HILL AIR FORCE BASE — Advancements have dulled a weapons technology once considered cutting edge, and that means a long-time Hill Air Force Base maintenance shop is closing for good.
Nathan Simmons, spokesman for the 388th Fighter Wing, said work in the wing’s “LANTIRN” targeting pod maintenance and repair shop has been halted permanently and workers are being transferred to other F-35 maintenance units on base in preparation for the September arrival of the new jet.
As the F-35 creeps closer to full operation, an Air Force-wide maintainer shortage continues to plague the Air Force. But Simmons said the closing of the repair shop involves more than just manpower.
“We will have folks moving into F-35 maintenance,” he said. “But (the shop’s closing) isn’t a direct result of the F-35 coming on board.”
Simmons said new and advanced technology, like Lockheed Martin’s “Sniper Advanced Targeting Pod,“ and other weapons systems have pushed LANTIRN out the door.
An acronym for “low altitude navigation and targeting infrared for night,” the LANTIRN technology is used in targeting pods that are attached to the underbelly of F-15s and F-16s. Simmons said the technology allows pilots to fly at low altitudes, in the night, and beneath clouds to attack ground targets.
The 388th was the first unit to fly LANTIRN-equipped F-16s into conflict, taking to the skies above Iraq and Kuwait during Operations Desert Shield and Desert Storm in the early 1990s. Since 2007, the 388th has been responsible for all of the LANTIRN-based pod maintenance for aircraft from not only Hill, but from Mountain Home AFB, Idaho, Luke AFB, Nev., Edwards AFB, Calif., and National Guard units in Arizona and Texas.
Master Sgt. Erica Fox, assistant avionics flight chief in the 388th FW's Component Maintenance Squadron, said that at peak volume, the Hill shop maintained 276 LANTIRN pods.
“A typical shop maintains approximately 40,” she said. “We've shipped pods across the world in support of real-world conflicts.”
But they say father time is undefeated, and the LANTIRN pods are quickly becoming a thing of the past.
Lockheed’s Sniper is now most widely deployed targeting system for Air Force planes like the F-16 and the A-10 and it’s used by 16 international air forces.
The Sniper system specializes in long-range target detection and offers technology that allows planes to detect both air and ground targets while keeping pilots at a safe distance from threats.
“(Air Force) technology is constantly changing and advancing,” Simmons said, explaining the shop’s demise. “And that’s what happened here.”
Contact reporter Mitch Shaw at 801-625-4233 or firstname.lastname@example.org. Follow him on Twitter at @mitchshaw23.
WASHINGTON — CEOs make a lot more than the average working Joe or Jane. And in the near future, Americans will find out how big the disparity actually is within publicly traded companies.
Federal regulators, under mandate from a 2010 law that reshaped regulation after the financial crisis, will require companies to reveal the extent of their own pay gaps. The Securities and Exchange Commission is scheduled to vote Wednesday to formally adopt the rule, which will compel public companies to disclose the ratio between their chief executives’ annual compensation and median employee pay.
Public reporting of the gap is unlikely to result in a rush to cut executives’ pay packages or boost employee salaries. The numbers could pack a symbolic punch, though, and nudge company directors as watchdogs to push back on executives’ excess, supporters of disclosure say.
The issue of executive compensation took on greater urgency in the wake of the 2008 financial crisis. Outsize pay packages — often tied to the company’s stock price — were blamed for encouraging disastrous risk-taking and short-term gain at the expense of long-term performance.
Although a handful of U.S. companies currently disclose the ratio of CEO compensation to rank-and-file worker’s pay, they don’t calculate it the way the SEC is requiring, according to an analysis by the law firm Simpson Thacher & Bartlett.
It won’t be known until the SEC acts how soon the new information would start showing up in companies’ financial reports.
The vote at the public meeting is likely to split the five-member SEC along partisan lines, as it did when the rule was proposed in September 2013. The two Republican commissioners, Daniel Gallagher and Michael Piwowar, at the time called it a shaming exercise and political showmanship.
Business interests such as the U.S. Chamber of Commerce have lobbied against the requirement, saying it will be costly and time-consuming for companies to gather the information. The Chamber maintains it will cost U.S. companies more than $700 million a year, compared with the SEC’s estimate of about $73 million.
“It will impose on companies and their shareholders an extremely costly and burdensome requirement, and compel companies to disclose immaterial, if not misleading, information,” Mike Ryan, vice president of corporate governance at the Business Roundtable, said in a statement Monday. The group represents chief executives at the largest U.S. companies.
On the other side, investor advocates, shareholder groups and union pension funds have pushed for reporting of the CEO-employee pay gap. They say the gulf has widened about ten-fold since 1950. Moreover, fat pay packages for executives don’t necessarily track with strong financial performance by the company, critics say.
“We think it’s very important, very clear information,” said Ed Mierzwinski, consumer program director at U.S. Public Interest Research Group. “It’s going to send a message to investors.”
During the nearly two years since the SEC first proposed the rule and sent it out for public comment:
—Pay packages for CEOs grew for the fifth straight year in 2014, driven by a rising stock market that pushed up the value of executive stock awards. Median compensation for the heads of Standard & Poor’s 500 companies rose to a record $10.6 million, up from $10.5 million the year before, according to a recent study by executive-compensation data firm Equilar and The Associated Press.
—The gap between CEOs’ pay and that of the average worker narrowed slightly last year, because average wages crept up more than CEO pay did. A chief executive made about 205 times the average worker’s wage last year, compared with 257 times in 2013, according to AP calculations using earnings statistics from the Labor Department.
The average annual salary for U.S. employees was $47,230 in 2014, according to the Labor Department. The average salary differs from the median in the SEC’s rule — the median is the salary point at which half the company’s employees earn more and half earn less.
In a nod to the public outrage spurred during the financial crisis, shareholders already get to weigh in on executives’ pay packages. In 2011 the SEC gave shareholders at public companies the right to register their opinions on the executives’ pay in a non-binding vote.
But most shareholders don’t seem to be too concerned about the issue.
This proxy season, a majority of shareholders at only 47 of the 3,000 largest U.S. companies gave executives’ pay packages a thumbs-down vote, according to the compensation consulting firm Semler Brossy.
Those negative “say on pay” votes included some well-known consumer brands: Bed Bath & Beyond Inc., where CEO Steven Temares earned about $19.1 million last year; Kate Spade & Co., whose chief Craig Leavitt pulled in $26.2 million; and Restoration Hardware Holdings Inc., whose chairman and CEO Gary Friedman saw his compensation drop to $2.6 million from $36.4 million in 2013.
Before World War II, red-brick textile mills that processed cotton and wove it into cloth were all over the southern United States, dotting the Carolinas, Georgia and Alabama. But in the last 50 years, automation, free trade agreements and competition from countries like China whittled down the historic industry until it was almost gone.
Now some textile jobs are coming back, but on much different terms. As The New York Times reported Sunday, some Chinese manufacturers are setting up shop in the United States, after finding it cheaper to produce their goods in the American South than in China.
Keer Group, a Chinese yarn-maker, is investing $218 million in a factory in South Carolina. Another Chinese manufacturer, JN Fibers, is investing $45 million in the state. And Indian company called ShriVallabh Pittie is investing $70 million in a yarn-spinning plant in nearby Sylvania, Ga.
The changes are happening in other industries and locations, as well: Chinese auto glass maker Fuyao is investing in a $230 million production facility in Ohio, and Chinese acquirers are expanding manufacturing capacity at Cirrus Aviation in Minnesota and Nexteer Automotive in Michigan.
An index created by Boston Consulting shows how much the difference between the cost of manufacturing something in the United States and making the same thing in China has narrowed. In 2004, a good that could be made for a dollar in the United States could be manufactured in China for 86.5 cents. One decade later, that $1 product in the United States would cost 95.6 cents to make in China — not a whole lot of savings.
The narrowing of the gap has a little to do with what’s happening in America and more to do with what’s happening in China.
Americans are still making far more in wages than Chinese manufacturing workers. Adjusted for productivity, Chinese factory workers made $12.47 an hour last year, a little more than half of what American workers made, $22.32 an hour, according to figures from the Boston Consulting Group.
But other attributes of doing business in America make up the difference in cost. For example, state and local governments offer ample tax breaks and subsidies to companies that set up shop in their jurisdictions. America’s natural gas boom has also lowered the cost of electricity, attracting energy-intensive manufacturing industries.
Overcoming trade barriers and taking advantage of free trade agreements can also make a big difference: For example, yarn manufacturers might set up shop in the United States to take advantage of agreements with Mexico and Central America, whose factories transform the yarn into fabric and clothes that are shipped back to American consumers.
And U.S. workers are relatively educated and productive, making them especially suited to advanced manufacturing, like auto parts and consumer electronics. All in all, the United States is now one of the lowest-cost locations for manufacturing in the developed world, BCG has said.
But Thilo Haneman, a research director at Rhodium Group who studies Chinese investment in the United States, says that the return of these manufacturing jobs is not really due to changes happening in America. “I think what’s mostly being reflected is the change of commercial realities in China,” he says.
As China’s economy has developed, wages have risen, and so have the costs of land, energy and other raw materials.
Data from Boston Consulting Group shows how the competitiveness of manufacturing in China and Russia has changed over the past 10 years. Even when adjusted for productivity, Chinese manufacturing wages have risen by 187 percent over the decade. Industrial electricity costs have grown 66 percent, while natural gas costs are up 138 percent.
In the same time frame, U.S. wages have risen only 27 percent, while natural gas costs have fallen 25 percent, according to Boston Consulting.
For products where Chinese companies need access to qualified labor or proximity to American consumers, and don’t require lots of low-cost labor, it can make a lot of sense to manufacture in the United States, says Haneman.
The yarn-spinning operations are in this mold. That industry is heavily automated and doesn’t require a lot of labor. More labor-intensive work, like actually sewing garments, still relies on inexpensive workers in Bangladesh, Vietnam, Mexico and elsewhere. Those types of jobs won’t be coming back to the United States anytime soon.
And because the industries that are returning to the United States are heavily automated, they won’t provide anywhere near the number of jobs that manufacturing facilities did in past decades. The Economic Policy Institute, a left-leaning think tank, estimates that the U.S. trade deficit in goods with China eliminated or displaced 3.2 million American jobs between 2001 and 2013, three-fourths of which were in manufacturing. And that’s not to mention the millions of manufacturing jobs that were lost to automation and offshoring in the decades before that.
Chinese investment in the United States remains small, but as data by the Rhodium Group shows, it is bringing tangible economic benefits in the form of jobs.
Manufacturing in the United States may never return to the heights it reached in the 1980s, and the industries that come back onshore today are much more automated, creating fewer jobs overall. But these more skilled manufacturing jobs will still be a boon to the U.S. economy. For one, they tend to be better paid: Manufacturers these days need more highly trained workers who know how to operate automated systems.
China’s manufacturing prowess is also unlikely to disappear anytime soon. The move out of China mainly applies to new factories, rather than existing ones. Companies have invested lots of money over the last decade to build factories in China that may have life spans of 20 or 30 years, and most will likely see those investments through. And China offers manufacturers other advantages besides just price: It’s become a manufacturing hub where suppliers and consumers of all types of goods can coexist in proximity to each other, which brings down the manufacturer’s price.
But Haneman of Rhodium Group sees Chinese manufacturing investments in the United States as a great opportunity, not just for individual workers but also the U.S.-China economic relationship. In the past, Americans also benefited from trade ties with China, but in less visible ways — like having cheaper price tags on TVs and sweaters. In contrast, the negative consequence of trade with China — the migration of manufacturing jobs overseas — was far more tangible and immediate to people, says Haneman.
Now, with the rise in U.S. employment at Chinese firms, the benefits of trade with China will be a little more visible.
For the latest front in the war on coal, look no further than the Coffeen Power Station, about 60 miles south of Springfield, Illinois.
Trains roll into Dynegy Inc.‘s plant hauling coal mined halfway across the country in Wyoming’s Powder River Basin -- even though there’s a mine just a few miles down the road. That galls Illinois state representative John Bradley, who’s pushing for legislation that’ll boost the use of the state’s own supply.
“Powder River Basin coal is not as good as coal from Illinois,” Bradley, a Democrat, said by phone. “Illinoisans are sitting on better coal than any other in the country.”
America’s coal miners are so desperate, beaten down by the lowest prices in eight years, increasing competition and mounting environmental regulations, that they’re battling each other for scraps. Alpha Natural Resources Inc., once the second- largest U.S. coal producer, filed for bankruptcy Monday.
The dominant energy source since the Industrial Revolution, coal has seen its role reduced. Details emerging ahead of the release of President Barack Obama’s Clean Power Plan on Monday show pressure to curb its use will only intensify over the next 15 years, escalating the industry’s fight for survival.
The fiercest war of all is emerging between the resurgent Illinois Basin and the Powder River Basin, which has long been king of coal. Up for grabs is the business from a collection of power plants located chiefly in the Midwest and Southeast, which have long been fed by Powder River producers.
Mining costs are low at the vast open pits of Wyoming and Montana. The region boomed after the Clean Air Act expanded in 1990 because many plants found it cheaper to haul in the region’s less-polluting coal than install costly scrubbers to clean up Illinois’s high-sulfur grade. On the other hand, Powder River coal is low in heat content and expensive to ship far.
Illinois Basin’s coal output jumped 34 percent to 132.1 million tons a year in 2013 from five years earlier, compared with 407.6 million tons for Powder River, after regulations forced utilities to install scrubbers -- thus enabling the boilers to use the high-sulfur fuel.
Miners in the Illinois Basin, who feasted off the Central Appalachian market, are looking to new markets after running out of plants to steal away from competitors in West Virginia and Kentucky.
And no coal basin is immune to the onslaught of cheap natural gas. In April, gas overtook coal as the largest source of electricity generation, government data show. Near the Marcellus shale formation, gas fell below 80 cents per million British thermal units in July. Benchmark Central Appalachia coal has meanwhile fallen 11 percent since last year to $43.13 a ton, the equivalent of $1.80 per million Btu.
Nor are producers safe from retiring coal-fired plants. Obama’s Clean Power Plan would cut coal-fired electricity by 90 gigawatts, the Energy Information Administration said in May. There were about 292 gigawatts of coal-fired generation capacity in 2014, according to EIA.
Details of the plan released ahead of the full roll-out on Monday show deep emissions cuts will be required, by curbing the country’s use of coal and natural gas. By 2030, coal’s share of power generation will have fallen to 27 percent, Environmental Protection Agency Administrator Gina McCarthy said Sunday. That’d be down from 33 percent in May.
“From the Illinois Basin perspective the only way they can grow, absent exports, is by stealing market share,” said James Stevenson, director of North American coal at IHS Energy in Houston.
Illinois Basin producers could take 60 million tons of Powder River Basin’s market, Robert Moore, chief executive officer of miner Foresight Energy in St. Louis, said in a July 30 earnings call. Foresight alone could probably take as much as 15 million tons in the state of Illinois away from Powder River mines, he said.
Colin Marshall, CEO of Cloud Peak Energy Inc., a Powder River producer in Gillette, Wyoming, calls that hogwash.
“It’s not like suddenly the Illinois Basin is going to wipe out Powder River Basin coal,” he said by phone.
_ Mark Drajem contributed.
Delta Air Lines, American Airlines and United Airlines will no longer allow the shipment of lion, leopard, elephant, rhinoceros and buffalo hunting trophies, the U.S. carriers said Monday.
Delta, which announced its ban first in an afternoon statement, said it was “effective immediately.”
“Prior to this ban, Delta’s strict acceptance policy called for absolute compliance with all government regulations regarding protected species,” the carrier said. “Delta will also review acceptance policies of other hunting trophies with appropriate government agencies and other organizations supporting legal shipments.”
Late Monday night, American Airlines announced its own ban on shipments of trophies from the animals that comprise what hunters frequently call “the big five.”
According to NBC News, a United spokesman said Monday that the airline was also prohibiting big-game shipments. The airline did not immediately respond to The Washington Post’s request for comment Tuesday morning.
The bans by the three major U.S. carriers were announced amid mounting international outrage over the hunting death of one of Africa’s most iconic lions, Cecil, who was killed in Zimbabwe by an American big-game hunter. Walter Palmer, a Minnesota dentist, has said he had “no idea that the lion I took was a known, local favorite.”
“I relied on the expertise of my local professional guides to ensure a legal hunt,” he said last week in a statement obtained by the Minneapolis Star Tribune.
Delta isn’t the first airline to take such action. Emirates Airlines announced a similar ban earlier this year, for example.
“Lions, elephants and the other species that make up the Africa Big Five belong on the savanna, not on the walls and in home museums of wealthy people who spend a fortune to kill the grandest, most majestic animals in the world,” Wayne Pacelle, president and CEO of the Humane Society of the United States, said in a statement. “Delta has set a great example, and no airline should provide a getaway vehicle for the theft of Africa’s wildlife by these killers.”
The Humane Society had urged the airline industry “to join the international fight to end trophy hunting.”
As The Washington Post’s Christopher Ingraham reported, wealthy American tourists account for the majority of lions killed for sport in Africa. A 2011 report by the International Fund for Animal Welfare found that between 1999 and 2008, Americans brought home lion trophies (including heads and pelts) representing 64 percent of all African lions killed for sport during that period.
And that number is rising: “Of these trophies, the number imported into the U.S. in 2008 was larger than any other year in the decade studied and more than twice the number in 1999,” the report found.
“In Africa overall,” the report says, Americans “make up the greatest number” of big-game hunters targeting the big five, as well as animals such as antelopes and zebras — “particularly in countries where hunting safaris are expensive.”
The Zimbabwe Conservation Task Force, a nongovernmental organization, believes that Cecil was lured off the Hwange National Park — land on which he was protected.
In the aftermath of the hunt, protesters gathered at Palmer’s dental practice, and his membership to Safari Club International was suspended. He’s largely remained out of sight, though a representative has made contact with U.S. Fish and Wildlife Service officials.
On Sunday, Zimbabwe’s National Parks and Wildlife Management Authority accused a second American doctor, Jan Seski, of illegally killing a lion in April. The wildlife authority said Seski killed the animal — without approval — with a bow and arrow on land where it was not allowed, near Zimbabwe’s Hwange National Park, according to the Associated Press.
WASHINGTON — Aiming to jolt the rest of the world to action, President Barack Obama moved ahead Sunday with even tougher greenhouse gas cuts on American power plants, setting up a certain confrontation in the courts with energy producers and Republican-led states.
In finalizing the unprecedented pollution controls, Obama was installing the core of his ambitious and controversial plan to drastically reduce overall U.S. emissions, as he works to secure a legacy on fighting global warming. Yet it will be up to Obama’s successor to implement his plan, which reverberated across the 2016 presidential campaign trail.
Opponents planned to sue immediately, and to ask the courts to block the rule temporarily. Many states have threatened not to comply.
The Obama administration estimated the emissions limits will cost $8.4 billion annually by 2030. The actual price won’t be clear until states decide how they’ll reach their targets. But energy industry advocates said the revision makes Obama’s mandate even more burdensome, costly and difficult to achieve.
“They are wrong,” Environmental Protection Agency Administrator Gina McCarthy said flatly, accusing opponents of promulgating a “doomsday” scenario.
Last year, the Obama administration proposed the first greenhouse gas limits on existing power plants in U.S. history, triggering a yearlong review and more than 4 million public comments. On Monday, Obama was to unveil the final rule publicly at an event at the White House.
“Climate change is not a problem for another generation,” Obama said in a video posted to Facebook. “Not anymore.”
The final version imposes stricter carbon dioxide limits on states than was previously expected: a 32 percent cut by 2030, compared to 2005 levels, the White House said. Obama’s proposed version last year called only for a 30 percent cut.
Immediately, Obama’s plan became a point of controversy in the 2016 presidential race, with Hillary Rodham Clinton voicing her strong support and using it to criticize her GOP opponents for failing to offer a credible alternative.
“It’s a good plan, and as president, I’d defend it,” Clinton said.
On the Republican side, Marco Rubio, a Florida senator, predicted increases in electricity bills would be “catastrophic,” while former Florida Gov. Jeb Bush called the rule “irresponsible and overreaching.”
“Climate change will not be solved by grabbing power from states or slowly hollowing out our economy,” Bush said.
Obama’s rule assigns customized targets to each state, then leaves it up to the state to determine how to meet them. Prodded by Senate Majority Leader Mitch McConnell, R-Ky., a number of Republican governors have said they simply won’t comply. If states refuse to submit plans, the EPA has the authority to impose its own plan, and McCarthy said the administration would release a model federal plan that states could adopt right away.
Another key change to the initial proposal marks a major shift for Obama on natural gas, which the president has championed as a “bridge fuel” whose growing use can help the U.S. wean itself off dirtier coal power while ramping up renewable energy capacity. The final version aims to keep the share of natural gas in the nation’s power mix at current levels.
Under the final rule, states will also have an additional two years — until 2022 — to comply, yielding to complaints that the original deadline was too soon. They’ll also have an additional year to submit their implementation plans to Washington.
In an attempt to encourage earlier action, the federal government plans to offer credits to states that boost renewable sources like wind and solar in 2020 and 2021. States could store those credits away to offset pollution emitted after the compliance period starts in 2022.
Twenty to 30 states were poised to join the energy industry in suing over the rule as soon as it’s formally published, said Scott Segal, a lobbyist with the firm Bracewell and Giuliani who represents utilities. The Obama administration has a mixed track record in fending off legal challenges to its climate rules. GOP leaders in Congress were also weighing various legislative maneuvers to try to block the rule.
The National Mining Association lambasted the plan and said it would ask the courts to put the rule on hold while legal challenges play out. On the other end of the spectrum, Michael Brune, the Sierra Club’s executive director, said in an interview that his organization planned to hold public rallies, put pressure on individual coal plants and “intervene as necessary in the courts” to defend the rule.
By clamping down on emissions, Obama is also working to increase his leverage and credibility with other nations whose commitments he’s seeking for a global climate treaty to be finalized later this year in Paris. As its contribution to that treaty, the U.S. has pledged to cut overall emissions 26 percent to 28 percent by 2025, compared to 2005.
“We’re positioning the United States as an international leader on climate change,” said Brian Deese, Obama’s senior adviser.
Power plants account for roughly one-third of all U.S. emissions of the heat-trapping gases blamed for global warming, making them the largest single source.
Taxpayers who received health insurance through the HealthCare Marketplace need to file a tax return in order to receive the Advance Premium Tax Credit for 2016.
The HealthCare Marketplace offers assistance toward insurance payments for taxpayers who qualify. However, part of receiving this credit was the requirement that a tax return for 2014 be filed and the Advance Premium Tax Credit reconciled with the actual tax return. If a tax return was not filed, then the Advance Premium Tax Credit would not be available to taxpayers for the upcoming tax year.
Reconciliation of the Advance Premium Tax Credit is required because the amount of the credit was based on an estimate of income when applying for healthcare through the Marketplace. The tax return verifies the actual income of the taxpayer and therefore requires the Advance Premium Tax Credit to be finalized with the tax return.
Part of the oversight by the IRS for healthcare involves verifying that a tax return has been filed for those receiving assistance through the HealthCare Marketplace. This process takes time and taxpayers wanting assistance with insurance payments will find that they are not eligible for assistance for the upcoming tax year because a tax return was not filed.
Taxpayers should file a tax return as soon as possible without waiting for the allowed time for an extension. Open enrollment for healthcare for 2016 from the HealthCare Marketplace begins Nov. 1. At a recent IRS Forum in Denver, it was stressed that taxpayers who have not filed a tax return and reconciled the Advance Premium Tax Credit would not be able to get the credit for 2016.
Even when a tax return is electronically filed it takes several weeks for the information to be entered into the taxpayer’s account to show that a return has been filed. There are many taxpayers who requested extensions, which gives them until Oct. 15 to file a return. However, because the HealthCare Marketplace relies on information from the IRS, waiting until the deadline, may cause the Advance Premium Tax Credit to be denied.
The Advance Premium Tax Credit provides assistance to taxpayers who get their insurance through the marketplace. An important part of the Affordable Care Act was the creation of subsidies. Subsidies -- officially known as the “Advanced Premium Tax Credit” -- are like “discounts” that are applied directly to your health care costs.
These discounts help make the monthly premium affordable to taxpayers. A taxpayer can choose to receive the discount monthly, which is applied to the amount of the insurance, or wait until filing the tax return. If a taxpayer waits until the tax return is filed, the amount of the Advance Premium Tax Credit is applied to the tax return and helps to reduce a tax liability or increases the amount of a refund the taxpayer may receive. Most taxpayers have the credit applied to the monthly insurance payment.
Not having the credit available to reduce the monthly insurance premium may make it difficult for taxpayers to comply with having insurance for 2016. This could subject the taxpayer with having to pay a Shared Responsibility Payment when filing the tax return. If a taxpayer who received insurance through the HealthCare Marketplace hasn’t filed the 2014 tax return, it is important to file this return as soon as possible.
Tracy Bunner is an enrolled agent and tax preparer with an office in Harrisville. She can be reached at 801-686-1995 or at email@example.com.
OGDEN — In the dark with everyone else, city officials hope the recently announced Harmons-Ridley’s transaction will preserve the retail economy in the Five Points area.
Harmons in September will leave its Five Points store and Ridley’s will move in. Ridley’s also owns Wangsgard’s, across the street.
Will Ridley’s keep both stores open?
“To my knowledge, they (Ridley’s) haven’t talked to anyone at the city,” Ogden City Chief Administrative Officer Mark Johnson said.
Ridley’s has yet to apply for a business license for the Harmons location. The company acquired a business license for the Wangsgards store site this spring, according to officials.
The Harmons move raises questions not only for customers and employees of the stores, but the flow of sales tax revenue to the affected cities, especially Ogden.
“We’re being caught off guard on this too,” Johnson said
Some city officials speculate that Ridley’s will keep the Wangsgards name on that property, while placing the Ridley’s name on the Harmons store. Harrisville City Administrator Bill Morris confirmed he has heard similar rumors.
But whether the two locally owned grocery stores are victims of big-box stores like Walmart, one of which that has been located about a mile down the road in Harrisville for about eight years, would be guess work.
“I don’t know that we have any proof,” Johnson said regarding the idea that the Walmart in Harrisville could be siphoning customers and sales away from the Five Points markets. “Logically, it would make sense that the Harrisville Walmart must have impacted Harmons and Wangsgards.”
But Utah law protects the privacy of private organizations’ tax records, so such a claim would be difficult to document.
Johnson said even if he could pull individual sales tax information to look into that idea, it would be against the law for him to release it.
Ogden Community and Economic Development Director Tom Christopulos said he too is curious about what Ridley’s is going to do with two grocery stores in such close proximity of each other.
But Christopulos discounted the notion that the Walmart in Harrisville had anything to do with Harmons leaving, based on earlier conversations he had with store officials.
Harmons officials talked to Ogden officials 18 months ago about its Five Points remodeling project, in which the store was planning to going “up-market” to reach a new, more affluent customer base, Christopulos said.
Other Harmons stores have gone up-market, he said, “and they tried to do it at this store, and couldn’t get the market to follow.
“Harmons recently remodeled (the store). It’s been a good market. It is just not where they are going.”
Morris said the Harrisville Walmart has enjoyed consistent customer traffic. And even had Harmons or Wangsgards experienced a drain of business, Morris said it may have been a result of the Walmart store at 20th Sreet and Wall Avenue in Ogden, rather than the one in Harrisville.
“We were worried the Walmart on 20th would siphon off of our Walmart in Harrisville,” Morris said.
“So far,” Morris said, that does not appear to be the case. But the Harrisville Walmart does have to contend with the new Smith’s Marketplace store that recently opened at 2700 North in North Ogden.
“They are all my favorites,” Utah Food Industry Association and Utah Retail Merchants Association vice president Kate Bradshaw said of the stores in question.
Bradshaw declined to speak about Ridley’s or Harmons, or if big-box stores are hurting local grocers’ customer base.
Walmart and Harmons are both members of the Utah Retail Merchants Association, while Harmons and Wangsgards are members of the Utah Food Industry Association, a sister organization to the merchants group, Bradshaw said.
Ridley’s, which operates stores in Morgan and in Tremonton, is not a member of either organization, Bradshaw said.
Johnson said he hopes Ridley’s keeps both the Harmons and Wangsgards stores open. Ridley’s would have to change the name of the Harmons store, he said, but he wondered if they might keep the other store operating under the Wangsgards name.
“It is always sad when you lose choices and options,” Ogden Mayor Mike Caldwell said of the ongoing consolidation of grocery stores.
“We would love to see Harmons have a continued presence in Ogden,” he said.
Harmons also has stores in Roy and Farmington and more in Salt Lake and Utah counties.
Reporter Becky Wright contributed to this report.