Missouri Minute: AMC announces debt offering; Missouri could sue vendor over faulty face masks

Good morning, MBA readers,

In Missouri, the COVID-19 pandemic has served as an unfortunate reminder of a yearslong, critical issue for the state’s hospitals: There are not enough nurses to fill vacant spots.

Missouri’s nursing shortage reached a peak of 16% — or about 6,000 positions — in 2017. In places like Jefferson County, a dearth of nurses has forced the closure of clinics that find themselves short-staffed.

Some progress has been made to boost the nursing workforce over the years, but it’s unclear how the coronavirus outbreak may affect the future of training programs. By 2018, nursing vacancies in the state dropped to 10% — nearly 3,800 positions — according to the Missouri Hospital Association. But the need for nurses is expected to continue growing nationwide.

At the same time, the ability of state schools to expand their nursing programs to meet that demand depends on state funding. That, of course, is complicated by a statewide budget shortfall, which will take a substantial bite out of higher education funding.

There’s another driving force behind the nursing shortage in Missouri: a high number of nurses reaching retirement age. According to the Columbia Missourian, about 34% of Missouri nurses were older than 55 and reaching retirement age in 2017. Some may not choose to retire early, but they may cut back on hours.

At least one new initiative in St. Louis is looking to address the retirement spiral as part of the local coronavirus response. As the number of virus cases rises across Missouri, SSM Health and Saint Louis University are accelerating a program that brings retired nurses back to the job. The program may expand depending on demand, potentially providing a much-needed stream of additional recruits for SSM facilities in Missouri, Illinois and Oklahoma.


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From our newsroom

Speaking Startup: Makers pitch in to produce PPE
As the coronavirus started to spread, Nick Ward-Bopp began to get inquiries about using the Kansas City-area makerspace where he works to produce personal protective equipment. Ward-Bopp is makerspace facilitator for the Black & Veatch MakerSpace at the Johnson County Library and co-founder of Maker Village KC. Lately, he has helped produce face shields and protective masks to meet demand for personal protective equipment during the pandemic. Ward-Bopp joined the latest episode of Speaking Startup to discuss how makers are pitching in to produce PPE.


Stay alert

More Missourians have filed for unemployment claims than all of 2019
Since March 15, 340,000 people have filed for unemployment benefits in Missouri — equal to the total number of claims filed from June 2018 through February 2020. At least 307,000 of those claims were related to the coronavirus pandemic. (St. Louis Post-Dispatch)

State officials report more than 100 new coronavirus cases
As of Sunday, more than 5,600 people in Missouri had tested positive for COVID-19, and 176 had died from it. (Kansas City Star)

Missouri could sue vendor over faulty face masks
State officials are working to recover more than $8.25 million paid in advance for more than 3.9 million KN95 face masks, of which the state only received about 101,000. Last week, the state recalled 48,000 of the masks because they were found to be faulty. (Columbia Missourian)

Shareholders approve $6.3 billion Tallgrass Energy sale
Despite a 30% rout in global fuel demand, the Leawood, Kansas-based pipeline operator has closed on its sale to a group led by Blackstone Group under pre-market crash conditions. (Reuters)

AMC announces $500 million debt offering
The Leawood, Kansas-based cinema operator has announced plans for a private offering of $500 million expected to allow the company to survive economic shutdowns until a partial reopening sometime this fall. As of March 31, AMC reported a cash balance near $300 million made up largely of revolving credit. (Kansas City Business Journal)

SSM, SLU accelerate program that brings ex-nurses back to hospitals
The program, which typically takes four weeks, has been condensed to just two weeks as a way of not only supplementing a stressed nursing workforce, but also addressing a long-term shortage of nurses. (St. Louis Post-Dispatch)

KC Council narrowly approves downtown Waddell & Reed headquarters
With Mayor Quinton Lucas casting the deciding vote, the Kansas City Council voted 7-6 to approve plans to build a new $140 million headquarters for the financial services firm. (Kansas City Business Journal)

Creditors offer to buy KC Star parent for over $300 million
Some of McClatchy’s largest creditors have offered to acquire the bankrupt newspaper giant for a price “well in excess” of $300 million. With a deadline of early July, the offer could potentially set off a bidding war. (Sacramento Bee)

Columbia council to discuss airport bond issue, coronavirus policies
The Columbia City Council is set to hold a public hearing during its meeting Monday evening on a proposed $14.5 million bond issue to finance a new terminal building at Columbia Regional Airport. The council is also expected to introduce ordinances that give local businesses more time to renew or acquire certain licenses during the coronavirus pandemic. (Columbia Missourian)

St. Louis printing business lays off 72
RR Donnelley has announced that it will permanently close two facilities in St. Louis due to the pandemic, shedding 72 jobs. (St. Louis Post-Dispatch)

Clayco subsidiary closes Springfield office, suspends operations
The Lamar Johnson Collaborative, a subsidiary of Chicago-based construction firm Clayco, has indefinitely closed its office in Springfield and suspended all operations there until further notice. (Springfield Business Journal)

University City furloughs employees amid budget shortfall
The city has laid off or furloughed about 13 full-time employees as it forecasts a $3.7 million reduction in current fiscal year revenues. Officials expect another $6 million shortfall next fiscal year due to the economic shocks from the pandemic. (St. Louis Business Journal)

St. Louis golf courses remain open, under new rules
Several golf courses in the area remain open during the coronavirus pandemic with new rules that aim to minimize any physical contact between players. (St. Louis Business Journal)


Say that again

“Nobody knows where we’re going to wind up. It’s a wide window. It’s hard to plan for.”

That’s St. Louis operations director Todd Waelterman on the city’s daunting budget deficit for the current fiscal year, which could range between $55 million and $63 million, the St. Louis Post-Dispatch reports. Just months ago, city staff had projected a surplus thanks to growing tax revenues. Local lawmakers even planned a 3% raise and $1,000 bonuses for all city employees. But all of that changed with the coronavirus outbreak. The city may scale back the planned raises to 1.5% as policymakers scramble to make up the difference. So far, no layoffs or furloughs are outlined in the draft budget, said Steve Conway, chief of staff of St. Louis Mayor Lyda Krewson. But “that may become a possibility,” he added, depending on how the pandemic continues to affect the city’s revenue streams.


Go figure

50%

That’s how much background checks conducted for gun sales in Missouri jumped in March compared to a year earlier, going up by nearly 25,000, the Columbia Missourian reports. Firearm sales are on the rise nationally amid the pandemic, and Missouri has been no exception. Retailers across the state report a surge in customers, with one vendor in Kansas City reporting a 175% increase in sales. Another store in St. Louis claims business has quadrupled, with customers lining up outside, six feet apart, each day. These are all substantial bumps in gun sales, but not unusual. According to a spokesman for the Bureau of Alcohol, Tobacco, Firearms and Explosives’ Kansas City division, sales tend to increase based on major societal or political events.


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That’s the Missouri governor laying out his plan for reopening the state economy, which depends on dramatically expanding essential resources. Specifically, Parson’s plan requires that Missouri reach 40,000 to 50,000 coronavirus tests a week, more than double the current pace of around 15,000 to 20,000 tests a week, KSDK reports. Parson said he believes the plan could come to fruition by May 4, but some experts disagree. “We’re only testing people with more severe systems, knowing full well that we’re not testing everybody who has the disease, so I don’t think we can get that testing accomplished by May 3,” Dr. Sharon Frey, an infectious disease researcher at SLU’s Center for Vaccine Development, told St. Louis Public Radio. With Missouri’s cases still on the rise, medical professionals argue it’s too early to tell exactly when it will be safe to reopen the economy.


Hello, my name is

Cynthia Brinkley

This St. Louis business executive has been tapped to lead a group advising St. Louis County on how to distribute its $175 million in federal stimulus funds, the St. Louis Business Journal reports. The funds are earmarked for expenses related to the COVID-19 outbreak, such as expanding access to virus testing and acquiring personal protective equipment. In appointing Brinkley to the new role, county executive Sam Page emphasized the need for “integrity, transparency and compassion” in the process of divvying up funds between competing priorities. Brinkley retired last year as chief administrative officer and COO of Clayton-based managed care giant Centene. Before she joined Centene in 2016, Brinkley was vice president of global human resources at General Motors for two years and spent 25 years at AT&T.


It’s been a pleasure doing business with you this morning.


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