ARKADELPHIA -- Recent changes to federal law have proven more difficult for the Honeycomb Restaurant and Bakery to overcome than the disasters befalling the city's downtown over the years.
When a deadly tornado ripped through town in 1997, the Honeycomb Restaurant, operated by the nonprofit Group Living Inc., was leveled but managed to rebuild. The popular downtown breakfast and lunch spot was again temporarily shuttered in 2005 after a fire wiped out the 700 block of Main Street in Arkadelphia.
Since opening in 1995 the restaurant has existed as a "sheltered workshop," which provides jobs to the community's developmentally disabled. Sheltered workshops are a designation that since the 1970s have allowed nonprofits to pay less than the federal minimum wage for jobs that help integrate disabled workers into society.
Continuing to operate under new regulations would place too much of a burden on the Honeycomb and Group Living, said Jane Lucas, executive director for the nonprofit. Patrons can pick up meals for Christmas on Dec. 23, then the restaurant will close for good.
"We've had a lot of things to overcome along the way," Lucas said. "We've justified [the expense] because we've been able to provide these jobs for our clients who would have a hard time finding it elsewhere. We've provided interaction with the community that money can't provide, but we've been stealing from the rest of the program to keep the restaurant afloat. We can't continue to do that. It's unfair."
About 15 Group Living clients work at the Honeycomb, and under old federal regulations they could have been paid as little as $1.81 per hour, depending on productivity. Some clients over the years have made more than minimum wage, Lucas said. Under the new regulations, Group Living would be required to pay those clients more and devote more of its budget to finding those clients better-paying jobs. Hourly wages would be calculated on a variety of factors, including the client's age.
Federal minimum wage is $7.25 an hour, and in the state of Arkansas it is $8.50.
Lucas estimates the nonprofit lost between $4,000 and $7,000 per month over the past 22 years in order to keep the restaurant operational and provide work for its clients. Businessman and philanthropist Jane Ross founded Group Living in Arkadelphia in 1973, and the nonprofit has offered jobs to its clients through the restaurant, a cleaning service and downtown thrift shop.
Not once in that time has the restaurant broken even, Lucas said.
Both the cleaning service and thrift shop will remain open as they are more financially sustainable than the restaurant, where even seasoned operators can find a thin line between profit and loss. Continuing to operate the restaurant -- more a social enterprise than a business, Lucas said -- at a deficit is no longer feasible.
Locals are lamenting the loss of a decadeslong gathering place and a steadying presence as the community rebuilt after the 1997 tornado. When the restaurant reopened after the storm, it helped signal to the community that downtown would one day thrive again, said Downtown Arkadelphia board member Carrie Price.
Group Living will likely move some of its services into the building from older real estate it owns where utility rates are higher. Other restaurants and retail options exist downtown, but Price said losing the mainstay at 705 Main St. will be particularly painful for the town.
"It's a significant piece of real estate on Main Street," said Price, who serves as marketing director for Southern Bancorp. "It's a staple. As hard as we've worked for many years to rebuild downtown, for it to close, it's heartbreaking. I have a vested interest in downtown, and the Honeycomb has been a large part of the rebuilding."
President Barack Obama signed the Workforce Innovation and Opportunity Act into law in 2014 and regulations included there change Department of Labor guidelines that previously made sheltered workshops allowable. Opponents of the previous arrangement were concerned that disabled workers are taken advantage of because they are being paid less than minimum wage.
Lucas argues that Group Living clients with more severe disabilities will be unable to find work elsewhere.
Missy Gillum began working at the Honeycomb shortly after enrolling in Group Living Inc. She delivers food from the kitchen to guests and cleans tables between 7:15 a.m. until 2:30 p.m. each day.
Gillum is hopeful, she said, that she can find work at a day care. Despite the small size of her weekly paycheck, Gillum said the experience at the restaurant has been a positive one.
"Some people say I'm a little more responsible than I was. I know I'm happier," Gillum said, adding, "I'll be sad it's closing, but I'll find another place."
Ross Whipple, chairman of the Ross Foundation and president of Horizon Timber Services, has served on the board of Group Living and been a donor to the organization in the past. He characterized the Honeycomb as a unique gathering place for community members and a popular stop for politicians visiting the area in search of votes.
Arkadelphia will miss the Honeycomb, but Group Living is likely to benefit in the long run from the changes, Whipple said. Though Whipple said he wasn't intimately familiar with the nonprofit's current financial position, he said the changes could be a net positive for the organization.
"Job one is to take care of those clients and get them engaged in employment that helps fulfill their life," Whipple said. "Anything else that comes out of that is lagniappe. The restaurant was lagniappe. It was good for the clients, good for the community. Who knows, as time goes on they'll probably find a new way to integrate those folks into the community."
SundayMonday Business on 11/06/2016