15 CAR Part 147 — Rules for Funding Programs of the Division of Science and Technology of the Arkansas Economic Development Commission at Arkansas Code § 15-3-101 et seq

Chapter VIII

Subchapter B

Subpart 1

15 CAR § 147-101 Definitions {#sec-15-car-147-101 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-101}

15 CAR § 147-101. Definitions.

As used in this part:

(1) “AEDC” means the Arkansas Economic Development Commission;

(2) “Applied research” means any activity which seeks to utilize, synthesize, or apply existing knowledge, information, or resources to the resolution of a specific problem, question, or issue;

(3) “Basic research” means any original investigation for the advancement of scientific or technical knowledge;

(4) “Board” means the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission;

(5) “Business incubator” means a facility in which the success and growth of technology-based enterprises are fostered;

(6) “Center for applied technology” means a college or university or university-affiliated unit, or a consortium of such units, which conducts a continuing program of basic research and applied research, development, and technology transfer in one (1) or more technological areas in collaboration with and through the support of private enterprises;

(7) “Commercialization Committee” means a standing committee selected by the Chair of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission that shall review funding program applications and make funding recommendations to the Executive Director of the Arkansas Economic Development Commission in accordance with program-specific review criteria;

(8) “Deployment” means the effective transfer of knowledge, information, or resources from qualified applicants for the resolution of technology-based problems;

(9) “Director” means the Director of the Division of Science and Technology of the Arkansas Economic Development Commission;

(10) “Division of Science and Technology of the Arkansas Economic Development Commission” means the Arkansas Economic Development Commission division designated by the Executive Director of the Arkansas Economic Development Commission to administer funding programs of the Division of Science and Technology of the Arkansas Economic Development Commission authorized under Arkansas Code § 15-3-101 et seq.;

(11) “Enterprise” means a business with its principal place of business in Arkansas and which is or proposes to be engaged in this state in manufacturing, research and development, or the provision of services involving a significant amount of technology;

(12) “Executive director” means the Executive Director of the Arkansas Economic Development Commission;

(13) “External expert” means a representative, selected at the discretion of the Executive Director of the Arkansas Economic Development Commission, from state or federal government, academia, private industry, and/or the private sector who provides knowledge or experience useful in analysis and review of funding program applications of the Division of Science and Technology of the Arkansas Economic Development Commission in accordance with criteria defined under program-specific review criteria;

(14) “Facility” means any real property, personal property, or mixed property of any and every kind that can be used or that will be useful in securing or developing industry, including science and technology, including without limitation:

(A) Rights-of-way;

(B) Roads;

(C) Streets;

(D) Pipes;

(E) Pipelines;

(F) Reservoirs;

(G) Utilities;

(H) Materials;

(I) Equipment;

(J) Fixtures;

(K) Machinery;

(L) Furniture;

(M) Furnishing; and

(N) Instrumentalities;

(15) “Industry” means manufacturing facilities, warehouses, distribution facilities, repair and maintenance facilities, agricultural facilities, and corporate management offices for industry;

(16) “Initial capitalization” means financing that is provided for the development, refinement, or commercialization of a product or process and other working capital needs;

(17) “In-kind services” means scientific or technological equipment or suppliers, or both, release time, and indirect costs approved by the Arkansas Economic Development Commission;

(18) “Investment agreement” means a written agreement between the Arkansas Economic Development Commission and an enterprise or qualified applicant which stipulates the terms and conditions of a qualified security purchase by the Arkansas Economic Development Commission;

(19) “Machinery and equipment” means tangible personal property used in connection with a qualified education program or a qualified research program which has been approved for a tax credit under rules prescribed by the Department of Finance and Administration;

(20) “New” means machinery and equipment that is state-of-the-art machinery and equipment which has:

(A) Never been used except for normal testing by the manufacturer to ensure that the machinery or equipment is of a proper quality and in good working order; or

(B) Been used by the retailer or wholesaler solely for the purpose of demonstrating the product to customers for sale;

(21) “Principal place of business” means the physical location in this state where the eligible business maintains its principal business office;

(22) “Qualified applicant” means:

(A) Under the Technology Development Program, one (1) or more Arkansas-based inventors representing small businesses, colleges or universities, and federal laboratories engaged in innovation;

(B) Under the Technology Transfer Assistance Grant Program, one (1) or more technology transfer resource providers who possess or have the capability to identify and transfer innovative technology to provide a technical solution to a specific problem identified by an Arkansas-based enterprise; and

(C) Under the Basic Research and Applied Research Grant programs, a designated individual associated with an Arkansas-based college or university who enters into a contractual partnership with an industry to provide basic or applied research to stimulate the transfer of science and technology through the provision of matching services, equipment, or both;

(23) “Qualified security” means any:

(A) Note;

(B) Stock;

(C) Treasury stock bond;

(D) Debenture;

(E) Evidence of indebtedness;

(F) Certificate of interest or participation in any profit-sharing agreement;

(G) Preorganization certificate or subscription;

(H) Transferable share;

(I) Investment contract;

(J) Certificate of deposit for a security;

(K) Certificate of interest or participation in a patent or application therefore, or in royalty or other payments under such a patent or application; or

(L) In general, any interest or instrument commonly known as a security or any certificate for, receipt for, guarantee of, or option, warrant, or right to subscribe to or purchase any of the foregoing, provided that in the valuation of qualified security, no value shall be placed on in-kind services;

(24) “Qualified technology” means a technical or science-based product or process;

(25) “Research Committee” means a standing committee selected by the Chair of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission that shall review Basic Research Grant Program and Applied Research Grant Program applications and make funding recommendations to the Executive Director of the Arkansas Economic Development Commission in accordance with program-specific review criteria;

(26) “Royalty agreement” means a written agreement between the Arkansas Economic Development Commission (licensor) and an enterprise or qualified applicant, or both (licensee), specifying the conditions by which payments shall be made by the licensee to the licensor as a percentage of the revenues obtained using the investments made by the licensor to the licensee to commercialize a product, process, or both;

(27) “Scientific and technological project” means a project undertaken in Arkansas by an enterprise, which project the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission shall have determined promotes the purposes of science and technology as defined under Arkansas Code § 15-3-101 et seq.;

(28) “Technology development” means the evolution of innovative products and processes through the following stages:

(A) The laboratory/workshop stage of development, usually before a working prototype is developed, during which evaluation and protection of the idea are paramount and a market application is identified;

(B) The workshop/early startup stage of development during which the production and testing of a working prototype are paramount; and

(C) The late startup/setup stage of development during which limited production and market testing of products are paramount;

(29) “Technology transfer” means the match, deployment, or implementation of innovative knowledge, information, or resources from a technology transfer resource provider to an enterprise for the resolution of technology-based problems, issues, or concerns; and

(30) “Technology transfer resource provider” means any public or private Arkansas-based enterprise, college or university, or laboratory that has the capability to identify and transfer innovative technology.

Subpart 2

15 CAR § 147-201 Introduction {#sec-15-car-147-201 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-201}

15 CAR § 147-201. Introduction.

The following programs, established in accordance with the authority granted above, are governed by this part.

15 CAR § 147-202 Seed Capital Investment Program (SCIP) {#sec-15-car-147-202 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-202}

15 CAR § 147-202. Seed Capital Investment Program (SCIP).

(a) Purpose.

(1) The purpose of the Seed Capital Investment Program (SCIP) is to foster the formation and development of innovative, technology-based enterprises that will:

(A) Stimulate the economy of Arkansas by creating high-wage employment;

(B) Leverage private investment;

(C) Increase tax revenues; and

(D) Advance the benefits and opportunities realized through advanced science and technology.

(2) SCIP funds may be used by the Arkansas Economic Development Commission to purchase qualified securities issued by Arkansas-based enterprises seeking initial capitalization of scientific and technological projects.

(3) SCIP investments shall be in the form of the following qualified securities including without limitation:

(A) Debt financing;

(B) Equity financing;

(C) Royalty participation;

(D) Stock appreciation; or

(E) A combination of such financing arrangements.

(b) Eligibility requirements. Enterprise eligibility requirements include the following:

(1) The enterprise’s principal place of business is in Arkansas;

(2) The project of the enterprise shall:

(A) Be scientific or technological, or both, in nature; and

(B) Promote the purpose of the commission by providing scientific and technological benefits to Arkansas;

(3) The enterprise shall complete the application submittal process delineated in subsection (c) of this section; and

(4) Not more than five hundred thousand dollars ($500,000) shall be invested by the commission in the qualified securities of any one (1) enterprise.

(c) Application submittal process.

(1) Applicants for SCIP funds shall submit one (1) completed signed application, using forms provided by the commission, and may be subject to:

(A) An interview;

(B) A site visit; or

(C) Both.

(2) Applications shall include:

(A) The legal name, address, North American Industry Classification System classification, and business filing status of the enterprise;

(B) The names and contact information of professional staff affiliated with the enterprise;

(C) A list of key officers, owners, and personnel, including senior technical staff (attach resumes);

(D) Source or sources, amount or amounts, and anticipated use or uses of commission and non-commission funds;

(E) A brief description of the business enterprise;

(F) A brief description of the project, including the technology involved, for which funds are requested;

(G) An explanation of the enterprise’s stage of development in relation to the project;

(H) A statement of anticipated economic impact including the number, location, occupational classification, and compensation of jobs to be created;

(I) A business plan, including a description of the enterprise and its:

(i) Background;

(ii) Management;

(iii) Product or products; and

(iv) Market or markets; and

(J) Other information as requested by the commission.

(d) Application review and approval process. No financial commitment or approval shall be made by the Executive Director of the Arkansas Economic Development Commission to an applicant until the applicant has completed the following review and approval process:

(1)(A) All applications will be evaluated by Division of Science and Technology of the Arkansas Economic Development Commission staff for completeness and for the potential to effectuate the formation and development of innovative, science- or technology-based enterprises that will stimulate the economy of Arkansas through increased high-wage employment and leveraging of private investment.

(B) Review criteria include, without limitation:

(i) The application is signed and complete in accordance with subsection (c) of this section;

(ii) Investment proceeds will be used to cover the initial capitalization needs of the enterprise;

(iii) Evidence has been provided showing that the enterprise has a reasonable chance of success;

(iv) The enterprise shall be able to demonstrate that it has been unable to secure sufficient capital from traditional sources on terms that would enhance the success of the enterprise;

(v) The enterprise has the reasonable potential to create a substantial amount of primary employment within the state;

(vi) The entrepreneur and other founders of the enterprise have already made or are contractually committed to make substantial financial and time commitments to the enterprise;

(vii) The securities offered by the enterprise to the commission for purchase are qualified securities;

(viii) There shall be evidence showing a reasonable possibility that the commission will recoup at least its initial investment;

(ix)(a) A binding commitment has been made by the enterprise to report financial data to the commission.

(b) Commitments shall include a requirement for an annual or other periodic audit of the books of the enterprise, and for such control on the part of the commission as the executive director shall consider prudent over the management of the enterprise, including, at the discretion of the executive director and without limitation, the right of access to financial and other records of the enterprise; and

(x) Other criteria as determined by the executive director;

(2) Applicants may be subject to an interview, a site visit, or both, during the application review process;

(3) Division staff shall prepare a project summary of each project reviewed in accordance with criteria listed in subdivision (d)(1) of this section;

(4) Optional step. The executive director may request an independent review of the application, including the technology employed by the applicant, by an external expert or external experts in accordance with 15 CAR § 147-301;

(5) Optional step.

(A) The executive director may request division staff to submit project summaries to the Commercialization Committee of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission (Commercialization Committee) for review.

(B) If so requested:

(i) The Commercialization Committee will review projects in accordance with program rules;

(ii) Applicants may be invited to present their projects before the Commercialization Committee;

(iii) The Commercialization Committee may ask applicants for additional information before recommending projects for funding;

(iv) Projects receiving Commercialization Committee support will be forwarded to the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission for review; and

(v) The board will vote, by simple majority, to determine whether or not to recommend project funding;

(6) Division staff will prepare a resolution for funding for each project recommended for funding and distribute for signatures;

(7) For projects recommended by the Commercialization Committee, the secretary of the board will sign the resolution for funding and forward to the executive director;

(8)(A) The executive director, or his or her designee, after reviewing all recommendations, will sign resolutions for funding for approved projects.

(B) Unsuccessful applicants will be notified in writing by division staff.

(C) Approved applicants will be required to execute a written investment agreement outlining the amount, terms, and conditions of the qualified security purchase prior to receiving funds; and

(9) Funds shall be disbursed to enterprises in accordance with terms and conditions of the investment agreement.

15 CAR § 147-203 Technology Development Program (TDP) {#sec-15-car-147-203 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-203}

15 CAR § 147-203. Technology Development Program (TDP).

(a) Purpose.

(1) The purpose of the Technology Development Program (TDP) is to assist in commercializing new, technology-based products and processes created or developed by inventors, businesses, Arkansas-based colleges or universities, and federal laboratories located in Arkansas.

(2) The program is intended to provide flexible bridge financing in the form of grants of up to one hundred thousand dollars ($100,000) for projects to develop qualified technologies.

(b) Eligibility requirements. Applicant eligibility requirements include the following:

(1) The qualified applicant’s principal place of business is in Arkansas;

(2) The proposed TDP project shall promote the benefits of science and advanced technology to the State of Arkansas and its citizens by commercializing new products and processes;

(3) The application is complete and has been submitted by a qualified applicant;

(4) The applicant shall submit a well-developed and defined project plan in accordance with requirements of subsection (c) of this section; and

(5) A nonpublic applicant shall submit a nonrefundable fee, via check, of one dollar ($1.00) with the preliminary application.

(c) Application submittal process.

(1) Applicants for TDP funds shall submit one (1) completed signed application and, if a nonpublic applicant, a nonrefundable fee of one dollar ($1.00), under forms provided by the Division of Science and Technology of the Arkansas Economic Development Commission, and may be subject to:

(A) An interview;

(B) A site visit; or

(C) Both.

(2) Applications shall include the following information:

(A) The legal name, address, North American Industry Classification System classification, and business filing status of the qualified applicant;

(B) The names and contact information of professional staff affiliated with the enterprise;

(C) A list of key officers, owners, and personnel, including senior technical staff (attach resumes);

(D) Source or sources, amount or amounts, and anticipated use or uses of Arkansas Economic Development Commission funds and non-commission funds;

(E) A brief description of the project, including the technology involved, for which funds are requested;

(F) An explanation of the business’s stage of development in relation to the project;

(G) A statement of anticipated economic impact including the number, location, occupational classification, and compensation of jobs to be created;

(H) A business plan, including a description of the business and its:

(i) Background;

(ii) Management;

(iii) Product or products; and

(iv) Service or services; and

(I) Other information as requested by the commission.

(3) Applications shall also include a well-developed and defined project plan, showing progression from idea to prototype to production, which includes the following:

(A) A description of the proposed:

(i) Product;

(ii) Process; or

(iii) Technical innovation;

(B) An assessment (if applicable) of previous research and development efforts that strengthens technical claims;

(C) Potential sources of prototype development;

(D) A description of any known barriers to production of the product (e.g., process, materials, safety, or environment);

(E) A description of the product to be commercialized, including potential manufacturers, distributors, niche markets, etc.;

(F) A description of the implementation plan for the accomplishment of the project, including a:

(i) Timetable;

(ii) Narrative description of the use of funds; and

(iii) Listing of any required supporting facilities, equipment, and personnel;

(G) The budget for the proposed project period;

(H) A description of the qualifications of key personnel including resumes;

(I) A statement of economic impact, including without limitation:

(i) Potential job creation;

(ii) Export potential; or

(iii) Value added to existing products; and

(J) A description of all methods used to protect intellectual properties including disclosure documents, patents, trademarks, copyrights, etc.

(d) Application review and approval process. No financial commitment or approval shall be made by the Executive Director of the Arkansas Economic Development Commission until a qualified applicant has completed the following review and approval process:

(1) Division staff will evaluate applications for completeness based on the following five (5) factors:

(A) Technical feasibility:

(i) Is there a sufficient description of the proposed product, process, or innovation to derive a sound technical evaluation;

(ii) Is the invention based upon scientific principles;

(iii) Is there previous research or development that substantiates the technical feasibility;

(iv) Does it require redesign, rebuilding, or further testing; and

(v) How is the project technically innovative;

(B) Production feasibility:

(i) Can it be produced economically and in sufficient quantities using existing production technology;

(ii) Can it be produced safely, meeting legal, liability, product infringement, and pollution guidelines; and

(iii) How many sources are willing to produce it;

(C) Commercial feasibility:

(i) What specific customer needs does the product or process satisfy;

(ii) Will the market support the project;

(iii) Who is the competition;

(iv) Does the product, process, or innovation provide a competitive edge;

(v) Is there adequate financial support;

(vi) Does the budget support the implementation plan;

(vii) Is the commercialization plan valid; and

(viii) Can key personnel support the project;

(D) Economic potential:

(i) Will the project impact Arkansas’s economy;

(ii) Does the project have job creation potential;

(iii) Does the technology add value to existing products; and

(iv) Can the technology be exported; and

(E) Patentability:

(i) Has a patent been applied for;

(ii) Have similar patents been granted; and

(iii) Can the concept be protected with a patent;

(2) Applicants may be subject to an interview, a site visit, or both, during the application review process;

(3) Division staff shall prepare a project summary of each project reviewed in accordance with criteria listed in subdivision (d)(1) of this section;

(4) Optional step. The executive director may request an independent review of the application, including the technology employed by the applicant, by an external expert or external experts in accordance with 15 CAR § 147-301;

(5) Optional step.

(A) The executive director may request division staff to submit project summaries to the Commercialization Committee of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission for review.

(B) If so requested:

(i) The Commercialization Committee will review projects in accordance with program rules;

(ii) Applicants may be invited to present their projects before the Commercialization Committee;

(iii) The Commercialization Committee may ask applicants for additional information before recommending projects for funding;

(iv) Projects receiving Commercialization Committee support will be forwarded to the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission for review; and

(v) The board will vote, by simple majority, to determine whether or not to recommend project funding;

(6) Division staff will prepare a resolution for funding for each project recommended for funding and distribute for signatures;

(7) For projects recommended by the Commercialization Committee, the secretary of the board will sign the resolution for funding and forward to the executive director;

(8)(A) The executive director, or his or her designee, after reviewing all recommendations, will sign resolutions for funding for approved projects.

(B) Unsuccessful applicants will be notified in writing by division staff.

(C) Approved applicants will be required to execute a written agreement outlining the amount, terms, and conditions of the funding, in the form of a royalty agreement, prior to receiving funds; and

(9) Funds shall be disbursed to approved applicants in accordance with terms and conditions of the royalty agreement.

15 CAR § 147-204 Technology Transfer Assistance Grant Program (TTAG) {#sec-15-car-147-204 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-204}

15 CAR § 147-204. Technology Transfer Assistance Grant Program (TTAG).

(a) Purpose.

(1) The purpose of the Technology Transfer Assistance Grant (TTAG) Program is to increase Arkansas industry’s competitiveness through technical and operational advancements by providing funds for the transfer, deployment, or both, of innovative technology to Arkansas-based enterprises to resolve identified technology-based, industry-driven problems, issues, or concerns.

(2) TTAG is intended to provide financing that allows a business’s specific technology to better compete for funding from other Division of Science and Technology of the Arkansas Economic Development Commission programs.

(3)(A) TTAG funds may be used to fund costs associated with:

(i) Engineering or technical support fees;

(ii) Database searches;

(iii) Travel;

(iv) Responses/cash matches to the Small Business Innovation Research Program or the Small Business Technology Transfer Program; and

(v) Other costs decided on a case-by-case basis.

(B) TTAG funds are generally not approved to purchase fixed assets or training.

(4) Maximum Arkansas Economic Development Commission funding per project shall not exceed three thousand seven hundred fifty dollars ($3,750) based on the following:

(A) First two thousand five hundred dollars ($2,500) of project costs; and

(B) Additional amount up to one thousand two hundred fifty dollars ($1,250) based upon a fifty-fifty (50-50) match with the enterprise assisted with TTAG funds for the next two thousand five hundred dollars ($2,500) of project costs.

(5)(A) All costs in excess of five thousand dollars ($5,000) shall be assumed by the assisted enterprise.

(B) However, additional TTAG funds may be awarded at the discretion of the Executive Director of the Arkansas Economic Development Commission.

(6) Unlike most division programs, qualified applicants are technology transfer resource providers approved by the division.

(b) Eligibility requirements.

(1) Applicant eligibility requirements include the following.

(2) Applications will be evaluated based upon the following criteria:

(A) The application is complete and has been submitted by one (1) or more qualified applicants (technology transfer resource providers);

(B) The enterprise being assisted by the applicant or applicants is a business with its principal place of business in Arkansas;

(C) The purpose of the project is to promote the benefits of science and advanced technology to Arkansans by identifying and transferring innovative technology to resolve a specific problem, issue, or concern of an Arkansas-based enterprise; and

(D)(i) Not more than three thousand seven hundred fifty dollars ($3,750) (with appropriate enterprise matching funds) is being requested from the commission.

(ii) An enterprise may receive only two (2) TTAG awards in any one (1) state fiscal year.

(c) Application submittal process.

(1) Applicants for TTAG funds shall submit one (1) completed signed application, using forms provided by the division, and may be subject to:

(A) An interview;

(B) A site visit; or

(C) Both.

(2) Applications shall include:

(A) The legal name, address, phone number, and North American Industry Classification System classification of the enterprise being assisted by the technology transfer resource provider;

(B) The name or names, title or titles, and contact information of professional staff affiliated with the enterprise;

(C) The legal name of the technology transfer resource provider;

(D) The name or names, title or titles, and contact information of professional staff affiliated with the technology transfer resource provider;

(E) The area of technology covered in the application;

(F) A brief description of the business and competitive challenges facing the business enterprise;

(G) A brief description of the specific problem and anticipated solution to the project to be addressed;

(H) A description of how the technology transfer resource provider will implement the solution to the problem;

(I) A description of how the business enterprise will maintain the solution after implementation;

(J) A listing of specific tasks to be performed by the project participants;

(K) The anticipated financial impact of the project; and

(L) Any other information as requested by the commission.

(d) Application review and approval process. No financial commitment or approval shall be made by the executive director until the qualified applicant has completed the following review and approval process:

(1)(A) All applications will be evaluated by the commission’s TTAG Review Committee for completeness and for the potential to identify and transfer innovative technology to solve a specific technology-based problem, issue, or concern of an Arkansas-based enterprise.

(B) Review criteria include, without limitation:

(i) The application is complete;

(ii) The qualified applicant and the associated enterprise shall have the support and resources available to ensure a reasonable probability of project success given that a transfer of appropriate technology occurs;

(iii) The qualified applicant or the division shall be able to locate appropriate technology transfer resources willing to assist with the project;

(iv)(a) The proposed technology transfer project shall be technically feasible.

(b) The transfer of technology shall:

(1) Improve the enterprise’s technical competitiveness, operational competitiveness, or both; and

(2) Add value to new or existing products, processes, or services;

(v)(a) The proposed technology transfer project shall have commercial feasibility potential.

(b) The transfer of technology should provide the enterprise with the ability to compete more effectively in the marketplace; and

(vi) The project shall have a time frame of no longer than ninety (90) days;

(2) Applicants may be subject to an interview, a site visit, or both, during the application review process;

(3) The commission may request an independent review of the application, including the technology employed by the applicant, by an external expert or external experts in accordance with 15 CAR § 147-301;

(4)(A) The executive director, or his or her designee, after reviewing the TTAG Review Committee’s recommendations, will specify which applicants may receive funding.

(B) Unsuccessful applicants will be notified in writing by division staff.

(C) Approved applicants will be required to execute a written agreement outlining the amount, terms, and conditions of the funding; and

(5) Division staff shall provide a list of projects funded with TTAG funds to the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission.

15 CAR § 147-205 Basic Research and Applied Research Grant Programs {#sec-15-car-147-205 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-205}

15 CAR § 147-205. Basic Research and Applied Research Grant Programs.

(a) Purpose.

(1) Basic Research Grant Program.

(A) The Basic Research Grant Program provides matching grant funds to:

(i) Help promote and support the growth and development of scientists working in Arkansas; and

(ii) Enhance the status of science and technology in Arkansas-based colleges and universities by funding basic research.

(B)(i) The Arkansas Economic Development Commission may fund up to sixty percent (60%) of the total cost of the basic research project being funded.

(ii) Remaining project costs shall be funded with cash or in-kind services provided by the college or university proposing the research project.

(2) Applied Research Grant Program.

(A)(i) The Applied Research Grant Program provides matching grant funds to help create applied research partnerships between private industry and Arkansas-based colleges and universities to stimulate the transfer of science and technology.

(ii) Private industry match may be in the form of cash or new machinery and equipment.

(B)(i) The commission may fund up to fifty percent (50%) of the total cost of the applied research project being funded.

(ii)(a) Remaining project costs shall be funded with cash or new machinery and equipment provided by a business or industry cosponsoring the project.

(b) However, the commission may fund up to sixty-six and two-thirds percent (66 2/3%) of the applied research project if the participating private industry is principally located in Arkansas and employs up to fifty (50) persons.

(iii) The commission will approve for funding only those applied research projects which are likely to enhance employment opportunity within Arkansas.

(b) Eligibility requirements.

(1) Applicant eligibility requirements include the following.

(2) Applications will be evaluated based upon the following criteria:

(A) The application is complete and has been submitted by a qualified applicant in accordance with established deadlines;

(B)(i) The purpose of the project is to promote the benefits of science and advanced technology to Arkansans by addressing an area of either basic or advanced research.

(ii) Basic research projects shall establish or build upon an established institutional base of research capability and result in permanent and significant enhancement of the institution’s research capabilities; and

(C) The Arkansas-based college or university has committed to provide the requisite match for the research program for which the applicant is applying.

(c) Application submittal process. Potential applicants for Basic Research Program and Applied Research Program grant funds shall submit one (1) completed, signed, and dated application, using forms provided by the Division of Science and Technology of the Arkansas Economic Development Commission, and may be subject to an interview, a site visit, or both, during the application review process.

(d) Application review and approval process.

(1)(A) All applications will be evaluated by division staff for completeness and for the potential to enhance research at Arkansas-based colleges and universities.

(B) No financial commitment shall be made by the Executive Director of the Arkansas Economic Development Commission to an applicant until the applicant has completed the following review and approval process.

(2) Applications shall consist of the following documents:

(A) A project summary and cover sheet;

(B) The name of the college or university applying for research funds;

(C) The names, titles, addresses, and telephone numbers of the principal investigator and the institutional contract officer;

(D) The title and technical abstract of the project proposal;

(E) The amount of funds requested from the commission;

(F) A statement of how the specific objectives of the project relate to commission research program objectives;

(G) A review of the literature pertinent to the proposed research, including an assessment of previous research efforts;

(H) A clearly-described implementation plan for the accomplishment of the project including:

(i) A description of the proposed activities, including experimental design and methods;

(ii) A timetable; and

(iii) Information detailing the availability of support facilities, equipment, and personnel necessary for the attainment of the project’s objectives;

(I) A detailed budget for the current and upcoming fiscal years including:

(i) Personnel;

(ii) Fringe benefits;

(iii) Equipment;

(iv) Supplies;

(v) Travel;

(vi) Indirect costs; and

(vii) Support;

(J) A statement and letters of commitment detailing the source and amount of the required matching funds;

(K) A statement of plans for future support of the research from sources other than the commission including identification of anticipated funding sources and likely titles of the proposals to be submitted;

(L)(i) A description of the qualifications of the personnel to be involved in the proposed project.

(ii) Information shall include:

(a) Academic credentials of key professionals;

(b) A list of recent publications in accepted professional journals; and

(c) A record of past and current grant support received; and

(M)(i) Acknowledgment that a final summary report will be submitted to the division within sixty (60) days after project completion.

(ii) The report shall include:

(a) A topic sentence restating the project’s major thesis;

(b) The primary objectives and scope of the project;

(c) The techniques or approaches used;

(d) A concise statement of findings and implications; and

(e) Other information as requested by the division.

(3) Projects shall meet the following administrative, technical, and scientific criteria:

(A) The scientific merit of the proposal, including the quality and importance of the proposed research and the suggested research procedures;

(B) The competence of the professional personnel involved in the project as evidenced by relevant academic training, research, and publications;

(C) The availability of administrative support and resources necessary to ensure a reasonable probability of project success;

(D) The soundness of the implementation plan and the likelihood that the project objectives will be achieved;

(E) The potential of the project to attract support from third-party sources; and

(F) The overall probability of success of the proposed project.

(4) Applications for Applied Research Program Grant funds shall meet the following additional fiscal criteria:

(A) The commercial feasibility of the proposed research;

(B) The capacity of the proposed project to enhance employment opportunities in Arkansas; and

(C) The capacity of the project to attract private investment.

(5) Applicants may be subject to an interview, a site visit, or both, during the application review process.

(6) Division staff shall prepare a project summary of each project reviewed in accordance with criteria listed in this subsection (d).

(7) Optional step. The executive director may request an independent review of the application, including the technology employed by the applicant, by an external expert or external experts in accordance with 15 CAR § 147-301.

(8) Optional step.

(A) The executive director may request division staff to submit project summaries to the Research Committee of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission (Research Committee) for review.

(B) If so requested:

(i) The Research Committee will review projects in accordance with program rules;

(ii) Applicants may be invited to present their projects before the Research Committee;

(iii) The Research Committee may ask applicants for additional information before recommending projects for funding;

(iv) Projects receiving Research Committee support will be reviewed by the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission; and

(v) The board will vote, by simple majority, to determine whether or not to recommend project funding.

(9) Division staff will prepare a resolution for funding for each project recommended for funding and distribute for signatures.

(10) For projects recommended by the Research Committee, the secretary of the board will sign the resolution for funding and forward to the executive director.

(11)(A) The executive director, or his or her designee, after reviewing all recommendations, will sign resolutions for funding for approved projects.

(B) Unsuccessful applicants will be notified in writing by division staff.

(C) Approved applicants will be required to execute a written agreement outlining the amount, terms, and conditions of the funding.

15 CAR § 147-206 Business Incubator Program {#sec-15-car-147-206 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-206}

15 CAR § 147-206. Business Incubator Program.

(a) Purpose.

(1)(A) The purpose of the Business Incubator Program is to enhance economic development by stimulating technological innovation and fostering the growth of technology-based enterprises to create new employment opportunities for Arkansans through the establishment of Arkansas-based college and university incubators.

(B) The intent of the program is to create an entrepreneurial and technological environment drawing upon a diversity of business enterprises which will stimulate the innovation process and result in economic benefits to Arkansans.

(2) Applications for funding should emphasize:

(A) Innovation;

(B) Entrepreneurial engagement;

(C) Leveraging of private capital to the greatest extent possible; and

(D) Local business support.

(b) Eligibility requirements.

(1) Applicant eligibility requirements include the following.

(2) Applications will be evaluated based upon the following criteria:

(A) The application is complete and has been submitted by an Arkansas-based state college or university that is supported by general revenue appropriations from the General Assembly;

(B) The project shall propose the creation of a facility to locate a business incubator; and

(C)(i) The proposed project shall create an environment that fosters the success and growth of technology-based enterprises which contribute to the state’s economic development.

(ii) Such an environment might involve the presence of well-established technology businesses and nontechnology supportive businesses.

(c) Application submittal process.

(1) Potential applicants for Business Incubator Program funds:

(A) Shall submit one (1) completed signed application using forms provided by the Division of Science and Technology of the Arkansas Economic Development Commission; and

(B) May be subject to an interview, a site visit, or both, during the application review process.

(2) Applications shall consist of the following documents:

(A) The name and address of the college or university applying for funds;

(B) The name, title, address, and telephone number of the contract official;

(C) The title and description of the proposed project, including:

(i) An explanation of how the incubator addresses local economic development needs;

(ii) The incubator’s concept;

(iii) The objectives of the proposed project; and

(iv) The anticipated public benefits of the incubator project;

(D) A discussion of the proposed business incubator facility operations, including without limitation:

(i) Any entrance and graduation requirements of incubator tenants;

(ii) A discussion of how the project proposes to establish an environment which stimulates innovation and economic development;

(iii) A list of the basic services to be provided to incubator tenants, including technological and managerial assistance;

(iv) A discussion of how the local business community will support the incubator efforts; and

(v) An explanation of the incubator facility’s governance;

(E) A list of any cooperating institutions;

(F) A statement of any other financial resources, including private funds that will be used during the project and afterwards for continuous operation;

(G) A list of key project personnel including their:

(i) Education;

(ii) Related experience; and

(iii) Biographic information;

(H) A list of proposed agreements with consultants who may develop or manage the incubator facilities;

(I) Source or sources, amount or amounts, and anticipated use or uses of Arkansas Economic Development Commission funds and non-commission funds;

(J) A timetable showing major milestones for completing the project and the overall project duration; and

(K) Any other information required by the commission.

(d) Application review and approval process. No financial commitment shall be made by the Executive Director of the Arkansas Economic Development Commission to an applicant until the applicant has completed the following review and approval process:

(1)(A) All applications will be evaluated by division staff for completeness and adherence to eligibility criteria.

(B) Review criteria include, but are not limited to:

(i) Completeness of the application;

(ii) The comprehensiveness of the proposed project;

(iii) The cost-effectiveness of the proposed project;

(iv) The qualifications of the key project personnel;

(v) The anticipated public benefits of the proposed project;

(vi) The overall merit of the proposal; and

(vii) The potential of the project to assist the division in carrying out its mission to bring the benefits of science and technology to Arkansans;

(2) Applicants may be subject to an interview, a site visit, or both, during the application review process;

(3) The commission may request an independent review of the application, including the technology employed by the applicant, by an external expert or external experts in accordance with 15 CAR § 147-301;

(4) Division staff will provide a project summary to the Commercialization Committee of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission for each project reviewed;

(5)(A) All applications will be reviewed by the Commercialization Committee in accordance with program rules.

(B) Prior to final approval:

(i) Applicants may be asked to present their projects before the Commercialization Committee; and

(ii) The Commercialization Committee may ask applicants for additional information before recommending projects for funding;

(6) Projects receiving Commercialization Committee support will be reviewed by the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission;

(7) If the board votes, by simple majority, to approve the application for funding, division staff will prepare a resolution for funding for signature by the secretary of the board and the executive director; and

(8)(A) The executive director, after reviewing board recommendations, will specify which applicants may receive funding.

(B) Unsuccessful applicants will be notified in writing by division staff.

(C) Approved applicants will be required to execute a written agreement outlining the amount, terms, and conditions of the funding.

15 CAR § 147-207 Centers for Applied Technology Program {#sec-15-car-147-207 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-207}

15 CAR § 147-207. Centers for Applied Technology Program.

(a) Purpose.

(1) The purpose of the Centers for Applied Technology (CAT) Program is to encourage greater collaboration between private enterprises and Arkansas-based colleges and universities in the development and application of new technologies.

(2) This is effectuated through identifying, designating, and funding centers in technological areas with significant potential for economic growth and development in Arkansas, or in or within which the application of new technologies could significantly enhance the productivity and stability of Arkansas enterprises.

(b) Eligibility requirements.

(1) Applicant eligibility requirements include the following.

(2) Applications will be evaluated based upon the following criteria:

(A) The application is complete and has been submitted by a state-supported or independent, not-for-profit, Arkansas-based state college or university that offers degrees at the baccalaureate level or higher; and

(B) The project proposes the creation of a center concentrating its effort on specific scientific and technological areas.

(c) Application submittal process.

(1) Potential applicants for CAT funds:

(A) Shall submit one (1) completed signed application, using forms provided by the Division of Science and Technology of the Arkansas Economic Development Commission; and

(B) May be subject to an interview, a site visit, or both, during the application review process.

(2) Applications shall consist of the following documents:

(A) The name and address of the college or university applying for funds;

(B) The name, title, address, and telephone number of the institutional contract officer;

(C) A description of:

(i) The scientific and technological focus;

(ii) The research and development plans of the proposed CAT; and

(iii) Its relevance to the Arkansas economy;

(D) A discussion of the proposed CAT technology transfer and technology development efforts geared to benefit specific industries within Arkansas;

(E) A description of the organizational structure and management plan for the proposed CAT;

(F) A detailed budget for an initial two-year period and a projected budget for the subsequent three (3) years; and

(G) A description of institutional and other government and private funds to be used by the proposed CAT.

(d) Application review and approval process. No financial commitment shall be made by the Executive Director of the Arkansas Economic Development Commission to an applicant until the applicant has completed the following review and approval process:

(1)(A) All applications will be evaluated by division staff for completeness and adherence to eligibility criteria.

(B) Review criteria include without limitation:

(i) An established record of research, development, and instruction in the area of technology;

(ii) The capacity to conduct research and development activities in collaboration with private enterprises;

(iii) The capacity to secure substantial private and other government funding for the proposed CAT;

(iv) A willingness to work cooperatively with other colleges and universities in conducting research and development activities, disseminating research results, and working with institutions of higher learning to enhance the quality of technological education in the area or areas of technology involved; and

(v) The ability to cooperate with the division and other economic development agencies in promoting the growth and development in Arkansas of enterprises based upon or benefiting from the areas of technology involved;

(2) Applicants may be subject to an interview, a site visit, or both, during the application review process;

(3) The Arkansas Economic Development Commission may request an independent review of the application, including the technology employed by the applicant, by an external expert or external experts in accordance with 15 CAR § 147-301;

(4) Division staff will provide a project summary to the Research Committee of the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission for each project reviewed;

(5)(A) All applications will be reviewed by the Research Committee in accordance with program rules.

(B) Prior to final approval:

(i) Applicants may be asked to present their projects before the Research Committee; and

(ii) The Research Committee may ask applicants for additional information before recommending projects for funding;

(6) Projects receiving Research Committee support will be reviewed by the Board of Directors of the Division of Science and Technology of the Arkansas Economic Development Commission;

(7) If the board votes, by simple majority, to approve the application for funding, division staff will prepare a resolution for funding for signature by the secretary of the board and the executive director; and

(8) The executive director, after reviewing board recommendations, will specify which applicants may receive funding.

(A) Unsuccessful applicants will be notified in writing by division staff.

(B) Approved applicants will be required to execute a written agreement outlining the amount, terms, and conditions of the funding.

15 CAR § 147-208 Contact information {#sec-15-car-147-208 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-208}

15 CAR § 147-208. Contact information.

For more information regarding funding programs of the Division of Science and Technology of the Arkansas Economic Development Commission, please contact:

Arkansas Economic Development Commission

Division of Science and Technology

1 Commerce Way, Suite 601

Little Rock, AR 72202

(501) 682-1121

Subpart 3

15 CAR § 147-301 External expert or experts {#sec-15-car-147-301 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-301}

15 CAR § 147-301. External expert or experts.

(a) The Executive Director of the Arkansas Economic Development Commission may request that an external expert or external experts, bound by a nondisclosure agreement to protect the applicant from unfair competition, review applications to aid the Arkansas Economic Development Commission in evaluation of the potential investment.

(b) External experts are representatives, selected at the discretion of the executive director, from state or federal government, academia, or the private sector who provide knowledge or experience useful in analysis and review of funding program applications of the Division of Science and Technology of the Arkansas Economic Development Commission.

(c) If so requested, the external expert or experts may evaluate applications based upon, without limitation, the following:

(1) Management’s qualifications and ability to control growth and operate successfully;

(2) The technology’s viability and commercial applicability;

(3) The financial condition of the enterprise;

(4) The legal aspects of the enterprise;

(5) The feasibility of the enterprise’s marketing plan;

(6) The feasibility of the enterprise’s operating plan;

(7) The overall soundness of the business plan of the enterprise; and

(8) Other information as requested.

15 CAR § 147-302 Confidential information {#sec-15-car-147-302 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-302}

15 CAR § 147-302. Confidential information.

(a) Applications and attachments submitted to the Division of Science and Technology of the Arkansas Economic Development Commission are subject to the Freedom of Information Act of 1967, Arkansas Code § 25-19-101 et seq.

(b) To the extent an applicant believes that information in an application is confidential or otherwise exempt under the Freedom of Information Act of 1967, Arkansas Code § 25-19-101 et seq., the applicant shall specifically designate in writing the information the applicant believes to be confidential or exempt and the basis for the confidentiality or exemption on that portion of the application in which the information appears.

15 CAR § 147-303 Program funding {#sec-15-car-147-303 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-303}

15 CAR § 147-303. Program funding.

(a) In establishing and maintaining the programs governed by this part, the Executive Director of the Arkansas Economic Development Commission may use such moneys as are lawfully available to the executive director for supporting the purposes of the Division of Science and Technology of the Arkansas Economic Development Commission.

(b) Funding for all programs of the division is at the discretion of the executive director, subject to the availability of funds.

15 CAR § 147-304 Conflict of interest {#sec-15-car-147-304 omnilex-key=us-ar-regs-official--title-15-part-147--15 CAR § 147-304}

15 CAR § 147-304. Conflict of interest.

(a) No director, officer, or employee of the Arkansas Economic Development Commission, for purpose of personal gain, shall have or attempt to have, directly or indirectly, any interest in any contract or agreement of the commission in connection with funding programs of the Division of Science and Technology of the Arkansas Economic Development Commission.

(b) It shall not be a conflict of interest for the commission to permit any college or university with which a director, officer, or employee of the commission is affiliated to participate in any program of the commission provided that such director shall promptly disclose the nature of the affiliation to the Executive Director of the Arkansas Economic Development Commission.