(a) State funds.

1. (1) Each regional economic development partnership approved by the Arkansas Economic Development Commission shall enter into an agreement with the commission to receive state funds, if available.

2. (2) The agreement shall:

   1. (A) Be for a term not to exceed one (1) year; and
   2. (B) Identify the eligible expenses for which the regional economic development partnership intends to use state funds.

3. (3)

   1. (A) Subsequent one-year agreements may be entered into by the regional economic development partnership and the commission following the commission’s review of the annual report of the regional economic development partnership.
   2. (B) If a regional economic development partnership was initially approved as a multi-year project, a one-year renewal may by granted by the commission without the regional economic development partnership submitting an annual application.

4. (4)

   1. (A) Each year the commission shall allocate funds specifically appropriated by the General Assembly or the commission for regional economic development.
   2. (B) The funds shall be distributed equally to the qualifying regional economic development partnerships that meet the matching fund requirements under Arkansas Code § 15-4-3408.
   3. (C) Funds that are not disbursed under this section during a fiscal year may be distributed in a subsequent fiscal year.
5. (5) If a regional economic development partnership includes a territory located in another state, regional funding provided under the Regional Economic Development Partnership Act, Arkansas Code § 15-4-3401 et seq., shall only be provided to a county in Arkansas.

(b) Matching funds.

1. (1) A regional economic development partnership shall match the state funds allocated to the regional economic development partnership on the basis of at least one dollar ($1.00) local matching funds for every one dollar ($1.00) of state funds.
2. (2) If a regional economic development partnership does not provide proof of sufficient matching funds before the release of state funds, the commission shall reduce the award of state funds in the amount necessary to adhere to the required one-to-one (1:1) ratio of local matching dollars to state dollars.

3. (3) Local matching funds may be:

   1. (A) Provided by:

(i) Public sources;

1. (ii) Private sources; or

   1. (iii) A combination of public and private sources;

   2. (B) Received in the form of:

      1. (i) Cash;
      2. (ii) In-kind contributions; or
      3. (iii) A combination of cash and in-kind contributions; and

   3. (C) In-kind contributions shall not be more than forty percent (40%) of the regional economic development partnership’s total matching funds.

      1. (c) Eligible uses of state funds. State funds under the Regional Economic Development Partnership Act, Arkansas Code § 15-4-3401 et seq., shall be used only for marketing, advertising, promoting, and other activities related to implementing the required strategic plan.
      2. (d) Ineligible uses of state funds.
2. (1) State funds under the Regional Economic Development Partnership Act, Arkansas Code § 15-4-3401 et seq., shall not be used for administrative costs.

3. (2) Ineligible uses of state funds include without limitation payment for the following expenses:

   1. (A) Administrative salaries, benefits, general administrative costs, and salaries and benefits related to economic development;

   2. (B) Overhead expenses, including without limitation:

      1. (i) Postage;
      2. (ii) Shipping;
      3. (iii) Rent;
      4. (iv) Subscriptions;
      5. (v) Equipment;
      6. (vi) Furniture;
      7. (vii) Fixtures;
      8. (viii) Telephone; and
      9. (ix) Utilities;
   3. (C) Travel and conference expenses within the state;
   4. (D) Local promotions or sponsorships;
   5. (E) Stationery, paper, pens, and general office supplies;
   6. (F) Construction and infrastructure costs;
   7. (G) Membership dues;
   8. (H) Alcoholic beverages; and
   9. (I) Gratuity on meals, including meals related to activities classified as eligible expenses.