(a) Use of Arkansas Manufacturers and Suppliers - Act 462 of 1989 requires enterprise zone businesses and their contractors to give preference and priority to Arkansas manufacturers, suppliers, contractors, and labor, except where not reasonably possible to do so without added expense or substantial inconvenience or sacrifice in operational efficiency. In considering application for tax refund, special attention will be given to those applicants agreeing to use, purchase, and contract for machinery, supplies and equipment manufactured in Arkansas, or, in the absence of Arkansas manufacturers, sold by residents, and to the use of Arkansas contractors and labor in the construction and operation of proposed facilities.

(b) Contractor Eligibility - A contractor is not eligible to receive the tax credit or refunds afforded by Act 462 of 1989, as amended, unless the contractor is the owner/developer creating permanent new jobs within an eligible zone, or meets the requirements of subsection (c) herein. In such circumstances, the contractor will be considered the business of record and must comply with the regulations as set forth in Section 1 of these regulations.

(c) Refund to Contractors - Contractors performing work on behalf of the business of record (which is eligible for tax credits or refunds) may be permitted to receive a sales tax refund on eligible purchases directly from the State only when the business of record requests to the Department of Finance and Administration, Revenue Division, in writing, that this be permitted and states the basis for this request. Department of Finance and Administration, Revenue Division, will authorize this procedure only when it is satisfied that: