SB386
To Repeal The Arkansas River Navigation System Fund; To Provide Additional Funding For The Arkansas Port, Intermodal, And Waterway Development Grant Program Fund; And To Create A Waterways Investment Income Tax Credit.
Last Action (May 1, 2023): Sine Die adjournment
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AI-Generated Summary
Senate Bill 386 amends Arkansas law regarding funding and tax incentives for water transportation infrastructure. The bill repeals the Arkansas River Navigation System Fund and consolidates funding toward the Arkansas Port, Intermodal, and Waterway Development Grant Program Fund. It establishes a new state income tax credit for taxpayers who invest in capital improvements related to water transportation, such as facility construction or rail/road access upgrades. The tax credit is capped at $2.5 million in total annual credits for all taxpayers, with individual credits limited to $3 million and subject to a 10% annual claim cap. The Department of Commerce must verify that the capital investment provides an economic benefit to the state equal to or greater than the credit amount. Taxpayers receiving other waterway grants are ineligible for this credit. Finally, the bill requires the Secretary of the Department of Finance and Administration to review and report on the economic impact of these tax credits in 2030 and 2035.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries include businesses and entities involved in water transportation, logistics, and port facility operations, as they are eligible for significant income tax credits to offset the costs of capital improvements. Additionally, entities receiving funding through the Arkansas Port, Intermodal, and Waterway Development Grant Program will benefit from the increased resources allocated to that fund.
Who Might Suffer?
The bill could be viewed as negatively impacting the state's general tax revenue base by providing tax credits that reduce the amount of income tax collected. Additionally, because the bill explicitly bars entities from receiving both the new tax credit and the Arkansas Port, Intermodal, and Waterway Development Grant Program funds, those that might have preferred the flexibility or immediate liquidity of a grant may be disadvantaged if they pursue the tax credit instead.
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