Current through Register Vol. 49, No. 2, February 2024
I.
Introduction
The goal of the Arkansas Enterprise Zone Act is to create an
environment that produces a variety of economic opportunities for Arkansans.
See Arkansas Code Annotated § 15-4-1701 et. seq. These rules are being
jointly promulgated by the Arkansas Department of Economic Development and the
Revenue Division of the Arkansas Department of Finance and Administration. The
adoption of these regulations will replace the Department of Finance and
Administration's Enterprise Zone Act of 1993 Regulation 1993-11.
For additional information contact:
Business Development Section
Arkansas Department of Economic Development
One Capitol Mall
Little Rock, Arkansas 72201
(501) 682-7675
Policy and Legal, Revenue Division
Arkansas Department of Finance and Administration
1900 West Seventh Street, Suite 2062
Little Rock, AR 72201-1272
(501) 682-7000
II.
Definitions
A.
"Average hourly
wage" means the average wage of the net new full-time permanent
employees based on payroll for the most recent quarter reported to the Arkansas
Employment Security Department. The average wage is computed by using the total
of the net new full-time permanent employees' reported taxable earnings,
including overtime pay and one quarter of the employee's annual bonus, divided
by the number of weeks worked during the most recent quarter, divided by the
average hours worked per week per net new full-time permanent
employee.
B.
"Coal
mining" means an operation that hires a minimum of 25 net
full-time employees and extracts coal or lignite from within the boundaries of
the State of Arkansas. (Act 1065 of 2001 added coal mining as a business
eligible for benefits under the Enterprise Zone Act.)
C.
"Corporate
headquarters" means the home or center of operations, including
research and development, of a national or multinational corporation with no
retail sales to the general public.
D.
"Department"
means the Department of Economic Development.
E.
"Director" is the
director of the Department of Economic Development.
F.
"Digital Content
Production" means companies engaged in the creation of product
that includes acquiring, modeling, and manipulating video imagery, film and
animation. These products are created in digital form and are eligible for
copyrighting under the copyrighting laws of the United States. Outlets for
digital content products may include broadcast television, corporate
presentations, cable shows, advertising, video games, movies and themed
entertainment outlets. For companies engaged in digital content production to
be eligible for benefits under this program, they must derive seventy-five
percent (75%) of their revenue from out-of-state sales and have no retail sales
to the general public.
G.
"Digital Preservation" means companies engaged in the
transformation, storage, archiving and/or distribution of various forms of
media which have been transferred into a digital format. Media transformation
into digital content may include film, video or written materials. For
companies engaged in digital preservation to be eligible for benefits under
this program, they must derive seventy-five percent (75%) of their revenue from
out-of-state sales and have no retail sales to the general public.
H.
"Distribution
center" means a facility for the reception, storage, or shipping:
(A) of a business' own products or products
which the business wholesales to retail businesses or ships to its own retail
outlets; or
(B) of products owned
by other companies with which the business has contracts for storage and
shipping if seventy-five percent (75%) of the sales revenues are from
out-of-state customers; or
(C) of
products for sale to the general public if seventy-five percent (75%) of the
sales revenues are from out-of-state customers.
I.
"Endorsement
resolution" means a resolution approved by the governing body of a
municipality or county within whose jurisdiction the facility is located and
must:
1. Approve the specific entity's
participation in the program; and
2. Specifically state whether the
municipality or county authorizes the Department of Finance and Administration
to refund local sales and use taxes to the entity under the program. A
municipality or county can authorize the refund of all or part of a tax levied
by it, but cannot authorize the refund of any tax not levied by it.
J.
"Existing
employees" means those employees hired by the business prior to
the date of the financial incentive agreement. Existing employees may be
considered 'net new full-time permanent employees' only if:
1. The position or job filled by the existing
employees was created as a result of the project; and
2. The position vacated by the existing
employee was either filled by a subsequent employee or no subsequent employee
will be hired because the business no longer conducts the particular business
activity requiring such classification. To count existing employees that have
no replacements, there must be sufficient evidence that the business is clearly
discontinuing its old operations and beginning a new business
activity.
K.
"Financial incentive plan", within this regulation,
the "financial incentive plan" is referred to as a "financial incentive
agreement" and consists of:
1) the
application;
2) the endorsement
resolution; and
3) the project
plan.
L.
"Governing authority" means the quorum court of a
county or the governing body of a municipality.
M.
"High
unemployment" means an unemployment rate equal to or in excess of
one hundred fifty percent (150%) of the state's average unemployment rate for
the preceding calendar year as specified by statewide annual labor force
statistics compiled by the Arkansas Employment Security Department, when the
state's annual average unemployment rate is six percent (6%) or below. When the
state's annual average unemployment rate is above six percent (6%), "high
unemployment" means an unemployment rate equal to or in excess of three percent
(3%) above the state's average unemployment rate for the preceding calendar
year as specified by statewide annual labor force statistics compiled by the
Arkansas Employment Security Department.
N.
"Modernization",
in the context of this program, means a plan that will increase efficiency or
productivity of an existing plant or facility or enable an earlier project to
function as originally intended through investment in machinery and/or
equipment, not including costs for routine maintenance.
O.
"Motion picture production
company" means a company that produces any motion picture or
portion thereof for: display at theaters, video release, television shows,
music videos and special effects, titles and credits all of which are embodied
on film or prepared for digital presentation. Motion picture production
companies are generally a subset of those companies classified in SIC code 7812
and must have no retail sales to the general public and derive at least 60% of
their revenue from out of state sales.
P.
"Net new full-time permanent
employee" means a position or job which was created pursuant to
the signed financial incentive agreement and which is filled by one (1) or more
employees or contractual employees who were Arkansas taxpayers during the year
in which the tax credits or incentives were earned; and
1. The position or job held by such employee
or employees must have been filled for at least twenty-six (26) consecutive
weeks with an average of at least thirty (30) hours per week;
2. Provided, however, in order to qualify as
a net new full-time employee, a contractual employee must be offered a benefits
package comparable to a direct employee of the business seeking incentives
under this act; and
3. Employees
could not have been claimed for tax credits or incentives under this subchapter
during the preceding taxable year.
4. The number of net new full-time permanent
employees shall be equal to the total number of new full-time permanent
employees for the current year minus the total number of new full-time
permanent employees for the previous tax year.
Q.
"Office sector
business" means control centers that influence the environment in
which data processing, customer service, credit accounting, telemarketing,
claims processing, and other administrative functions that act as production
centers are performed. Office sector businesses can have no retail sales to the
general public.
R.
"Program" means the Arkansas Enterprise Zone Act of
1993, as amended.
S.
"Project" means:
1.
All activities and costs associated with the construction of a new plant or
facility; or
2. The expansion of an
established plant or facility by adding to the building or production equipment
or support infrastructure, or both; or
3. The modernization through the replacement
of production or processing equipment or support infrastructure, or both;
(a) Expenditures for routine repair and
maintenance that do not result in new construction or expansion are ineligible
for benefits under this act.
4. In order to receive a refund for eligible
project costs, such costs must be incurred within four (4) years from the date
the project plan was approved by the department.
5. Routine operating expenditures are
ineligible for benefits under this act.
T.
"Project plan"
means the plan submitted to the department containing such information as may
be required by the director to determine eligibility for projects.
U.
"Regional
headquarters" means the home or center of operations for a
multi-state geographical area, including research and development, of a
national or multinational corporation with no retail sales to the general
public.
V.
"Routine
maintenance" means the replacement of existing machinery parts
with like parts.
W.
"Routine operating expenditures" means:
(1) costs normally associated with doing
business; or
(2) recurring
expenditures for items which in the normal course of business must be routinely
renewed, upgraded, improved, repaired, replaced or changed. Nothing contained
herein limits a company's ability to obtain credit for items which are
purchased as part of an approved project including material used in the
construction of a building or buildings or any addition, modernization, or
improvement thereon for housing any legitimate business enterprise and
machinery and equipment to be located in or in connection with such building or
buildings.
X.
"Sudden and severe period of economic distress" means
a period of hardship for a county which occurs as a result of the closure of a
business entity which employs 500 or more full-time permanent jobs. A sudden
and severe period of economic distress may also result from the closure of one
or more business entities that close within a county which results in a minimum
job loss of five percent (5%) of the employed labor force, determined by the
most recent annual averages of "County Labor Force Statistics" published by the
Arkansas Employment Security Department. In order to qualify for the
designation based on a minimum job loss of five percent (5%) of the employed
labor force, the losses must occur within one (1) year of the first
closure.
Y.
"Support
infrastructure" means systems or equipment that are necessary for
the operation of a business in the context of a modernization
project.
Z.
"Trucking
sector business" means a business that is classified within the
Federal Standard Industrial Classification (SIC) Code number 4231. This SIC
code includes companies that operate terminal facilities used by highway-type
property carrying vehicles and includes terminals which provide maintenance and
service for motor vehicles. It does not include terminals operated by motor
freight transportation companies for their own use.
III.
To Qualify for the
Program a Business Must
A.
Be an eligible business as defined by one or more of the following:
1. A manufacturer in Standard Industrial
Classification (SIC) codes 20 through 39 including semiconductor and
microelectronic manufacturers creating one (1) or more net new full-time
permanent jobs.
2. Computer
businesses primarily engaged in providing computer programming services; the
design and development of prepackaged software; businesses engaged in digital
content production and preservation; computer processing and data preparation
services; information retrieval services; computer and data processing
consultants and developers. All businesses in this group must employ five (5)
or more net new full-time permanent employees, after July 1, 2001 and derive at
least seventy-five percent (75%) of their revenue from out of state sales and
have no retail sales to the general public;
3. Businesses primarily engaged in commercial
physical and biological research as classified by SIC code 8731, which will
employ one (1) or more net new full-time permanent employees;
4. Businesses primarily engaged in motion
picture production which will employ twenty-five (25) or more net new full-time
permanent employees. All businesses in this group must derive at least sixty
percent (60%) of their revenue from out of state sales and have no retail sales
to the general public;
5. An office
sector business, which will employ twenty-five (25) or more net new permanent
employees and have no retail sales to the general public;
6. A national, corporate or regional
headquarters which will employ twenty-five (25) or more net new full-time
permanent employees and have no retail sales to the general public;
or
7. A distribution center, with
no retail sales to the public, unless seventy-five percent (75%) of the sales
revenues are from out-of-state customers, creating twenty-five (25) or more net
new full-time permanent jobs.
8. A
trucking/distribution terminal (SIC 4231), with no retail sales to the public,
creating twenty-five (25) or more net new full-time permanent jobs.
9. A coal mining operation that hires a
minimum of twenty-five (25) net fulltime employees and extracts coal or lignite
from within the boundaries of the State of Arkansas.
B. Plan a project that will result in the
creation of the requisite number of net new full-time permanent jobs.
1) A project includes one or more of the
following:
1) the construction of and
equipping of a new plant or facility;
2) the physical expansion of an established
plan or facility; or
3) the
modernization of an existing facility through the addition of production or
processing equipment.
2)
Each of the three (3) project elements may qualify under the program by itself.
Each element must be identified separately when applying with the Director for
qualifying project status. An estimated completion date for each element is
required as part of the application.
3) A project to construct and equip a new
plant or facility generally is complete when the equipment has been installed
in the new plant or facility.
4) A
project to physically expand and/or add equipment is generally complete when
the construction is completed and/or the equipment has been
installed.
5) A modernization
project is generally complete when the addition of the last piece of production
or processing equipment has been installed. A project of this type must be
specific in describing the equipment to be added. Routine maintenance
expenditures and routine operating expenditures are not eligible project
costs.
6) Every project that
includes the element of adding equipment or modernization without significant
construction (either of a new facility or plant or the expansion of an existing
facility or plant) must be able to document to the satisfaction of the Director
that such project results directly in the creation of the requisite number of
net new full-time permanent employees.
7) When included in an approved modernization
project, purchases of replacement production or processing equipment can
qualify as eligible project costs although such equipment is replaced prior to
expiration of its useful depreciable life for income tax purposes if such
equipment is expected to significantly improve the function of the replaced
equipment or peripheral equipment.
8) When included in an approved modernization
project, expenditures for items integral to the success of such project (for
example, software upgrades) may qualify as eligible project costs, depending on
the justification provided by the applicant and the acceptance of the
justification by the Director.
C. Submit a properly completed application,
endorsement resolution, and project plan (see Attachment) to:
Department of Economic Development
Incentives Coordinator
One Capitol Mall
Little Rock, AR 72201
D. The application, with endorsement
resolution and project plan attached, must be filed with the department within
60 days of the endorsement resolution in order to use the endorsement
resolution as the starting date for counting new employees and project costs.
If the application is received after the 60-day period, only those employees
hired after the date the application is received and only those project costs
incurred from the date the application is received will be eligible for
benefits.
IV.
Powers and Duties of the Department of Economic
Development
A. The
Department will review the application to insure, among other things, that the
project described complies with the requirements of the law, including
sufficient detail as to the project elements and their expected completion
dates. If the project description and application are approved, the Department
of Economic Development will issue the business a letter of acceptance and a
certificate of eligibility. This letter of acceptance shall include a provision
that states that if the business exceeds the projected cost estimate by more
than twenty percent (20%) of projected costs, the business shall be required to
submit an amended application. In the amended application, the business should
explain why the costs exceeded estimates and how these additional costs relate
to the original project plan. A copy of the certificate and financial incentive
agreement will be sent to the business contact person and the Department of
Finance and Administration (DF&A. DF&A will contact the business and
provide the forms and instructions needed for the business to receive the
credits in accordance with the financial incentive agreement.
B. If declined, the Department of Economic
Development will forward a letter to the business stating the basis for the
denial and that they are ineligible for benefits.
C. A business whose application has been
denied due to lack of documentation or sufficient detail must provide the
lacking documentation or provide detail to satisfy the Department's needs to
properly approve within thirty (30) days of such denial. Failure to provide the
necessary information within this time will result in the business having to
submit a new application.
V.
Terms of the Incentive
Agreement
A. Financial
Incentive Agreement
The financial incentive agreement determines when a business may begin
counting new employees and earning income tax credits. Only employees hired
after the date of the financial incentive agreement are eligible for the income
tax credits (except as provided in paragraph 2 below).
1. The financial incentive agreement will be
issued to the business after a complete application, including an endorsement
resolution and project plan, is received by the Department of Economic
Development.
2. If the application
is submitted within sixty (60) days of the endorsement resolution, the
effective date of the financial incentive agreement is the date of the
resolution. If the application is received after the sixty-(60) day period has
expired, then the effective date of the financial incentive agreement is the
date the application was received by the Department of Economic
Development.
3. The Department will
issue the financial incentive agreement certifying the business for
participation in the Advantage Arkansas program within ten (10) working days of
receipt of the complete application packet.
B. Conditions for receiving benefits:
1. The requisite number of net new full-time
permanent employees must be employed by the business within twenty-four (24)
months following the date the financial incentive agreement was signed (except
as provided in paragraph C.1. of this section).
2. To be considered a "net new full-time
permanent employee", the position or job must have been created pursuant to the
signed financial incentive agreement. This position must be filled by one (1)
or more employees or contractual employees who were Arkansas taxpayers during
the year in which the tax credits or incentives were earned; and
(a) be employed at the facility listed in the
endorsement resolution;
(b) the
position or job held by such employee or employees must have been filled for at
least twenty-six (26) consecutive weeks with an average of at least thirty (30)
hours per week;
(c) contractual
employees must be offered a benefits package comparable to a direct employee of
the business seeking incentives under this program;
(d) employees could not have been claimed for
tax credits or incentives under this program during the preceding taxable year;
and
(e) the number of net new
full-time permanent employees is equal to the cumulative total number of new
full-time permanent employees for the current year, since the issuance of the
financial incentive agreement, minus the cumulative total number of new
full-time permanent employees for the previous tax year, since the issuance of
the financial incentive agreement.
3. Existing employees may be considered "net
new full-time permanent employees" only if:
(a) The position or job filled by the
existing employee was created as a result of the project.
(b) A new employee will fill the position
vacated by the existing employee or no new employee will be hired because the
business no longer conducts that particular business activity.
C. Failure to meet
required conditions
1. If a business fails to
meet the required number of employees within twenty-four (24) months, the
business can apply for a twenty-four (24) month extension if the Director of
the Department of Economic Development and Chief Fiscal Officer of the State
determine that additional time is needed because of:
(a) Unanticipated and unavoidable delay in
the construction of a facility that must be completed before the employees can
be hired; or
(b) The project, as
originally planned, will require more than twenty-four (24) months to complete;
or
(c) A change in the business
ownership or business structure due to a merger or acquisition.
2. If the business falls below the
required number of new employees, the business should inform the Department of
Finance and Administration that the business no longer employs the required
number. Because of this, the business will no longer receive the benefits of
the program.
a) If the business fails to
notify the Department of Finance and Administration, that business will be
liable for the repayment of all benefits which were paid to the business after
it no longer qualified for the benefits. Interest shall also be due at the rate
of 10% per annum.
3. In
the event that a business is receiving benefits of this incentive program but
has failed to meet the requirements of the program or misrepresents its
qualifications to receive benefits, the business:
(a) Will be liable for the repayment of all
sales and use taxes which were refunded;
(b) Will be disqualified from receiving any
further benefits under the program and shall be liable for the repayment of
such additional income taxes as may be due after the income tax credits
provided are disallowed plus interest at a rate of 10% per annum; and
(c) If a business misrepresents its
qualifications in order to receive benefits from this program, that business
will be liable for the above plus penalty as allowed by law.
VI.
Administration of Benefits
The program provides Arkansas income tax credits and sales and use tax
refunds. Companies are eligible for benefits regardless of their location in
Arkansas.
A. Earned income tax credits
begin in the year in which the new employees are hired after the financial
incentive agreement has been signed. However, employees hired as a result of
the project, if an application is made within 60 days after the date of the
endorsement resolution, may be considered as new full-time permanent employees,
starting with the date of the endorsement resolution. Any unused portion of the
credit may be applied against the income tax for the succeeding nine (9) tax
years or until the credit is entirely used, whichever occurs first.
B. By participating in the Advantage Arkansas
Program, a business is eligible for a refund of the state's sales and use taxes
on building materials and on all taxable purchases of machinery and equipment,
excluding licensed motor vehicles, connected with a project. Purchases of
eligible items will qualify for a refund after the date of the endorsement
resolution, if the application is filed in a timely manner. All requests for
the refund of a local tax must be filed with and received by the Department of
Finance and Administration within sixty (60) days of the invoice date which
indicates that the local tax was paid.
C. Ineligible costs include:
1. Expenditures for routine repair and
maintenance that do not result in new construction or expansion are not subject
to refund.
2. Routine operating
expenditures.
3. Purchases of
replacements of items previously purchased as part of a project unless the
items previously purchased will not enable the project to function as
originally intended.
D.
A business may receive a refund for eligible purchases that are incurred within
four (4) years from the date that the project plan was approved by the
department.
E. All claims for sales
and use tax refunds shall be filed with the Revenue Division of the Department
of Finance and Administration within three (3) years from the date of the
qualified purchase or purchases. The date of the qualified purchase is
established by the date of the pertinent invoice.
F. REFUND OF LOCAL SALES AND USE TAX. A
municipality or county can authorize the refund of all or part of the sales or
use tax levied by it, but cannot authorize the refund of any tax not levied by
it. Therefore, all requests for refunds for local sales and use tax must be
supported by the original sales receipt which must reflect that the tax to be
refunded is the tax of the municipality or county which authorized the refund
of its sales or use tax to the applicant. All requests for the refund of a
local tax must be filed with and received by the Department of Finance and
Administration, Tax Credits/Special Refunds Section, P.O. Box 1272, Little
Rock, Arkansas 72203 within sixty (60) days of the invoice date which indicates
that the local tax was paid. If the request for refund is not received by the
Department of Finance and Administration, Tax Credits/Special Refunds Section
within this time period, the request for refund will be denied. However, in the
event the request for refund is not timely filed with the Department of Finance
and Administration, the request for refund of local tax can be filed with the
local government that authorized the Department of Finance and Administration
to refund the tax.
G. DEVELOPERS
AND CONTRACTORS.
(a) Developers building a
structure for lease to an approved enterprise zone business and contractors
performing work for an approved enterprise zone business may be permitted to
receive a sales and use tax refund on eligible purchases directly from the
state only when the approved enterprise zone business requests the Department
of Finance and Administration, Tax Credits/Special Refunds Section, in writing,
that this be permitted and states the basis for this request. The Department of
Finance and Administration, Revenue Division, will authorize this procedure
only when it is satisfied that:
(1) This
arrangement is crucial to the success of the business project; and
(2) All requirements of the Act and this
regulation be adhered to; and
(3) A
notarized affidavit (Form EZP 1201) is presented to the Department of Finance
and Administration, Revenue Division, from the contractor or developer stating
the enterprise zone business will receive the benefit of the sales and use tax
refunds by having the cost of construction or lease payments reduced by the
amount of the tax refund; and
(4) A
notarized affidavit (Form EZP 1301) is presented to the Department of Finance
and Administration, Revenue Division, from the approved enterprise zone
business waiving the right to claim a refund of sales and use taxes, and
passing on the right to claim refunds to the contractor or developer. The
affidavit must state that the enterprise zone business acknowledges that if the
enterprise zone business fails to comply with the conditions contained in this
regulation, that business will be liable for the payment of all sales and use
taxes which were refunded to contractors and developers under this section,
plus penalty and interest.
(b) An approved enterprise zone business may
receive a sales and use tax refund on eligible purchases made by a contractor
or developer performing work or building a structure for lease or sale to the
approved enterprise zone business provided the enterprise zone business submits
to the Department of Finance and Administration, Tax Credits/Special Refunds
Section:
(1) A notarized
Contractor's/Developer's Waiver of Refund Form (Form EZP 1101) completed by the
contractor or developer waiving any and all rights to claim a refund of sales
and use taxes; and
(2) An
Enterprise Zone Business Sales and Use Tax Refund Request Form (Form EZP 1001),
and a Schedule A listing the qualified enterprise zone purchases; and
(3) All other requirements of the Act and
this regulation are adhered to.
VII.
Benefit
Calculations
For Projects Prior to April 6, 1999
A. This program provides an Arkansas income
tax credit equal to the average hourly wage of each net new full-time permanent
employee times the number of new employees times a multiplier of 100, with a
$2,000 cap per employee.
B. In
counties where the unemployment rate is in excess of ten percent (10%) or in
excess of three percent (3%) of the state's average unemployment rate for the
preceding calendar year, a multiplier of 200 is used, with a cap of $2,000 per
employee.
C. The Advantage Arkansas
income tax credits are calculated as follows:
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For Projects Beginning April 6, 1999 to March 19,
2001
A. This program
provides an Arkansas income tax credit equal to the average hourly wage of each
net new full-time permanent employee times the number of new employees times a
multiplier of 100, with a $3,000 cap per employee.
B. Average hourly wage is the average wage of
the net new full-time permanent employees based on payroll for the most recent
quarter that was reported to the Arkansas Employment Security Department. The
average hourly wage is calculated by using the total net new full-time
permanent employees reported taxable earnings (including overtime pay and one
quarter of the net new fulltime permanent employees annual bonus) divided by
the number of weeks worked, divided by the average hours worked per net new
full-time permanent employee.
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C. In counties where
the unemployment rate is 150 percent of the state's average unemployment rate
for the preceding calendar year, a multiplier of 400 is used, with a cap of
$6,000 per employee.
D. The
Advantage Arkansas income tax credits are calculated as follows:
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E. Unemployment is
measured by yearly county unemployment averages. High unemployment counties are
those with an unemployment rate equal to or in excess of one hundred fifty
percent (150%) of the state's average unemployment rate for the preceding
calendar year as specified by the statewide annual labor force statistics
compiled by the Arkansas Employment Security Department.
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For Projects Beginning on or after March 19,
2001
F. This program
provides an Arkansas income tax credit equal to the average hourly wage of each
net new full-time permanent employee times the number of new employees times a
multiplier of 100, with a $3,000 cap per employee.
G. Average hourly wage is the average wage of
the net new full-time permanent employees based on payroll for the most recent
quarter that was reported to the Arkansas Employment Security Department,
including overtime pay and one quarter of the employee's annual bonus. The
average hourly wage is calculated by using the total net new full-time
permanent employees reported taxable earnings divided by the number of weeks
worked, divided by the average hours worked per net new full-time permanent
employee.
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view image
H.
(1) When the state's annual average
unemployment rate is six percent (6%) or below, in those counties where the
unemployment rate is 150 percent of the state's average unemployment rate for
the preceding calendar year, a multiplier of 400 is used, with a cap of $6,000
per employee.
(2) When the state's
annual average unemployment rate is above six percent (6%), in those counties
where the unemployment rate is equal to or in excess of three percent (3%)
above the state's average unemployment rate for the preceding calendar year, a
multiplier of 400 is used, with a cap of $6,000 per employee.
Unemployment rates shall be calculated using the statewide annual labor
force statistics compiled by the Arkansas Employment Security
Department.
I.
The Advantage Arkansas income tax credits are calculated as follows:
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image
J. Unemployment is
measured by annual county unemployment averages. In order to give a benefit to
those counties experiencing high unemployment, three conditions prevail:
1. When the state's annual average
unemployment rate is six percent (6%) or below, "high unemployment" counties
are those with an unemployment rate equal to or in excess of one hundred fifty
percent (150%) of the state's average unemployment rate for the preceding
calendar year as specified by the statewide annual labor force statistics
compiled by the Arkansas Employment Security Department.
2. When the state's annual average
unemployment rate is above six percent (6%), "high unemployment" counties are
those with an unemployment rate three percent (3%) or more above the state's
average unemployment rate for the preceding calendar year as specified by the
statewide annual labor force statistics compiled by the Arkansas Employment
Security Department.
3. A county
that does not qualify as a "high unemployment" county, but has experienced a
sudden and severe period of economic distress caused by the closing of a
business entity that results in the loss of a minimum of five hundred (500)
full-time permanent jobs or a minimum of five percent (5%) of the employed
labor force, as determined by the most recent "Labor Market Information"
publication published by the Arkansas Employment Security Department, may be
designated as a high unemployment county by the Arkansas Economic Development
Commission. The designation as a high unemployment county shall be in effect
for one (1) year after the closing of the business.
(a) To initiate a designation as a high
unemployment county because of a sudden and severe period of economic distress,
the County Judge should send a letter to the Chairman of the Arkansas Economic
Development Commission describing the employment situation in his or her county
and ask the Commission to consider declaring their county a high unemployment
county.
VIII.
Restrictions
A. The additional benefits provided by Act
807 of 2001 shall only apply to those financial incentive agreements signed
after March 19, 2001.
B. No person
or entity may file for benefits under the Arkansas Enterprise Zone Act of 1993
(Advantage Arkansas) if an application for benefits has been filed and approved
under the InvestArk program (ACA § 26-52-701 et seq.) for the same
project. An application for benefits under the InvestArk program may be
withdrawn if no tax credits have been taken under that act.
C. If a project has been approved under the
InvestArk program, no application for a project under Advantage Arkansas will
be accepted until the expiration of one (1) year after the date of approval of
the application under InvestArk.
D.
When a project has been approved under the Enterprise Zone Act of 1993
(Advantage Arkansas), no application for projects under the InvestArk program
shall be accepted until the expiration of one (1) year after the date of
approval of the application under Advantage Arkansas.