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Siloam Springs: Growing Wisely

by Curtis Lanning

SILOAM SPRINGS, Ark. — Northwest Arkansas is enjoying a healthy economy, but that growth isn’t limited to the Interstate 49 corridor; it also includes the town of Siloam Springs.

Siloam Springs City Administrator Phillip Patterson said the town is in a “very good position,” recently seeing a seven percent growth in sales tax.

And while the city may not be growing at the rate Fayetteville is, it is steadily increasing in size, according to Patterson.

“It’s a good growth pattern to be in,” Patterson said.

The population has grown from around 11,000 in 2000 to more than 16,000 people now. Patterson attributes this to the quality of life Siloam offers, calling the town an “undiscovered gem, to some degree.”

One key advantage? Siloam doesn’t have the traffic and congestion of the Interstate 49 corridor.

And while the town has around 16,500 people in it, Siloam has a trade area of closer to 75,000 people.

One big factor in the city’s economy is the impact of U.S. 412, which runs east and west through the town.

Nathan Reed, director of economic development for the Siloam Springs Chamber of Commerce, said nearly 30,000 cars drive through the area on U.S. 412 every day.

“When you’ve got 30,000 cars a day, that’s just a key,” Reed said.

He added 40 percent of Siloam’s daily workforce comes from U.S. 412. Around 40 percent of the town’s sales tax income is also attributed to nonresidents, according to Patterson.

Another thing to consider when looking at Siloam’s population is for most in rural eastern Oklahoma, Siloam Springs is their “big town” they do their shopping in, said Wayne Mays, president and CEO of the chamber of commerce.

One example Mays gave, Furniture Factory Outlet. Not long after opening, Siloam’s FFO was doing more business than the one in Springdale, Mays said. And the reason? People in eastern Oklahoma that used to drive to Springdale, now could just stop in Siloam to purchase furniture.

John Brown University, Simmons Foods, and the Gates Corporation are among the town’s largest employers, Patterson said. But JBU plays a larger role than just that of an employer.

“It’s a huge role,” Patterson said, describing the impact 1,500 on-campus students and faculty have on the local economy.

Mays said Siloam has a couple key advantages when it comes to attracting businesses, the first of which is availability and low price of land. As more companies purchase land along Interstate 49, land will become sparse, he said. Siloam still has plenty available. Another advantage is the accessibility of U.S. 412, one of the largest entry points into Arkansas.

Reed described yet another advantage Siloam has, municipal utilities for electricity and water. This allows businesses to get lowered electric rates for the first five years if they invest enough money into the area and generate jobs.

In the future, Mays said he anticipates more growth for Siloam.

“We’re going to see some serious growth over the next 10 years,” he said.

He predicts the town will see a population of more than 20,000 in the next decade.

But the city wants to be careful with that growth. Patterson said he wants to see the population expand in a “responsible manner,” not wild growth. This way, city leaders can take their time and plan appropriately for the added people, making wiser infrastructure and policy decisions.

Mays described a similar ideal for business growth, wanting to avoid a “boom or bust economy.” The chamber of commerce president said the town would much rather grow with small and medium businesses that will be competitive and long lasting.

Siloam does have one key problem it’s working to address, Patterson said. And that’s sales tax leakage. While the town has done a good job of adding restaurants, the city administrator said, it still has work to do expanding retail options so residents aren’t driving to Fayetteville for shopping.

Another issue at the moment is businesses having trouble finding skilled workers, Reed said. Siloam has one of the lowest unemployment rates in the state at 2.1 percent.

“Somebody is always looking for somebody,” he said.

And it’s not just minimum wage jobs that are vacant. Plenty of businesses in the area start salaries above minimum wage with room for growth, according to Reed.

To combat this skills deficit, Mays said, the city and chamber are working with Siloam Springs High School to train students and get them valuable work training before they even graduate. This works to establish a talent pipeline from the school to local industries and combat Siloam’s shortage of tradesmen.

“It comes back to skills,” Mays said.

Siloam isn’t perfect, but the town has identified key issues and is working to fix them so it can continue its slow but steady growth.

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