve this most elemental challenge, what would you do or design for pre-k to 12 (or 16)? 7. Niches of Competitiveness Industries or Technologies. If competitiveness means being top in something on a globally visible level, which of course means building on already-present strengths, then what should that something (or somethings ) be for Fayetteville (and this region)? 8. Regionalism and Leadership. What are your ideas for how we could better organize in this region, to ensure that there is common vision, common purpose, and concerted action on those bigpicture investments and strategies that need to be done on a regional level? 9. Infrastructure. Given the past economic base in this region, and what needs to be developed and cultivated for future competitiveness, what are the priorities for future infrastructure investments? 10. Entrepreneurship. By now, everyone in America more or less understands that our growth (both jobs and wealth) comes from new and high-growth businesses. What are we doing well now and what more should we do to strengthen our capacity to support successful entrepreneurship? 11. Marketing and Promotion. What are your ideas for how we should brand this region and exactly how we should promote our competitive strengths and assets for knowledge-based companies, investment, and jobs? 12. Quality of Place. What kinds of actions or investments would strengthen the appeal of the City of Fayetteville (and the region) as a place where people and companies would want to be? Page 71 of 124 Appendix C Interview Protocol

76 APPENDIX D INTERVIEWEES AND PLANNING PARTICIPANTS City of Fayetteville Elected Officials Mayor Dan Coody Lioneld Jordan, Alderman, Ward 4 and Mayor-Elect Robert Rhoads, Alderman, Ward 3 Kyle Cook, Alderman, Ward 2 Brenda Thiel, Alderman, Ward 1 Adella Gray, Alderman, Ward 1 Shirley Lucas, Alderman, Ward 4 Nancy Allen, Alderman, Ward 2 Bobby Ferrell, Alderman, Ward 3 City Department Heads Tony Johnson, Fire Chief Tracey Risley, Deputy Chief of Police Paul Becker, Finance Director Jeremy Pate, Director of Current Planning Karen Minkel, Interim Director of Long Range Planning David Jurgens, Director, Water & Waste Water Leif Olson, City Engineer Louise Schaper, Library Executive Director Fayetteville Chamber & FEDC J. W. Bill Ramsey, President & CEO, Fayetteville Chamber Bob Nickle, Partner, Nickle, Hill, Rodman & Trumbo Tommy Deweese, Past Chairman, Fayetteville Chamber Dennis Hunt, Sr. Vice President, Stephens Inc. Bruce Johnson, President, White River Hardwoods Bob Davis, President, Eason Insurance Fayetteville Independent Business Alliance Elizabeth Slape, FIBA Lisa Sharp, Nightbird Books & FIBA Economic Development Professionals Ray M. Boudreaux, Director, Director, Aviation & Economic Development Steven K. Rust, President & CEO, FEDC / Green Valley Network Page 72 of 124 Appendix D Interviewees and Planning Participants

77 Neighborhoods / CDC Bob Caulk Other Communities / Local Governments Mayors Mayor Jerre M. Van Hoose, Springdale Mayor Bob McCaslin, Bentonville Quorum Court Ann Harbison, Justice of the Peace (Jessie Bryant attended prior evening event) Regional Business / Economic Development Organizations Chambers of Commerce Ed Clifford, President & CEO, Bentonville/Bella Vista Chamber NW Arkansas Council Mike Malone, Executive Director Scott Van Laningham, Executive Director, NW Arkansas Regional Airport Greg Lee, Tysons Foods (retired) Note: Several additional members of the Board of the NW Arkansas Council are listed in other groups of interviewees. Green Valley Network Dan Sanker, President/CEO, CaseStack Regional Businesses Small / Tech Companies Ron Foster, COO, Axept Alan Mantooth, Professor and Chief Scientist, Lynguent Inc. Alex Lostetter, President & CEO, APEI Inc. Sharmila Mounce, Business Operations Manager, APEI Inc. Chuck Chalfant, CEO, Space Photonics Inc. Calvin Goforth, President, Virtual Incubation Co. LLC David Lewis, President, Team Lewis Bankers and Developers Tommy L. Van Zandt, Managing Partner, Sage Partners Dennis R. Hunt, Stephens, Inc. Investment Bankers Donny Story, President, Arvest Bank Richard Alexander, Managing Member, AMA Real Estate Group Tracey Hoskins, President & CEO, Paradigm Companies Inc. Page 73 of 124 Appendix D Interviewees and Planning Participants

78 Big Business/Utilities Dr. Christine J. Daugherty, Senior Counsel, Tyson Foods, Inc. Keith Kaderly, Manager of Marketing, Ozarks ECC Nick Coburn, Plant Manager, Pinnacle Foods Steffan Sarkin, VP Corporate Development, Pace Industries Alan Fortenberry, CEO, Beaver Water District Arts and Cultural Tim Vogt, VP, Finance and Planning, Walton Arts Center Jodi Beznoska, Communications Director, Walton Arts Center Brent Robinson, Advisor to Science Springs Education and Higher Education School Systems/Superintendents Dr. Bobby New, Interim Superintendent, Fayetteville Dr. Janie Darr, Superintendent, Rogers Dr. Gary Compton, Superintendent, Bentonville Dr. Allen Williams, Assistant Superintendent, Springdale Dr. Lisa Morstad, Finance Officer, Fayetteville Dr. Susan Norton, Information Officer, Fayetteville NorthWest Arkansas Community College Dr. Becky Paneitz, President Dr. Steve Gates, VP for Advancement Dr. Susan Holmes, Executive Dean, Strategic Initiatives University of Arkansas Dr. Lalit Verma, Interim Dean, AFLS Peggy Gabriel, Director of Development Dr. Adam K. Motherwell, Assistant Dean, Fulbright College of Arts and Sciences Dr. Linda Beene Ballard, Dean, Global Campus Dr. Collis R. Geren, Vice Provost for Research / Dean, Graduate School Dr. Carolyn Allen, Dean, University Libraries Dr. Shannon Davis, Assistant Dean, Research, College of Engineering Dr. Suzanne McCray, Interim Dean, Honors College Dr. Cyndi Nance, Dean, Law Dr. Dan Worrell, Dean, Walton College of Business Phillip Stafford, UATDF Page 74 of 124 Appendix D Interviewees and Planning Participants

79 David Whitmire, UATDF Media Ray Minor, City Editor, Arkansas Democrat-Gazette Mike Vaughn Vice President/General Manager, KNWA Greg Harton, Executive Editor, NW Arkansas Times Planning Workshop Round Table Participants (October 17) Note: The following lists may have some missing names, as some October 17 participants arrived and departed during the day. Round Table: Niches of Competence Ray M. Boudreaux, Director, Aviation/Economic Development, Fayetteville Peggy Gabriel, Director of Development, Engineering, UA Dr. Lisa Z. Morstad, Chief Financial Officer, Fayetteville Public Schools Brent Robinson, Business Designer, Spring-Line Consulting Group (and Science Center) Dustin Tracy, Reporter, Northwest Arkansas Times Round Table: Infrastructure for Innovation Lisa C. Childs, Associate Vice Provost, Research and Patent Attorney, Division of Agriculture, UA Shannon Davis, Assistant Dean for Research, College of Engineering, UA Gary Dumas, Director of Operations, City of Fayetteville David Jurgens, Director, Water/Wastewater, Fayetteville Phillip Stafford, President, UATDF Round Table: Human Capital Dr. Collis R. Geren, Vice Provost, Research/Dean, Graduate School, UA Dr. Susan Holmes, Executive Dean, Strategic Initiatives and Board Relations, NWACC Shirley Lucas, Fayetteville City Council Shelly Walters, Marketing Manager, Fayetteville Visitors Bureau Round Table: Regional Promotion Skip Descant, Morning News Marilyn Heifner, Fayetteville A & P Commission Bruce Johnson, President, White River Hardwoods Mike Johnson, Facilities Management, UA Otto J. Loewer, UA Economic Development Institute Terri Trotter, Walton Arts Center Page 75 of 124 Appendix D Interviewees and Planning Participants

80 Round Table: Smart Community Places Allyson Twiggs Dyer, Fayetteville Visitors Bureau Stephen Luoni, Community Design Center, UA Dede Peters, DDDP Gallery, Fayetteville Arts Council Bill Ramsey, CEO, Fayetteville Chamber Elizabeth Slape, Keep Fayetteville Funky/FIBA Round Table: City Development and Finance Paul A. Becker, Director of Finance, Fayetteville Dan Coody, Mayor, Fayetteville Bob Davis, Eason Insurance Agency Bobby Ferrell, City Council Adella Gray, Alderwoman, Fayetteville Susan Heil, SBC Global Tony Johnson, Fire Chief, Fayetteville Karen Minkel, Long Range Planning, Fayetteville Scott Van Laningham, Executive Director/CEO, NWA Regional Airport Page 76 of 124 Appendix D Interviewees and Planning Participants

81 APPENDIX E: STAKEHOLDER VIEWS OF PRESENT AND FUTURE Following are representative comments from interviews. They are organized by major topic from the Interview Protocol (Appendix C). In compiling these comments, the consultants have attempted to avoid attribution of comments to any individual or group of interviewees. Strengths and Opportunities City and Region. Please tell me what you consider to be the greatest strengths, weaknesses, opportunities, and threats for the City of Fayetteville (metro area and the two-county region). What distinguishes the economic role of the City of Fayetteville within the regional economy? Strengths and Opportunities City of Fayetteville Following are strengths and opportunities that are somewhat specific to City of Fayetteville. Physical Place and Amenities A beautiful place that people fall in love with. I ve lived in a lot of other places. This is much more cosmopolitan than a Midwest city of this size usually is. Fayetteville is the only one of the four towns that has a true city core. Rogers has had a lot of success but has abandoned its old downtown and relocated on the bypass. This works for Rogers. Fayetteville is the other extreme keeping a core. What I like: I went to University and then went to (city in Texas) for 20 years. We didn t want to stay there. I convinced my wife that this is the place. Other thing is the small town atmosphere, but because of the big company influence, there is an incredible cultural piece that you wouldn t have in a town of this size. We have free of charge cultural things for children. We have people from all over the world. So, we re not just a bunch of rednecks from Arkansas who have never been anywhere. I moved to Arkansas 18 years ago because I wanted to live in Fayetteville. It s a college town. The University presence is a great asset. Fayetteville has a unique culture--not folksy, but down-home artsy (which can be both strength and a weakness). This is a university town, although it may not be quite as vibrant as a university town could be. People in Fayetteville are not as connected to the University as they could be. But the intellectual nature of the town is stimulating. It s a small and very pretty town, where you know your neighbors. I moved here 8 years ago because I was looking for four seasons, a University town, and a good hospital. Universities have activities, interesting things to do. P&G made a conscious decision to be in Fayetteville when it started the vendor presence thing. At that time, Walmart and P&G didn t want their employees to be neighbors. Another factor P&G was bringing in high level executives. If you knew what Bentonville and Rogers were like in the 1980s, you would know that there was a vast difference between those towns and Fayetteville. P&G hired Nancy Biddle to take the wives around, to sell our location, as it was a concern that we re going to have a hard time getting people to live here. Now, P&G people come and they don t want to leave. Why? Culture opportunities. Look out the window. Go see our new city library, which won a national award. It s an example of why P&G people come here and say: This is neat. Companies that locate in Fayetteville have staff people that then never want to leave. The schools have a good reputation. Educated workforce expects certain amenities. Fayetteville has potential to provide that and has done it over the years. Has ability to become a national good place to live - already regionally known. Nice asset base to work from Diverse base to build on. We re not a sawmill type town. We re not targeted on any one particular industry at this time. (Not necessarily due to good planning; this just occurred) So, when we ve had Page 77 of 124 Appendix E Stakeholder Views of Present and Future

82 downturns in the past, we weathered them because of this diversity. The University may have cutbacks, but it isn t going anywhere. It s been a huge driver for the economy. Our entertainment district Dickson Street has lots of traffic football weekends bring in lots of people - That s where the Arts Center is. it used to be dangerous but now it s revitalized. But they are struggling unless there is a game or Arts Center event. Natural beauty hillsides, parks, green space, preservation, trails Natural beauty of the town Development of the downtown, instead of having things go out to the malls and interstate Library fantastic Library regional draw, 1 st LEED certification in Arkansas Lots of local artists, including potters, photographers Walton Arts Center Walton Arts Center is looking at expanding with a 2-3,000 seat auditorium Walton Arts Center a very valuable asset for the region. Want to create and bring art experiences like what s available in Chicago, NY, Madison. One of main reasons people cite when they say they dreaded moving to Arkansas with their businesses, but are delighted by the arts center. Lighting of the Ozarks holiday lights, parade, celebration draws people to the square Art Center is launching an outdoor exhibit- video dance installation. Arts community downtown market, crafts, performing arts Fayetteville has been the entertainment center of the region. This role is now under challenge as other communities look for ways to capitalize on entertainment as a draw. Any presented art is in Fayetteville - Broadway shows, Itzhak Perlman, Yo Yo Ma, dance. Started from a UA/City partnership U has representation on the board as well as the City. Trying to develop more relationships for venue and teaching opportunities in various areas like visual arts. Cultural center of NW Arkansas is here. Entertainment district Parking, coordination, promotion money comes from the mall cluster but Dickson Street and downtown are the magnet for other people. Anecdotally, Walmart and suppliers bring people they are courting to Dickson Street and downtown at football games - because of the color. People come here for a short stay and stay a long time and refuse to be transferred. Music scene here is good. Science building Botanical Garden Bumper sticker says Keep Fayetteville Funky. Dickson Street is no longer funky George s is the last bastion [of the really funky Dickson Street.] Mama Dean s soul food Downtown potential asset waves of leadership move through the community- sometime advocate for the downtown, sometimes not. John Lewis responsible for renewal of the square Green Valley could contribute. Health care here is good and there is an adequate supply of doctors. My neighbor is an MD. He said that the place to live is NWA. He has no trouble getting young staff and can get his pick of the litter out of the medical school. The Medical School is in Little Rock, but we have a satellite medical campus coming here. Page 78 of 124 Appendix E Stakeholder Views of Present and Future

83 Health care (Washington Regional Med Center) is a major asset of Fayetteville. Fayetteville has more of a smaller city feel with the Town Square. Strict sign ordinance and no billboards help maintain a sense of place. Neighborhood planning for Fayetteville Junction recent comprehensive planning activity now working through one neighborhood at a time to develop their identity and role. Fayetteville Junction wants to be a portal farthest south of exits from highway. Vision is to have a conference center, etc. U of A is playing a role in way-finding. There is an opportunity area near the University where cheap housing is being built currently. University should buy the land along Razorback, to eventually connect the campuses and the Research & Technology Park. Trail system has been master planned trails being built out gradually $42 M. thoroughfare project streets & sidewalks. Good entrepreneurial spirit in the business community. Business is not afraid to step out there. Lack of desire to continue to sprawl, but, rather, to keep things fresh and new by rebuilding things. Fire and police are excellent safe area with low crime. Fayetteville is ranked among the top 10 safe communities. People (Human Capital) and Civic Engagement Human capital is our strength. People diversity Cultural melting pot with Fayetteville as the most diverse in the region. It s very urbane (due to the University) for a small southern town. This characteristic came from the University. Basically, we have a lot of open-minded, creative people. We are bringing in people that enjoy this kind of place. Fayetteville is open-minded with a high quality of life and many creative class residents. Open and accepting of different lifestyles, particularly in Fayetteville (rated as gay-friendly ) School system in Fayetteville Higher educational attainment is high, relative to the State. Per student expenditures in public schools are above the national average Some districts have large high schools (like colleges) Springdale High School has largest auditorium in area. Many of our State leaders are here or from here. Our retirement community is a strength. Retirement used to be predominantly at Bella Vista, but Bella Vista is no longer purely retirement. Lots were cheap. Families moved in. Now it is an incorporated city and has to deal with schools, etc. Retirees have big potential to contribute in economic development. (The wave is already here.) Fayetteville is the center for legal, financial services in the region. 30,000 University students and supporting services have a strong influence on the economy. Citizen input Open dialogue within the community Citizenry involvement: The 2020 plan shows intelligent and informed decisions. Citizen input/interest Biggest strength is people, an incredibly engaged citizenry. Based on a random sample of voters, 100 in each ward, about 38 percent of residents belong to one or more organizations Opinionated, politically active, intellectually lively. Page 79 of 124 Appendix E Stakeholder Views of Present and Future

84 The Council of Neighborhoods is a strength. It works collaboratively on several programs like a sustainability effort: The Twist of Green (Mayor s Office). Fayetteville sets itself apart with green initiatives, maximizing sustainability (although there are few town and gown initiatives). Strengths and Opportunities Northwest Arkansas Region Following are strengths more generally applicable to the Northwest Arkansas region, as well as to Fayetteville. Big Players Walmart, Tyson s, Hunt, and the University Fortune 500 companies in the region The University of Arkansas not only the largest employer, but as we look at knowledge-based things and what UATDF is doing, that s probably our greatest strength for the City and the region. University is one of our biggest assets. The University is the key #1 player. It attracted Neose Bio, the third largest chemical company. (Neose was looking for bioethanol expertise.) It has world-class technology (e.g., nano cutting tools). But the professors don t understand business. The University helps to create the quality of life with art, theater, symphony, football, baseball, basketball, volleyball, soccer, etc. The University s knowledge base great folks coming out of there with skills sets for our businesses Huge R&D facility at Tyson s need microbiology. University of Arkansas. University is the educational center for the state. University was the 600 lb gorilla before Walmart was the 800 lb gorilla. U of A is a research university, with growing quality and quantity of research. And there can be company access to University facilities/equipment). The University is supportive of entrepreneurial faculty. A key advantage for small technology companies is access to University facilities at a discounted rate. This is critical for several who use the National Center for Reliable Power Transmission (NCRPT), High Density Electronics Center (HIDEC), analysis labs, packaging analysis equipment, etc. They can license technology and access equipment in the inventor s lab. There is a system to manage conflict of interest issues. Fees are appropriate, but not discounted. The Dean of the Graduate School has been very important in providing latitude with respect to equipment access. He has promoted initiatives and enacted supportive policies. University support for entrepreneurs (much more in Engineering than in Agriculture). The previous Chancellor was pro-entrepreneurs and had himself patented and commercialized an invention. Sports are the real opportunity for the region---university related sports and recreational sports. Huge dollars are driven into Fayetteville by University sports. Fayetteville must play on the strength of the University. The University is its only competitive edge. Strength is U of A diverse and open nature of the population and they type of people it attracts. Lots of discourse, which is democracy in action Strength is U of A diverse and open nature of the population and they type of people it attracts. Lots of discourse, which is democracy in action. Genesis Incubator in the Arkansas Research & Technology Park allows small technology companies to grow in steps with flexible space. Home of the biggest retailer in the world and the suppliers that grow up around it. The scale of the business is huge, especially related to the size of the region. As regional strengths, the region has Walmart, Tyson and Hunt. Walmart is leading a major environmental sustainability initiative. Page 80 of 124 Appendix E Stakeholder Views of Present and Future

85 Again, Walmart. We are working on a project now IBM will sign leases and bring 100 IBM people here it s a contract due to/with Walmart. In 1980s, there was a huge change in Walmart s business model. They used to get in a room and argue (until Walmart won). Then Walmart decided it had to take their big vendors into their trust. They had to let them know things in order to sustain supplies. They had to overcome their concern about information leaking to competitors. But this change allowed Walmart to grow. Growth has been mainly in the last 20 years. There are some smart people at Walmart. Vendorville opened as sales offices. Then, it became more sophisticated the vendors added logistics people, etc. This is important. For example, percent of P&G s total sales go through Walmart. P&G is the biggest vendor based in Fayetteville. Most vendors are in Bentonville, second highest number is in Rogers. Some are in Fayetteville and Springdale. They used to come to Fayetteville. Sam Walton didn t believe that the vendors and Walmart people should talk socially. He liked the unwritten rule that the Walmart people lived in Bentonville and the vendors people lived in Rogers or Fayetteville. Early vendor arrivals liked Fayetteville because it s a town. P&G is good example. There was nothing much in the area (other than Fayetteville), when they came here, so early. All that has changed. There is no longer a rule against mixing socially. Thus, anywhere is fair game to move. Walmart people now are being paid market compensation at HQ. So, if you re a vendor, you re no longer the richest guy in town. You can live in Bentonville, but it s not that interesting. Rogers has gone upscale. Its new part is nice. If you want a bagel, you have to go to Rogers. We live near Fayetteville but, now, we have to go to Rogers, because Fayetteville doesn t have good restaurants any more. 1,400-1,500 Walmart suppliers are located in NWA. If you want to sell to Walmart you must originate and consummate the transaction at Walmart. Companies want to locate nearby but the people could live anywhere. Fayetteville must create the place that people want to live. P&G has 350 employees here. Logistics expertise Mini-IT cluster with 5,000 to 7,000 IT jobs. Walmart runs lights, heat, etc. for all its stores. JB Hunt has a tremendous data system as does Tyson. Regionally, the big companies and the NW Arkansas Council are helpful, but they re focused too much on old ways of doing business. Instead of looking at broad range of things, they re on roads. The NWA Business Council is a strength. It focuses on the big picture for the region, but it is too focused on roads. People here now have a sense of region attributable to the work of the NW Arkansas Council (formed in 1989). It has worked on getting I-540, Beeville Water System, Regional Airport, US 412. It is our regional advocacy group for large Infrastructure projects (advocacy within the region and in Little Rock). In the past, if you came to Arkansas from somewhere normal, you wanted to be in the college town. Now you can go to Bentonville (although a little lower-end). Rogers has a Ruth s Chris and Einstein s Bagels, etc. Fayetteville has the non-chain restaurants. Alltel, Walmart others - thousands of suppliers Hunt, Tyson, Kraft: We have about 500 employees here to work with Tyson, Hunt and Walmart Tyson s is in Springdale. Tyson family is great for the whole area. They are our leaders in the area. They are a huge asset. Fayetteville should figure out how it can help Walmart be successful. Even though vendor growth has slowed, they re all already here we re still seeing influx of people. It now is big enough that we do have the amenity base, but we still have a beautiful area. And now we have a megaphone with people telling their friends all over. Page 81 of 124 Appendix E Stakeholder Views of Present and Future

86 P & G does 18 percent of its worldwide business with Walmart. A broad-based economy with major players like Hunt, retirement and the University. Regional Economy Other Factors and Elements There is more manufacturing here than is thought: Supervision (makes wheels), Tyson Products, Mexican Original (foods), molding/injection, Budweiser (distribution). There is a manufacturing committee of the Chamber; there are small plants but relatively diversified. NWA is not known for one thing. It is really diversified. The Chambers had a tag line: Where the World Comes to do Business. The region does a lot of business with multinationals. It needs to make itself known. It is perceived as welcoming and embracing of diversity. The metro area is becoming six counties including two from Oklahoma. Economy here is different from the rest of the State. Labor market Work ethic of the people There are many one-person operations, many of which are vendors, small companies trying to get into Walmart, Hunt distribution and others. Intelligent workforce Technology is a strength. Stable economy that is somewhat insulated from downturns. State incentives for start-up technology companies. The R&D credit can be used to match Federal R&D money up to $330,000 less 10 percent. Those credits can be transferred or sold. ASTA is dramatically underfunded; its programs are not funded. We should test the idea of technology hardening money. There are incentives people don t know about, including the payroll tax credit (10 percent), manufacturing incentives to train employees, etc. There are reasonable processes to access those credits and incentives. It s not easy but it is okay; the administrators are sorting it through. The State investor tax credit is a new program with a 33-percent State tax credit that can be sold for individual companies. Culture: Energy, Agriculture, Frugality. NW Arkansas is transient. One thousand people a month move to the region. This is a growing region with the chance to learn from and avoid other region s mistakes. Local business base / economy Sales tax dollars and service jobs are the engine that fuels the economy. Dominance was long held in Washington County but that dominance has shifted. The Medical facility is valuable. The facility is five years old with a new addition already. Also a new hospital in Rogers is growing strongly. UAMS is moving a medical facility here. There will be a medical student presence. This will be in the old hospital, near the VA hospital on College Street. So, we will have more physicians, nurses; a teaching environment; and plenty of opportunity for residencies here in the region. Green Valley Initiative Opportunity Existing green cluster: U of A critical for business cluster. Missouri has the greatest collection of plant scientists. The Delta is one of biggest agricultural areas in the country. One third of rice crop. Great opportunities for bio-fuels and eco-tourism. Delta is really depressed. We are trying to bring it into the Green Valley thing. Delta offers agribusiness and bio-fuels. They can grow stuff cheap and ship cheap on Mississippi and theoretically cheap labor. America s Costa Rica untouched. Page 82 of 124 Appendix E Stakeholder Views of Present and Future

87 Shift to Green Valley is important. There are lots of things here are going sustainable, and this cuts across the entire University. It s a unique opportunity and U of A leads the way. Our Mayor is green to the core, for example, promoting biking and walking paths. Sustainability initiative Green Valley Initiative encompassing communities in a five-hour drive; potential international connections. No opposition to Green Valley Initiative. People want to understand if it represents the City or region. We re too small a region population-wise we have all those plant scientists in MO and energy center in Tulsa why not include them. Delta looks like a problem but great potential. In business sense we should develop products that are sustainable. We could capitalize on the University and on Fayetteville schools. We have the highest SATs in the state. We are working hard to spread AP to all kids, not just U of A faculty kids. Our manufacturing past doesn t need to be the death of manufacturing. Look at Pittsburgh. Arkansas has many advantages over Pittsburgh. And there is a new company going to Jonesboro, so it s not just Fayetteville or the NW Arkansas region. In the Global Economy, shipping costs are now so high, we can have more manufacturing here. As China has a growing middle class, we will be more competitive. China s middle class will raise wages there and increase the demand for consumer products there. Small companies are here because of Walmart we can have a blooming manufacturing sector. Fayetteville should be the hub mainly because of University and history. U of A should become the University of Sustainability. You have the companies. Then you start this next generation. Then, you end up with a diverse job market like RTP, Silicon. If you add in that light rail, you have a top 10 metropolis with Fayetteville as the San Francisco for the region. NW Arkansas is a kind of green field for these sustainability efforts. There are no mistakes yet. We have to think in terms of linear development (north-south), especially from transit and rational development perspective, rather than a triangle with spoke and hubs. P & G leads Walmart on sustainability -- Whole green thing has become very big here. Civic Leadership and Entrepreneurship Entrepreneurial spirit. Some of the world s biggest companies grew up here with nothing more than strong backs and strong will. They did not start with many resources. We even had to create the supply of water. This spirit continues now. Here, when people get their mind around an idea, they figure out how to do it. Time after time this has happened. The Botanical Garden is an example. We have the only start-up (from the ground up; not as a gift of an existing garden) botanical garden in the last 30 years. Also, our regional airport is only one of a few built in the last 30 years. In additional to entrepreneurial leadership, a great strength is their willingness to work and give back/invest in the community both for civic reasons and to nurture their own businesses. And our civic leaders work collaboratively on things that are overarching needs. Entrepreneurial region Walmart and its 1,300 vendors, Tyson, J.B. Hunt. Proctor & Gamble has 200 employees to serve Walmart with average wages over $100,000. (With respect to this civic leadership) There is a fuse burning but we are lucky. This is a Midwestern community, not really southern. We have second generation (family business) involvement, although some of the older generation is still around. We still have some of these people who feel rooted in the community not all communities have this. (Another interviewee: I see the third generation coming along.) Outstanding environment for entrepreneurs. Hundreds of small companies have spun out. The banking system is okay and will lend for a software company. The three family foundations are good at investing in local companies. JB Hunt invested in 300 companies. Page 83 of 124 Appendix E Stakeholder Views of Present and Future

88 With the population growth, the Regional Planning Commission will be given new powers to address regional issues. Bentonville has public/private partnership working with businesses to bring in people to filling their square lots of activities. Lifestyle: Arts, Culture, and Recreation All the amenities that are already here are strengths. Crystal Bridges, major league sports, Botanical Garden, Walton Arts Center, Razorbacks. Many of these are important for recruitment and retention. Crystal Bridges (American Art Museum) will be a huge draw. Crystal Bridges will draw in lots of people. Alice Walton s Crystal Bridge $100 million art gallery and museum in Bentonville Alice Walton put up money for Crystal Bridges in Bentonville. Largest museum of American art like Louvre. Outbidding major museums. Waltons are really Bentonville people, but they have connection with the University. Their legacy is what people see in Bentonville. Now it s not that nice. Square will be revitalized. Museum will be game changer for Bentonville. Crystal Bridges major art museum Bentonville square will have a walkable sculpture garden to take people to the museum architectural and curatorial iconic structure. Alice Walton Crystal Bridges will complete the transformation of Bentonville as a world destination. The cultural epicenter is moving north. Bentonville is building a major art museum. People are going to come from all over to see the Crystal Bridges from the world! Major pieces of art are moving to the middle of the country. Fayetteville will need to see this as an asset give people something to see and do and a way to get into downtown not well signed, no entrance to tell you you ve arrived in Fayetteville, not a pretty way in. People in Bentonville are talking about beds, services, etc in preparation. Child-focused recreation, green space, play space, parks World s largest crafts fair at War Eagle 200,000 per day. Eureka Springs town is writers crafts, bohemian arts town. Bikes Blues and Barbecues bikers festival second largest in US. 400,000 people with only 36 arrests. We are a center for weekend festivals, rare commodity in the state. Fayetteville and Eureka Springs are very tolerant communities. Trails and regional recreation Buffalo River, Eureka Springs Beauty and amenities Open dialogue People, diversity Lots of people want to retire here. Good medical care regional hospitals and VA No crowding, crime is very low. Quality of life in region Springdale s minor league baseball Six brand new hospitals. They are not thought of as major medical providers, so the challenge is to link them together in people s minds. Nice place to be Housing affordability Page 84 of 124 Appendix E Stakeholder Views of Present and Future

89 It is critical for Fayetteville to realize. Fayetteville has history of good schools. Other towns have caught up and are surpassing Fayetteville newer physical plants, better salaries. They have the shopping, the recreation, etc. They have everything except the University and Dickson St. Park system. Trail system. Entertainment / dining center. Walton Arts Center may be a divided entity. Creative class. Aesthetically pretty. Until 3-4 years ago, Fayetteville was the only place to shop. Financial center of NW AR. It was the largest community in region. A tourist draw for Arkansans and others. The Razorbacks. If you want a two-day get away, it s Fayetteville or Eureka Springs. It s not Rogers. Fayetteville is no longer the region s only cultural center. Air Museum old Drake Field airport old planes, military museum Younkin (?) brothers based at Siloam Springs airport. Science Springs Tech & science museum start-up no physical place yet. Science museum business plan is structured around sustainability and impact on the planet two of three possible sites in Fayetteville. Prosperity and growth in the north of the region have positive impact on business, infrastructure, culture people north of here are more open-minded, receptive to new things. The only thing that we control is the environment. Rogers is creating a vibrant commercial environment. P & G over 200 people had culture of sending people for two years but people were leaving the company rather than leave Fayetteville liked the area. Went to different policy on moves. Natives (Arkansans) are outnumbered by outsiders. Outsiders want things that are not typically in Arkansas, and they will move to places that have them. Location, Climate, Natural Resources, and Infrastructure Geographic center of the US near here Central location Our location (being central US) is a strength. We have four seasons. It s a great place. Location fairly close to Dallas, St. Louis, Tulsa and Kansas City. Not isolated. Growing road network. Natural beauty Lake, mountains Sustainability/green The Natural State Moderate climate, adequate water This area has a following that s growing. People who left the area 10 years ago are now more willing to come back, if you can show them opportunities. We have three that are coming home in our company. When you talk about the area, people think it s a top place to be, to retire. There is a stronger commitment to get better than anywhere among the 14 places I ve lived. Constantly improving roads I-540 is probably the main economic factor for NW Arkansas. Lots of water potable and lake Stable water supply Affordable, reliable utilities for industry. Easily accessible water, gas, electrical. More water than we need. Good airport Airport has an active tower and a nice facility for general aviation business charters and business jets. Regional airport with direct flights to major hubs Page 85 of 124 Appendix E Stakeholder Views of Present and Future

90 Rail Still a family oriented region. Safe, wholesome. And this is a unique place in that we have a mini-urban environment in the midst of vast natural resources. Large expanses of natural forests and lots of outdoor stuff. A nice four-season climate. And a rich mix of people that have come in for quality of life. Employment opportunities, but also a good place for retirement. People locate here now if their livelihood is portable, due to quality of life. Friendliness of the people. My wife, who is from CT, has made many friends here. Low cost of living. Arkansas tends to be conservative, so there are no State fiscal problems. The severance tax on natural gas provides funding. Once people get here, they like to stay. They d like to develop an environment that would attract workers even before they have jobs. One issue is that there is not enough to do, so they attracted semiprofessional baseball. One of our strengths is water. The first regional thing the NW Arkansas Council did was to build the lake. You have the environment. I don t disagree that we need to do better in planning land use. I feel we need to protect the water. We can t bring people to mud holes. Land use needs to be planned. To another in the group: I don t know if we can fix Fayetteville s problems, but Jonesville brings in huge industries because they take care of power and water/sewer because they are business-friendly. It is a liability that we re in an environmentally sensitive area. The Attorney General of Oklahoma wants to sue us. There is potential support for alternative transit, given the high cost of gasoline. There is space for growth. University, Community College, and K-12 Our top strengths: Economic development, entrepreneurs, educational systems U of A, NWACC, and the schools together, these are a great resource. University of Arkansas, NWACC and upgraded K-12. Bentonville has a Blue Ribbon high school. University students as a talent pool Talent small technology companies use U of A professor recommendations to filter employees. One firm hired all but two of its 20 employees from the U of A. Pre-existing knowledge based tax incentives from Little Rock provide incentives for knowledge-based jobs. Schools in the University get multi-million-dollar gifts. Honors College got $100 M for Graduate School, $200M for Honors College recently. University now has a billion dollar campaign. Raised through gifts in kind - not all endowment, some is in future gifts. Endowment now worth $700-$800M. Means all schools can compete for the best students. Students love study abroad. U also has great strengths, brought great faculty and students but also created some inequities within colleges facility issues, library issues caste system of haves and have-nots Arts & Sciences is at the bottom of the food chain. University Library has its own endowment of $40 million. Student caste system some students have a full ride for travel, etc. Twenty-two percent of students are honors college students and most have solid scholarship funding. This is more visible now more egalitarian than before, but also more visible and therefore felt more. U of A students are recruited from all over, including Texas, Kansas, etc. There are students who take classes both at U of A and NWACC (dual enrollment). Page 86 of 124 Appendix E Stakeholder Views of Present and Future

91 NWACC supports the new focus on global development. The college offers programs that support sustainability, logistics, entrepreneurship, and retail both credit degrees and corporate training (noncredit). NWACC enrolls students in a Free Enterprise program. Ninety-five percent of NWACC students stay in the local area (the value of the education and training is retained). NWACC has a strong criminal justice program, but it s not geared to training police. Its graduates go on to BS degree programs. [Arkansas has an elite Law Enforcement Training Academy for firefighters and police.] NWACC works very closely with business and industry and looks for the skills needed. Businesses come to the NWACC campus and recruit. NWACC offers high school students concurrent courses on site. It also offers classes throughout the area so students can get started in town. Very high quality schools High quality school systems Very good public schools in NW Arkansas. Also a very high number of people home schooling kids many university people do this. School [superintendents] have good relationships with all the districts in the region. The staffs share ideas and get along, Public schools here are top tier because of University faculty and staff. Their children go to Fayetteville Public Schools so the district has a larger population of 3 rd, 4 th, and 5 th generation of college-educated residents. Sense of place they don t want to promote and overpopulate the area. The region has a pretty good balance of growth. Rogers has a plan for schools. Rogers wants community schools. The Chamber of Commerce funded consultants to study to how to move from Good To Great. Having a plan is the way we do business. Our goal: All students graduate prepared for college and/or work. There is a project to recruit Hispanic students. Rogers students are 32 percent Hispanic. NWACC offers concurrent courses to many of these students, preparing them for employment in fields including cosmetology, culinary. All [the districts] do this. High School and College credit is given. Weaknesses and Threats City and Region. Please tell me what you consider to be the greatest strengths, weaknesses, opportunities, and threats for the City of Fayetteville (metro area and the two county region). What distinguishes the economic role of the City of Fayetteville within the regional economy? Weaknesses and Threats City of Fayetteville Fayetteville s Culture Fayetteville became complacent, assumed that since Walmart came, others will come. Those of us from other states see that there is a sense here that we don t have to do anything. My way of putting it: We ve had economic development success, but we ve never had to do economic development. We ve never had to perform. It s been given to us. I think that s what a lot of the population does not understand. We never lost the sawmill, if you will. Diversity is a strength, but it s also a weakness. There are lots of different opinions. It s hard to get a consensus for governmental (or any) action. So, let me go back to weaknesses, why you re here. You say the world is flat. We still are fractured on economic development. In other communities, they get on the same page. Here, we have too much history, or whatever. We don t get on the same page within Fayetteville. You have a lot of population of people who, once they moved in, wanted to close the door. Page 87 of 124 Appendix E Stakeholder Views of Present and Future

92 You have a part of the population the no-growth people who will not recognize economic factors. We need to get their buy in. Analysis paralysis attitude that people need to stay in line. It s not Keep Fayetteville Funky, but make Fayetteville funky again. Risk-taking is not rewarded, it is punished. Fayetteville is a city that has a system of values developed over the years, and differs in these compared to its neighbors. You will see how Fayetteville s system of values has led to the development here vs. how things are done in the rest of NW Arkansas. People choose to live here but work elsewhere. To follow up, there is a great cultural divide: Fayetteville is the Birkenstocks. Bentonville/Rogers is white collar business. Springdale is blue collar/manufacturing oriented. We had a vote on impact fees. It was Failed. Fair representation of the split in the City s voters. The political leaders in the community schism between far left and far right. Far left is populism of the nay-sayers. No growth. If you made money, if you re successful, you should be lambasted. Then, there is the far right, that if you want the amenities that bring companies here, then you are wasting public money. The media here does not act as a cohesive binder. They promote the most inflammatory things. On a scale of 1 to 10, I d say it s about 6.5 to 7. They start stories without facts, then you can t refute. Too many have axes to grind. Old guard/new guard old guard goes back to hippie roots of Fayetteville If you look at sustainability, product adoption curve has gone through curve-starting to get to mass market in green People are not making so many decisions out of altruism, so are suspicious of the new entrants to the area old guard is into preserving things the way they are Fayetteville is liberal thinking but at same time have no tolerance for new ideas. Terribly divided populace on what that vision ought to be example: issue relating to road impact fees defeated by one vote. Very evenly divided Growth on our terms! Chamber split - still believes in buffalo hunting. War. People don t want it (Fayetteville) to change. Fayetteville people don t know what they want their place to be in that growth...how they should compare themselves. Of the communities that are likely to be concerned about transportation changing the communities in a bad way, it s Fayetteville. The other communities would see it as growth. There are people who want growth on their own terms. Most would say those terms are anti-growth. Fayetteville says: We can impose (unreasonable or unpredictable) standards or policies and people will come anyway. They re not right. If Fayetteville could get together, work together and decide what they want to do... Everything is a controversy they will argue about everything, never decide. Fayetteville is the Joke of the NW region. Fayetteville wants to benefit from growth without changing what /who they are. Protective sacred cows spend a lot of time analyzing and discussing, but they don t take much action, don t embrace change. If they are going to benefit from the great things that are happening, they need to change. Fayetteville s (and U of A s) expectation is that all things will come to them because look how good we are. There is a gradual realization that the world will go on without paying attention to them. Business community formed FEDC out of frustration that the City wasn t doing general economic development. City wanted to have a meeting on this. Someone said something about assuming that the City wants economic development. A Council person said: Well, that would be your assumption. That is half the Council they grew up in a sleepy college town. The other half knows we have to pay for schools, resources, trails, job creation. Page 88 of 124 Appendix E Stakeholder Views of Present and Future

93 City should be recruiting businesses. Low hanging fruit was there. Now it s gone. Springdale, Bentonville, Rogers have come of age. And it will be a really difficult economy. The no growth people may get what they want no growth. Uniqueness of community very strong anti-growth /development/ anti chamber of commerce. People think they are preserving the culture. For example, a woman sat in a tree for three weeks to keep Kohl s from being built. Can t make the connection between no growth and higher taxes. Fayetteville is synonymous with Arkansas for Fayetteville residents. Most of Arkansas is Arkansas. Fayetteville is not really Arkansas as Arkansas is defined by most of the State and the Nation. Business Environment and Economic Development We (City of Fayetteville) have a problem we are seen as anti-business. Perception that we re anti-business is a weakness. Our past history. And we probably have some stricter ordinances than other towns in the area. Perception of being anti-business past history, stricter ordinances such as sign ordinances (40 years ago went to Supreme Court) (other cities are considering one now). Cracker Barrel was blocked (perceived to be sign ordinance issue). Developers and businesses believe takes inordinate amount of time to get through development permitting process (has improved dramatically). Follow the rules and get through pretty fast. Long memories of older times. As an illustration, we lost 30 candidates for the position of Chamber Executive. Lack of incentives It worried people that sales tax revenues were down. (Now, they are back up). We need to be able to tell people that we have to take action for the future. I sat with AEDC yesterday. As we come up with a plan, we can t forget the people who brought us where we are. We have a lot of existing industry here and a lot of technology. Some are struggling now. If they get the idea that they re excluded, that s not going to help. A key weakness is governmental leadership in this community. They turn a deaf ear to the desires/needs of manufacturing. They raised sewer costs 28 percent. That s a significant amount of money for me as a big user. I spent a lot of time with the economic group. I told them: What you re doing doesn t make sense. You will ask me for $300K more. I will make the capital investments so that I decrease my usage and then you won t get it anyway. I received a deaf ear. I told them my strategy but they already had decided before that. I understand why they did what they did. They opened a new waste water treatment facility and overspent/mismanaged. They had to pay for it. In manufacturing, we re held accountable for the decisions we make. Someone made comment last night about doing things for businesses that are here. This City is not very positive in its relationships with companies that are here. (It s different positive with FEDC and the University.) As things go in the food businesses if we can t get some help/concessions in the future, it erodes our margins. Companies have many options for making their products. The risk to Fayetteville is that any of us could combine and rebuild bigger and more efficient sites elsewhere, including new, green sites. There is a project that is a big hole in the ground TIF district. Developer doesn t have the money to proceed. Probably a mistake. In Fayetteville, Chamber of Commerce is black hole, ineffective, etc. Other chambers are active in the region. People don t see it as career advancing move to come to Fayetteville. Fayetteville Chamber is weak. The Board is looking for new leadership, but several job candidates decided this is not a good place to advance their careers. Residents of this town are not anti-business. (Are they just waiting for the right business?) Some people say that it takes a long time to get approvals to locate a business I don t think that is true. I think most Page 89 of 124 Appendix E Stakeholder Views of Present and Future

94 businesses could go through the process in 60 days or less. Local opposition can slow anything down (NIMBY). There area long fights about sign size but I think they only lost one business to that. Some neighborhoods are anti-business. Fayetteville is a neutral force in business development. Springdale s local business leaders helped finance one technology company through the Chamber of Commerce; they fronted money for equipment and built a custom 8,000 square-foot building (in exchange for stock). The company would have stayed in Fayetteville if there were similar incentives. Springdale has set technology and knowledge-based industry as its top priority. Springdale approached another company with free building space, but proximity to the University for its staff who attend classes was too important for the company to move. No space to grow at ATRP. Companies are struggling for space on and off campus. Genesis needs more space. The ARTP space will be maxed out in 18 months. Unavailability of land for commercial development. I mean industrial land, not retail. Flood plains impact sites; few sites are large. There are no shovel ready sites. Although they ve been offered. Other than the University of Arkansas, not another one of the major employers is in Fayetteville. Fayetteville doesn t make business easy. P&G wanted a traffic light agonizing dispute. Takes long time. But you have a lot of aggravation for businesses. Our business is fine we just move into any kind of office space. But it s hard for developers. Today, you may wake up and people flip out about size of your parking lot and next morning they don t care. No even, clear objectives. Business uncertainty drives people crazy. It is not business friendly. Parking The Square is going through a problem. No programming of activities outside the businesses. Retailers would like to be here, but nothing is going on in the evenings to draw people in like the farmer s market does on Saturdays. Rallying the city around festivals is very, very hard just now loosened restrictions on having street vendors. No way to translate vision of a month-long festival because nobody is there to tie it together. Breakdown in the idea of public commons vs. rights and responsibilities of businesses. Public street in which public has invested -- but businesses don t fully appreciate that these developments add to their attraction power. Bars are angry about smoking ordinance- resentment of that and fact that construction closed them down or reduced businesses. Now economic downturn also is affecting business. City is not very responsive on arts and culture overall shortsighted on these ideas. Acknowledge importance, but feel too strapped to support financially. No central entity to apply for grants or take overall responsibility. People to get it done (carry projects out) aren t there. Square example: great infrastructure project but not the activity to draw people to see it. Row of offices on Center Street attorneys from courthouse move them upstairs on the Square. From an Arts & Culture perspective, the community has the right intellect, mindset, but not the policies they aren t there to support it. Arts Center is a non-profit, must earn its revenues. Need downtown zoning for art studio space, signage, way-finding, parking that would make it easier for these activities to incubate. Fayetteville Ad & Promotion Commission is a joke spend money giving grants but no campaign to promote the area Fayetteville hasn t found way to communicate the uniqueness to the region brand issue, How to make people realize that Fayetteville is a unique place. Low level of income for many residents Page 90 of 124 Appendix E Stakeholder Views of Present and Future

95 There are people behind the scenes willing to broker deals for Springdale, Bentonville, and Rogers--- Fayetteville doesn t seem to have this flexibility. There are leaders in each community who bring the resources together and work with the City to get deals done. There is a division of leadership, lack of focus on economic development in terms of bringing companies in. Anything that s a threat is an opportunity if you work hard enough to turn it down. The University has a stake in how this town develops. They can have regional focus but this town is their recruiting tool. I want the University to have an active voice. They have to say we need housing. Fayetteville must be willing to risk its own capital. Choices are elsewhere. Bad attitude has to change. People here think business is bad. Not just anti-growth. They don t get it that businesses are connected to the tax base. Here only thing we have that s stuck is University. They were used to being the only game in town. Now that there is competition, we don t have to be in Fayetteville. We can be in Rogers. Rogers is already becoming the first choice. The reason: Our family wants to go to Rogers every weekend. That s not how it s supposed to be. Seems that communities around us have more success in terms of economic development Rogers and Benton particularly. This has shifted the economic center of the area. Benton has a better mall, more restaurant facilities, etc. Now those amenities are more accessible to people in the area. Fayetteville has its head in the sand about that kind of competition. A strength of Fayetteville is having the University right here. Strengths can be related to weaknesses. We haven t got a good way to leverage the intellectual assets of the University. Walton Arts Center retention/expansion; loss would be a problem in creating/maintaining Cultural District. Trying to form a public/private partnership to support that. Development Approval Process and Civic Leadership In the area of real estate development, on the City side, in the name of good development, they have made it extremely expensive for developers to do projects. I own some property and it s amazing how you go to Planning Commission and sit with people and they can t even tell you what ordinances or plans apply. They say: You have to bring it to us lots of money is spent and then they say it s not what they want. And, the University doesn t have any planning/zoning rules. It s not fair for the University to have advantages. Lots of people think it takes a long time to go through development process in Fayetteville. It s improved dramatically. The ones who follow the rules get there fast. It s a strength that we have strong regulations, but also a weakness. The zoning code has a clean technology use code. Development is by right in industrial zones and by conditional use in commercial zones. The form-based code in the downtown plan would allow administrative review of projects. There is also precedent for an overlay district. I-540 has development standards, but they are not enforced by administrative review. Can be a weakness that things get interpreted differently. There is very little you can rely on. A thing you can do on one day, don t even try another day. Driving force of NIMBYs in this town. Selected number of people that you can count on one hand but they can bring an uprising in the city. There is a lot of rhetoric, horse manure. Page 91 of 124 Appendix E Stakeholder Views of Present and Future

96 Handful of concerned citizens (four or five) who show up at every meeting and complain about every project. They get quoted in the paper. Even the City Council has grown tired of them. It s not just the dad-gum typical NIMBY. They take it to a whole other level. This town has an overwhelming sense of entitlement, perceived ownership. People who live in subdivisions will argue that you shouldn t do subdivisions. Barriers to doing business here more of a negative system that punishes people who do things, rather than rewarding people who do things. Developers who come with positive things not sprawl - they are nitpicked to death. Not rewarded for sustainability, Unpredictable business environment with high development costs due to governmental approval delays. The rules are overwhelming in number and complexity. On the first review, the Planning Department may not catch all the relevant issues. Planning, Engineering and Parks all review each development plan and may have opposing conclusions. Developers really need simultaneous review around one table. They don t know the amount of their impact fees until after they buy the property. They need better predictability and transparency. Some local developers weren t used to the increasing standards; 80 percent understand them now. The Council says they want affordable housing but won t pay for it and not next to their house. Part of engaged citizenship is public meetings that go on and on. Perceived as attempting to come to consensus. Doesn t see that regulations, permitting, etc. get in anybody s way. Only thing that gets in the way of a real businessman is changing the rules. Rules that don t change aren t a problem. We have land out the wazoo along highway bypasses that can be promoted for commercial uses property tax. Developers shouldn t be chastised and put through what they are put through. Part of what we enjoy here is that all our friends and families have good jobs. Take the jobs away and you wouldn t want to be here. I tell the guys in Planning when you get a chance, look at who is building and rebuilding. It s us the developers, not you. In this city the biggest problem is education (of the policy makers) those complaining about their property taxes don t understand that you can t be just focused on downtown or the Mall. When people say there is a lot of land to develop it s not true. Much of it is owned by County and City lands we can t use. We could put it back on private taxable rolls. We have a project with a hotel going in and if they raised the impact fees to what the study says, fees go from $12K to $74K on this one project. Why would you penalize people for bringing things to your city that you want and need? The City touts development by right a 40 day process. But it doesn t work that way. The City and citizens spent six years developing the Downtown Master Plan with thousands of meetings and many consultants. They decide the height limit will be six stories on Dickson Street. They decide on setbacks. Because it s an old town, every lot is nonconforming. Within minutes of adopting the big plan, one Council member wanted to start all over again with a three-story height limit. Same with 2025 plan. You bring in a project that fits the plan and they start all over with the discussion. Every zoning decision and site plan ends up going to the City Council for approval, even with as of right development. I am going to appeal my approval because the conditions are ridiculous. I have to appeal. Delays. Can t deliver to my leases. Staff has way too much leeway in interpreting an ordinance, or deciding that they don t want to interpret and send you to City Council instead. The City won t identify what it wants and where it wants it. And, once identified, won t identify the policies either by progressive or regressive taxes. Page 92 of 124 Appendix E Stakeholder Views of Present and Future

97 I ve asked the City a million times do you want in-fill or not? Do you want affordable housing or not? How will you pay for that? Don t get distracted by the neighbors. We re reactive, not proactive. The City and Council don t have an appreciation of cost. The longer they hold up development, the greater the development costs (redesign, interest, etc.) without any increase in the prices that can be charged. They want redevelopment, but if you buy an old building they make it so you re better off tearing it down and building schlock, because of problems with redevelopment. What does the city want in the way of development? Developers need clarity. This City is driving the good developers away. Many companies come to this area and won t locate in Fayetteville because the City is too hard to deal with. I love Fayetteville but we lose a lot of development opportunities. All of the developers currently active in Fayetteville are looking at whether that money could be better spent elsewhere. Conducted a big public process to develop the downtown master plan developers like it. They come up with cool stuff that exceeds our expectations. They buy the land, do the planning. They get staff to help. Then, they get to City Council where all bets are off. Go back to the drawing board. Developer says: I did exactly what you wanted and you re turning me down. There is no strategy for downtown. The downtown plan includes a form-based code. They need 3,500 more dwelling units downtown. The populists on Council may subvert the form-based code. City Council has no political will to enforce the code. In 1970s-80s, we had city manager form of government and some of our mayors were professors from U of A. And half City Council was elected by wards, and four at large. There was not the animosity that you see nowadays. Then we went to the model of mayor as chief executive. And changed to all eight elected from the wards. So, it s a problem because the City Council members pander to the vocal elements of their wards. Those of us who think we should have an at-large City Council are in the minority. City Council votes by ward rather than thinking about the interests of the City as a whole. There are no at-large members. The Council doesn t understand that impact fees can t be flat fees. Why should you pay the same fee for a 500 square-foot apartment as for a 6,000 square-foot house. They need to give help to those who redevelop the city, who do things that help sustainability. The Council doesn t understand that the opposite of bad development is not no development, it s good development. FOIA rules prevent City Council going into executive session for real estate contracts. That means they don t get into the process until the very end when it should be a done deal. They have no opportunity to provide early indications of support or concerns. Members use development as a political platform. Council wouldn t accept an administrative process for planning approvals. They have to be able to thwart what their friends want them to thwart. Fayetteville should change from Mayor to benevolent dictator. Start to annex go south for space. Sign ordinance went to Supreme Court of US a few times. 40 year old ordinance. It s a perception. It s not anti-business. It s pro-beauty. Now a lot of our sister cities wish they had done it. Now they would have to buy all the signs. Springdale paid for extension of the Cross Town Corridor it enabled the location of UPS, Karcor and others Fayetteville has to do more. Page 93 of 124 Appendix E Stakeholder Views of Present and Future

98 City Tax Structure Sales tax is up only because Sam s Club came to town. And because hotel prices are up. Systematic weakness coming from the State. No accident about reliance on sales tax it takes a super majority to change income tax, simple majority to change sales tax. Mindset of Arkansans if you accumulated property you should not pay any more taxes on that accumulation. Challenge for this area Dependence on sales taxes losing market share to Rogers, though the new 17-screen stadium theater and the new Sam s Club off the interstate have helped this year. Also, the State law changed to allocate sales taxes to point of delivery instead of point of sale. The regional mall is doing well again. A lot of the gain in sales tax this year has to do with where it s paid. Change in rules at State level. Back out the Sam s numbers and see the year to year growth in sales tax. Sales tax downturn threatened the City s ambitious parks and recreation program. Wake up call pedestrian-friendly city envisioned. A city s reliance on sales taxes drives strange decisions. High percentage of the city property is tax-exempt (about 30 percent). Remaining sites need to make up for that. They need to plan more for commercial development. Rooftops don t build classrooms. Our tax base. We have a lot of public use that doesn t pay property taxes. Tax base no property taxes from University and other tax-exempt entities (but also an asset) Our large shopping area (mall) is in Springdale school district for real estate tax. We get the sales tax but not the property tax. Unique tax structure we have this golden boot in which we get all the taxes and then spaces around it where we don t get the taxes. Inspiration for this work is decline of sales tax in City of Fayetteville. Turned around now is positive again, attributed to opening of Sam s Club, multiplex cinema. Our infrastructure we haven t kept up with growth as well as we should have. Impact fees, etc. Sales tax is main source of revenue and is regressive. Mall is in Springdale public school district for property tax, though Fayetteville gets sales taxes; district lines cross municipal boundaries. How does the wealth that is created by a knowledge based economy translate to the sales tax? If it doesn t drive the sales tax it is not sustainable as a strategy. This is a consumption based economy. Threat of debt with economic downturn. Real property taxes are mostly dedicated to the school system. The property tax is very low compared with anywhere. Including other towns in Fayetteville region. Our property tax has a small amount that goes into the General Fund for operations. Other things are police, fire retirement, library, etc. Limited revenue to support more economic development activity. Property tax rates are lower than in other states. City s very low compared with other Arkansas towns. Tax goes to other things, especially schools, police and fire retirement funds, library. School millage is very high because so much exempt property, so total tax doesn t seem so low. Together, they re high in the city and low in the nation. School millage is higher because high per capita income entitles Fayetteville to less turn-back money from the State. Legislature is looking at this issue and may set some balance in turn-back money per child. Discretionary 5.0 mills without voter approval. Now at 1.3. Can talk about higher millage for clear investment. Perhaps targeted to Green Valley Initiative. Millage issue for Fayetteville school board narrowly defeated. Page 94 of 124 Appendix E Stakeholder Views of Present and Future

99 Regional Weaknesses and Threats Northwest Arkansas Arkansas Factors Perception of Arkansas Negative stereotypes of NW Arkansas make it hard to recruit faculty OR no impression of Arkansas. Not on the radar map on the East Coast at least she made this comment after living in Kansas City. Fayetteville is not on the map there. Big companies don t recruit the students from here even if they are headquartered in Kansas City. It can be hard to recruit experienced people because of Arkansas reputation/ image. That can also affect company credibility and ability to attract customers. Legacy of Central High that impression of the Little Rock segregation battles keeps African-Americans away from the University. Central Arkansas resentment of NW Arkansas. For decades the area has struggled with the perception that NW Arkansas is the wealthiest area of the state and sitting on that wealth so much better than the rest of the state. Populace and State government have a don t come whining to us mentality. The State seems to hold NW AR in disregard because of jealousy. We don t need anything up here. So, they pour all kinds of money into poor areas where they get no return. I would like them to see us as a serious piston and keep us fueled. Legislature is the problem. Made up of a lot of small town, small thinking people. We don t get back much of the money we send to Little Rock, except to the University. University is going to have to apply pressure to Little Rock on this point in the future. There is a new AEDC plan is forthcoming. Indications are that this is going to reverse. Recognition is that, if state is to succeed, it needs to promote its areas. No longer shackle NW and Central Arkansas. Little Rock doesn t like NW Arkansas. Deep down, they would prefer to keep NW Arkansas smaller than Little Rock. State government: They forget what they re there for. So, I want to make sure they are supportive, because they have money and control. People always want to go to Little Rock with hands out. I say: Not always necessary. I don t think our State government gives us much. They consider us taken care of. So, they d rather pour money down a rat hole in the delta. They ve done that for decades, without any success. Anything we say, remember this is Arkansas. We have high levels of poverty and education problems in the delta. We re a poor state. So, we re viewed as rich (here in Fayetteville/NW Arkansas). Arkansas State structure; dated constitution. Legislature meets only briefly every two years, so hard to get attention and support. Legislature too much turnover lack of institutional memory don t understand the law and the implications of the wording not a professionalized legislature. Meets every two years (means that every department has to get its budgets ready three years early). Budget hearings are going on now, three years ahead for FY 2010 and Arkansas is fiscally sounded and has increased funding to NWA a little bit, but it needs to be more. NWA has little impact on legislation. The six-week legislative session every two years limits its effectiveness. It is also subject to term limits. There is a stigma associated with being a Fayetteville law. AEDC is involved with big company prospects. The Center for Business and Economic Research is a good resource. The state has a relatively low educational attainment; Fayetteville s is highest level in Arkansas. There is no recognized State (or City) economic development strategy. Small population base it s hard to be effective in voting. They need to create alliances with other parts of the state that have clout. The State AEDC doesn t spend much time in NWA generally. Page 95 of 124 Appendix E Stakeholder Views of Present and Future

100 Infrastructure and Planned Development Lack of basic infrastructure growth has been phenomenal and has outpaced development of human amenities, roads, sidewalks, sewers, power, water treatment also needed Infrastructure not kept up with as well as possible given rapid growth. Didn t keep up with growth with tools like impact fees. Washington County is weak with respect to planning and sprawl. They don t have strong regulations. Infrastructure in particular roads ability to get people from place A to B hasn t kept up with growth. Infrastructure is not in place for a regional economy. And no broad-based regional public transportation. On one hand, limitations on road capacity and, with that, no public options. We are living regionally, but we have one interstate to connect a half million people. We have one north-south. We don t have east-west. Run through our towns, not straight shot. I d like to think we re at point of arguing how. But we re so far behind. We have one interstate and intersections that fail during times of the day. We have to catch up in the short run, or companies will say they have to go where they can move their trucks. Lots of people like to live in Fayetteville, but work elsewhere in the region. If the traffic starts taking them 45 minutes, they may move to Bentonville. In each city s interests to succeed at this. People are mobile. Big discussion of rail vs. auto. We can t ignore cars and federal policy hasn t changed. No good east-west connection working on 412 but not enough I-540 is a parking lot at times. Center of the universe is Walmart. As traffic increases, it takes longer to get to Walmart. It used to be 30 minutes, now 45 minutes. If it gets to be an hour, it will be a problem. Transportation internal to Fayetteville may not be much of a real problem. They have a rush minute (actually 15 minutes). One issue is access to the mall from the interstate at the suicide merge on Fulbright Expressway. Infrastructure has to be here to support these people. City has been working hard. Wastewater treatment plant, better roads, improve ease of movement East/West corridor needed no political will to get a corridor. Lack of public transportation in Fayetteville. General weakness poor public transportation. We have Ozark Regional Transit and University stuff. No public transportation Razorback express is vital to U. Light rail not an opportunity because with Tyson and Walmart north of us it could turn Fayetteville into a bedroom community disastrous to tax base. No way to keep first-rate school system or the services we want. Other towns missing infrastructure sewers, natural gas, roads, curbs, sidewalks City should pursue one Broadband infrastructure. We don t have it. AT&T and cable are creeping along in creating it, but we still have rural rather than urban infrastructure. Arkansas is focusing on poor communities first to extend telecommunications infrastructure. It is important [for student progress] that homes have Broadband connectivity - Susan Thomas has been working with them [community leaders] over the year on this. FEDC should create a focus on this should have wireless on Dickson Street anyway. Universal wireless could be a big opportunity. The city could do it in partnership with APCSN UA, RFID haven t taken opportunity to participate missed opportunity. Fayetteville is getting landlocked. Has to be smart about growth. Goshen, etc. encroaching. Page 96 of 124 Appendix E Stakeholder Views of Present and Future

101 Not a transportation node Not a traditional large market Regional stereotype Population needs to be higher. Density would be nice, but need more people. Selfish but, for example, I love to cook and for some items, have to go to Tulsa or Little Rock If the population were higher, we might be able to support an upscale food store (example, dried espresso coffee). No good place to build. The University can t build fast enough to respond to the opportunities. No wet lab space There are some privately owned business parks. There are no sites close to the interstate. None have rail. Things move here that shouldn t go elsewhere airport, Walton Arts Center. When these things move to some other place, it creates an economic challenge in the neighborhood. Problem is if the Waltons want it in Bentonville, it will go in Bentonville Crystal Bridges museum should go here. Need more restaurants and condos Airport not easy to get here from various places. And this airport runs out of rental cars. Regional Work Force Skills Lack of decent living-wage jobs percent of residents in 1999 were making less than $30,000 Workforce Issues Deep and wide U of Ark doesn t lack for educational resources but does not retain the students in the area. Big exporter of bright, well-trained minds they go to Dallas, Houston, Kansas City. Lots of students here from Texas Need more opportunities to keep those students here. Two important weaknesses: First, the hourly work force it s under-skilled. And we experience 24 percent turnover. Second, we can t find the technology base skilled people. By this I mean the people who can work on sophisticated stuff: technician level with at least an associate degree. We have partnered with Synergy Tech, a great resource to help us get our skills base. You have to make an investment. Our wages in unskilled labor were competitive and our technical wages were not competitive. So we changed. It s somewhat better now. University is a big help in marketing of the area. The University needs to go to the industrial base in the region and ask companies what skills are needed. Maybe an associate program. Programs that promote clean industry. We have a lot of discussion about the lack of skills in the labor force. Those with 8 th to 11 th grade educations. Frankly, we are being saved by hiring Hispanics. They have a great work ethic. What I see the year olds have no work ethic at all. They just don t care. They live at home. They are spoiled. If we fire them, they get hired the same day somewhere else. Region is struggling with influx of Hispanics Tyson and others attracted them. The building industry was a big attraction. Some clash with Fayetteville s vision. Places in NW Arkansas not coping with Hispanic growth very well police profiling, etc. Community committees related to this seeing that lots of difficulties with workforce issues relate to changing demographics need to get people who are good hard workers allow them to grow and climb career ladders. There is not the training infrastructure that would help these people prepare for technical jobs that would move them up. Not enough advocates to help these folks cope with medical, legal, and life processes. Housing/transit issues for lower strata Page 97 of 124 Appendix E Stakeholder Views of Present and Future

102 Well-paid people could afford a lot of house - lower strata could not afford this type of home. Fayetteville s efforts to address this with zoning market forces not making it happen. Research park in south Fayetteville needed revitalization community banks interested. Not enough to show a trend. Overabundance of apartments not much in middle. Springdale has largest Marshallese community outside the Marshall Islands quality of life is good for them. The community started with one person moving here. Many people are outside the prosperity vigorous food pantry, very poor housing not just immigrant population. The area has little technology momentum, so prospective employees can t identify their next job if this company fails. They need some success stories. It s easier once people are in the region and experiencing the lifestyle. Education Redundancy: locally, regionally, statewide in education. Way too many K-12 school districts consolidation is a bad word. Too many universities and colleges also regional competition is great. Ten public universities, 10 private; 22 public two-year colleges in Arkansas - all have plethora of centers and other locations. Sometimes schools are too close together and sometimes so remote. These remote schools are not serving children well; remote ones bus their students, but it requires long rides. These children are shortchanged. Some places can t even provide a building. Kentucky consolidated school districts from 300 to about 115 now is performing much better. Almost every county could have one high school per county. Seventy percent of State budget by law goes to the public schools 2003 law puts school funding ahead of all other State needs (Medicare, higher education, State police, etc.) This could be important in a few years when State funds are reduced schools will still get 70 percent no matter what that means for other things. Devaluation of technical education in Fayetteville. Example: Fayetteville high school s west campus location (now being abandoned) made career education less prestigious. Fayetteville is really slow in coming to grips with their elitism. They are smug. There is an opportunity to meet a workforce need that isn t being taken. Fayetteville school board has allowed itself to be diverted from educational programming with controversy over location of the new high school. NWACC is about to throw in the towel. Fayetteville needs a reinvented approach to technical training, but the money streams are against it as is the city s culture. Contrast the Collin County area: Allen High School arranged a field trip to expose students to NWACC, but NWACC couldn t sell that approach to the local area. The former chancellor of U of A also opposed community college education and wouldn t let NWACC do anything with Fayetteville schools. Fayetteville High School physical conditions There are haves and have-nots. Lots of Hispanic workers in Benton County can t live there, so they live in Springdale and Rogers. Many Hispanics work for Tyson Industries. Fayetteville and Bentonville don t really want their presence. Both school systems cater to high end students. Fayetteville school challenges now (defeat of millage last spring; changing superintendent hard to get good applicants as the selection process was controversial). University and Business Capital The U of A needs to be a top quality research institution not so much what they do but the people they bring here. Starting to bring in world-class scientists and engineers, but they need more it s the people. Page 98 of 124 Appendix E Stakeholder Views of Present and Future

103 They haven t brought very many people here not actively recruited that he can see. They don t focus on an area and build it up, they scatter good people around. If a department gets several people, who can support each other but are in different specialties, it can be strong. I believe that the University could be doing more. Until present, they ve had their hand out to Walmart like everyone else. Everyone usually looks to Walmart for leadership. Would be great if the university would get its act together and lead. All of the University leadership needs to get on the message of sustainability. Only thing that stands in the way of this place being great is the University. It s probably a third-rate university. Only department that stands out is Poultry Science probably good but he has no way to judge or even know what their competition is. The University s thinking about technology licensing is somewhat old-school and needs to continue to evolve. The Intellectual Property (IP) policy provides the inventor with 50 percent of the first $250,000 net and 33 percent above that. The reality isn t quite that favorable. There was a system policy from 1986 to 2001 that had favorable revisions in Companies find it better to use the facilities, professors and grad students rather than licensing IP. Limited cooperation across disciplines. U of A has 100 fiefdoms with each doing its own thing. A larger university calls for a more significant infrastructure but there are no tax dollars to support it. Having no available sources of resources is counterproductive to the prosperity of the community. Misconception about undergraduate students leaving the state. Now 70 percent of undergraduates stay in Arkansas at least initially. Among Graduate students, all but percent leave. We can t place all the U of A graduates locally, so they look elsewhere. Our companies cannot absorb the output of the University. There are pockets of money in the region but no history of investing in technology. There were some attempts earlier that resulted in fraud and a leeriness among potential investors. What s missing is risk capital. Angel capital is a nightmare always hard to do. It would be better to have a fund, perhaps associated with the Walton Foundation. There is a Fund for Arkansas Angels based in Little Rock. The impediments to an angel network locally include: Funders interests -- the Walton family is interested in something more broad than high technology. The Green Valley Initiative would fit nicely with a broader agenda. There are similar issues with Tysons and JB Hunt. It needs to be sold with professional involvement to give investors a comfort level. These folks are not attuned to investing in technology, but the Walton Foundation is about $15 billion. Locals have been very successful investing in real estate, which is easier to understand. Lack of venture capital (institutional business investment resources is another weakness. But we have the net worth in private fortunes. Opportunity?: How do you go to these families and say: Here s what you re investing in. There would be risk but maybe they could look at somewhat the opportunity somewhat philanthropically. They are not inclined at present to be interested. But the capital is there. It s hard to get $1 to $2 million in mezzanine financing. The region doesn t have any examples of companies seeking $5 to $10 million. One start-up company was able to raise money, but it was difficult. A fund with multiple projects would be more attractive; it might incorporate tax credits. One company s owners invested $2.5 to $3 million and are seeking another $3 million; they ll either get it or wilt on the vine. The Board of Trustees should be energized to participate. Limited immediate access to financial markets. There are locally owned banks but not all the big nationals There is a lack of capital, but there are significant pools of money in NWA. We need to connect the money and people. Need models to home grow venture capital. Page 99 of 124 Appendix E Stakeholder Views of Present and Future

104 We need $1 billion in venture capital (VC) here. We need to launch a VC fund. Stuff at state level is not really VC money. Either out of state or into real estate. I think that s the future here. We have all these assets. There are two venture capital sources Stevens Corporation from Little Rock and Arkansas Capital. Most Walmart millionaires are not angel investors or entrepreneurs. Not enough help for small businesses. There is a disconnect with the University Board of Trustees. The University s business investments are several $100,000s versus $60 million per year in Florida. Lack of awareness of the need to close the loop and get money into businesses. They could get professional managers involved for oversight. Still, people do not know how to start a business in Arkansas. None of the actors has a good way to communicate with potential businesses. Arkansas has pretty decent incentives for business, but they are not well communicated. Have incredible strengths but no way to narrow down to an accessible format. SBA and SBDCs are irrelevant. Current Fayetteville Economic Development Strategies City s Current Strategies. At present, what are the City of Fayetteville s main strategies and priorities for economic development? Do you have ideas about how these strategies might/should be refined, expanded, refocused, or changed altogether? Green Valley Initiative Green Valley initiative which is a non-profit intends to make NW AR and Fayetteville the burning white hot center of sustainability. When I say this, we don t need to keep here what we learn here. We have a desire to share it with the world. Add our insight and knowledge to what s in Timbuktu. We will strive to be it and help others. What is current strategy in a few words? To get our act together. No real economic development strategy. Well, currently just hunting big companies and yet we don t have land for them, etc. Build the qualities of the community and go after the sustainability companies. Hope for the Best that a big company moves to town. Capitalize on the University, the creative class, the Innovation Center and the Center for Applied Sustainability. Swedish companies are coming in every day. Fayetteville is on the ground floor of the next economic movement as a sustainable, bikefriendly community. They need to recruit related companies and build on those blocks. Closest thing you could say: Mayor s sustainability focus. But Council is not on board with it necessarily. Does City Council have an ED plan? No. Mayor kind of does. Quality of life improvements safe, natural, education, civil behavior Trails, retaining the Arts Center, quality of life enhancements With our limited funding, the trails and arts, etc. are what we ve concentrated on. We re not spending a lot of money on ED programs because we don t have that much extra revenue. Most important strategy is to turn this into a great place to live that will bring the jobs, businesses, engaged citizens here. Trails, green spaces preserve natural areas, that kind of amenity Keep working on the amenities, make them better and better. The City is on the right track in terms of what the City has control over. In a year or two things are going to pick up. I think we re making real progress. Promoting a city that s focused on high quality of living, green lifestyle raise awareness nationally and regionally Page 100 of 124 Appendix E Stakeholder Views of Present and Future

105 University is a strategy for the city something to build on incubator, tech park, scientists who live here. Partner with U of A ARTP, partnership with UATDF very good The Research & Technology Park has been very good. There was some land swapping six to seven years ago. Bring more development there. We ve already worked well with that entity because advantageous for that part of time. Research Park; business incubator Contractual agreement with Swedish company to bring in Swedish companies along with Chamber, FEDC and U of A. Already have had a few visits. Also, City has tried to be hospitable to the vendor community. Good example: doing some things to retain P&G, which could have moved to Benton County. We have an Economic Development fund of $1.2 million (was $3 million). About four to five years ago, the City partnered with the University and business to develop the FEDC. It went out, raised money and hired an Executive Director. Notion of having that Executive Director be the focal point. FEDC was created as marketing group. One point of contact. Role has been fulfillled. Has highlighted the bigger issues. And has brought the Chamber along. FEDC private organization trying to represent U, Chamber, City modest or little success Chamber s role: We re a partner a point of contact. People are used to calling the chamber. Work hand in hand. Chamber focuses on total business environment. Making Fayetteville business friendly. FEDC was formed because we were a fractured community. People didn t know whether to contact the University, City or Chamber. Head of state agency that is now AEDC calls Fayetteville the most fractured community that we deal with. Tweaking the organization should be on the table for discussion. Not sure FEDC and the Chamber should merge, but should be discussed. City paid for services from a Washington consulting firm that helps us get federal money, so we got some testimonials from Univ. That is economic development, lot of the funds go to infrastructure, and things that help assets. Big believer in continuing down the path toward getting knowledge-based industry. Have innovation here, future of our students here. Goal to be among the top 50 universities Some justification in the statement that strategic planning can be a substitute for strong leadership. If that leader has vision strategic, planning isn t as important Leader might not have vision; plans are useful for getting other people into the process. What s Missing Let s consolidate the Chamber and FEDC. Get the best person nationally. Have the City on board. All the naysayers have to be on board. Need finished industrial land. Seeking funding for an Aerospace & Technology Park at the airport. It would start at 167 acres and could grow to about 300 acres in a beautiful setting on the river with opportunities in electronics/digital equipment, navigation, aircraft parts, etc. There is a local aviation parts manufacturer that needs to expand and build. Create a virtual park that is fully planned, permitted and ready to go when a company walks in the door. Page 101 of 124 Appendix E Stakeholder Views of Present and Future

106 Industrial Land and Building Supply. There is private land available but not improved (e.g., at airport and Mexican original site). There are a few lots in the existing industrial park. They are lacking a strategy for the little land that they have and how to move it ahead. There are political issues, though there may be some funding for infrastructure. Timing is an issue Council does not like to be hurried. There is not enough money for required infrastructure. Fayetteville water is a 120-year-old utility that hasn t been able to keep up with replacing failing mains. More partnering with Walmart (just a little now), JB Hunt and Tysons Regionalism They don t act like a region. There is no Council of Governments. There is no cooperation on storm water and some antagonism over annexations. The language is one of competition. There are culture wars. Tiered impact fees relative to existing infrastructure and sprawl, but there is a problem in implementation. They struggle to offer incentives because regulations are law. Take care of existing industry Old vs. new, growth vs. no growth Partnership with the State. Little Rock focuses on Central and South Arkansas. NW is not well connected. The University should explore the concept of drawing research dollars from overseas. The University needs to be protected from businesses running it. The University is an underperforming asset. There are graduates who d like to stay here, but don t have jobs. They might be candidates for home-based businesses. There should be entrepreneurial encouragement, training and education. Fayetteville needs diversification of industry, establishment of the green initiative. In connection with this, there is a need to define knowledge worker. The Information Technology area could be sexy enough to get everyone motivated. Fayetteville needs some other identity than being the university town. Protect/expand the Walton Arts Center New ideas: Shovel-ready property Venture Capital money Training for all levels Light rail public transportation definitely We need to learn more about good incentives we can provide. Good people might want to come here. Other cities: Incentives like energy tax breaks for energy savings. We have to add incentives. New way of thinking for many of us. New for us in our culture. We have to be competitive. We are doing this on street bond level set aside street bond program money for this. Street Committee bond program set aside $10 million to help new business with roads they are trying to recruit. I think we may have helped a few companies. Some cities have a Business Directory so they know what s out there and we don t have this. Other thing cities do let them pay upfront costs over time not all at once. Predictability is important. They want to know upfront. We have a lot of development fees. But they should be predictable. Two or three businesses recently came in with the same complaint. They want to know the costs. Hit with one cost. Then later on another and another. Fayetteville Independent Business Alliance is several small independent businesses. Emphasize sustaining and growing existing businesses. Target self-employed people who work out of their homes. This couple looked nationally for a place to live and start their business. Page 102 of 124 Appendix E Stakeholder Views of Present and Future

107 What about the film industry? Fayetteville has the technical labor and the creativity. We are selling the sense of place and shouldn t lose that. Fayetteville doesn t have the jobs to support the population. This is a safe place for investors concerned about the global financial meltdown. We should discuss better connecting the University to the community and to industry. Fayetteville has lost its dominance because it has lost focus on anything except the University. The academic economy is not the economy of Fayetteville or Northwest Arkansas. Regional Economic Development Collaboration Regional Collaboration. Since it is commonly assumed that economic development strategy in the 21 st century economy must involve regional collaborations, how would you assess the way in which local/regional organizations are (or are not) working together in the Fayetteville / NW Arkansas region? On what things does collaboration occur? On what other things should it occur? Fayetteville almost wasn t going to go along with the Mobility Authority. I think this could be the vehicle to establish the priorities. They might come to the public with a program to be accomplished. We will have to fund that with local monies that will need a designated sales tax and maybe a toll on the road. You d have to campaign for that. Becomes reality only when the people vote for it. The NWA Council is 65 business people, including Lee Scott from Walmart, Dave Gearhart from the University and Don Tyson. It provides vision and funding for major projects. The NWA Chambers of Commerce lobby for business interests and focus on issues such as image, soft infrastructure, events and recruitment. The regional Mobility Authority was just formed. It is the first in the state. The Two-Ton Water District provides a regional water reservoir. The two County judges and five Mayors dominate the political scene; State senators and representatives respond to their leadership. Regionalism must be a major priority and focus. We would look to the RMA to do the projects of regional significance. The Northwest Arkansas Council has prioritized those that we want to champion in short term. The RMA legislation was crafted in such a way that it could be effective in bringing projects to fruition. Then, once RMA helped get the legislation, it had to advocate to the governments to join. The NWA Council focuses on regional issues transportation, regional water and the airport. They meet monthly with the regional Chamber of Commerce so there is cooperation, but there is no regional economic development and no regional marketing. NW Arkansas Council --examples of how they operate consider themselves an advocacy group for things necessary to sustain vitality of region, like the airport. They lobby the legislature. If measures are taken either at state or local area, they do it. They create management entities Airport Authority; Mobility Authority with taxing, bonding, eminent domain This is manifest in bonding They sponsor things like Rural Water districts projects that generate revenue. The new Regional Mobility Authority with regional highway and transit departments has been endorsed by each of the two counties. All the Class 1 cities have signed up to be members. The notion is that the governing board of the Mobility Authority will actually set these priorities. Up to and including rail. Recently created. One meeting so far. Regional cooperation depends on the issue. We studied light rail. Airport is regional. Our issue is that we don t agree about the solutions. On scale of 1 to 10? I d give us a 7 or 8. A lot of other regions ask us for suggestions on how to do it. Northwest Arkansas Council gets a lot of credit for that. Page 103 of 124 Appendix E Stakeholder Views of Present and Future

108 We have our differences but recognize the needs. We are more of region than not. But, we collaborate when the time is right for the University, for the airport, for the regional transportation board. The next big thing is public transit but not light rail. NW Council and chambers of commerce [are effectively collaborating] local and regional collaboration happens emphasis on knocking down walls focus more on global, but especially regionally need major beltway taking traffic off I-540 new western beltway 412 will be the major connector. Heavy hitters from the big companies have been able to get together and get things done not spend lots of time talking about it an issue because this group is not as active. NW Arkansas Council is doing a good job. New mobility authority will get support- heaviest economic benefit will be felt throughout the district Transportation large MSA need for all to cooperate in developing mass transit talk about rail run from here to Bella Vista and maybe down to Ft. Smith. Increasing cost of bus labor lots of buses sitting at intersections at traffic jams wasting fuel, time, creating pollution. District is prohibited by law from using school buses to serve other uses. Regional transit system is not linked to bus system. Don t know how big Ozark Regional Transit System is. Marketing, lobbying for infrastructure dollars from the Feds The region combines efforts on major projects but not when publicizing their own towns. They need to keep a regional focus. The region needs one chamber that does it all; corporations don t want to join five chambers. The region has five Chambers. The chambers and communities have different characters. There are 29,000 Walmart associates in Northwest Arkansas with about 20,000 working in Bentonville. There are 1,250 offices of corporations that sell to Walmart. There are about 400 suppliers, major corporations, banks and small service businesses focused on either business-to-business services or personal services. Rogers is more manufacturing oriented. Springdale is a blue-collar town with a heavy concentration in poultry. Fayetteville is a typical university town and tries to make everyone happy. Siloam Springs is part of the Bible Belt very conservative with Franklin and La-Z-Boy. The chambers meet monthly. Six chambers are forming into one regional group a fledgling effort. Five chambers meet on monthly basis. There is sixth Chamber in Gravette. Rogers-Lowell, Bentonville- Bella Vista, Siloam Springs, Springdale, and Fayetteville. Talk about regional issues. Round robin the chairman. XNA, 540, etc. Work with Regional Planning Commission and Northwest Arkansas Council. Looked at as a model of regionalism by rest of the State. Is regional chamber feasible? I m a hopeless optimist, so I would say, Of course. No one wants to be second fiddle. Neighborhoods think NW Arkansas Council, Mobility Council, Economic Development Council are designed to shut them down steal airport, build a beltway to the west that doesn t serve anyone unless they drive a truck truth is they are not known or understood, not provided coverage in the papers. They do get things done, but it appears that the Walton family flies in and drops money on the table. People leading these organizations are good people but need to publicize their mission and vision more only one other person besides him would be able to name the director of Regional Planning Authority. There should be regional economic development something not chambers. The area must look globally at economic development, look at the big picture, get school districts together for workforce development, get it (cooperation in regional development) out of communities that try to keep the status quo. You will never get the towns to agree on everything maybe on big things like roads. Page 104 of 124 Appendix E Stakeholder Views of Present and Future

109 Vertical towns string of pearls could play together better. Lots of competition Other promising collaborative entity is Arkansas World Trade Center. Mission is to create trade between NW Arkansas and the rest of the world. Helps small businesses with business plans, fosters agreements, both export/import, hosts trade delegations (state level). Direct funding is from Dept. of Commerce. U of A has put in money. No funding this year but last year s money has just been received and will cover this year s expenses. U of A subsidizes by putting people there (World Trade Center) who do their work there. Expects that faculty have connections many international visitors come here who would like to start businesses she hasn t seen the World Trade Center making these connections. Not working together real well. Not a great feeling that doing everything possible. Depends on what the issue is, such as light rail. Regional cooperation for airport. There has been competitiveness among the cities; want to retain funding to keep the city s assets (retail and sales tax). NWA Regional Planning Commission addresses regional transportation issues. City supportive of regional public transportation Ozark Regional Transit in addition to Razorback. Cities are all different. Rogers has changed its competitiveness with the new shopping center. Could be much better at marketing as a region. Would be advantageous. Diverse ordinances and diverse citizenries make it difficult to describe themselves as alike. Community Dialogue Connectivity On scale of I would give it an 8. On big issues, there is cooperation. Transportation. Regional wastewater. On who gets Sam s Club, they compete. Definitely we work on regional transportation. We have a Regional Planning Commission. They also provide planning services for small towns that don t have a planning office. But also work on regional planning. We support regional public transportation Ozark Regional Transit. The Regional Planning Commission published a long range plan in That s a vehicle for some of these planning discussions. It s a Municipal Planning Organization (MPO). Their last plan talked some about transit and interrelatedness of the modes. Next plan may do more. It would seem to me we might be able to improve the NW Arkansas Planning Commission aspect of cities working together. I suspect there is a better way to do things than what we re doing. Both in marketing and pulling things out of Washington, DC. We could do better at marketing this region. But so long as we have such diverse ordinances and citizenry, it will be hard. We are more liberal. From protecting green spaces---even down to our animal ordinances. Makes it harder. Different tax bases. Would be wonderful if we were marketed as a region. We each have different assets. Doing well on some things water, transportation, Regional Mobility Authority, ambulance, etc. But we are not doing well at all on regional marketing for economic development. There is not a pool of incentive money. For promotion, we need to raise money regionally. We need a regional economic development marketing entity. The Northwest Arkansas Council might fund promotion but only if it is regional. The media needs to get behind the regional pitch and stop cultivating divisions. There is no regional economic promotion. Funds will be drawn from the highway system that some businesses want to address other needs. Businesses will not always come to the decision that is what the whole community needs. Decisions are harder to make diverse needs, takes more people to come together around a vision. Decisions may not always be what the business group would make Page 105 of 124 Appendix E Stakeholder Views of Present and Future

110 Political leaders are on too short a time frame second generation leading family leadership isn t making the back-room decisions of the past that could be made quickly. Things are more open. Coffee group the four people in the back room They aren t there any more. Going to Bentonville once was a trip but now the cities flows into each other. There is an educational cooperative 17 districts meet monthly to discuss cooperative elements, teacher development. It is a quasi-governmental group. They work together on logistics, supplies, etc. Fayetteville Area Natural Heritage Association The Northwest Economic Development District out of Harrison is supported by the Federal government for workforce development. Competition Among the Towns Healthy competition but negative if don t work together on something that would benefit all. All the cities are very different. Springdale has factories and chicken plants. Different kind of industry. Rogers and Bentonville always were smaller. That has changed a lot. Now they have a huge upscale mall which has had a huge impact on our sales tax. Historical Fayetteville has been the largest of the cities and I was born here and I m competitive, but I think there is a certain amount of competitiveness. We want to keep our retail and sales tax strong. I d say there s healthy competition. I ve lived in Benton County too. They will compete for various things. Where I have a negative feeling is if we didn t work together on something that would benefit all of us like the airport. If one community thought they could pollute Beaver Lake. On things of a regional nature, there is not competition. Rogers is supportive of whatever it takes to make progress. The Mayor works well with the Chamber and State. The County passes bond issues. Rogers has a plan, so that, after the bond issue is paid off, we know what the next one will pay for. The Mayor builds consensus and has made tremendous gains in the road system in Rogers. Rogers is becoming the epicenter of region WAY more than Fayetteville. This growth will generate tax dollars. We have a new, splashy mall that attracts people. The older one (Fayetteville s) will sunset. Rogers has done it differently from the rest of the State. People went to Fayetteville for everything movies, restaurants, etc. Now, they do not rely on Fayetteville at all. The Walton Arts Center or U of A are exceptions. Everything else is right in Rogers. People in Rogers resented coming here to shop. They are tickled pink. It will be a challenge to market a Fayetteville strategy to these other areas. Not bringing in new companies like Ft. Smith, Jonesboro do. The area needs diversification, new jobs, but prospective clients are only shown Fayetteville -- they don t show the other communities. So clients don t see that the region as a whole has many assets, and Fayetteville doesn t get them. There is a competitiveness and jealousy among local cities. Rogers and Bentonville have Walmart and see this as payback time to take away what Fayetteville has had as the center of the region. Springdale people used to head to Fayetteville but, at this time, we go north rather than south. We are hopeful that the area along 412 will be the next area to develop. We have a new minor league baseball park. The Walmart chair has ownership in the Kansas City Royals, so a minor league farm team is there. Not going to Fayetteville any more is a huge, huge issue. Vendors moved north and the upscale [restaurants and stores] came to them. Rogers has a Ruth s Chris Steakhouse, for example. Springdale has put an emphasis on Information Technology, Architecture and Engineering a higher tech emphasis. Even agriculture is becoming more high tech. We are trying to improve numbers in [student] achievement. On marketing, you still have Friday Night Loyalty. Page 106 of 124 Appendix E Stakeholder Views of Present and Future

111 Good old boy syndrome is still real. Fayetteville is as insular as anywhere There are no regional economic development programs. Four chamber CEOs meet on a regular basis evidence of the problem. Leadership is critical who is taking over the reins? Rogers does a good job with [developing vision] city, chamber, school system work together - Rogers has worked together in the community on visioning VISION 2010, now being developed - sector meetings now happening. All are brought to lead city. Wish leadership had one vision for where we want to be 20 years down the road, but it doesn t and that has hurt. Rogers has done a good job. Why can t we work more cooperatively within the two counties? There is not a lot of collaboration now. The chambers compete. Have regionalized United Way Washington/Benton counties why not other regional efforts? NW Arkansas Airport is a sore point. The airport was here in Fayetteville Walmart got it put into Benton County. Fayetteville is seen as a little wacky and environmentally friendly, but the regional change has been led by Walmart. Fayetteville sales tax is suffering and business continues to leak north. Fayetteville is dependent on University growth. Knowledge-based industry could be its savior such as those in the Genesis Center. Hewlett Packard brought 1,200 workers to Conway, but that was a perfect storm because AllTel was closing and its workers were available. There is not an economic development fund ready to go in NWA. Conway used money to get Hewlett Packard. In NWA, they have to assemble money for each project a time-consuming and difficult task. That only occurs at the individual city level. It s hard to get other communities to support economic development in Fayetteville. We have to change the perceptions and demonstrate the advantage to all involved when a business locates in Fayetteville. Everybody s a tribe Fayetteville, Bentonville, Rogers region of communities - not one region to the people who live here. People coming from outside view it as a region that s what attracts people to come here then become segmented into community Hubris Fayetteville has been the destination city for so long that they don t see how it can change in spite of them, and that Fayetteville can turn into a bedroom community that has football games. I don t sense a lot of regional cooperation with regional mobility authority just formed we will learn to cooperate more with the rest of the region. Limited because some members of the City Council always react to cooperation as if it s leaving Fayetteville with the short end of the deal. Comes off as almost bullying the surrounding communities. Talking with folks Almost have to leave off the Fayetteville when they go to see people in other communities. I don t think we talk at all in general with other cities. When Springdale drops the ball, Fayetteville is there to pick up the pieces. When Springdale didn t spend the Walton family grant for trails, Fayetteville took it. Very competitive. What effect would regional cooperation have on the neighborhoods? Negative? I don t think so. The problems today are things neighbors have been dealing with. Most neighborhoods are against infill, speed bumps in your neighborhood, but not in mine A strong NIMBY attitude. Density is good, just not in my neighborhood. Somewhat lacking because of the competition between towns. Could be partnerships, but they haven t formed NWA Council got a good start. Page 107 of 124 Appendix E Stakeholder Views of Present and Future

112 Role of the State State Strategies. Would you please comment on the range and effectiveness of the State of Arkansas strategies for economic development perhaps especially as these state strategies may help Fayetteville and NW Arkansas. Need enabling legislation that allows cities some flexibility in providing economic development incentives. We have no resources and no opportunities. Cities are most successful when they create their own environment for economic development. For example, Bentonville is not waiting for the State. it is using its own resources to build roads and interchanges. Need State s support for $30 million in bonding for NW Arkansas. Tax structure changes are a 5-10 year conversation. We cannot expect any changes in tax policy (sales tax) for the foreseeable future. We ve had some experience from airport level. I found the State s incentive program competitive. I don t know how successful the State can be, given the political climate in terms of helping us. If we find a contact or develop something, they will help. If someone knocks on State door first, and they bring them to us first, they have big political problems in the Delta and Little Rock. So, you recognize that there are two islands Little Rock and NW Arkansas. They say: You re rocking and rolling yourselves. Maybe slowly growing recognition that the impact on the State of NW Arkansas economy is very important. We are maybe being heard a bit better than in the past. One other comment: I think we are seeing the State s development where we directed all our efforts to land basic manufacturing while there is a place for that, there is also recognition that we have to create more knowledge-based jobs. To do that, we have to coordinate business and academic; we have to have the workforce, other things. We have Accelerate Arkansas involved. Similar to NW Arkansas Council advocacy. We re advocating for change, focus. New Accelerate Arkansas initiative created in 2004 with goal of raising the average per capita income of Arkansas to national level by Must grow employment base annually at a certain wage. Could be a good outcome it s a volunteer organization. State government has stepped up to realize that there is a good basis in this (raise per capita income so you don t need to raise taxes), refocused on knowledge-based industry, moved away from manufacturing base with incentives, etc. Now a new economic development plan. We re big supporters of AR Research Alliance. All trying to improve our opportunities to develop knowledge-based businesses. We may disproportionately benefit from that. We have more assets to throw against. There will soon be a Governor s Summit on Education and Economic Development, involving ten representatives from every county in the State. The Governor has pushed economic development and always puts education and economic development in the same sentence. State lacks aggressive Business & Industry training like NC and Texas that use training as an incentive for bringing in businesses. The Governor has provided training funds for some industries, but not an incentive program or a workforce training fund. Little Rock is becoming an aerospace hub. Ft. Smith and Jonesboro have been aggressive. Another opportunity is the Governor s Yellow Ribbon Task Force addressing how to handle returning service people. The 39 th Division is coming home to this area soon. AEDC communities self-select vision and plan is there to help them. If NW and Central Arkansas succeed, that s good for the Delta and other areas in best interest of the whole state. Arkansas Economic Development Commission has a confusing mission relative to community development. They see community development as creating places but not jobs a job for HUD. Page 108 of 124 Appendix E Stakeholder Views of Present and Future

113 AEDC is now becoming more relevant, but ASTA has less money. State dictates curriculum frameworks, specific learning objectives in curriculum. State tests everybody all the time, so we have to teach to the test objectives. It has gotten so that March 1 through the end of April testing is all that happens. Proud that the State has been one of the most progressive in nation in tackling the funding and equity issues put more money behind poor kids, kids that are hard to educate. Focused on teacher pay and development. Consequence is that these districts have been hurt more in state construction formula can t get much in construction dollars, except for Springdale, which gets more money because of low wealth lawsuit. Have done more in professional development in the past through professional development funding from the State now $41 per student. It was $50 reduced but still very helpful. Governor has fund to bring businesses to central and eastern Arkansas which is depressed (more so than NW Arkansas). State really needs that all benefit. Early projects organize 911 system into a database. Did this as a service learning project. Kids in school worked in emergency services, with GIS systems. University Center for Advanced Spatial Technologies built State s first geospatial database. State took it on and hosts it. State has one of the deepest and best GIS. City has GIS, but hasn t used the data to advantage. It could be coupled with broadband [to market the city as a tech leader]. State thinks that NW Arkansas is prosperous streets are paved in gold. Don t think that NW should ask for anything Delta region is pretty grim with very high poverty levels and incredible unemployment rate. If State chooses to ignore NW Arkansas in favor of people in those areas, it s understandable. I don t think we in NW Arkansas should be looking to the State. We re very fortunate to have the University (major source of employment), real industries with Tyson and WM. With all our problems, we are extremely wealthy. Role of the University University Roles. What roles should the University of Arkansas play in providing resources, assets, specific programs/services, leadership, etc. in building the future economy for NW Arkansas (and the State as a whole) and strengthening the success of its people and communities? Governor says: Education and economic development are inseparable. Graduates to support the knowledge-based economy. They do that but we re exporting graduates. Our role is to provide the jobs and employment opportunities here. Green Valley, etc. Transformation of knowledge from the University to business. Without that transformation, t doesn t help. Eighteen years ago (1990) every Electrical Engineer that graduated went out of state to go to work. We need to reach out to the University to find common ground. Forum for open conversation. We used to have more town-gown conversation. The University is trying to do a good job. I don t think they give enough freedom for movement, independence or focus of enough energy in the Tech Park. I m not sure that the Park is or isn t a priority that proves it s not a big enough priority. The University should be coming to City Council encouraging the City to adopt measures that develop the assets we re talking about. Mike Johnson at University comes to say things about signage, etc. But we don t hear enough from University about bigger picture of asset-building all kinds. Bully pulpit is Page 109 of 124 Appendix E Stakeholder Views of Present and Future

114 good term. U of A should be pushing Fayetteville to increase/enhance the qualities that make technology companies want to be here. If U of A could promote an agenda that is more advantageous to what we re trying to do backing our trails program; backing comprehensive public transit program or other concepts that would help the environment, that would help. Anchor institutions should have a moral voice. This area has a significant number of people who really care. Lots of input on strategy, but not vision U of A phase one You might say that Univ. will step out and take leadership. Second phase would have to talk to more people and get ideas of people of region as to how that should happen University will get less insular, inward-focused more a part of the community. UARTP City and U are partners in ARTP land swap, main road infrastructure Innovation Center Work on ties and incentives to keep incubated businesses from leaving Fayetteville The University has done a decent job of coordinating research with flagship industry needs. You can t fail to emphasize the need for more of that in the future. The University s role depends on where you are. It is important in Fayetteville, but it didn t help much in Rogers and Bentonville so those communities founded the NWACC. The University educates the thinkers versus NWACC training for doers the people on the ground. Now U of A has a branch up there. Sports are focused around the University. The University did not have much of a reputation until the $300 million from the Waltons for the business school. Now it s 25 th or 26 th in the US. There are endowed chairs and higher enrollment now. Focus/work with Walton Arts Center University and the library are partners FEDC partnership Fayetteville Junction plan and Bio Base There should be more internships in the City. University could use City as a classroom (e.g., RFIDs in library and green technology in wastewater treatment plant) Integrated water and sewer with the University The community college is very nimble. Stands up programs on very short notice. I don t know if University is nimble enough to respond to needs in marketplace. Some of the vehicles or structures (not right word) are there. The entities are there Center for Poultry Science, Center for Sustainability, etc. Long list of examples back-scratching. I give you resources if you ll do this. Given that we have such limited resources, we want to be sure we are spending our money in alignment with the objectives of the community. University should stay in alignment with the growth of the region. Growth vehicles, so you can support provision of the people who have the right training. From research perspective, do research that supports the needs of those businesses. As a community, we then have to nurture those same businesses. It is good for the region for the University to be a good university. A second rate institution is not in our best interests. We need to be advocates for John White s vision that we are not in competition with Little Rock or Central AR or Jonesboro. Our competition is Texas, Kansas, etc. We want our best and brightest in Arkansas to recognize that they can get the best education here and staying in our state. And letting us benefit from the businesses and wealth they create. Page 110 of 124 Appendix E Stakeholder Views of Present and Future

115 Good relationship with U of A. A large percentage of students go there. Schools get help with teacher education, internships, grant programs, setting up evaluation system. Information Academy U of A professors help with that. Wish for more graduate education, especially graduate education for administrators. Disappointed that public universities don t do this - Harding College (Searcy) has just about taken over this program. U of A should do this! Schools research division is supported through U of A College of Education seasonally bring in information researchers in education from places such as Harvard, Yale, Stanford. Superintendents are invited. Strongest students come from (graduate from) U of A, but least capable (local) high school graduates go there - UA shoots itself in the foot doesn t recognize the International Baccalaureate (IB) program, so those kids (our best) go anywhere but U of A. Should make dormitory space for local freshmen and sophomores. Kids that live in dorms outperform those who do not. We often lose the ones who live off campus. NORMES (National Office for Research, Management, and Evaluation Systems) connected to U of A hopeful that they will do something with International Baccalaureate (IB) Florida gave students 38 credit hours to start because of credits earned in an IB program. These kids get double majors, aren t just staying three years in high school. State diploma requires so many courses that IB students have a hard time taking all their courses and doing extra curricular IB requires a lot of commitment by students take classes starting at 7 AM or after regular school hours so can meet State requirements and IB requirements - they will go to FLA, TEX, GA and get IB credit. Rogers District is not involved in IB. The District now has a second high school for first time. The high school principal of the old high school is great supporter of AP; Rogers has been very successful with that. There are 230 discreet AP courses offered in Bentonville. U of A also needs to recruit AP students - Springdale has moved up from 600 to 1600 AP exams given over a period of five years. U of A from art perspective at tail end of feasibility study about expansion. U is uniquely poised. Walmart is leading the world in businesses, diverse, global U is flagship for Arkansas - Desire for arts and culture. Positioned to look at how they are impacting Arkansas as a whole combining business and art whole. New chancellor has an opportunity for leadership with sustainability blanket. Arts community can t make the City do what it needs to do, but could influence. International populations at the U are the most interested in the Arts Arts are global, multi-faceted, etc. Could have international festivals, programming, global cultures, with partnerships with U of A. Need a vision for that partnership. Science museum is geared to the U.students and professors will be there hands on, wet labs, etc. Under the radar here we don t toot our own horns. FEDC is bringing Swedish green and sustainable businesses eye-opening experience, Innovation a real surprise to these connectors. Drama and writing programs, architecture (undergrad only) a feeder school to Harvard Design school. Visual arts less don t have performance, studio, etc. space. Previous chancellor not a champion of the arts. Fulbright Arts & Sciences getting a new dean. Easier for them to go through housing, international students, profs than Fulbright to get students out for arts programming. Page 111 of 124 Appendix E Stakeholder Views of Present and Future

116 Honors program multidiscipline teams Belize Team architectural, economic, agriculture, writing, business to a city there to partner Science Museum is using that. What would Fayetteville be if University wasn t here? State lottery to benefit education is on the ballot in November. Tennessee has done great things with its lottery. Lots of resistance to it. Actual decisions as to how the money flows are administered by a lottery commission. Special Topics Education and Workforce Education and Workforce. We now have experienced 2 to 3 decades of experimentation in Pre-K- 12 models with federal, state, local, philanthropic, and business funding. We have many model programs and lots of data but, in many respects NO REAL CHANGE. If you could wave a magic wand to solve this most elemental challenge, what would you do or design for pre-k to 12 (or 16)? University is very aggressive in Internet - and built it for higher education in the rest of the state. Internet II- AR-on next generation Internet. City, econ dev person, etc should participate in these meetings. Grid on U of A campus could showcase the Internet. University of Arkansas Medical School (UAMS) is coming to Fayetteville. There will be a teaching hospital physicians and pharmacists sort of a branch campus. It will occupy the old Washington Hospital, next to veterans medical center. The campus will house AHEC, NWACC, UA Nursing, UAMS. There is a huge and urgent need for health professionals phenomenal growth possibilities for careers in those areas. AHEC (Area Health Education Center a long standing national initiative) representatives visited NWACC to discuss partnerships. They talked about training opportunities for NWACC. AHEC toured site (NWACC) to look at dental assisting, CAN, pharmacy tech and other possible partnerships. U of A will move college of nursing BSN and MA programs to the new site. NWACC has great pass record for AD Nurses percent. It also offers LPN, CNA, Access nursing. NWACC has a 15 month Department of Labor grant to develop an accelerated program to train nurses. Engineering, business schools are huge. Vendors promote that. What are the green jobs? Training for these is really NWACC s niche. Packaging training is part of NWACC s sustainability role. Walmart is advocating for 2+2 programs [student takes two years in community college and adds two years in a university) to support technology transfer. NWACC has a corporate learning facility in Fayetteville. NWACC worked with U of A to insure that there wasn t duplication. Students take college-level classes here. With the closing of the Regional Technology Center coming up, NWACC is looking for space for the classes held there now. It is looking for somewhere in Fayetteville especially for dental and nursing. NWACC is talking NW Technical Institute about putting auto, collision and welding but this is questionable because NWTI lacks space. Relocation of aviation is also a question. All these are very expensive programs. Secondary and postsecondary dental assisting classes need relocating. NWACC has leased space owned by Real Planet, a private computer training center, bought their equipment and will set up corporate training there. Criminal justice and computer repair can go anywhere. Decisions are needed by December, making the nature of NWACC s presence in Fayetteville questionable. AP classes Fayetteville does a lot. But it keeps NWACC out though the college could play a role. Washington County is a challenge. Almost 40 percent of NWACC student population comes from Washington County. They want to take classes closer to home. Also, the college is out of space in Bentonville. Page 112 of 124 Appendix E Stakeholder Views of Present and Future

117 Strong supporters of allied health. Washington Regional has given NWACC $250,000 to help with program needs. Technical education Fayetteville district subcontracts to NWACC. Students have to go to an offcampus location. That caused some problems with parents/students especially since the site was a former alternative school, which has a bad connotation. Schools offer no technical programs as such, but do offer classes in technical subjects. There is no tracking system to give students technical program alternatives Parents have resistance to this, perceive it as closing options. Arkansas Workforce Development not big players. When company closes down, they retrain. Put in Universal pre-k all three districts got grants from Walmart Foundation (tremendous asset to schools) to upgrade buildings for pre-k. Pre-K helps especially with the large number of second language students. Schools also got 21 st Century Skills grants to pay for the program. There is a tremendous difference in success of students who have pre-k. Getting second language students a year early to pick up English is a major plus. Those kids are achieving as well as other kids because they have mastered the language. Not knowing the language is a real handicap for older kids who show poorly on 11 th grade literacy exam. Would like to use Oklahoma model for pre-k. We should look at putting formula dollars in for pre-k funding. Universal Pre-K would bring in all the children at risk and give them a better start. Districts Bentonville and Rogers have 3 mill tax support. Those board members don t look favorably on lots of efforts to work with districts that won t chip in especially after Fayetteville schools experience with the millage issue. U of A made a mistake not buying the building [high school]. The idea was that Fayetteville school district, NWACC, U of A could create programs with a seamless transfer. That could literally have made a huge difference, been a model. Arkansas is 50 th in per capita BA degrees. This model would help alleviate that situation. International Baccalaureate (IB) program was started in Springdale and has spread. Superintendents have cooperative organization smaller districts use this organization more than large ones for assistance. All the districts superintendents comprise the Board of the organization. Every district worked on Total Instruction Alignment, a document to look at state learning objectives so [State s recommended] curriculum is taught here. Consultants were brought in to assist the cooperative organization. The schools have run 21 st century skills schools integrate these where there is a good fit. Schools have a unique organization chart. School strength enormous investment in technology (info tech) large resource of people and capability Could create a niche for the city Silicon Holler promote that concept here. Have the people power to pull it off- technicians, programmers, network engineers, support for teachers in the schools. Technology Integration Specialists larger schools have one full time four other schools share two half time. State EAST initiative Environmental and Service Technologies State wide initiative grew from Bobby New s former district s accomplishment Teaching employability skills was an emphasis in his district. State s program is shared with U of A at state level. TECAL Administrative leadership engage students with technology equipment and they have employability beyond Arkansas borders. Fayetteville desires to build computational science and engineering hub. Fayetteville District has hired an Enterprise Program Director to teach entrepreneurship. There is a need to set up coordinated K-12/CC/U of A partnerships. Growth is associated with housing boom construction jobs last year K-12 enrollment was constant or slight decline but this year growth again. Comparison with Bentonville: Page 113 of 124 Appendix E Stakeholder Views of Present and Future

118 Bentonville has a strong information system, built themselves. Also Springdale (distributed to an I- touch for principals). All teachers have a laptop issued to them (District) upgraded this year for those who asked for more capability. All Buildings saturated with wireless talking about instructional phone capability have I- touches or I-phones. District has fitness center for employees- partnership with city for fire/police. Benchmark with Texas, etc. Schools selected NSBA districts that become site locations? Largest coop over 60,000 kids. [This may be the multi-district group they are in ] Schools transient population in all the districts have been growing rapidly. Schools have focused on meeting their own obligations rather than meeting needs of all citizens. Mostly poor minorities culture shock for teachers flip flops example even in mid-winter SE Asian children come to school in flip flops shoes means flip flops. Poultry processing brought them here. With low wages, we have to train workers to raise their standard of living. Or you don t increase the tax base. We have to do more training. Do better. Schools are very good. Few complaints. Facilities are antiquated. Working with schools and University on ways to rebuild the existing campus and how it interfaces with the university, multi-use trails, Walton Arts Center. We ve had two big meetings about that. Need new Fayetteville High School. The deal with U of A didn t work. District has property but couldn t build a high school on this property located right off of I-540 because of severe resistance on the basis of causing sprawl. The schools find it hard to openly support leadership since people perceive that the leadership is in collusion with the developers. We should get past the argument about where to put the High School. Propose whatever millage is required to build a first-class facility on that site. They need to get on with building and making it a world-class facility. People who are considering moving here look at that building and make a negative judgment. Continue keeping up the elementary schools. High school sale they should just make a decision and do it. Elementary schools being renovated. Issue is small schools vs. larger, more efficient economically. Population stagnant. We are not getting people (into the workforce) who have the skills of the jobs of today, much less the jobs of tomorrow. Undocumented students/people are a huge issue. We depend on that labor here. Where are we going to go when that labor source is not there? Need to get students on career tracks in 8 th and 9 th grades. It would mean breaking the barrier in thinking that college equals a four-year degree, not understanding the two-year option. There must be more alignment of education and workforce realities. Teacher education needs reform nobody s doing anything different. Counselors still push their own experience the four-year degree. When money is tight it goes to K-12 because support of K-12 is required by the Arkansas constitution, but not community colleges or universities, so they experience real shortages. Remediation is on legislators minds. More money is not the answer for K no change has been working. Page 114 of 124 Appendix E Stakeholder Views of Present and Future

119 Cut back on the testing. There is a rigid testing protocol: if anyone messes up we have to test the kids again, and messing up is hard to avoid. There are many hoops you have to jump through so many ways you can violate the testing guidelines. Have the State Department of Education be more leadership oriented, less regulatory look at antiquated required processes that are expensive such as required reports. Also textbook requirements don t need new books every year -- books are there on disk and online order. Buy room sets so every child has a book can take home the room copy if they need a personal copy. There is a move to require every school to use same textbook this is the wrong direction. Need progressive action. There are 116 laws that principals have to verify they are following or will lose their license have to look them [the laws] up to see what they are, sign form saying they are following each one. Legislatures demand what s on their [legislators ] agendas, and put requirements into effect to fix a problem but that often results in over-restrictive processes. Legislature put into effect the measures to help low-wealth counties also put a lot more into the schools. Rogers and Bentonville brought the lawsuit. They are not very popular now with State officials (or larger districts) but other [smaller] districts are grateful. Bentonville is not treated with respect by legislature Superintendent had to go to Little Rock about their budget, which was off by $100,000. Out of a $100 million budget they were off by $100,000 and were raked over the coals. Schools send in reports with lots of data, but the State will request an additional bit of data to be sent in separately that has already been sent. Another example: State made a change in a report the day before it was due but did not change the due date and it resulted in lots of problems. State pay structure and formula is too low much less than local district needs creates quality problem. The State also has 300 positions with 100 vacancies. Involved community with a focus on education. High expectations International students kids and staff are positively influenced by the presence of the multiple cultures an advantage gives all students an insight into global world. For example, awareness of non- Christian religions works for more tolerance and more awareness of need for separation of church and state. The ability mix of students across the cultures is pretty normal (multicultural students are not at a disadvantage in academics). Hispanic influence is not as strong as that of some other cultures Schools are an enclave of understanding The high school has one of the only gay-straight alliance groups in a high school in the state. Poverty levels in Fayetteville are10 percent higher than Bentonville. High percentage of Fayetteville students is college-bound. Strong teacher corps in last five years, have become district with highest salary for teachers in the state. Priority to get there (to the national average?). Many teachers have a master s degree. Right now, nine additional counselors are getting master s degrees. They do this because it makes economic sense. Teachers association is much more cooperative here than in some places. Teacher development is stronger than anywhere in Arkansas, maybe nation. We have lots of graduates who stay here. In law, medical, other engineering high tech jobs graduates stay in the region. Strength of finance emphasize putting aside the $2.5 million bonus for teachers at Christmas. This money would be spent in the community. The school district is the 4 th largest employer in the community with an $85 million budget. Would people be receptive to bonuses for teachers in this economy? Not sure, but funds are there at this point. State has APCSN (Arkansas Public Schools Computer Network). It s beneficial because you can get at data standardized. But the system is antiquated. Fayetteville schools have a data system student data warehouse. Can do longitudinal studies. Assessments over and above what State asks us to do. Page 115 of 124 Appendix E Stakeholder Views of Present and Future

120 Admin look at data regularly to identify and address gaps. Teachers can look at data by students The most enlightened Doesn t think other districts have this. Fayetteville is generally wealthier. Fayetteville presents nationally every year- developing leadership in 21 st Century Skills. Schools Website regularly wins top ten awards from the Center for Digital Education and National School Board Association. More and more dependent on property tax no facilities funding from State. State funding formula not favorable to this district because of its property wealth scale too tilted toward low-income districts over reaction at state level to needs of poor counties. State has reduced its contribution to the schools. Fayetteville district has high millage charge already so State s reduction is really a pinch. We need to pitch millage, but it is taxes (and people resist). Fayetteville city limits extend into other school districts percent of city students go to other districts. Perception that we (Fayetteville schools) do not communicate with the public. Substantial numbers of school-dependent students, i.e., those who come from identified subpopulations at risk: poverty, minority, handicapped - who don t have family support. The schools are their family support. We should be more involved in mental health, social/emotional support programs. There is an achievement gap. Graduation rate is lower than Bentonville and Rogers, higher than Springdale, but Springdale has twice the number of disadvantaged students. District is addressing the dropout rates with protocols in the classroom. Drawing on 21 st Century Skills and other steps. The Global Achievement Gap - Tony Wagner, author -- is a district-wide read. Ruby Payne came entire district read her book (Understanding Poverty) Safety level is a threat non-custodial parents coming to the school and posing a threat. Cyber bullying, other internet safety issues. Threats are more psychological and social than physical, but possession of weapons is more of a glamour issue so it gets more media attention. Psychological issues are hard to pin down, not printable, not exciting enough not a Dateline issue. So the public passes these issues off as cliques. I ve been here 13 years and we have not made much progress. If you re from Iran, you may be more accepted than if you come from a local minority. Schools green team initiative good school system initiative to bring classes in around the region 100 percent schools is a goal this means each classroom from each school attends at least one performance Fayetteville is now 100 percent district from middle school on down. Offer summer institute for teachers to learn more about teaching art. Bring people from Kennedy Center University starting to develop a robust teacher training process, so want to partner with them to do an Arts component. Hands-on classes in performing arts space rented on long term basis by community coop. Very good options over the community early training for children teen and high school programs less. Arts in school less. Science focus groups. Harder to get students out of school for a visit. Structure a day s worth of multidiscipline. I think the schools are pretty good reason is number of national merit scholarships number is impressive says that on standardized tests our kids can do well. How much is due to the schools or due to educated parents? Page 116 of 124 Appendix E Stakeholder Views of Present and Future

121 Niches of Competitiveness Industries or Technologies Niches of Competitiveness Industries or Technologies. If competitiveness means being top in something on a globally visible level, which of course means building on already-present strengths, then what should that something (or somethings ) be for Fayetteville (and this region)? Sustainability Environmental issues and sustainability generate lots of interest. Fayetteville has always emphasized sustainability, that is, clean companies. Lee Scott, Walmart has put suppliers on notice that they will expect environmentally friendly practices. Lee Scott s address to his board challenged his company to become green. The objective of Green Valley Network is to create a cluster here around sustainability. The core technology is sustainability. We have based this idea on models in California, Austin, Seattle, Research Triangle. For this cluster, we have many assets: Walmart largest company in the world. And the largest sustainability company. We have the supplier community vendorville all NW AR has about 1,200-1,300 vendor companies. We have the University. We have the agricultural resources of the Delta. We have proximity to a major cluster of plant sciences in Missouri. Etc. Etc. Many assets to work with. Green Valley Network Initiative is our niche. It is largely a volunteer effort now. We had a Sustainability Summit last week that was well attended. Interest to pursue sustainability is high. This is an issue that the community could get together around. Dan Sanker is our leader and wants to center this cluster here, but, it s multi-state: AR MO, TN, OK. Memphis is a huge transportation center. Plant scientists are a special resource in nearby MO. And we have the retail base here in NW Arkansas. The Mayor has articulated a vision about sustainability. Clean Tech Valley idea is an opportunity. We re recruiting Swedish firms to develop sustainability technologies. Next (FEDC) will approach Indian firms. Fayetteville is working with the Swedish-American Chamber. We ve had 6-7 companies come to town. If I were to expand beyond that, I d go to the R&D incubators around the country and have incentives to offer land, buildings. We can recruit companies from those high-tech centers, but we have to have something to show them. On sustainability, FEDC has reached out to the Swedish-American Chamber of Commerce, which is very green. They have the research and technology incubators. They talk with Walmart vendors about proximity to the sustainability theory and practice in Fayetteville and the University. Green Initiative has a major regional component, fits in with values and culture of the area. Walmart is a big mover in this, is tracing its product footprint. Green Jobs, sustainability initiative packaging, energy scorecard for sustainability. Green Valley initiative: NWACC has a relationship with Dan Sanker. NWACC will be part of the Green Valley network. I would also talk to the vendors. You should be in Fayetteville access to latest in sustainability theory and practice. Walmart is an innovator forces suppliers to innovate idea of creativity, innovation, whether artistic, business, or INNOVATION is the common thread. Big untold story from Science Focus group Three labs in US can handle avian flu and other threatening diseases Tyson s lab here is one that has been identified. (Other labs are CDC in Atlanta and on the West Coast.) We need to put together the pieces about Walmart, University, Green Valley, and the no growth guys. Turn all that into a sustainable economic growth strategy. Page 117 of 124 Appendix E Stakeholder Views of Present and Future

122 Nanotech U of A partners with MIT and Stanford for research in nanotech U of A is running a test, Stanford rock stars in nanotech and several other high-tech fields A.J. Malshie. Walmart, Tyson, JB Hunt are the best at what they do Walmart is hooked into the national and FBI crime fighting system - Amber alerts are put on Walmart truck driver screen face of child, abductor, vehicle (example of community orientation of Walmart). Logistics expertise Walmart warehouse has no human hands on products. Sustainability effect should be bigger than big schools hope that they will get to benefit from biodiesel, economical lighting. Schools have all these mechanical issues help us out teach us everything. Have no R & D budgets - no discretionary money to do this. Thinks there is something going on in town on nanotechnology doesn t know much else. Does anything under the term sustainability look like it has potential? Yes, I think there are things could be there. Green jobs tradesmen type jobs but green. Also do low-impact construction no matter what the structure Example: For complexes, use rain gardens, etc. The Green Valley initiative is the region s niche. The key concept is selling at a profit while reducing the impact on the environment. That is what really makes it sustainable. Green Valley/sustainability Bioengineering is a strength turning trash to ethanol and using switch grass or algae for biomass. Agriculture/bioengineering/nanotech/aviation-aircraft parts are local niches. Pratt & Whitney is local and aviation parts are the region s biggest value export. RFID High temperature/high voltage electronics. About five percent of the entire industry is here in Arkansas. NCRPT and Linguent are important assets. Advanced electronics as it pertains to energy is an emerging perhaps unique strength. It s a good target as well because the graduates are able to stay in Arkansas without the common brain drain. Bio and nano (but they re just a blip compared to the national activity) Agricultural research is relatively untapped. The department is less supportive of entrepreneurs. Quality of Place Quality of Place. What kinds of actions or investments would strengthen the appeal of the City of Fayetteville (and the region) as a place where people and companies would want to be? Haven t brought arts community into the economic development mix (Keep the Arts Center to be more attractive to high-wage workers) Trails. Street improvements/beautification. More of the arts. (We ll keep Walton Arts Center.) Transportation: We don t compare ourselves to Dallas and Houston. We compare to how we were 20 years ago. Big line of inbound traffic in morning. But if you left 10 minutes earlier or later, you would avoid. Recent survey: 84 percent of people travel less than 15 minutes. Light rail from here to Bentonville would be great. Springdale example decision to put in middle school concept was made. Fayetteville talked about it while Springdale had their schools constructed and running before Fayetteville agreed on what they should do. Affordable housing: South pass development park has a great appeal more emphasis on trails and parks. Bicycles parked outside of schools in Germany vision is to bring to new campus an initiative to Page 118 of 124 Appendix E Stakeholder Views of Present and Future

123 create a bike and walking trail connecting U of A, library, school Kids are in charge of planning. Every school has a green team. See Fayetteville has a senior position for Student Life Services focuses on engaging students in extra curricular activity engage kids in service learning, music, art, etc. Delighted to see that quality of life was on the list. Economic development pays for quality of life. To keep what I want and to add to it, we do need economic development. Lack of bringing the arts into the economic development scene. In cities that I ve lived in, cities with strong arts communities also have good jobs base. To me the more you bring trails and arts center (keep the Arts Center) and bring in place for local artists, you become more attractive to folks who want to be here. Entrepreneurship Entrepreneurship. By now, everyone in America more or less understands that our growth (both jobs and wealth) comes from new and high-growth businesses. What are we doing well now and what more should we do to strengthen our capacity to support successful entrepreneurship? It s important but I don t know how the City could foster it. Doesn t see what the City does that is hindering, but doesn t know how it would foster entrepreneurship. How do neighborhoods feel about more business? Most favor participants in 2020 plan said they wanted more businesses. Rebuild 6th Street (MLK) and College and pack businesses in along established routes. He thinks there is regulation against businesses. If clients do not come and go nobody knows. Zoning regulations and appropriate to have some, but have conditional use permitting. Appropriate to have that public discussion. Approach local funders for a business investment fund. The pitch has to be made very carefully with a lot of preparation and groundwork. There is an opportunity to create a structure with a Board guiding technology evaluation. Encourage the University to provide capital and invest in spin-offs from its Endowment Fund. That would need State sanctions. Develop a Technology Hardening fund for the UATDF. However, the Board of Trustees is system wide and not Fayetteville only. This should be run to make money if it is to be sustainable. It needs a Board with a sense of urgency and good investment tax credit matching rather than straight funding. There is not a good track record of government funds. Expand the use of University centers to institutionalize that cooperation. Entrepreneurship. By now, everyone in America more or less understands that our growth (both jobs and wealth) comes from new and high-growth businesses. What are we doing well now, and what more should we do to strengthen our capacity to support successful entrepreneurship? Two issues paucity of angel and seed stage capital. Those that are succeeding (tech start-ups) are learning how to maneuver around and cultivate individuals of high wealth no institutional funds, no angel network incredible wealth older families invested in real estate. No serial entrepreneurs University could do better in educating entrepreneurs. Distinction between entrepreneurship and innovations need people who can take innovations to the marketplace a few scientists or engineers might be capable of taking their innovations to scale. Marketing and Promotion Marketing and Promotion. What are your ideas for how we should brand this region and exactly how we should promote our competitive strengths and assets for knowledge-based companies, investment, and jobs? Page 119 of 124 Appendix E Stakeholder Views of Present and Future

124 NW Arkansas Council is very powerful. It came together to build a new airport. For the last four to five years the Council has focused on infrastructure, not on the whole economic development picture. Until recently they didn t feel that [economic development] was anything they needed to worry about. This council is pivotal in the future. They could lead the way to a real economic development strategy; they could put energy and influence behind something and it will happen. The region should recruit former Arkansas residents Come Home to Fayetteville. Accelerate Arkansas is trying to get a program to network people who have left the state. Engineering and Physics have addresses for their graduates. Bikes, Blues and Barbecues is a great event affects the whole region. Bikers spend a lot of money. It is now a regional event. We work well together on these things. Benton sponsored Star Days similar event featuring Star motorcycles - smaller event but popular. New museum (Crystal Bridges) collection more pricey than ANY museum in the United States. Natural American Art - Alice Walton modern American art, too. What else will people do while they are here? we need to build off this children s museum for Benton Co. Science museum may be in Fayetteville Walton Arts Center is old, tired, too small needs to be twice the size. Where are they (Fayetteville) going to do that? Desire to build national aquatic center for Olympic trainers Rogers Mayor has eye on this. Bentonville is farther behind. Benton County is dry. Springdale got the ballpark because fans could have a beer. In Bentonville you can go to restaurants and get a drink (private club rule, but easy to get around). Sam s Club went to Fayetteville because they wanted to sell alcohol. $30 million per year leaves Benton County to go to Washington County and Missouri for alcohol and lottery. Great idea for EAST (Environmental and Service Technologies) was hatched by a teacher. Bring awareness of global gap community-wide awareness day. Wants to become a MECCA for the 21 st Century education recommendations, a magnet for 21 st century skills linked to the Wagner book. Recommended to Governor that Arkansas has the opportunity to become 10 th state in the Partnership for 21 st Century Skills. Task force to develop recommendations. ASTA Fayetteville is on the steering committee for the state s recommendations. When you were looking for a place to live, how hard was it to get the information? At that time there wasn t much out there about Fayetteville compared to others; that s not true now. If you hadn t been doing a lot of research, how would Fayetteville have gotten on the list? Other people are going through similar process. Wife s sister lives here, and knew to look here. Several magazines have done rankings where Fayetteville is ranked high Kiplinger (father got it) Fortune, Inc., Forbes. Infrastructure Infrastructure. Given the past economic base in this region, and what needs to be developed and cultivated for future competitiveness, what are the priorities for future infrastructure investments? Infrastructure biggest need Fayetteville Airport Corridor the Park. Transportation issues cited as a threat to economic stability. Fayetteville is at risk of becoming a bedroom community center of commerce is north. When people get tired of fighting traffic to Bentonville and Rogers, they will move there. Old school? Mobility Authority will attack this. Create the environment with access and mobility; it starts with a good bus system. Need a strategy for intentional, responsible, and disciplined growth, not just sprawl. Page 120 of 124 Appendix E Stakeholder Views of Present and Future

125 If you want to totally transform this area into a top 10 metroplex in a 20 year period, you would put in light rail connecting the University, Springdale, the Airport and on up to Bentonville. That s a $20 billion project. But, it s a car culture area. In years, you would want that light rail as a game changer. But it s hard to justify now. Student transit - and Ozark Regional transit (four counties) great cost for few people Big issue 4-5 years ago available for both Razorback Transit and Ozark = money shifted to Ozark. It s only a few years that reliable taxi service is available Highways and/or light rail more highways would show growth, but transportation would still be an issue. Every piece of the road system is undersized Interstate 540 beyond capacity after only 10 years airport corridor commuter community parking problems of city, University, any venue Health care leadership is separate. Fayetteville Hospital is an independent hospital very progressive, modern. Washington Regional Medical Hospital University does not have a med school. Springdale Hospital went through a transition. Page 121 of 124 Appendix E Stakeholder Views of Present and Future

126 APPENDIX F DOCUMENTS AND DATA Strategic Directions, The Next Two Decades for Northwest Arkansas, Regional Economic Development Study, Northwest Arkansas Council, June 2001 Northwest Arkansas Council Economic Development Strategy Outline, June 7, 2001 Fayetteville Economic Development Council Strategic Plan and Priorities 2007 FEDC 2008 Priorities, Fayetteville Economic Development Council, Inc., Innovate Arkansas, Bringing High-paying, High-tech Jobs to Arkansas, Winrock International, Building a Knowledge Based Economy in Arkansas: Strategic Recommendations by Accelerate Arkansas, UALR Institute for Economic Advancement, September 2007 Arkansas Position in the Knowledge Based Economy Prospects and Policy Options, Milken Institute, September 2004 Arkansas Economic Development Commission Strategic Planning Update, The Process of Change, June 24, 2008 Report of the Task Force for the Creation of Knowledge-Based Jobs, September 2002 Arkansas Research and Development Plan, A Strategic Plan To Guide Arkansas into the 21 st Century, April 1996 Arkansas Science & Technology Authority, The Role and Scope of Economic Development in Arkansas for the 21 st Century, Task Force for the 21 st Century Economy, February 12, 2008 Task Force for the Twenty First Century Economy, Interim Report, July 31, 2008 Task Force for the 21 st Century Economy. Building a 21 st Century Economy in Arkansas. October, City of Fayetteville, 2008 Briefing Book, Fayetteville Past, Present and Options for the Future, An Economic Development Conundrum, February 2008, Lyle Sumek Associates, Inc., Strategic Plan , Mayor, City Council and Executive Team/Fayetteville, Arkansas, August Sales and Property Tax Projections for the City of Fayetteville, Center for Business and Economic Research, University of Arkansas, January 2008 Washington County 2007 Millage Rates. The Survey Center, University of Arkansas, Fayetteville, Arkansas Survey of Citizens, Report of Results, December Arkansas Development Finance Authority, Program Descriptions, Arkansas Research & Technology Park Arkansas Economic Development Commission, taxation, Arkansas Department of Education. Arkansas Department of Education. Statewide Information System. Page 122 of 124 Appendix F Documents and Data

127 Discover Arkansas. Labor Market Information Source. Projected Employment Opportunities List Northwest Arkansas Economic Development District. Workforce Investment. Northwest Arkansas Workforce Centers. Work Connection. National Center for Education Statistics. Education Indicators An International Perspective Bentonville Public Schools Board of Education Goals. Fayetteville Public Schools. We Don t Like to Brag, But Fayetteville Public Schools. One Vision Rogers Public Schools: From Good to Great. Strategic Plan Springdale Public Schools. Goals of the Springdale School District. Northwest Arkansas Community College. Fall 2007 Fact Book. NorthWest Arkansas Community College. Regional Technology Center. NorthWest Arkansas Community College Strategic Plan, North West Technical Institute. Catalog/Student Handbook Help Not Wanted: Congress is Doing Its Best to Lose the Global Talent War. Economist. April 10, Wheeler, Janie. Northwest Arkansas Economic Development District. re: enrollees in northwest Arkansas Local Workforce Investment Board programs. October 13, Holzer, Harry J. and Lerman, Robert I. America s Forgotten Middle-Skill Jobs. The Workforce Alliance, Inc., November, Applied Sustainability Center, The Business of Sustainability, Annual Report, The Aspen Institute, Center for Business Education, A Closer Look at Applied Sustainability Centers, March Supply Chain Management Research Center. US Census Bureau, American Community Survey, US Census 2000, County-to-County Worker Flows Files, US Bureau of Labor Statistics, State and Area Employment, Hours, and Earnings, Page 123 of 124 Appendix F Documents and Data

128 US Small Business Administration, MSA Births, Deaths and Employment, The Edward Lowe Foundation, YourEconomy.org. Dover, Kohl & Partners, City Plan 2025, August Fayette Junction Neighborhood Master Plan, Fayette Junction Illustrative Plan Draft Walker Park Neighborhood Master Plan, February Fayetteville Downtown Master Plan: Our Vision, Our Future, April %20Master%20Plan% pdf 2008 City of Fayetteville Budget and Work Program Page 124 of 124 Appendix F Documents and Data

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