Established in 2023, the Natural State Initiative (NSI) Economic Opportunity Zones were created to encourage private investment and enhance the visitor experience at four Arkansas State Parks. In conjunction with this initiative, the Arkansas Tourism Development Incentive Program was amended to provide increased sales and income tax credits for businesses that open or expand within these designated zones.

Arkansas Tourism Development Act Rules

Arkansas Legislative Amendment

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Designated Zones

Each NSI Economic Opportunity Zone includes land within the park boundaries and an area extending one (1) mile immediately outside the park perimeter. The four designated zones are:

1. Pinnacle Mountain State Park
2. Petit Jean State Park
3. Delta Heritage Trail State Park
4. Queen Wilhelmina State Park

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Eligible Projects

Projects may qualify for incentives if they are:

• Located on privately owned land within a zone (as private ventures), or
• Located on State Park property and operated under a concessionaire agreement.

All projects must fall within the boundaries of a designated zone to be eligible.

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Incentives Available

Qualified projects may be eligible for sales tax credits and income tax credits under the Arkansas Tourism Development Incentive Program.

Sales Tax Credit

The percentage of sales tax credit is based on the project’s location and the county’s unemployment status:

• Low-Unemployment County:
  • 15% of eligible project costs
  • $150,000 minimum investment
• High-Unemployment County:
  • 25% of eligible project costs
  • $50,000 minimum investment

Additional details

• The credit applies to the business’s increased sales tax liability resulting from the project.
• The Arkansas Economic Development Commission (AEDC) may require additional review criteria to confirm the project aligns with the goals of the Act.

Counties designated as high-unemployment for FY 2025: Ashley, Chicot, Izard, Jackson, Lafayette, Lee, Montgomery, Mississippi, Phillips, and St. Francis.

Income Tax Credit

• 4% of total payroll for new full-time permanent employees for a period of five (5) years from the effective date of the agreement.
• Credits may be carried forward for up to nine (9) years.
• Payroll thresholds are determined by the current Arkansas Incentive Tier Map.

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Project Requirements

To qualify, each applicant must:

• Submit a completed application before incurring any project costs.
• Develop a marketing plan that targets at least 25% of visitors from out of state.
• Meet all additional requirements outlined in the program rules and legislation (see attachments).

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Contact

For more information, please contact Katherine Andrews.