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Committee approves amended data-center incentives bill with reporting clarifications
Summary
The committee adopted an amendment and passed a data-center bill that updates investment and payroll thresholds, lowers an investment trigger, requires positive cost-benefit analysis and clarifies handling of confidential documentation transferred to DFA for auditing.
The Revenue & Tax committee adopted an amendment and approved legislation updating the state's data-center tax-exemption framework, including investment and payroll thresholds and clarifying the use of confidential documentation when responsibilities move to the Department of Finance and Administration.
Paul Gehring of the Department of Finance and Administration explained the amendment adopted in committee clarifies that, where HB 1444 transfers review duties from the Department of Commerce to DFA, DFA may use taxpayer-provided documentation not only to confirm project and employment requirements but also for auditing and other lawful purposes. "This amendment clears up that confusion," Gehring told the committee.
Senator Dismaine (committee sponsor/presenter) outlined policy changes in the bill: it would require a qualified data-center investment of $2 billion within 10 years and $3 million in annual payroll (including contractors) to be eligible for certain incentives, lower a prior $500 million investment threshold down to $100 million for qualification in some cases, and retain a required positive cost-benefit analysis from the Arkansas Economic Development Commission. The measure also explicitly excludes cryptocurrency mining from the definition of eligible data centers.
Committee members were told the bill and amendment have no fiscal impact to the state. After adoption of the amendment, the committee approved the bill by voice vote.
DFA staff indicated that shifting review duties to DFA created a need to clarify limitations on use of confidential information previously applied when the Department of Commerce performed the function; the amendment allows DFA to use documentation for audit and other lawful purposes.
