Kellams: Let's start with our friend Michael Tilley from Talk Business & Politics. Michael, we have arrived at fall.
Tilley: Yes, we have. And it's Razorback football season, which means always look forward to finding new places to curl up into the fetal position. So.
Kellams: Well, there haven't been any nail-biters yet this year, at least.
Tilley: No, there hasn't.
Kellams: All right, let's talk about some of the things that have happened in the last week, a continuation of something we did talk about last week, this computer attack on the city of Fort Smith. Last time you and I talked, there weren't a lot of answers. Do we have any more answers about this cyberattack?
Tilley: Well, kind of. First of all, I've been erroneously calling a computer system attack. The city calls it a cybersecurity event, which, I don't know if you get tickets for that event. I don't know what the dress is for a cybersecurity event. So anyway, it's an event, kind of like a weather event, you hear weathermen say.
But yeah, so we heard about this event. It was first made public on Aug. 16, and the city's been very limited. They say they're in an ongoing investigation. And the insurance companies and the lawyers, all that, the regular crew won't let them talk about it. But they put out a statement this Wednesday saying that, hey, we've learned a little bit more. And one of the key things they said, they "found no evidence that customer or resident credit card or banking information was compromised."
I don't know. I'm not smart enough to know. But is having found no evidence that necessarily the same as certainty that no personal or financial data was compromised? I don't know. Further, the city has said its financial accounting, customer data and human resource systems were not part of the attack.
The other part of this is that the city on Sept. 15 said that we're wrapping up this monthlong investigation. In fact, City Administrator Jeff Dingman said we're nearing a conclusion, was his term, and that we have an assurance that the threat has been contained. But now, more than a week later, now we're being told, hey, guys, this is pretty big. This is going to take more time than we thought. So a little bit of a mixed message.
What we do know and what the city did admit is that an outfit, Interlock ransomware, has claimed credit for it. They claim to have stolen a lot of data. I think we talked about that last week, a lot of it that could have legs in terms of legal liability.
Kellams: There is a proposal to give firefighters in Fort Smith a raise. Fort Smith Fire Department chief doesn't think it's enough of a proposed raise.
Tilley: Yeah, he made it very clear. It's been a long time since I've seen a city department head have a pretty clear and blunt message for the city board and city staff. And he essentially told them Tuesday at a study session, look, either get our pay up to competitive levels or watch the department essentially become a training site for other fire departments.
Chief Clark, Chief Darrell Clark, said that the city is, "near a critical point where we become the department that trains personnel for the fire services and they leave for higher-paying jobs." And he would go on to kind of back that up.
What we're talking about here is the city has proposed around a 6.5% across-the-board raise. It's about a $755,000 budget outlay. The department chief, Clark, said no, we're talking more around 14% just to get us to competitive levels, not to even be at the top of the competition, but just to be back in the game. That's a budget outlay of about $1.65 million a year.
So the board's challenge, and this board, mind you, has been very focused on balancing its operating budget. So their challenge is to find another $895,000 without breaking the bank, or more directly, $1.65 million without breaking the bank.
So some of the numbers that Chief Clark threw out, for example, he compared the Fort Smith Fire Department to 10 comparable cities around the state. Most of those, several of those were in Northwest Arkansas. He cited Fayetteville several times as being the area where they're losing the most trained personnel.
So for example, starting pay among the 10 cities was highest in Fayetteville at almost 53,000. And in Fort Smith, it's almost 44,000, and $9,000 difference. And it's similar in these other categories. There's $9,000, $10,000, $15,000 differences. Chief Clark's point was, look, if you're on a four-day-on, three-day-off or three-day-on, four-day-off, if you're on a cycle like that, you can afford to live in Fort Smith and commute to Fayetteville once or twice a week.
Kellams: Yeah.
Tilley: And so if your pay difference is $15,000 a year, that's definitely worth that commute. So you have the lower cost of living in Fort Smith, and you're making a higher pay in Fayetteville. So it's a challenge.
And so Directors Christina Catsavis and Lee Kemp, who are both running for mayor, weighed in, essentially demanded the city staff find the money to meet the 14% raise. Catsavis suggested a one-time bonus until the city could find the money. But based on the reaction of the firefighters in the room, the one-time bonus plan was a nonstarter. This discussion is going to continue. Expect it to be a part of the mayoral race and probably a contentious part of the 2027 budget cycle.
Kellams: There's a long-running joke that if you're seeing Lynyrd Skynyrd, about three songs in, people start saying "Free Bird" because they want to hear the favorite. I imagine there are people that listen to you and me every weekend that get their lighters out and they go, "Consent decree, consent decree." We haven't talked about the consent decree for a while, but it's back. And of course, this is a decades-long challenge for the city of Fort Smith with their water and sewer operations.
Tilley: Yeah, well, those folks who yell for consent decree are true news geeks who probably drill down into census data in their free time. But yeah, so here we are. The city's been under a consent decree since 2014. The federal, the EPA and the DOJ for decades told the city to fix its sewer system. The city kept reneging on that, saying they would, and they didn't. And so here we are. And we've got $800 million or more in consent decree work. We've done quite a bit of that. Not quite half, maybe.
But one of the things that the city board's been asking for is a management contract. Bring in a company that's done this around the country, knows how to do it and package this work and do it efficiently, help us save money and still meet the mandates required by the feds.
And so this Tuesday, we heard from Arcadis. They're a group. They're based in the Netherlands, formed in 1888, by the way, but they have a U.S. division, and they're proposing, they've got a plan. It's not-to-exceed contract value of $2.4 million, almost $2.5 million.
There will be many things that they'll do or promise to do. Some of the highlights is they talked about some of the unique ways they have to fix some of these infrastructure issues that have worked in other cities. They'll bring that to the table. They can work to package these projects differently. They'll have what's called a dashboard, where they can show daily, weekly, monthly progress, whatever the city wants. They can help the city file the timely reports that are required by EPA and DOJ.
It's a long list of things that they'll do, but this could be one of those things where, you hear that phrase sometimes, be careful what you ask for. You just might get it.
So when this proposal was thrown out there, there's some board members that were, gosh, almost $2.5 million for the first year. Now, Arcadis said that price will go down in year two and three because the first year is pretty intense because they got to bone up on what's going on and get a lot of the road map in place, is what they kept saying. But there was some hesitancy among the board about that $2.5 million first-year contract.
But the board is going to have to do something. I think they've boxed themselves in saying we have to have a management firm. We need to do this work as efficiently as possible, as soon as possible, while saving as much money as possible. But I think they're learning that's going to come with a cost. And so it'll be interesting to see if they're willing to, again, another phrase, put their money where their mouth is.
Kellams: Finally, we've talked about some dips in the number of people flying out of the Fort Smith airport. They dip, dip. The latest month numbers show a double-digit decline. Is that concerning?
Tilley: Yeah. The airport started off the year with pretty good trends, but the recent numbers, they've reversed that trend. And sometimes airports will see a boost in numbers during the summer travel season, but we've not seen that in Fort Smith. Enplanements were down 12.5% in August compared to August 2025. Traffic was down 3.1% in July, was down 5.7% in June. And through the first seven months of the year, traffic is down 3%.
So in some defense of the airport, or giving them a little bit of room, the TSA said it screened passengers in August was down 4.4% compared with August 2025. So there was a national decline. But I talked to Andrew Meyer, and he said passenger totals were down because American Airlines, which is the only service in and out of Fort Smith, had fewer available seats during the month. So there will be an additional four flights scheduled to return in October and November. Hopefully that'll boost it up.
But I don't want to say it's a concern, but there's kind of growing question in the community that I hear from business folks and just regular folks, really, about the viability of commercial service at the airport if it doesn't return to normal levels. And the airport was on a growth trend prior to the COVID-19 pandemic. Enplanements were rising and had reached almost 96,000 in 2019. But they've just struggled to return. For example, in 2025, airport enplanements were just a little over 62,000, well, more than 30,000 off.
So a big part of that is Delta, who had a connection to Atlanta. They left in July 2020 and have not returned. So almost all the factors determining where airlines fly are out of the airport's control. So there's just a little bit of concern about the future of a commercial air service at Fort Smith. But we'll see if the rest of the month picks up. Airline ticket prices, as everyone knows, are now a problem because of higher jet fuel prices, and that's not going to help. But yeah, so we'll be watching.
Kellams: All right. You can watch all of these stories develop further at talkbusiness.net. Michael, enjoy this last weekend of September. Talk to you next week.
Tilley: Yes, sir. Always appreciate it.
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