Senator Payton (District 22) opened an interim study of Arkansas’ waste‑tire program, describing repeated attempts to find efficiencies and long‑running funding shortfalls after district consolidations. Payton told the committee he filed a supplemental appropriation request for $5,000,000 to stabilize the program for approximately 18 months while the legislature considers longer‑term revenue options.

Industry and district witnesses said the program faces operational uncertainty because the $3 rim‑removal fee does not apply to all tires that eventually require collection, transport and processing. Robin Reed (Boston Mountain Regional Solid Waste Management District), administrator for a tire district, told the committee the $3 fee yields a net available revenue of about $2.31 per tire but that approved reimbursement rates exceed available funds by roughly $0.49–$0.59 per tire. Reed recommended a package of changes: fairly apply the existing $3 fee to new car tires (preliminary estimate: ~$12,000,000 in additional revenue, pending updated DFNA projections), restore the truck/tire fee to $5, remove the $1 used‑tire fee, permit volunteer collection centers more easily, allow districts to set an extra‑large (XL) tire fee capped at $30, and reimburse districts monthly rather than quarterly.

Private processors reinforced the shortfall argument and highlighted market dynamics. Philip Davis (Davis Rubber Company) said his company invested $500,000 in a new shredder, $300,000 in trailers and $200,000 in installation to fulfill a district 2 contract, expanded employment to about 25 workers, and reported a 93% recycling rate for Q3 2024 in his service counties. John Dillon (Liberty Tire Recycling) described national market variations and said roughly 30–40% of Arkansas’ system is underfunded relative to processing costs; he suggested models used in other states (state fee with private contracts, incentive grants for higher‑end products, county‑led RFP approaches) as possible options.

Committee members asked detailed operational questions about manifests, chain‑of‑custody, collection‑center staffing and whether manifesting prevents fraud. Witnesses said manifests create a chain of custody but that volunteer collection centers are a weak point; several said improving permitting and compensating collection centers could reduce leakage and ensure accurate manifests.

No formal appropriation was passed in committee. Payton and witnesses asked the legislature to consider applying the existing $3 fee to new tires and to examine options to increase net available revenue to the program. Committee staff requested copies of presentations and follow‑up financial projections.

The committee closed the interim‑study session and adjourned.