Kellams: It is Friday the 13th. It's time to talk with Michael Tilley from Talk Business and Politics. Michael, do you remember where you were the last time it was Friday the 13th in March?
Tilley: I barely remember what I had to eat two days ago. So no.
Kellams: It was six years ago today and we were shutting everything down.
Tilley: Oh, yeah.
Kellams: Let's just not put that out into the universe anymore. Let's talk about some of the things that people can find at talkbusiness.net, including a renewed — or a new — push to maybe change the form of government in the city of Fort Smith.
Tilley: Yeah, here we go again. Maybe it should be Groundhog Day. There's been talk in recent decades about the form of government. Fort Smith — I think it's only Fort Smith and Siloam Springs that have this city administrator form of government. Everyone else has a mayor-council form. There have been talks in recent decades about changing the form of government, but nothing ever comes out of it. But there's a petition now that's out collecting signatures to change it to a mayor-council. I think they've got an uphill climb. First they have to get the signatures. Then they have to get it approved for the ballot — get the signatures approved and the language approved for the ballot. And then they have to convince voters that a new government will be better. Those are three big mountains to climb. The thing we need to remember: a mayor, if it were to be a mayor-council form of government — the mayor would be a CEO of a city that has an annual budget of more than $300 million, more than a thousand employees. It's essentially a large corporation. You're providing key services — safety, sanitation, water — to a city with a population of 90,000, and a region that you're providing, for example, water services to around 150,000 to 160,000 people. It would be an important job.
Now, this all comes as the city board is looking for a new city boss. We haven't had a city administrator since December 2020. The Fort Smith Board of Directors tried to do this in-house, tried to find an administrator in-house. And that, well, just to put it politely, was not a success. So they're now working with a firm out of Florida. Director Lee Kemp, Fort Smith board member, has been the liaison for the board in this process. I talked to him Wednesday. He is convinced they will have a new city boss hired by mid-July. They're confident they'll get a good pool of candidates.
So the talk is: What happens when you're in the middle of a push to change the form of government and you're also looking for a city administrator? Does that have a chilling effect on who would apply? Director Kemp doesn't think so. He thinks that people in this line of business know that's always kind of an assumed risk, and that Fort Smith has a lot of positives to attract a good candidate pool. But we'll see. Even if that form of government question is approved, it'll be on the ballot in November. You may have a city administrator hired in July. It will prove to be an interesting overlap.
Kellams: I kind of thought when we got the consent decree modification approved, things would calm down for a bit.
Tilley: Not so much this week. The city board heard from Kendall Ross, UAF associate vice chancellor of economic and workforce development, talking about the metro economy — good, bad, indifferent. We work with Kendall quite closely. His department compiles and provides analysis for the Compass Report, which we put out every quarter. Very good analysis. And he was very straight with the board. He said, look, we have overall a stable economy — that's a good thing — but we lag. The Fort Smith metro area lags other metro economies in the state and around the nation to some extent. Part of that is the region has low population growth compared to those other metro areas. So it makes it difficult to expand job numbers, makes it difficult for employers to find the talent they need. He also pointed to housing affordability being an issue. Average wages are up 30% since COVID. In the metro area, home prices are up around 60%. So he said that's something the board would want to pay a little more attention to. He was complimentary about the region's manufacturing sector — ever since it kind of collapsed about five years ago, it's been on an upward slope to recover. The healthcare sector is doing well. The tourism sector is doing well. But overall, the job numbers aren't as robust as they are in other metro areas. Kind of a wake-up call for the board.
Now, I was in the audience and they were very complimentary of Kendall. They kind of acted like, gosh, this is the first time we heard these numbers. I've been thinking — we've been reporting on these numbers consistently for almost two decades. But I guess sometimes you need an expert to get the board's attention. They loved the presentation, even though it wasn't a glowing positive report. And I think they want to have this kind of report annually, if not more.
Kellams: The city of Fort Smith got the attention of The Boring Company. The city's a finalist for the Tunnel Vision Challenge.
Tilley: Yes. The Boring Company, which was launched by some guy named Elon Musk — some folks may have heard of him — had this challenge: tell us why we should build you a tunnel in your city or for your organization. There were 487 applicants, and the city of Fort Smith is one of the 16 finalists. The city has asked them to help build a 12-foot diameter tunnel stretching about a mile and a half under the Arkansas River, near where the I-49 Arkansas River bridge is now being built. It would help the city complete its 48-inch water transmission line. That segment is about a 2.1-mile phase of the overall transmission line. I think we'll know by the end of March or first of April. That would not only be a good piece of publicity, but it would save the city millions of dollars. Let's keep our fingers crossed on that one.
Kellams: Let's talk about millions of dollars in water. Talk Business has been doing a lot of reporting about the Fort Smith water system — comprehensive reporting.
Tilley: We've just started. We're two stories into the series and I don't know how many there will be. This is the first time in my almost 30 years of journalism that I started a series not really knowing how many stories there would be. And I think that speaks to how complex and how many layers there are to this issue facing Fort Smith — a water and treatment facility infrastructure that provides water to 150,000 to 160,000 people in the region, 90-something thousand in the city. I think it's the second-largest water system in the state.
This most recent story was really a primer about how we got where we are now. We looked at eight planning documents — system plans, master plans — between 1993 and 2022. And essentially what it shows is that all of the problems, all of the issues, all of the projections defined back in the early '90s are still problems and issues now. We've got enough capacity — we expanded Lake Fort Smith, completed that in 2006, and that gave us roughly 28 billion gallons of water, up from about 8.4 billion. So we have the capacity. But there's a big difference between having enough water and being able to deliver that water — to deliver clean water at all the necessary pressures.
We just go turn our faucet on and there's water. The more I learn about what goes on behind that, it's amazing. What I'm learning — and what I think we all as a community are learning — is that we still have these issues. We have a transmission line that needs to be built out because that provides not only more capacity but more redundancy. We still have aging distribution lines and systems in the city. We still have pressure points in growth areas — and I mean water pressure. The city engineers I've been talking to the last month or so, who keep the system working, are not shy about explaining how system improvements and maintenance have been delayed for so long that they are now in a constant crisis mode. Those are their words. They use that frequently. I'm not taking any editorial liberty here.
We're going to keep looking at this. Some of our upcoming stories will include details on those critical weak points in the system, the topic of water meter replacements, revenue options to fund all this necessary work — which could total around $600 million, if not more. We'll look at water rates. We'll look at the back and forth with wholesale water users, their agreements, what we charge them. Those are a few of the stories I hope to have in the next two to three months. And because every time I dig into one story, there are two or three pop-ups.
Kellams: We can read everything we've talked about right now at talkbusiness.net. Michael, have a safe Friday the 13th, and we'll talk to you next week.
Tilley: Hey, I appreciate the time.
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