Economic Bill Was Overdue (Editorial)

Arkansas’ new economic development bill became law in March. It’s something that should have been in place years ago, but at long last the state is on the right track.

Gov. Mike Huckabee said it will make Arkansas an even more attractive place to do business, and we agree. It certainly makes the state more competitive with neighboring states that often go after the same businesses and industries as Arkansas.

Even without the new incentives package, Arkansas has done fairly well in recent years. The state has landed some great companies: The Nestlé plant at Jonesboro, the Scholastic site at Maumelle, the Whirlpool expansion at Fort Smith, expansions at Superior Industries in Springdale and Heber Springs, and Raytheon at Little Rock, were all major job-creations. More than 12,000 jobs were created in the past two years.

Under Jim Pickens, the Arkansas Department of Economic Development has stepped up to compete with the nation’s best. He and the state made a good run at landing the Toyota truck assembly plant at Marion.

Here are some of the new law’s provisions:

• A job creation tax credit based on a company’s payroll rather than its average wage.

• A consolidated set of incentives for investment. The plan consolidates three existing investment-related incentives (the Arkansas Economic Development Act, InvestArk and the sales and use tax refund portion of Advantage Arkansas/EZ) and adds a sales and use tax refund opportunity for new, targeted businesses.

• A payroll rebate program similar to the current “Create Rebate” program.

• Income tax credits for research and development expenditures.

• Transferable income tax credits for new, targeted businesses.

Because of the publicity surrounding the highly sought-after Toyota plant, the super projects fund became a highly visible part of the governor’s plan and made the state more competitive in landing “the big one.”

We believe that very soon this measure will begin to bring in the kind of high-paying jobs that Arkansas needs. That will lead to a broader tax base and make for better schools and services — and a much better life for all Arkansans.