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003.19.9-V. Administration

AR ADC 003.19.9-VArkansas Administrative CodeEffective: May 2, 2022

West's Arkansas Administrative Code
Title 003. Department of Commerce
Division 19. Economic Development Commission
Rule 9. Consolidated Incentive Act of 2003 (Act 182 of 2003, as Amended) Rules
Effective: May 2, 2022
Ark. Admin. Code 003.19.9-V
Formerly cited as AR ADC 168.00.9-V
003.19.9-V. Administration
Currentness
1.A. If the annual payroll threshold of the business applying for incentives under this Act is not met within two (2) years after the signing of the approved financial incentive agreement, the business may request, in writing, an extension of time to reach the required payroll threshold.
B.(i) If the Executive Director and the Secretary of the Department of Finance and Administration find that the qualified business has presented compelling reasons for an extension of time, the Executive Director may grant an extension of time not to exceed four (4) years from the effective date of the financial incentive agreement.
(ii) However, the extension on projects applying for benefits under ยง 15-4-2705 is limited to a two (2) year extension.
C.(i) If a qualified business fails to reach the annual payroll threshold required under the approved financial incentive agreement, that qualified business is liable for the repayment of all incentives previously received by the qualified business that were conditioned on the approved financial incentive agreement for which the payroll threshold had not been met.
(ii)(a) If a qualified business fails to reach the annual payroll threshold required under an approved financial incentive agreement, the DFA has two (2) years to collect incentives previously received by the qualified business or file a lawsuit to enforce the repayment provisions.
(b)(1) If the annual payroll of a qualified business receiving benefits under this Act falls below the payroll threshold for qualification in a year subsequent to the year in which it initially qualified for the incentive, the incentives outlined in the financial incentive agreement shall be terminated unless a written application for an extension of incentives explaining why the payroll has fallen below the level required for qualification has been filed with and approved by the Commission.
(2) The Executive Director and the Secretary of the Department of Finance and Administration may approve the request for extension of time, not to exceed two (2) years, for the qualified business to bring the payroll back up to the requisite threshold amount and may approve the continuation of incentives during the period the extension is granted.
(3) If the business fails to reach the payroll threshold before the expiration of the time period established by a subsequent extension of time, the qualified business is liable for the repayment of all incentives paid to the business after it no longer qualified for the incentives.
(c)(1) If a qualified business fails to reach the investment threshold before the expiration of the four (4) year time limit, that qualified business is liable for the repayment of all incentives previously received by the qualified business that were conditioned on the approved financial incentive agreement for which the investment threshold was not met.
(2) If a qualified business fails to reach the investment threshold of this rule under an approved financial incentive agreement, the department has two (2) years to collect incentives previously received by the qualified business that were conditioned on the approved financial incentive agreement for which the investment threshold has not been met or file a lawsuit to enforce the repayment provisions.
(d)(1) If a qualified business fails to reach the average hourly wage threshold for incentives under this rule as specified in an approved financial incentive agreement, the qualified business is liable for the repayment of all incentives previously received by the qualified business for which the average hourly wage threshold has not been met.
(2) If a qualified business fails to meet the hourly wage threshold, the DFA has two (2) years to collect incentives previously received by the qualified business that were conditioned on the approved financial incentive agreement for which the average hourly wage threshold has not been met or file a lawsuit to enforce the repayment provisions.
(e)(1) Eligible businesses whose qualification depends on deriving either fifty-one percent (51%) or seventy-five percent (75%) of their sales from out-of-state customers shall meet this requirement within three (3) years from the approval date of their financial incentive agreement.
(2)(A) If the requirement is not met within three (3) years of the approved financial incentive agreement, the qualified business may request, in writing, an extension of time to reach the required sales threshold.
(B) If the Executive Director finds that the qualified business has presented compelling reasons for an extension of time, the Executive Director may grant an extension of time not to exceed an additional two (2) years.
(f)(1) If a qualified business fails to meet the out-of-state sales requirements of this rule under the specified deadlines in the approved financial incentives agreement, the qualified business is liable for the repayment of all incentives previously received by the qualified business that were conditioned on the approved financial incentive agreement for which the sales threshold has not been met.
(2) If a qualified business fails to meet the out-of- state sales requirements, the DFA has two (2) years to collect incentives previously received by the qualified business that were conditioned on the approved financial incentive agreement for which the sales threshold has not been met or file a lawsuit to enforce the repayment provisions.
(g)(1) If a qualified business fails to notify the DFA that the annual payroll of the qualified business has fallen below the threshold for qualification for and retention of any incentive authorized by this rule, that qualified business will be liable for the repayment of all incentives which were paid to the qualified business and that were conditioned on the approved financial incentive agreement for which the payroll threshold has not been met after it no longer qualified for the incentives.
(2) If a qualified business fails to notify the DFA that the qualified business has fallen below the payroll threshold, the DFA has two (2) years to collect incentives previously received by the qualified business and that were conditioned on the approved financial incentive agreement for which the payroll threshold has not been met or file a lawsuit to enforce the repayment provisions.
(3) Interest shall also be due at the rate of ten percent (10%) per annum.
(h) The DFA may obtain whatever information is necessary from a participating qualified business and from the Division of Workforce Services to verify that a qualified business is complying with the terms of the financial incentive agreements and reporting accurate information concerning investments, payrolls, wages, and out-of-state revenues to the DFA. The DFA shall provide the information obtained to the Executive Director upon request.
(i) The DFA may file a lawsuit in the Circuit Court of Pulaski County, or the circuit court in any county where a qualified business is located, to enforce the repayment provisions of this rule.
(j)(1) If a qualified business fails to satisfy or maintain any other requirement or threshold of this rule; that qualified business is liable for the repayment of all incentives received after it no longer qualified.
(2) If a qualified business fails to comply with the requirements or thresholds of this rule, the DFA has two (2) years to collect incentives previously received by the qualified business for noncompliant financial incentive agreements or file a lawsuit to enforce the repayment provisions.
(k) If a repayment is required as a result of not complying with the requirements or thresholds of this rule, interest shall be due at the rate of ten percent (10%) per annum.

Credits

Amended Aug. 21, 2009; Sept. 21, 2011; Aug. 25, 2012; May 6, 2016; Sept. 28, 2017; May 2, 2022.
Current with amendments received through February 15, 2024. Some sections may be more current, see credit for details.
Ark. Admin. Code 003.19.9-V, AR ADC 003.19.9-V
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