Arkansas Incentives and Laws

Arkansas Incentives and Laws

Last Updated November 2006 

State Incentives

Idle Reduction Technology Loans

The Arkansas Department of Environmental Quality has a small business loan program that provides low-interest loans to Arkansas small businesses to institute pollution control measures as required by state and federal law or to institute pollution prevention measures that reduce the amount of pollution produced by businesses. Idle reduction technologies for heavy-duty trucking applications are eligible for this loan. An eligible business must employ no more than 100 individuals and demonstrate proof of profitability and the ability to repay the loan.

Point of Contact

Angela Marsh
Loan Program
Arkansas Department of Environmental Quality
Phone (501) 682-0709 or (888) 233-0326
Fax (501) 682-0880
marsha@adeq.state.ar.us
http://www.adeq.state.ar.us/poa/envloans.htm
 

Biodiesel Tax Refund

A biodiesel supplier is entitled to a tax refund of $0.50 per gallon of biodiesel fuel used by the supplier to produce a biodiesel mixture that contains not more than two percent (2%) biodiesel and that is for sale by the supplier or for use by the supplier in a trade or business. In order to qualify for the tax refund, a supplier must meet the following requirements: 1) sign a financial incentive agreement with the Arkansas Department of Economic Development; 2) obtain approval from the Arkansas Alternative Fuels Commission and the Department of Finance and Administration as a biodiesel producer and have the production capacity to produce at least one million gallons of biodiesel in a 12-month period; and 3) certify that it will produce biodiesel fuel that meets the appropriate federal and state standards. This incentive expires June 30, 2007. (Reference Arkansas Code 15-4-2803)

Biodiesel Income Tax Credit

An income tax credit is available to biodiesel suppliers for up to 5% of the costs of the facilities and equipment used in the wholesale or retail distribution of biodiesel fuels. Additionally, the Alternative Fuels Commission may provide grants of up to $0.10 per gallon for the production of biodiesel, up to 5 million gallons per producer per year, for a period not to exceed five years. (Reference Arkansas Code 15-4-2803 and 15-4-2804)

Hybrid Electric Vehicle (HEV) Rebate

The HEV Rebate Program, administered by the Arkansas Energy Office, provides an incentive to state agencies to purchase new HEVs. The rebate is equivalent to the amount of the sales tax paid for the HEV, and a completed application must be submitted within six months of the delivery and registration of the vehicle. Qualified HEVs must have a hybrid drive train, regenerative breaking, and an energy storage device. Rebates are available on a first-come, first-served basis until available funds are exhausted; please check with the Energy Office for availability of funds prior to purchasing a vehicle.

Point of Contact

Chris Benson
Director
Arkansas Energy Office
Phone (800) 558-2633 or (501) 682-0865
Fax (501) 682-2703
cbenson@1800arkansas.com
http://www.1-800-arkansas.com/energy/index.cfm?page=transportation
 

Electric Vehicle (EV) Equipment and Fuel Cell Income Tax Credit

An income tax credit is available to Arkansas taxpayers for to offset the costs of an Arkansas-based facility which designs, develops, or produces advanced technologies including EV equipment and fuel cells. The credit is equal to 50% of the amount spent during the taxable year to purchase or construct the facility, including land acquisition, infrastructure improvements, renovation, building improvements, machinery, and other manufacturing equipment. This credit does not apply to any portion of facility costs which were provided by federal, state, or local grants. (Reference Arkansas Code 15-4-2104 and 15-4-2105)

State Laws and Regulations

Alternative Fuels Tax

Excise taxes on alternative fuels are imposed on a gasoline gallon equivalent basis. The tax rate for each type of alternative fuel is based on the number of motor vehicles licensed in the state that use each fuel type. (Reference Arkansas Code 26-62-201)

Natural Gas Metering

No user, including an alternative fuels supplier of natural gas fuels, who utilizes natural gas for residential or other tax-free purposes, is permitted to use natural gas fuels in motor vehicles unless the natural gas fuels are removed through a separate meter installed by the alternative fuels supplier for such purposes. (Reference Arkansas Code 26-62-203)

Liquefied Natural Gas (LNG) and Liquefied Petroleum Gas (LPG) User Permit

Any user of LNG or LPG as an alternative fuel in vehicles must apply for and obtain a liquefied gas special fuel user's permit for each vehicle owned and operating on LNG or LPG. Applications must be submitted to the Director of the Arkansas Department of Finance and Administration. (Reference Arkansas Code 26-56-304)

Liquefied Petroleum Gas (LPG) Tax

LPG as a motor fuel is taxed on a per vehicle basis through a yearly flat-fee special fuel user's permit. The amount of the fee is based on the vehicle's Gross Vehicle Weight Rating. (Reference Arkansas Code 26-56-301 and 26-56-304)

Alternative Fuel Vehicle (AFV) Conversion

Any individual or company who converts an AFV to operate on an alternative fuel must report the conversion to the Director of the Department of Finance and Administration within 10 days of the conversion. An owner or operator who fails to report such a conversion may be subject to a penalty. (Reference Arkansas Code 26-62-214)

Alternative Fuels Commission

The Arkansas Alternative Fuels Commission Act of 2003 established a seven-member alternative fuels commission to develop, coordinate, and promote the utilization of alternative fuels throughout the state, with emphasis on the production, development, promotion, and utilization of alternative fuels in transportation. The Commission is in charge of making grants and loans, and controls the Alternative Fuels Fund. (Reference Arkansas Code 15-10-601 and 15-10-701)

Utilities/Private Incentives

There are currently no known utility or private incentives offered in Arkansas

Arkansas Points of Contact: