Witt Stephens

Witt Stephens (September 14, 1907 to December 2, 1991) was the founder of the firm that became Stephens Inc. and the elder brother of Jackson Stephens. He was born at Prattsville in Grant County, the second of six children, and left school after Sheridan High School. He sold jewelry on the road from 1927, began trading municipal bonds in Little Rock in 1932, and in 1933 founded the W.R. Stephens Investment Company, which bought defaulted Arkansas bonds "for as little as ten cents on the dollar."¹

Gas

Stephens paid 1.2 million dollars for the Fort Smith Gas Company in 1945 and 6.5 million for the Oklahoma Producing Company in 1953, renamed Stephens Production, which has paid the family an estimated billion dollars in dividends. In 1954 he bought Arkansas Louisiana Gas from Cities Service. Its earnings rose from 1.8 million dollars in 1954 to 7.2 million in 1956, when he became president and chairman. In 1957 the Arkansas Supreme Court rejected the formula by which the utility passed its gas costs to customers. A replacement bill went through both houses of the legislature and was signed in four days. "Well, hell, we'll just change the law," he is reported to have said. He was elected to the Arkansas House of Representatives in 1961 and served two terms while running the utility it regulated. By the late 1960s seventeen of the thirty-five state senators drew salaries or retainers from the company.¹²³

He retired from Arkla in 1973 in favor of his executive assistant, Sheffield Nelson, then thirty-two. In 1975 Nelson refused to renegotiate the old contracts under which Stephens Production sold gas to the utility, and lobbied against a bill that would have made Arkla carry gas from Stephens wells for a rival. "Witt Stephens never got over his resentment." In the early 1980s Nelson sold a half interest in Arkla leases in the Arkoma basin to Jerry Jones, who joined the utility's board, with a commitment that Arkla would buy the gas at the highest lawful price. The Stephens family's own wells in the Cecil and Aetna fields were tied to Arkla by old contracts at 16 and 55 cents per thousand cubic feet. "After negotiating with Jones, the old contracts were broken on April 28, 1983, and Arkoma and Stephens began sharing in gas now being sold to Arkla under new Jones-negotiated agreements," at three dollars. Nelson retired on December 31, 1984, naming Mack McLarty to succeed him, and under McLarty Arkla bought the properties back in 1986 "for far more than it was sold to Jones." The final cost was put at 174.8 million dollars. A ratepayers' class action filed in January 1990 called it an insiders' arrangement that had overcharged Arkansas gas customers 80 million dollars. Nelson called it the "best deal" the utility ever made. His opponent in the Republican primary, Representative Tommy Robinson, by then a protégé of the Stephens family, said Nelson had tried to "stuff his pockets so full of money his pants fell down." Nelson became a Republican in 1989 and ran for governor in 1990 against Bill Clinton. The Arkoma transaction was the main issue of the campaign, and Clinton won a fifth term with 57 percent. McLarty became his White House chief of staff.⁴⁵

Politics

For thirty years after the Second World War Stephens was called the kingmaker of Arkansas. He backed Sid McMath for governor in 1948 and took part in the campaigns of Orval Faubus, Senator J. William Fulbright, and Senator John L. McClellan. In the 1966 primary for governor he backed J. Frank Holt, for whom the young Bill Clinton worked. He and his brother met Mochtar Riady of Indonesia in 1976 and considered buying the Arkansas Gazette in 1991. He died of complications of a stroke and is buried at Prattsville.¹³⁶