AR Code § 26-51-506 (2020)
2020 Arkansas Code|Title 26 - Taxation|Subtitle 5 - State Taxes|Chapter 51 - Income Taxes|Subchapter 5 - Tax Credits Generally|§ 26-51-506. Tax credit for waste reduction, reuse, or recycling equipment — Eligibility — Definitions

  (A)  The carry forward period for such tax credits under applicable law; or    (B)  The third taxable year following the year in which such tax credits were sold or transferred for value pursuant to this section.    (i)  Of a taxpayer that at the time of the agreement described in subdivision (b)(10)(D) of this section is a proprietorship, partnership, limited liability company, or other business organization treated as a proprietorship or partnership for tax purposes; and    (ii)  That, as of the end of the taxable year in which such tax credits are first allowed, does not have a public retirement system of the State of Arkansas as a proprietor, partner, member, or shareholder.    (i)  For a total investment in the qualified steel specialty products manufacturing facility of at least two hundred million dollars ($200,000,000) but less than two hundred seventy-five million dollars ($275,000,000), four million dollars ($4,000,000);    (ii)  For a total investment in the qualified steel specialty products manufacturing facility of at least two hundred seventy-five million dollars ($275,000,000) but less than three hundred fifty million dollars ($350,000,000), five million dollars ($5,000,000); and    (iii)  For a total investment in the qualified steel specialty products manufacturing facility of at least three hundred fifty million dollars ($350,000,000), six million five hundred thousand dollars ($6,500,000).    (ii)  The possession and control of the tax credits by the public retirement system under this subdivision (c)(3)(D) shall be confirmed in writing by a legal opinion issued by the department under the rules promulgated by the department.    (iii) (a)  The public retirement system shall sell or transfer for value the tax credits allowed under this section to the State of Arkansas for eighty percent (80%) of the face value, in lieu of the right of a proprietor, partner, member, shareholder, or beneficiary of the qualified expansion project or the qualified steel specialty products manufacturing facility to claim the tax credits as allowed pursuant to applicable state law.    (b)  Subject to the total recycling tax credit certification for a qualified expansion project, the maximum amount of tax credits allowed under the agreement between the taxpayer and the state, and the annual transfer by the Arkansas Economic Development Commission as agreed by the state and the taxpayer, no more than eleven million dollars ($11,000,000) of the tax credits in possession and control of the public retirement system with respect to a qualified expansion project under subdivision (c)(3)(D)(i) of this section may be sold or transferred each year.    (iv)  Any unused tax credit that cannot be sold or transferred in a tax year by the operation of subdivision (c)(3)(D)(iii) of this section may be carried forward as allowed by law. If a tax credit amount disallowed by operation of subdivision (c)(3)(D)(iii) of this section would otherwise expire, the carry-forward period for such unused tax credit shall instead be extended each year, for one (1) additional year at a time, to preserve the ability of the public retirement system to sell or transfer all unused tax credits in future years.    (v)  Beginning July 1, 2020, by July 15 of each year, the public retirement system with possession and control of the tax credits under this subdivision (c)(3)(D) shall provide notice to the department of the amount of tax credits, including tax credits expected to receive certification during the fiscal year by the Division of Environmental Quality, subject to the limitations in subdivision (c)(3)(D)(iii) of this section, to be sold or transferred for value.    (vi)  The State of Arkansas shall pay the purchase price equal to eighty percent (80%) of the face value of all of the tax credits included in the notice required in subdivision (c)(3)(D)(v) of this section on or before June 30 of the calendar year following the calendar year in which the notice was provided for all tax credits certified by the Division of Environmental Quality by June 30 of the calendar year following the calendar year in which the notice was provided by warrant from the Economic Development Incentive Fund funded by a transfer from general revenue.   (vii) (a) Tax credits under this section sold or transferred for value to the State of Arkansas are extinguished upon payment of the purchase price as if claimed against the tax imposed by the Income Tax Act of 1929, § 26-51-101 et seq.    (b)(1)  In the event the State of Arkansas fails to timely pay the purchase price, as required in subdivision (c)(3)(D)(vi) of this section, for the tax credits included in the notice required in subdivision (c)(3)(D)(v) of this section, the public retirement system may, before the end of the taxable year following the taxable year in which a failure to pay occurs, sell or transfer for value such tax credits to one (1) or more persons. Such person or persons may claim such tax credits in accordance with applicable law, provided however, any tax credits sold or transferred for value to such person or persons under this subdivision (c)(3)(D)(vii) (b) shall not expire before the later of the end of:    (2)  The sale or transfer of tax credits under this subdivision (c)(3)(D)(vii) (b) shall be confirmed in writing by a legal opinion issued by the department under the rules promulgated by the department.   (E) An expansion project or a manufacturing facility that does not meet the requirements to be a qualified expansion project or a qualified steel specialty products manufacturing facility is not subject to this subdivision (c)(3) and is eligible to receive the tax credits otherwise provided in this section and § 26-51-1215.    (F)(i) (a)  A tax credit under this subdivision (c)(3) shall not be authorized without:    (1)  A cost-benefit analysis, including an analysis of any other incentives offered by the State of Arkansas with request to the project subject to the tax credit, as certified by the Director of the Arkansas Economic Development Commission in consultation with the Chief Fiscal Officer of the State; and    (2)  The performance and claw back agreement required under subdivision (c)(3)(F)(ii) of this section.    (b)  The total amount of tax credits that may be authorized under this subdivision (c)(3) shall not exceed the amount determined by the cost-benefit analysis required under this section.    (ii) (a)(1)  A tax credit authorized under this subdivision (c)(3) shall be subject to a performance and claw back agreement between the taxpayer and the Arkansas Economic Development Commission.    (2)(A)  The performance and claw back agreement required under this subdivision (c)(3)(F)(ii) shall be subject to the approval of the Chief Fiscal Officer of the State to ensure that the cost-benefit analysis required under this section is met and maintained for a test period of the longer of the life of the tax credits or fourteen (14) years.    (B)  However, the test period described in this subdivision (c)(3)(F)(ii) shall not be longer than fifteen (15) years.    (b)  The performance and claw back agreement required under this subdivision (c)(3)(F)(ii) shall include without limitation the:    (1)  Capital investment for the project;    (2)  New full-time direct positions and independent direct positions as those terms are defined in Acts 2013, No. 1084, § 8, created by the project;