§ 26-52-702 - Definitions.
26-52-702. Definitions.
As used in this subchapter:
(1) "Corporate headquarters" means the home or center of operations, including research and development, of a national or multinational corporation;
(2) "Defense industry project" means an investment of at least five million dollars ($5,000,000) and an increase in employment of at least two hundred fifty (250) full-time permanent employees by a company which manufactures components for the defense industry and whose unit cost exceeds five hundred thousand dollars ($500,000);
(3) "Distribution center" means a facility for the reception, storage, or shipping of:
(A) A business' own products which the business wholesales to retail businesses or ships to its own retail outlets;
(B) Products owned by other companies with which the business has contracts for storage and shipping if seventy-five percent (75%) of the sales revenue is from out-of-state customers; or
(C) Products for sale to the general public if seventy-five percent (75%) of the sales revenue is from out-of-state customers;
(4) "Eligible business" means a business eligible for sales and use tax credits under the provisions of this subchapter that has been in continuous operation in Arkansas for at least two (2) years prior to the initial application to the Director of the Arkansas Economic Development Commission, has obtained a direct-pay sales and use tax permit from the Revenue Division of the Department of Finance and Administration under the provisions of 26-52-509, and is classified as one (1) or more of the following types of businesses:
(A) Manufacturers classified in federal Standard Industrial Classification codes 20-39, including semiconductor and microelectronic manufacturers;
(B) (i) Computer businesses primarily engaged in providing computer programming services, the design and development of prepackaged software, businesses engaged in digital content production and preservation, computer processing and data preparation services, information retrieval services, and computer and data processing consultants and developers.
(ii) All businesses in this group must derive at least seventy-five percent (75%) of their revenue from out-of-state sales and have no retail sales to the public;
(C) (i) Businesses primarily engaged in motion picture production.
(ii) All businesses in this group must derive at least seventy-five percent (75%) of their revenue from out-of-state sales and have no retail sales to the public;
(D) Businesses primarily engaged in commercial physical and biological research as classified by Standard Industrial Classification code 8731;
(E) A distribution center with no retail sales to the general public, unless seventy-five percent (75%) of the sales revenue is from out-of-state customers;
(F) An office sector business with no retail sales to the general public;
(G) A corporate or regional headquarters with no retail sales to the general public; and
(H) A coal mining operation that employs twenty-five (25) or more net full-time permanent positions;
(5) "Modernization" means to increase efficiency or to increase productivity of the business through investment in machinery or equipment, or both, and shall not include costs for routine maintenance;
(6) "Office sector" means control centers that influence the environment in which data processing, customer service, credit accounting, telemarketing, claims processing, and other administrative functions that act as production centers;
(7) "Person" means a person as defined by 26-18-104;
(8) (A) "Project" means any construction, expansion, or modernization in Arkansas by an eligible business.
(B) The investment must exceed five million dollars ($5,000,000) or six million dollars ($6,000,000) for projects involving multiple locations within the State of Arkansas, including the cost of the land, buildings, and equipment used in the construction, expansion, or modernization and which construction, expansion, or modernization has been approved by the Arkansas Economic Development Commission as a construction, expansion, or modernization project which qualifies for the credit under the provisions of this subchapter;
(9) "Regional headquarters" means the center of operations for a specific geographic area; and
(10) "Routine maintenance" means the replacement of existing machinery parts with like parts.