Arkansas Administrative Code › Agency 168 - Arkansas Economic Development Commission › Rule 168.00.05-002 - Non-Profit Incentive Act

Current through Register Vol. 49, No. 6, June, 2024
I.
Introduction
The primary purpose of the Non-Profit Incentive Program is to
			 encourage the location or expansion of national or regional non-profit
			 headquarters in Arkansas. This incentive program may only be offered at the
			 discretion of the Director of the Department of Economic Development. Eligible
			 non-profit organizations must create a payroll for new full-time permanent
			 employees of at least one million dollars ($1,000,000) and pay an average wage
			 in excess of one hundred and ten percent (110%) of the state or county average
			 wage (whichever is less) in the county in which the organization locates or
			 expands. In addition, the non-profit must receive seventy-five percent (75%) of
			 its income from out-of-state sources.
For additional information contact:
Incentives Manager
Arkansas Department of Economic Development
One State Capitol Mall
Little Rock, AR 72201
(501) 682-5277
II.
Definitions
(a) "Average hourly wage" means the weekly
		  earnings, excluding overtime, bonuses, and company paid benefits, of all new
		  full-time permanent employees hired after the date of the signed financial
		  incentive agreement, divided by the number of new full-time permanent
		  employees, divided by forty (40);
(b) "County or state average hourly wage"
		  means the weighted average weekly earnings for Arkansans in all industries,
		  both statewide and county wide, as calculated by the Arkansas Employment
		  Security Department in their most recent Annual Covered Employment and Earnings
		  publication, divided by forty (40);
(c) "Department" means the Department of
		  Economic Development;
(d)
		  "Director" means the Director of the Department of Economic
		  Development;
(e) "Financial
		  incentive agreement" means an agreement entered into by an eligible non-profit
		  organization and the Department of Economic Development to provide the
		  organization an incentive to locate in Arkansas;
(f) "Governing authority" means the quorum
		  court of a county or the governing body of a municipality;
(g) "Income" means the monies received by a
		  non-profit organization for operations of the organization and shall include
		  donations, revenue from sales or memberships, grants or legislative
		  appropriations;
(h)
(1)
(A)
		  "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.
(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.
(2) Provided, however, in order to
		  qualify for the provisions of this act, a contractual employee must be offered
		  a benefits package comparable to a direct employee of the non-profit
		  organization seeking incentives under this subchapter;
(i) "Non-profit organization" means an entity
		  which has filed papers with and been approved by the Arkansas Secretary of
		  State as having met the qualifications for a non-profit organization in
		  Arkansas and which has also received a 501(c) designation from the United
		  States Internal Revenue Service prior to applying for the benefits afforded
		  under this subchapter;
(j)
		  "Payroll" means the total taxable wages, including overtime and bonuses, paid
		  during the preceding tax year of the eligible non-profit organization to new
		  fulltime permanent employees hired after the date of the signed financial
		  incentive agreement;
(k)
(1) "Project" means:
(A) Preconstruction costs, including project
		  planning costs, architectural/engineering fees, right-of-way purchases, utility
		  extensions, site preparations, purchase of mineral rights, building demolition,
		  builders risk insurance, capitalized start-up costs, deposits and process
		  payments on eligible machinery and equipment and other costs necessary to
		  prepare for the start of construction;
(B) Costs associated with the construction of
		  a new plant or facility; including, but not limited, to land, building,
		  production equipment or support infrastructure; or
(C) Costs associated with the expansion of an
		  established plant or facility by adding to the building, production equipment,
		  or support infrastructure; or
(D)
		  Cost associated with modernization of an established plant or facility through
		  the replacement of production or processing equipment or support infrastructure
		  that improves efficiency or productivity.
(2) "Project" does not include:
(A) Expenditures for routine repair and
		  maintenance that do not result in new construction or expansion;
(B) Routine operating expenditures;
		  or
(C) Expenditures incurred at
		  multiple facilities.
(3)
		  In order to receive credit for, or refunds related to project costs, the costs
		  must be incurred within four (4) years from the date the financial incentive
		  agreement was signed by the Department.
(l) "Project plan" means the plan submitted
		  to the Department containing such information as may be required by the
		  Director to determine eligibility for benefits. If approved, the project plan
		  becomes a supplement to the financial incentive agreement; and
(m) "Start of construction" means any
		  activity which causes a physical change to the building and/or property
		  identified as the site of the approved project, excluding engineering surveys,
		  soil tests, land clearing and extension of roads and utilities to the project
		  site.