Gov.-elect Sarah Huckabee Sanders intends to nominate Hugh McDonald, a former president and chief executive officer of Entergy Arkansas Inc., as the secretary of the state Department of Commerce, Sanders announced Thursday.
She said current Commerce Secretary Mike Preston has helped create a "phenomenal foundation" in partnership with businesses in Arkansas under the direction of Gov. Asa Hutchinson over the past several years for McDonald to build on.
Sanders said at a news conference that Preston will transition to the private sector in Arkansas, and "we know that we are going to continue working with you in a close capacity as you move to the next step." Afterward, Preston said an announcement about his next job will be made in the near future.
The state Department of Commerce includes the Arkansas Economic Development Commission, Division of Workforce Services, Office of Skills Development, State Bank Department, Insurance Department, Securities Department, Development Finance Authority, Division of Aeronautics, Waterways Commission, and Wine Producers Council.
McDonald, 64, is the fifth Cabinet secretary whom Sanders said she intends to nominate to lead an executive branch department in her administration.
He served as president and chief executive officer of Entergy Arkansas Inc. from 2000 until he retired in 2016. Entergy Arkansas is the largest electric utility in the state, serving more than 700,000 customers with annual revenue exceeding $2 billion.
Sanders said one of the governor's most important jobs is to sell Arkansas, and "letting people know about the greatness of Arkansas, the goodness of our people, and the opportunity that exists in every corner.
"We need to make sure we have the right people in place that have a desire and a love to see Arkansas succeed, and I have no doubt that Hugh is that person," Sanders said at the news conference at the Arkansas State University System headquarters in Little Rock.
"He is not only going to help create and foster a great community and environment in the business world, but also help us build the workforce that is absolutely necessary for us to be successful," Sanders said.
At the news conference, McDonald said Sanders "pulled me out of retirement."
"But it is certainly a critically important job that I will do my dead-level best to make sure that we continue to press forward in increasing jobs, bringing companies in, building existing companies, and developing the top talent in the state of Arkansas," he said.
McDonald noted that Sanders' father, former Gov. Mike Huckabee, appointed him to his blue ribbon committee on education reform about 20 years ago.
In Sanders' news release issued after the news conference, McDonald said that "Together, we will foster a business-friendly environment with a strong workforce development pipeline that allows businesses to recruit and retain highly skilled workers.
"I'm proud to stand with Governor-elect Sanders as we champion our Arkansas economy," he said in the news release.
Randy Zook, president and chief executive officer for the Arkansas State Chamber of Commerce/Associated Industries of Arkansas, said Thursday in an interview that Sanders' selection of McDonald as the Department of Commerce secretary is "a first-rate choice."
Sanders "could not have found a better candidate," Zook said.
Gus Vratsinas of Little Rock, chairman of the Arkansas Economic Development Foundation, said Thursday in an interview that McDonald is "a wonderful choice" to lead the Department of Commerce.
"Mike Preston is going to stay in the state, so that's a positive," he said.
"Another positive is Hugh knows the state, and has been intimately involved in all these issues that are going to be coming up -- economic development, workforce development and everything else -- so this is a great choice," Vratsinas said,
McDonald's salary as the Department of Commerce secretary will be determined later, Sanders spokesman Judd Deere said after the news conference.
Preston's state-paid salary is $168,047 a year, according to the Arkansas Transparency website.
Under an updated memorandum of understanding between Preston as director of the Arkansas Economic Development Commission and the nonprofit Arkansas Economic Development Foundation signed in June of 2022, the foundation will provide quarterly supplemental payments of $7,684 to Preston in fiscal 2023.
For the past seven fiscal years, Preston has received performance bonus of more than $50,000 in private funds from the nonprofit foundation. In June, Vratsinas said the foundation's board approved a $54,810 bonus for Preston recommended by Hutchinson. The privately financed bonus is part of the compensation package agreed to in 2015 when Preston was hired. Hutchinson evaluates Preston's performance each year.
McDonald joined Entergy in 1982 as an engineer at the Waterford 3 nuclear generating plant in Louisiana, according to Sanders' news release. He held various management positions in the distribution, transmission, customer service, retail marketing, and regulatory business functions in Louisiana, Mississippi, Texas and Arkansas.
Prior to working for Entergy, he worked for Black and Veatch Consulting Engineers in Overland Park, Kan.
McDonald currently serves on the board of trustees of The Nature Conservancy of Arkansas, as a trustee for the North Dakota State University Foundation, and a board member of the Arkansas Career Education and Workforce Development Board.
McDonald is a past board member of the United States Chamber of Commerce, the University of Arkansas Sam Walton College of Business Advisory Board, and the University of Arkansas, Little Rock College of Business Advisory Council, according to Sanders' news release. He also served as past board chair of the Arkansas State Chamber of Commerce, the Little Rock Regional Chamber of Commerce, Fifty for the Future, the Arkansas Research Alliance, the Arkansas Career Education and Workforce Development Board, and the University of Arkansas for Medical Sciences Board of Advisors.
He received a bachelor's degree in construction management from North Dakota State University in 1980 and a master's degree in business administration from the University of New Orleans in 1987.
Besides McDonald, the four other department secretaries whom Sanders has said she intends to nominate include:
• Arkansas State Police Captain Mike Hagar as secretary of the Department of Public Safety and as director of the Arkansas State Police.
Current Department of Public Safety Secretary A.J. Gary has agreed to continue as director of the Arkansas Division of Emergency Management, according to Sanders. Gary currently serves in both roles. Arkansas State Police Director Col. Bill Bryant plans to retire Dec. 31, according to a department spokesman.
• Mike Mills as secretary of Department of Parks, Heritage and Tourism to replace the current secretary Stacy Hurst. Mills is the founder and owner of Buffalo Outdoor Center in Ponca, which was Arkansas' first log cabin resort. From 1982 to 1986 he served as Arkansas' director of tourism, where he started Partners in Tourism.
• Department of Agriculture Secretary Wes Ward, who has served in the post since March 2015.
• Department of Energy and Environment Chief Counsel Shane Khoury to replace current department Secretary Becky Keogh.
State government currently has 15 executive branch departments headed by secretaries.
Sanders will be sworn in as governor Jan. 10, succeeding the term-limited Hutchinson. Hutchinson has served as governor since 2015 and has said he is considering running for the Republican nomination against President Trump in 2024.
Sanders is a former White House press secretary for President Trump. She will be Arkansas' first female governor.