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VOL. 7 | NO. 39 | Saturday, September 20, 2014

Daily Digest

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City Council Approves $8.8 Million Utility Contract

Memphis City Council members approved Tuesday, Sept. 16, an $8.8 million Memphis Light, Gas and Water Division contract with a Lexington, Ky., construction company – a countract that has had a politically turbulent path to passage.

Last month, the council voted down the contract with Davis H. Elliot Construction Co. for three years’ worth of construction work to get the utility up to new federal reliability standards. Some on the council wanted the work to go to utility workers or a local construction company.

But most of the utility workers who could do the work signed a petition saying it would divert them from their daily duties maintaining the power grid and would create shortages in the workforce.

The council then reconsidered at the second meeting in August and delayed a vote then.

The approval Tuesday came without any council debate.

In other action, the council approved a residential planned development on Windyke Drive and Greenbelt Drive that is the latest phase of the Windyke development.

The council also approved a used car lot at 951 Brooks Road, east of Dogwood Lane.

Alexander, Ball to Debate at Candidate Forum

Republican U.S. Sen. Lamar Alexander and his Democratic challenger Gordon Ball will share the same stage Oct. 16 at the Tennessee Farm Bureau candidate forum in Cookeville, Tenn.

Word of the gathering came as Ball had been calling on Alexander to debate him in the campaign to the Nov. 4 statewide general election.

Alexander, in a written statement, said the forum is “a good opportunity to remind Tennesseans that my opponent is just one more vote for Barack Obama’s agenda, and that a vote for me is a vote for a new Senate majority that will lead the country in a different and more conservative direction.”

Ball is courting tea party members who backed state Rep. Joe Carr in Carr’s challenge of Alexander in the August Republican primary and is stressing his opposition to Common Core education standards as well as immigration amnesty.

Alexander campaign spokesman Brian Reisinger said Ball’s immigration platform is “a path to citizenship without any mention of a penalty, which is the very definition of amnesty.”

Ball has said immigrants who came to the country illegally should be put “at the back of the line if they want to be a citizen and get in line the way you are supposed to get in line.”

Cargill Will Close Memphis Corn Mill

Cargill Inc. will close its Memphis corn mill in January of next year, a move that will impact 440 employees, according to a news report.

"The closure of the facility results primarily from the underutilization of the Memphis facility and its higher cost position," Cargill spokeswoman Nicole Marlor said in a release to the Reuters news agency.

The mill employs 440 people, of which 120 are contract employees. The employees will be offered opportunities at other Cargill locations in the region, according to the Reuters report.

In July, Cargill announced it would invest $45 million to build a grain handling and shipping facility in West Memphis.

US Unemployment Benefit Applications Fall Sharply

The number of people applying for U.S. unemployment benefits dropped by a sharp 36,000 last week to a seasonally adjusted 280,000, a sign that the job market is strengthening.

The four-week average of applications, a less volatile measure, fell 4,750 to 299,500, the Labor Department said Thursday. The total number of people collecting benefits during the first week of September was 2.43 million, the fewest since May 2007.

Applications for unemployment benefits remain at pre-recession levels. The number of people seeking benefits has been trending downward for the past four months.

Over the past year, the four-week average for applications has fallen 7.1 percent. In 2009, during the Great Recession, they topped 650,000.

Applications are a proxy for layoffs. When fewer people seek benefits, it suggests that employers are keeping their workers, likely because they are more confident about customer demand and may be ready to hire.

The drop in the number of people applying for benefits has been coupled by steady job growth, despite a slowdown in hiring in August.

Employers added just 142,000 jobs last month, according to the Labor Department, down from 212,000 in July. That followed a six-month streak of monthly job gains in excess of 200,000. The unemployment rate fell to 6.1 percent from 6.2 percent, but only because some of those out of work gave up looking. The government doesn't count people as unemployed unless they are actively searching for a job.

Sprouts Applies for Building Permit

Sprouts Farmers Market has applied for a building permit to turn the old Kroger store in Lakeland into one of its upscale grocery stores.

Sprout applied for a $650,000 building permit to renovate the former Kroger at 9050 U.S. 64 in Lakeland. The building permit application lists AAD Fitch Inc. as the architect on the project.

Sprouts signed a lease for the former Lakeland Kroger store with owner Garfunkel Development Corp., which has been making improvements to the site to prepare it for Sprouts, which is expected to open in April.

Real estate sources have said Sprouts is also scouting a location in Germantown, including the old Schnucks store at The Shops of Forest Hill at Poplar Avenue and Forest Hill-Irene Road.

MAAR Elects New Board Members

The Memphis Area Association of Realtors recently elected several new members to the organization’s board of directors.

Felix Bishop of Crye-Leike Realtors Inc., Deborah Williams of 4 Success Realty LLC, Lauren Harkins-Wiuff of Crye-Leike, David Tester of Marx-Bensdorf Realtors, John Mercer of Highwoods Properties and Albert Lee of Century 21 Maselle & Associates were selected to be 2015-2016 board members.

They will join current 2015 board members Thomas Murphree of Birch Tree Realty Resources, Lynn Pfund of Crye-Leike, Frank Dyer III of Leob Realty Group LLC, Tommie Criswell of Crye-Leike, Thomas Byrd of ERA Legacy Realty and Myra McCaskill of Keller Williams Realty.

New Online Store to Sell Tigers Gear

T-Shirt Champions, formerly Champion Awards & Apparel, has announced the launch of Memphis Tiger Shop, an online store where Memphis Tigers fans can purchase University of Memphis gear and products.

The shop, at memphistigershop.com, lets customers choose from an initial selection of 50 Tigers-branded products, with the selection expanding to 200 options over the next year.

The company has been a licensed printer and embroiderer for the University of Memphis since 1982 and says it chose to launch the website in response to the demand for online ordering of University of Memphis gear.

Wal-Mart to Increase Holiday Hiring 10 Percent

Wal-Mart Stores Inc. says it plans to hire 60,000 temporary holiday workers for the crucial holiday season, an increase of nearly 10 percent from last year.

The world's largest retailer also emphasized that current workers who want more hours during the holidays will get priority. The retailer has been criticized by labor groups for low pay and intentionally keeping employees' hours low.

Wal-Mart, which is based in Bentonville, Arkansas, said the holiday hiring includes workers in stores and distribution centers. The discount retailer said a number of factors are driving the increase, including a focus on better customer service and the fact that it has about 200 more U.S. Wal-Mart stores than last year, bringing its total to about 4,300.

"We monitor traffic patterns, and we want to make sure we have adequate staffing,” said Kayla Whaling, a Wal-Mart spokeswoman.

About 25 percent of the seasonal workers will stay on in permanent roles, Wal-Mart said.

Wal-Mart also noted that the retailer will have more registers open this year during the season compared with last year. It couldn't offer a figure.

The news follows similar announcements from UPS, FedEx and Kohl's, which are also making more temporary hires this year.

A retailer's hiring plans can indicate its expectations for the holiday shopping season, which accounts for 20 percent of the retail industry's annual sales, according to the National Retail Federation.

30-Year Mortgage Rate Averaging 4.23 Percent

Average long-term U.S. mortgage rates surged this week, marking their largest one-week gain this year.

Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year loan jumped to 4.23 percent from 4.12 percent last week. The average for a 15-year mortgage, a popular choice for people who are refinancing, rose to 3.37 percent from 3.26 percent.

At 4.23 percent, the rate on a 30-year mortgage is at its highest level since the week ended May 1, though it is still at a historically low level.

Mortgage rates often follow the yield on the 10-year Treasury note. The 10-year note traded at 2.62 percent Wednesday, up sharply from 2.54 percent a week earlier. It was trading at 2.63 percent Thursday morning. Bond yields rise when bond prices fall.

The increase in the yield on the benchmark Treasury bond was stoked by speculation in financial markets that the Federal Reserve might abandon its nearly 6-year-old policy of keeping short-term rates at record lows. But at their meeting this week that ended Wednesday, Fed policymakers decided to keep the low rates, at least for a few more months.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged from last week at 0.5 point. The fee for a 15-year mortgage also remained at 0.5 point.

Eighty3 Adds Sidewalk Patio

The Downtown Memphis restaurant eighty3 has added a sidewalk patio.

The 30-seat al fresco addition to eighty3 is open to the public year-round, and it also has a full-coverage awning. Outdoor heaters are planned to be added for the cooler months.

Eighty3 is adjacent to the ballroom at the Madison Hotel, and the new patio is accessible through the private event space. Guests reserving the ballroom can now have the opportunity to host indoor and outdoor events with the attached patio, which can also be reserved for private events with or without the ballroom.

The patio will be open for lunch, dinner, late night, weekend brunch and Monday through Thursday happy hour.

Methodist Primary Care Adds Marion Doctor

Dr. Aaron Mitchell and nurse practitioner Jama Davis, both with Mitchell Family Medicine in Marion, Ark., have joined Methodist Primary Care Group. The practice was to re-open this week.

Aligning with Methodist allows the practice to remain in its current Marion location and offer the same operating hours, Monday to Friday from 8 a.m. to 5 p.m.

Mitchell sees patients ranging from newborns to senior citizens. Nurse practitioner Davis treats walk-in patients and also provides women’s health services.

Family Dollar Opposes Dollar General Overture

Family Dollar has told shareholders to reject an unsolicited, $9.1 billion takeover bid from its rival, Dollar General.

Family Dollar is currently trying to arrange a sale to another bargain chain, Dollar Tree Inc.

After repeated rejections by Family Dollar, Dollar General went hostile with its bid last week and took the same offer, $80 per share, directly to investors in Family Dollar.

Family Dollar accepted an $8.5 billion buyout offer from Dollar Tree Inc. in July. The bid includes $59.60 in cash and the equivalent of $14.90 in shares of Dollar Tree for a total of $74.50 for each share held. Family Dollar has backed the bid, saying regulators are less likely to interfere over antitrust concerns.

In response, Dollar General has said that it is willing to divest up to 1,500 stores if the Federal Trade Commission requires it. The company also volunteered a $500 million reverse breakup fee if the deal hits any antitrust snags.

Family Dollar began looking for buyers as sales began sagging. The company has cut prices and closed stores to drive sales and lower its costs. In June, activist investor Carl Icahn urged the company to put itself up for sale.

Dollar General did not immediately respond to an email seeking comment.

Homebuilder Confidence Soars in September

U.S. homebuilders' confidence in the market for new, single-family homes surged this month to the highest level in nearly nine years.

The brighter outlook reflects growing optimism that sales will increase over the next six months. That could potentially spur growth in home construction, a key driver of the economy.

The National Association of Home Builders/Wells Fargo builder sentiment index released Wednesday rose this month to 59, up four points from August. The index has risen four months in a row.

The latest reading is the highest since reaching 61 in November 2005, before the housing bubble burst.

Readings above 50 indicate more builders view sales conditions as good, rather than poor.

Builders' view of current sales conditions for single-family homes, their outlook for sales over the next six months and traffic by prospective buyers each increased in the latest survey.

The optimism comes despite a steady slowdown in U.S. sales of new homes this summer. Sales fell from a seasonally adjusted annual rate of 454,000 in May to a rate of 412,000 in July.

Still, sales of new homes are running ahead of last year's pace.

Economists project that sales accelerated in August to a rate of 429,000, according to FactSet. August sales figures are due out next week.

The U.S. economy added jobs at a solid clip through much of this year, though the gains slowed in August. Last month, employers added just 142,000 jobs, well below the 212,000 average of the previous 12 months.

Haslam Announces Workforce Grants

Gov. Bill Haslam has announced a new statewide initiative to help residents get more education and training for jobs that are available in their communities.

Haslam says the Tennessee Higher Education Commission is accepting applications from partnerships across the state for $10 million in grants from the Labor Education Alignment Program. Applicants must represent a partnership between a local economic development agency, a community college, the local school district and at least two employers.

The program is part of Haslam's "Drive to 55" campaign to help residents get an education or other training beyond high school. He says that will allow them to "get better jobs and create better lives."

The competition for grant money is open through Nov. 17. Applicants can apply for up to $1 million.

Consumer Prices Fall 0.2 Percent in August

U.S. consumer prices edged down in August, the first monthly drop since the spring of 2013, as gasoline, airline tickets and clothing prices all fell. It was the latest evidence that inflation remains under control.

Consumer prices edged down 0.2 percent last month following a tiny 0.1 percent gain in July, the Labor Department reported Wednesday. It was the first decline since a similar 0.2 percent drop in April 2013. Core prices, which exclude energy and food, were unchanged in August, the first time there hasn't been an increase since October 2010.

Over the past 12 months, overall prices and core prices are both up a modest 1.7 percent. These gains are well within the 2 percent annual increase for inflation that the Federal Reserve considers optimal.

Analysts believe that inflation will remain moderate in coming months, helped by falling energy prices. AAA reports that the nationwide average for a gallon of gasoline is down to $3.38, down eight cents from a month ago and 14 cents lower than a year ago.

University of Memphis Program Seeking Entrepreneurship Fellows

A new, selective program at the University of Memphis called the FedEx Institute Entrepreneurship Fellows is looking to develop entrepreneurial potential and leadership skills through hands-on experience, networking, mentoring and educational programming.

The fellowship involves a three-semester program that accelerates the student from idea to investor-ready pitch. The fellows will work 20 hours a week as part of a team developing a business model for a startup company, and they’ll work under the guidance of Crews Center for Entrepreneurship advisors. Fellows also will get a $3,500 stipend each semester they are enrolled in classes and actively working on their startup.

October 15 is the deadline to apply.

Memphis-Based AgFeed Settles Fraud Claim

Securities and Exchange Commission officials say a Memphis-based animal feed company has agreed to pay back $18 million in illegal profits from an accounting fraud.

In a news release, the SEC said Monday that AgFeed Industries and top company executives were charged in March for repeatedly reporting fake revenues from the company's China operations in order to meet financial targets and inflate AgFeed's stock price.

The SEC says the company, which is in Chapter 11 bankruptcy, obtained illegal gains in stock offerings to investors at the inflated prices. Company managers were accused of failing to disclose the fraud to investors.

AgFeed neither admits nor denies the charges in the settlement, which is subject to court approval. The $18 million will be paid to fraud victims.

Tennessee Justices Name Slatery Attorney General

The state Supreme Court on Monday named Republican Gov. Bill Haslam's top legal adviser, Herbert Slatery, as Tennessee's next attorney general.

The announcement comes in the aftermath of a failed conservative campaign to oust three Democratic justices who make up a majority on the five-member court. That effort focused heavily on incumbent Attorney General Bob Cooper's refusal to take part in a multistate lawsuit challenging President Barack Obama's health care law.

The justices did not take questions from reporters about why they decided against reappointing Cooper, who had previously served as legal counsel for Haslam's Democratic predecessor, Phil Bredesen.

Tennessee is the only state in the country where the high court names the attorney general.

Haslam made Slatery his first Cabinet appointment after his election in 2010. Slatery had served as Haslam's gubernatorial campaign treasurer, and the two men had served together as elders at Cedar Springs Presbyterian Church in Knoxville. He was also a member of Haslam's six-member transition team when he was elected Knoxville mayor in 2003.

Slatery was chairman of the Knoxville law firm Egerton, McAfee, Armistead & Davis, where he had worked for 30 years specializing in private business transactions and local government organizations. He was legal counsel for wholesale grocer H.T. Hackney Co., chairman of the Public Building Authority in Knox County and was a lawyer for the county's Industrial Development Board.

The other finalists for the position were state Sen. Doug Overbey, R-Maryville; courts administrator Bill Young; and private attorneys Gino Bulso of Nashville and Mark Fulks of Johnson City.

US Producer Prices Unchanged in August

A measure of prices that producers receive for their goods and services was unchanged in August, the latest sign that inflation is in check.

Wholesale gas prices fell 1.4 percent last month and food costs dropped 0.5 percent, the Labor Department said Tuesday. Those declines offset higher prices for transportation and shipping services.

The producer price index rose just 1.8 percent last month from a year earlier. The index measures price changes before they reach the consumer.

Economists had expected that the producer price index had risen 0.1 percent in August from the previous month, according to a survey by FactSet.

"The figures provide further evidence that price pressures have eased a bit in recent months," Paul Dales, an economist at Capital Economics, said.

Duncan to Retire from Botanic Garden

Jim Duncan, executive director of the Memphis Botanic Garden, will retire at the end of the year. Duncan announced his retirement Monday, Sept. 15, after 10 years leading the nonprofit.

In that decade, the garden has added the children’s attraction My Big Backyard, a permanent stage for the Live at the Garden concert series and seven new display gardens.

The board of the botanic garden is conducting a search for a new executive director.

Paper & Clay Owner Up for Martha Stewart Award

Memphian Brit McDaniel, the founder of handmade ceramics studio Paper & Clay, is a finalist for the national 2014 Martha Stewart “American Made” award.

If she wins one of the 10 available awards, it will mean a trip to New York City for the award ceremony, a feature in Martha Stewart Living Magazine and $10,000 to grow her business.

With the awards, Stewart and the editors of the magazine are spotlighting the next generation of American makers, including entrepreneurs, artisans and small-business owners. There’s an online voting component to the competition, which opened Monday, Sept. 15.

Evans Petree Names New Shareholders

Justin R. Giles, Aaron J. Nash and George “Harley” Steffens are the newest shareholders at Evans Petree PC law firm.

Giles had been an associate in the areas of construction and surety law, Nash was an associate in the areas of insolvency and litigation practice, and Steffens was an associate in real estate banking and commercial lending as well as corporate law and private client practice.

Giles, Nash and Steffens are part of the full-service law firm of 49 attorneys that was founded in Memphis more than 100 years ago.

Racquetball to Benefit Church Health Center

The 10th annual E-Force PowerSlam Racquetball Open to benefit the Church Health Center will be held Oct. 24-25 in Memphis.

WellWorX Sporting Clubs at 6161 Shelby Oaks Drive will serve as the host site for the tournament. Multiple skill and age divisions for men and women are available for singles and doubles play. The entry fee for one event is $45; participants may play up to three events and receive a reduced rate for the second and third events.

Starting times for the tournament be available Oct. 23 at memphisracquetball.org. Player receive a tournament T-shirt and free food and drinks. The tournament entry fee also includes the Oct. 25 awards banquet and silent auction.

Deadline for entry is Oct. 21. For more information, call David Gross at 833-2269 or email dgross@fabtn.com.

Community College, TSU Agree on Transfers

Tennessee State University and Southwest Tennessee Community College have signed an agreement that will allow students who complete two years at Southwest to transfer to TSU to complete their baccalaureate degree.

The agreement between the two institutions calls for the awarding of 10 two-year full Tennessee State scholarships with preference to students who major in STEM courses of science, technology, engineering and math, beginning fall 2015.

The partnership also includes a dual-admission component that builds on the Tennessee Transfer Pathway, which is designed to help community college students plan for transferring to a Tennessee public university to complete their baccalaureate degree.

TSU President Glenda Glover and Southwest President Nathan Essex signed the Transfer Partnership Agreement during a ceremony on Sept. 11.

PROPERTY SALES 61 61 6,453
MORTGAGES 46 46 4,081
BUILDING PERMITS 113 113 15,474
BANKRUPTCIES 19 19 3,289